Saturday Night Budget Deal Explained

You may have been watching the Saturday Night Live season finale, but I was watching the real show – the Texas Senate and House budget conferees rolling out a state budget compromise. The conferees adopted the major decisions that will shape the 2018-2019 state budget.

As Senate Finance Chair Jane Nelson stated, “Both chambers recognize that the continued success of our state depends on a budget that meets our needs.” When negotiations started, the total budget figures were not too far apart. The challenge this time was how to pay for public and higher education, health and human services, and other basic services, given the 2015 Legislature’s short-sighted decisions to reduce revenue available for general purpose spending.

While it’s good to see that the Senate and House conferees have reached consensus, it’s too early to tell how damaging it will be for hard-working Texans. It is clear that lawmakers should use more of the state’s Rainy Day Fund than they are proposing, rather than cutting and underfunding key programs like Medicaid.

What happens next?

After the Senate Bill 1 conference committee report is formally signed, filed, and distributed this week, the full House and Senate will vote to adopt it. Then the Comptroller will certify that SB 1 complies with the constitutional state spending limits, such as the “pay as you go” provision requiring General Revenue spending to be within his revenue forecast. The Governor can then line-item veto and sign the budget. 

Lawmakers must also approve the supplemental appropriations proposal for 2017 – which covers unfunded costs through August 2017. House Bill 2 will most likely pass the Senate on May 22, and could then be accepted by the House or sent to a conference committee. One major difference between the chambers’ supplemental budget proposals is that the House included $29.8 million in General Revenue and changed some rider language to allow for a partial restoration of funds cut for fiscal year 2017 to Medicaid-funded acute care therapy.

CPPP will continue providing information on budget details in SB 1 and HB 2 as they emerge this week.

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