We'll have to wait a month or more to see how state legislative leaders handle a budget that's bound to grow 30 percent or more.
The really, really condensed version: School tax fixes from last spring will likely force lawmakers to spend money faster than is allowed under a constitutional cap on growth.
They can vote to bust the cap. They can cut spending they think is necessary. Or they can put the choices off until January while their employees try to find them a fast car out of here.
The Legislative Budget Board, given those options, chose Door Number Three. They'll wait until January to vote on the allowed rate of growth and on the dollar value of the part of the budget that's limited. That panel, headed by House Speaker Tom Craddick and Lt. Gov. David Dewhurst, is also hoping there's a way to ease the pain of a vote by a conservative Legislature to spend money faster than personal incomes in the state are rising.
That's a characterization built on incomplete information. Without the state spending money to lower local school taxes, lawmakers wouldn't be in much danger of busting the cap.
With that tax swap, there's almost no way for them to avoid it. But that's politically unpalatable to some members, and so the ten folks on the LBB are trying to find a way to sugar-coat the bitter pill.
Two points of interest. The part of the budget that's subject to the cap now stands at $55.5 billion (that's a moving target, so if and when you see a new number in a few months, don't squawk at us). They've got five estimates of how much personal income will grow over the next two years, ranging from 13.1 percent to 17 percent. The lower number would put the cap on discretionary general revenue spending at $62.8 billion; the larger one would put it at $65 billion.
The increased costs of doing what the state does now are estimated by various budgeteers at $4 billion to $8 billion. The school tax swap will cost around $11 billion in the next budget, according to some estimators we trust.
Scribble it on the chalkboard. The spending cap, depending on the growth rate, would allow $7.3 billion to $9.5 billion in new spending. School finance is $11 billion — well above the high estimate — and growth in public school enrollments, welfare and health programs, prisons, and other existing services, would add $4 billion to $8 billion. If lawmakers decided not to make cuts, and if this back-of-the-envelope figuring is in the ballpark, the Texas Lege is on the way to spending $15 billion to $19 billion more than it currently spends in discretionary funds, an increase of up to 34 percent.
They can safely and honestly blame the school deal, and say the spending cap was sacrificed to lower local taxes. Some members are comfortable with that. Some aren't.There's an addendum to this: Some number-crunchers think the "sweeteners" included in the school tax package last spring would be enough to bust the cap if they're included with the normal growth in the budget. Add those things teacher pay, etc. to the $4 billion to $8 billion expected (by some) for normal growth in enrollments and caseloads and such. It's as much as $3.9 billion, and it's part of what got the school mess solved last year, but it might be considered outside the easy formulation of "we busted the cap to cut property taxes." One suggestion we've heard would be to split the budget, voting for a normal growth package, then voting on a second spending bill that included the busted cap and the school finance stuff. It might turn out to be easier to vote it all together: Incumbents could attribute the growth to the tax cut, and challengers would be burdened with doing the math for voters with short attention spans. The LBB will wait until January to see if there's an easy out, or at least an easier one.