Texas State Officials Require 2020-21 Budget Cuts, Potential 2022-23 Cuts
As the COVID-19 pandemic ravages Texas, agencies and institutions have been called upon to reduce their spending. On May 20, top Texas officials published a memo directing agencies and institutions of higher education to plan a 5% decrease in their budgets for the current, 2020-2021 biennium which was originally approved as $250.7 billion in June of 2019. The 2020-21 budget was a 6.3% increase from the 2018-19 biennium budget of about $217 billion.
Officials cited the economic losses and uncertainty caused by the COVID-19 pandemic and a resulting need for smooth economic recovery as drivers of the required 5% decrease. Some agencies and programs are exempt, the majority of which have a role in COVID-19 response.Â
In the memo, Gov. Greg Abbott, Lt. Gov. Dan Patrick, and Speaker Dennis Bonnen requested savings plans be submitted by each (non-exempt) agency and institution to the Office of the Governor and the Legislative Budget Board no later than June 15, 2020. The memo specifies some of the “cost saving strategies†expected in savings plans and outlines select agencies and programs that are exempted from the new directive. It also came with a warning that further budget adjustments may be necessary as the pandemic develops.
As a follow-up, the Legislative Budget Board issued guidelines on what to include in reductions plans as well as how to submit them.
Texas Comptroller Glenn Hegar has warned of severe impacts on the state budget given the significant drop in sales tax revenue, which is the state’s largest source of funding. You can keep tabs on the state sales tax trends by viewing this Texas Tribune article or take a look at key economic indicators on the Texas comptroller website. Budget shortfalls in the order of billions of dollars are expected. Hence, notice of potential future budget adjustments given in the memo by Abbott, Patrick, and Bonnen.
As mentioned previously, certain agencies and programs are exempted from the 5% budget decrease required for the current biennium. Those most relevant to the environmental community include:
- Texas Division of Emergency Management
- Texas Department of State Health Services
Unfortunately, it appears that most other environmental-related agencies and programs will have to scale back their budgets by 5% this biennium. If current economic trends continue, the 2022-23 budgets will likely be affected as well.
Legislative Appropriations Requests for the 2022-23 biennium should be submitted to the state beginning in late July through the end of August. Our staff will follow up with a list of dates and times for Legislative Budget Board departmental hearings when they are posted.
If you are unfamiliar with the Texas budget process, you can read a brief comprehensive summary by the Comptroller’s Office here. Additionally, you can view the typical 2-year schedule for budgeting here to get an idea of where Texas is now in the budget process.
