Texas budget draft cuts $13.7 billion in spending

The budget proposes nearly $5 billion less for public education below the current base funding. It is also $9.8 billion less than what is needed to cover current funding formulas, which includes about 170,000 additional students entering the public school system during the next two-year budget cycle. Pre-kindergarten would be scaled back.

Higher education funding, including student financial aid, would be slashed.
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The proposal wouldn't provide funding for all the people projected to be eligible for the Medicaid program and would slash Medicaid reimbursement rates for health care providers.

Community supervision programs would be cut and a Sugar Land prison unit would be closed. Funding would be eliminated for four community colleges including Brazosport near Lake Jackson.
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First Reading blog AAS 1/19/11
Texas schools would lose billions in budget plan

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Budget cuts billions in schools and Medicaid, nearly 10,000 state jobs would be eliminated and Texas Grant scholarships would be cut in half.

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School districts would lose $9.8 billion owed to them under current school finance law, such as money to cover growth in student enrollment. Big cuts to teacher incentive programs, pre-kindergarten and classroom technology money.

The budget proposes nearly $5 billion less for public education below the current base funding (which doesn’t account for enrollment growth and changes in property values), according to the AP.

Texas Tribune 1/19/11
Texas House Budget Proposes Sweeping Cuts

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The cuts are deep, but the proposed budget doesn't call for an increase in taxes or tapping the state's $9.4 billion Rainy Day Fund. The budget was released to legislators on Tuesday night and will be available to the public Wednesday morning. The Senate will follow with a proposal of its own next week — lawmakers say the differences are relatively small. And Gov. Rick Perry says he'll follow with his own proposal before his State of the State speech in the first week of February.

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Estimates of the state's budget shortfall — the difference between the amount of money needed to fund the state and the amount that's actually available — range from $15 billion to $27 billion. Going from this proposal, there's no shortfall in the state budget at all. The House's initial plan cuts spending in virtually every area of government and doesn't include funding increases that would cover current services, population growth and inflation.

The health and human services portion of the proposal would cut Medicaid provider rates — what doctors and hospitals and others are paid — by 10 percent. And it doesn't include funding for population growth or for increased costs or utilization rates. There's also a $4.3 billion cut included to account for the federal stimulus money used in the current budget that's not available for the next budget. The proposal would cut a total of $16.1 billion in health and human services spending. That's a 24.6 percent cut.

Public education spending would drop, too. The notes included with the proposal say it falls $9.8 billion short of the amount needed under current school finance formulas, which means that the Legislature will have to alter them or find the money. The proposed budget doesn't include funding for increased numbers of students, for projected declines in property values and related local school taxes, or $3.3 billion in the current budget from federal stimulus money. Public education spending would drop a total of $7 billion from current levels. Higher education would be cut $1.7 billion, or 7.6 percent, from current levels.

http://www.texasobserver.org/component/k2/item/17313-the-democrats-respond-to-the-draft-budget">Texas Observer 1/19/11
The Democrats Respond to the Draft Budget
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State Rep. Joaquin Castro, D-San Antonio, likened the preliminary budget to asking “an anorexic person to lose more weight.”

“We’re already, as a state, fiftieth in per capita spending,” he said. “We literally are dead last in our nation to what we spend on our residents.”

Castro and others who spoke after him complained that the budget plan assumed a zero percent growth rate for Medicaid caseloads and public schools—in a state with an exploding population. “This base budget is unwilling to accommodate that growth, to help that growth or to feed it,” Castro said.

The Democrats criticized the state’s current tax structure, pointing to the 2006 margins tax that failed to deliver the revenue it promised. Children will now be left without early education, first-generation college students will miss out on financial aid and the elderly will lose support. As the litany of consequences wore on, Gallego dared anyone to call the budget shortfall “speculative.”