Spending priorities: Texas’ historic $44B fund balance
Big Moves: The largest fund balance in Texas’ history — $44 billion — is projected for the state by the end of fiscal year 2023.
- The balance is the remaining funds after accounting for all current appropriations, incoming revenues and carry-over fund balances.
The Source: As Texas’ economy has bounced back, we’ve had record-breaking sales tax revenue. Plus, we saw greater tax collections on oil and natural gas as demand increased this year. The $44 billion includes:
- Texas’ general revenue fund ($27 billion), remaining recovery funds from the American Rescue Plan Act ($3 billion) and economic stabilization fund, a.k.a. the rainy day fund ($14 billion).
Items on the Table: Property tax relief, deferred Medicaid costs and state agencies’ inflationary pressures lead talks about where to allocate these funds.
Texas 2036 Take: Funds should be strategically invested to resolve long-term problems and provide relief to Texans impacted by the pandemic and economic pressures.
- We don’t need to spend it all. It’s important to have a sufficient balance to weather future economic challenges.
Meet the Moment: This historic fund balance positions state leaders to positively impact the state’s future prosperity for generations to come.
Opportunities for investment 🏦
As state leaders begin developing the 2024-2025 budget, below is a starting point of priorities where we think the Legislature should invest. We continue to explore more opportunities and plan to provide additional ideas between now and January.
🏗️ Invest in our infrastructure
Improving energy, water, transportation and broadband infrastructure will spur economic growth and allow us to keep up with a booming population
🛠️ Invest in our students and future workforce
Expanding virtual education and aligning community college programs with state and regional workforce needs are two ways to help ensure more Texans are equipped with the skills required for good-paying jobs
💸 Address unfunded liabilities
Funding post-employment benefit liabilities, especially retiree health benefits for state employees and teachers that contribute $75 billion in long-term liabilities, preserves long-term financial sustainability
👩🏻💼 Increase salaries for public employees
Recruiting and retaining a qualified public workforce with competitive salaries ensures the state government is providing quality service to its taxpayers
🌐 Modernize information technology infrastructure
Building on previous efforts, such the work of a legislative oversight committee to review investment and funding strategies for projects, bolsters our IT systems and improves government efficiency
🏞️ Invest in new state parks
Adding more state parks meets the demands of new and native Texans who count on them for economic opportunities and recreation
Speak up, Texans! 📣
What are your priorities for state spending?