AUSTIN - Texas Comptroller Carole Keeton Strayhorn today warned that there will be $7.4 billion fewer dollars available to the upcoming 78th Legislature. Included in that number is a $1.8 billion shortfall for this fiscal year 2003 ending August 31. Figuring in $2.5 billion for teachers health insurance and Health and Human Services funding for the next two years, this leaves the Legislature with a total shortfall of $9.9 billion if it wants to meet the obligations of the remainder of this fiscal year and complete a new biennial budget maintaining current programs and obligations.
Strayhorn said she will work "hand-in-glove" with the Legislature to get through this budgetary challenge. She called for a new era of fiscal reform and stated that the 78th Legislature needs to go to a zero-based budget. She believes that "state government must budget and live within its means like every hard working Texas family."
Strayhorn described the Texas economy as being relatively resilient despite the after effects of September 11th and the continued threat of war and terrorism . Strayhorn said that "because the productivity of Texas workers has increased at a faster rate than the loss of jobs in the state, Texas has been able to avoid the national recession."
Strayhorn reported declining revenue from the sales tax as a major problem. Economists were anticipating a rebound in sales this winter. That has not happened. Never before have our sales tax collections declined two years in a row.
Last week the Comptroller unveiled 179 recommendations that she believes would provide $3.7 billion in all funds--with $1.7 billion of that in general revenue--all with no new taxes. She resolved to continue to monitor the situation closely and to search for more savings, and will not hesitate to adjust the revenue estimate if she deems it necessary to do so.