80th Legislature: Early Budget Bills Propose Spending Surplus On “Tax Relief”

The ultra-bogus concept of “tax relief” in a state without an income tax features prominently in two budget bills filed by State Sen. Steve Odgen (R-Bryan). The bills are SB1, the general appropriations bill and SB2, which is educational appropriation for the purpose of property tax relief.

Though the appropriations bill isn’t online yet, the Star-Telegram indicates it is a $147 billion budget. It busts the spending cap by $4 billion and would require a vote to exceed the cap or a constitutional amendment mandating that “tax relief” doesn’t count toward the spending cap. The latter would be tough, because it would have to be approved by both chambers and signed into law by the governor intime for a May 12 amendment election.
Remember the ‘03 shortfall? It’s also coming back into play:

Dewhurst and Craddick both stressed the importance of setting aside about $3 billion from the surplus to pay for tax cuts in the 2010-11 budget. They also want to erase the lingering effects of certain accounting tricks used in 2003 to eliminate a $10 billion shortfall.

That strategy, known as budget deferrals, shifted money the state owed to some agencies into the next budget. Catching up on the deferrals and ending the state’s reliance on its Rainy Day Fund is a priority for both chambers, Craddick said.

Yes, but what about fully funding children’s health insurance? As for the property “tax relief” from the special session, it comes back to haunt us in a big way:

The new property tax relief is a result of a court-ordered tax swap that allowed local school districts to reduce their property tax rates. That money was replaced in public schools with revenue from new business and cigarette taxes, but those aren’t expected to raise enough to pay for all the tax relief promised.

That leaves lawmakers in a sticky situation: find about $6 billion every two years to pay for it, or renege on the promise to taxpayers.

Might as well renege on that one guys. As Carole Strayhorn said, “don’t go running to your mailbox…”

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