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Texas will close the books on its current budget cycle with an extra $725 million in the bank — which is welcome news as Texas Comptroller Glenn Hegar had predicted in January that the state would suffer a $1 billion shortfall due to the COVID-19 pandemic.
Hegar on Monday revised the revenue estimates for both the current budget cycle and the 2022-2023 biennium. Hegar increased the projection for state funds available for the 2022-2023 budget by $3 billion — to a total of $116 billion — as lawmakers race during the final weeks of the Legislature hammering out the spending plan.
“Our revised revenue forecast assumes continued economic growth through the next biennium, but uncertainty remains about the ultimate course of the economy and thus state revenue,” Hegar said during a Monday press conference. “Texas remains well-positioned to recover from the COVID outbreak and return to its norm of economic growth in excess of the national rate — if we haven’t already.”
The estimate doesn’t take into account all of the federal relief that has been sent to Texas over the past year by Congress through pandemic relief packages. State lawmakers have wrestled with how and who has the authority to spend that money. But Hegar’s estimate of all funds available for the budget includes federal money that could flow through state government. That “all funds” total of available revenue is now $294 billion, up from the $270.5 billion in his January estimate.
Last week, state officials announced they were releasing $11 billion of those federal funds designated to the state's public schools, after several weeks of outcry by school officials.
In a letter to state leaders, Hegar said the revisions are based on increased state revenue projections, particularly increased tax revenue collected from oil and natural gas producers.