Friday, April 03, 2009

Senate adopts $182 billion budget

April 1, 2009

AUSTIN, Texas — The Texas Senate on Wednesday voted to adopt a $182.2 billion state budget for the next two years, including $11 billion in federal stimulus spending.

The Senate voted 26-5 to adopt the two-year budget, the most important bill lawmakers will consider during the five-month legislative session.

Using the federal rescue money, senators were able to craft a spending plan that would not dip into a projected $9 billion balance in the state's Rainy Day Fund. Still, officials cautioned that economic conditions could worsen before the budget can become law.

"Sales tax collections are slowing down faster than what we thought," said Sen. Steve Ogden, who was the lead Senate budget writer.

"I would argue that ... the most prudent thing we can do in the state right now is to hold on to that Rainy Day Fund, make sure things don't get worse before they get better."

Attention next turns to the House, which is crafting a separate version of the budget before the two drafts can be reconciled.

The federal stimulus money, which was part of a law signed by President Barack Obama in February, is helping budgeters close a shortfall between available state revenue and spending needs.

"While other states are facing huge deficits, Senate Bill 1 invests in our state's future by increasing funding for education, higher education, job training programs and transportation," said Lt. Gov. David Dewhurst, who presides over the Senate. "This budget also uses federal stimulus funds responsibly by working to ensure they will not result in ongoing costs to the state, while allowing us to leave the Rainy Day Fund untouched so it can be used to balance the budget in 2011."

Counting all funds, the plan spends about $53 billion on public education, which makes up the largest portion of spending, based on current school finance law and projected student enrollment growth. But the bill also sets aside $1.9 billion, contingent on the Legislature adopting a new school finance plan.

Democratic critics of the budget expressed concern about measures in health and human services spending, including a provision that Ogden said was intended to prohibit state money from being spent on research that destroys human embryos.

Sen. Kirk Watson, D-Austin, called the budget a "fundamentally flawed document."

"It remains far from clear that this provision won't have a direct impact on scientists and researchers at some of the premier laboratories in the state," Watson said. "And this rider will doubtlessly damage our state's reputation for economic development and scientific discovery."

Watson, who voted against the budget, also criticized the plan for relying on the federal rescue dollars to enable "the state's worst fiscal habits without reforming them."

The budget significantly decreases funding to the Texas Youth Commission, which underwent a massive overhaul after a juvenile sex abuse scandal two years ago. The new proposal would cut spending on the juvenile agency by $81 million and mandates more than 700 employee cuts.

The Senate budget increases state spending by:

_ $600 million for cancer prevention and research;

_ $543 million for state schools;

_ $31 million to equip 2,500 school buses with seat belts;

_ $32.5 million to expand pre-kindergarten to 22,500 more children;

_ $27.1 million to buy and operate 450 patrol cars for the Department of Public Safety; and

_ $10 million to expand Boll Weevil eradication efforts made necessary in southeast Texas by Hurricane Ike;

The budget also prohibits the use of state dollars to purchase Microsoft Vista products.

State dollars, made up mostly of sales tax revenue and other taxes, comprise almost 48 percent of the total budget. Federal funds, including the stimulus money, make up about 36 percent of the budget.

The federal stimulus money is less than 10 percent of the total Senate budget. Another $3.3 billion in federal stimulus money has been set aside for supplemental spending in the current budget period, which ends this summer.

The two-year state budget is the one piece of legislation lawmakers are legally required to adopt during the biennial legislative session, which convened in January and adjourns in June.

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