Here’s an update as we head into Week 3 …
Both chambers release initial draft budgets. Both the Senate and the House released very similar budgets. Both budgets are over the revenue estimate provided by Comptroller Glenn Hegar by nearly $7 billion. Both budgets will have to move through committee hearings and floor debates before being reconciled in conference committee, so there will be ample opportunity to debate how the state will address the $7 billion spending gap.
The State must have a balanced budget. Because the Comptroller is required to certify a balanced budget, lawmakers must either find cuts or utilize other tools to reduce spending, tap the state’s Rainy Day Fund, or as is sometimes the case, the Comptroller may revise his revenue estimate upward.
The budgets maintain key spending and tax cuts. Notably both chambers were quick to point out that the budget drafts released last week maintain the increased public education spending committed last session in HB 3, as well as related $1 billion in property tax compression. The combined amount of these two items represents about $4 billion of the $7 billion spending gap.
The $7 billion gap may be a telegraph to leaders in Washington as they consider another round of stimulus. The President’s newest proposal would provide nearly $350 billion in aid to state and local governments, more than double what was provided in the CARES Act. Under the CARES Act, which provided a total of $150 billion for state and local governments, the state of Texas received nearly $8 billion.
Governor Abbott held roundtable discussions of legislative priorities. In two separate events last week, Governor Abbott hosted roundtable discussions to discuss his legislative priorities. During a visit to a Houston hospital, the Governor discussed his healthcare priorities which included the continued response to COVID-19, and especially vaccine distribution and a renewed emphasis on advancing telehealth. The Governor also signaled an emphasis on mental health and plans to ensure the ongoing availability of personal protective equipment (PPE). Later in the week, the Governor unveiled Texas’ Homeland Security Strategic Plan, and discussed specific proposals such as bail reform, which would make it harder for offenders with a violent history, and potential legislative measures to freeze property taxes to disincentivize cities from defunding police departments.
What to expect this week …
Expect another light week. The House and Senate both return to Austin this week on Tuesday, but neither chamber has anything substantive up for consideration.
The Senate Committee on Redistricting has scheduled a series of meetings over the coming week.
House Committee preference cards are due at the end of this week. We believe the most aggressive schedule would provide for committee assignments to be announced at the end of next week, but potentially (and maybe even more likely) later than that.
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