State Budget Slices Deep
by: Laurie Johnson, February 21, 2011 5:02:00 am
Scott McCown is executive director of the Center for Public Policy Priorities, a think tank in Austin. He calls the state's proposed cuts just crazy.
"We have $9.4 billion in the Rainy Day fund, which we have saved for this very kind of situation. And for some odd reason, even though they spent all the Rainy Day fund to deal with the last recession, they've suddenly decided that it's unavailable. I mean it's...it's crazy."
McCown says the current budget proposals are 28 percent short of the money needed to meet current spending. That doesn't account for any growth in the future. That's why he says it's imperative for lawmakers to use the Rainy Day Fund.
But Governor Rick Perry has made it clear he doesn't want to dip into the fund. Mark Jones chairs the Political Science Department at Rice University. He says much of what you're hearing out of Austin right now will change before the session ends.
"Part of that is just strategic negotiation. If they start off saying they don't want to tap it at all, then those who are reticent to spend much of it will be seen as compromising if they allow half of it to be spent. So part of it is politicking."
Part of it is also a result of the huge influx of freshmen lawmakers in Austin.
"Who really believe that they came with a mandate not only to not raise taxes, but also to make the state live within its means, which in this case means not paying for recurring expenses out of your savings account."
The likely scenario, according to Jones, is that lawmakers will end up using about half of the Rainy Day fund. But the state will still face as much as $20 billion in cuts and that could have an unexpected consequence.
"A lot of the actual cuts are going to be passed on to the school districts and community college districts and hospital districts, that in turn are probably going to raise taxes."
Jones says it's clear the Rainy Day fund won't rescue the state from having to make deep cuts — but using it could
make those cuts a bit easier to bear.
But a super majority of state lawmakers will have to agree to make that happen. Use of the fund requires a two thirds vote in both the house and senate.