EducationHealthcareStatewide NewsTaxes & SpendingAgency Budget Cuts Enforced by State Leaders Begin to Take Shape, Won’t Solidify Until Fall

In light of months of depressed tax revenues and an estimated $4.6 billion deficit, the state is looking at cutting a tiny portion from its $250 billion biennium budget.
September 1, 2020
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The Texas Legislature increased its spending just shy of $15 billion last year for the 2020-2021 biennium. The bulk of that increase came from the $11.6 billion property tax buydown and school finance legislation. But now, after coronavirus ripped a hole in the state’s purse, officials have reversed course, looking desperately for places to cut.

Back in May, Governor Greg Abbott, Lt. Governor Dan Patrick, and Speaker of the House Dennis Bonnen issued a letter to some state agencies announcing their intention to cut budgets by five percent. Many of the largest contributors to the state budget, however, were exempted in the original announcement.

For one, Medicaid, which amounts to a quarter of the state’s approved budget, was exempted after having its funding increased $800 million for this biennium. Also exempt was higher education, which received about $22 billion from the state budget.

The latest stage of the budget cut discussion indicates a $1 billion target mark. Agency cuts must be debated in a Legislative Budget Board (LBB) hearing open to the public.

Some Texas legislators are upset about the cuts, others are upset that the legislature won’t be consulted — save for those on the LBB — and some are upset about both.

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While $380 million in cuts for 2020 and $670 million for 2021 were expected, which agency budgets will ultimately be cut and to what degree remains unclear.

However, some figures were disclosed in a budget document obtained by the Houston Chronicle. For example, higher education will reportedly be cut by $250 million, amounting to about a quarter of it’s $1.1 billion increase by the legislature in 2019. 

An additional $184 million will be cut in other education programs, but public education — the recipient of a 20 percent increase due to House Bill 3 last year — was exempted from the proposed cuts.

A $3.8 million cut in “women’s health programs” is also included, a section which benefited from a $300 million increase to the Health and Human Services Commission allotment by the legislature split with “community mental health” and “early childhood intervention services.”

The state’s original budget appropriated $347 million to women’s health programs, from which the cut amounts to one percent.  

Texas’ Alternatives to Abortion program was spared from the cuts. The program aims to steer women away from abortion through counseling and direction to other services. It was allotted a total of nearly $60 million for the 2020-2021 biennium.

Additionally, 1.6 percent of the Supreme Court of Texas’ $74.1 million legal services budget will be eliminated.

The Texas Department of Agriculture is another agency facing budget cuts, although an exact amount has not been disclosed. However, based on the agency’s allotted $1.2 billion, the arbitrary five percent would amount to about $60 million. The agency received a funding boost of $71.3 million by the 2020-2021 budget.

Rural hospitals will reportedly face cuts to their capital improvement and equipment funding, institutions which were allotted $232.6 million for Medicaid cost reimbursement.

According to the original exempted list, at least 60 percent of the allotted costs in the state’s 2020-2021 biennium budget will not face any cuts.

Among those are the Teacher Retirement System and Employees Retirement System which together have amassed over $60 billion in unfunded liabilities.

Fiscal Year 2020 ended on Monday and the new year begins today. After decades of near-unabated spending increases, the State of Texas braces for choppy seas ahead after its and local government’s shut down of the economy.

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Brad Johnson

Brad Johnson

Brad Johnson is an Ohio native who graduated from the University of Cincinnati in 2017. He is an avid sports fan who most enjoys watching his favorite teams continue their title drought throughout his cognizant lifetime. In his free time, you may find Brad watching and quoting Monty Python productions.