As commerce picks up, Texas' fiscal projections have steadily improved with previously projected shortfalls now gone or seriously reduced for the next biennium.
The Texas legislature has one constitutional mandate every session: to pass a balanced budget.
Commerce in Texas remains downtrodden due to the pandemic but continues its modest improvement compared with previous months.
The dire fiscal straits projected last July have improved substantially, but the Texas comptroller still projects a nearly $1 billion shortfall at the end of this biennium.
The legislature cannot appropriate higher than a seven percent increase in general revenue spending for the next biennium when the body convenes in January.
November's sales tax collections show stronger consumer spending levels, but still indicate a long road ahead when the legislature convenes in January.
Due to depressed oil and gas production tax collections, this year's state savings account transfer was 30 percent less than last year.
Texas' oil and gas industry continues to limp through the pandemic, further illustrated by the depreciated production taxes remitted to the state.
Due to Texas' rich private sector, the state is less dependent on federal monies compared with its neighbor New Mexico, which relies heavily on its public sector economy.
From July to August, Texas' unemployment rate dropped 1.2 percent and remains below the national average.
Due to the pandemic-driven closures and decline in commerce, the State of Texas has brought in about $4 million less in tax revenue as projected through this point in the biennium.
The inclusion of a new "de minimis" exception could leave smaller cities and towns subject to higher taxes.
