A look at Texas’ historic revenue estimate and $32.7 billion budget surplus
The 88th Texas Legislature convened this week following Monday’s historic Biennial Revenue Estimate announcement. Here’s why this budget matters.
A Historic Revenue Outlook 💸
The BRE: Texas’ Biennial Revenue Estimate sets out how much funding is available for state budget writers to spend.
- During the legislative session, lawmakers then use these parameters to decide where and how much of taxpayer dollars to allocate.
By the Numbers: On Monday, Texas Comptroller Glenn Hegar shared his projection for the 2024-25 biennium budget cycle:
- $188.2 billion: General revenue available for the state
- 26% increase: Additional amount from the last budget cycle
- $32.7 billion: Budget surplus expected by the end of fiscal year 2023
The Big Takeaway: Texas’ record-breaking revenue growth has led to a once-in-a-generation opportunity to tackle big projects for the state.
- While the figures are exciting, prudent spending is key. Plus, there are spending limits in place.
👉 Get a refresh: Investments for lasting change
All In: Policy team members Rahul Sreenivasan, Hope Osborn and Renzo Soto attended the Comptroller’s conversation with the Texas Tribune following his BRE announcement on Monday.
- Texas 2036 will continue to closely track how this Legislature plans to leverage this remarkable budget.
What to Know: With the Legislature in session, here are five key takeaways to keep in mind as lawmakers start making hard decisions about the budget.
- Revenue growth was fueled by unprecedented sales tax collections
- Predictions are subject to change
- An economic cooldown is expected
- Caution could be warranted given the uncertain outlook
- There’s opportunity for one-time, generational investments
👉 Dive deeper: Texas’ historic revenue outlook: 5 takeaways
Improving Legislative Staff Salaries 💡
A Look Back: During the special legislative sessions of 2021, we came out in support of increasing wages for historically underpaid legislative staff.
- Our analysis on Article X—the section of the Texas budget covering legislative agencies—illustrated just how far behind the legislative employees’ salaries had lagged in the Austin area.
Time to Act: While the Legislature took up some of the concerns, many of the underlying issues were left unaddressed.
- With high inflation increasing costs of living in Texas, especially in Austin, we are highlighting legislative compensation again with updated numbers.
Making Progress: This week, the Senate adopted a significant wage increase to help members so they can retain experienced staff. Senate office budgets, which include both salaries and travel, were increased 46%—growing from $41,000 per month to $60,000.
- The House is scheduled to adopt its office budgets today. The proposal increases budgets by 13% during the legislative session—from $15,250 to $17,250. If approved, this will address recent inflation.
Worth Noting: Senate offices typically have larger staffs with correspondingly bigger office budgets to reflect their constituencies.
👉 Take a look: “Improving legislative staff salaries is a wise investment”
Texas 2036 In the News 🗞️
Watch: Senior Vice President of Policy and Advocacy John Hryhorchuk onState of Texas with KXAN’s Josh Hinkle.
- He discussed prioritizing higher pay for state employees, addressing our state’s aging water infrastructure, restructuring community college finance so more Texans can achieve the skills they need and more.
Read: Policy Advisor Rahul Sreenivasan talked to Bob Garrett with The Dallas Morning News.
- When it comes to Texas’ budget surplus, he said, “This is a session where [lawmakers] are going to have a hard time dealing with all the different asks that are there.”
Have a little fun, Texas:
Where would you spend the $33 billion budget surplus?