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crickets
Texas faces deeper cuts to balance budget
By Sheila McNulty in Houston
Published: November 10 2010 17:31 | Last updated: November 10 2010 17:31
Rick Perry may have won his third term as Texas governor this month, but the prize is a state budget deficit analysts estimate has grown as high as $25bn.
The projected deficit, to be announced in January, would leave Texas with tough decisions about how to meet spending commitments, as its cons ution requires a balanced budget. It faces scaling back already lean budgets for education, healthcare and public safety.
Texas is one of 39 states that have projected budget gaps for the 2012 fiscal year, according to the Center on Budget and Policy Priorities. Republicans who were swept to power in state capitols in midterm elections on November 2 are promising big spending cuts in response, from trimming social services and reducing benefits for public workers to selling off state assets.
Texas is among seven states with no personal income tax; imposing one would mean revising the state cons ution. Raising taxes is not an option for its Republican governor.
“You might not remember the $10bn deficit ... in 2003,’’ Mr Perry said in his recent campaign. “Rather than jack up taxes, we took the same approach you’d take if your business had a shortfall; we drew a line between wants and needs then cut spending. We won’t hesitate to take that approach again.’’
The Dallas Morning News quoted senior legislative staff this month saying the deficit has gone as high as $25bn and could rise if the economy does not pick up.
Analysts agree, citing falling sales taxes, which account for about 65 per cent of revenue. Other sources, including the motor vehicle sales tax, franchise tax, natural gas tax, insurance premium taxes and lottery proceeds, have all been hit by a weak economy.
“It’s going to be a really bad couple of years for public schools,” said Mark Jones, political scientist at Rice University. Education accounts for 55 per cent of state spending, he said.
Other areas highly dependent on the state are healthcare, accounting for 25 per cent of spending, and public safety, accounting for roughly 10 per cent.
Richard Murray, political scientist at the University of Houston, said the state had not fully recovered from the cuts made in 2003. For example, 26 per cent of Texans are uninsured – a higher percentage than in any other state. The estimated average salary of public school teachers ranks 39th among states, with state and local expenditures per pupil in public schools ranking 44th.
Given an increasingly elderly population, large numbers of uninsured and a rise in those using public education, Mr Murray said drastic cuts would be needed.
Harvey Kronberg, head of the Quorum Report, which reports on Texas politics, said: “There are a lot of cons uencies out there who are unaware how deep this is going to reach.’’
Interesting to see what Perry and the legislature will do. Are they going to f*ck the schools, elderly, or poor people..?
crickets
Just some gossip I picked up here at work. I've heard that every state agency has been told to plan for a 25% cut in their budget.
Texas has been incredibly fortunate thus far to have not felt anything close to the pain that most of the other states have. But this time we're all going to feel it.
Another proposal that I'm confident will pass is to convert new state employees into 401K's instead of defined benefit retirement plans. It's about ing time. The private sector did it years ago.
Definitely agree.
There's also going to be some pretty significant state government layoffs.
I hope it's the elderly, cause they are old so who gives a ?
It was 5% actually.
Here is a chunk of info from an interesting article:
http://uwire.com/2010/11/05/u-texas-...-report-shows/state agencies, including UT, once again face the possibility of a 10 percent budget cut during the next legislative session after a 5 percent budget cut this year. But the regents and other chief administrators have not considered raising tuition to make up for those cuts as they wait for more concrete information on the budget, said Kevin Hegarty, UT’s chief financial officer.
(U. Texas tuition rates increased 134% in last decade, report shows )
If you are sending your kids to college in the next 3 years, expect some hefty tuition increases.
They cut funding to state colleges, and the revenue had to be made up from somewhere. I was astonished how much higher tuition was when I finished my undergrad degree than when I started.
We are making college less accessable, and eating our seed corn.
The last legislative session was 5%. This time around it's going to be much larger. There's not another stimulus check headed our way for Gub'ner Goodhair to rail against on his way to the bank to cash it.
So why is it still so hard to get into a good school?
Ding ding ding ding!!
You are completely correct.
The big bad ol' stimulus plugged a LOT of holes in state budgets.
Those holes haven't gotten any smaller, but now there is nothing to plug them with. Maybe if we got a big enough Tea Bag... I don't see any federal help to the states materializing any time soon.
Cost as much as anything.We are making college less accessable, and eating our seed corn.
Not sure what/why you are asking, otherwise I could have gotten a better answer. (???)
OK, why do Texas, A&M, Tech, etc. keep raising their minimum SAT scores and turning away as many as they accept because they don't have room for all the applicants?
It is time for Texas to implement a 9.78% sales tax on all items other than food & a state personal income tax on earnings & savings like we have in California…Lets hope that Texas can get their fiscal responsibilities in order…
Perry said he is FED UP! with billions of dollars in federal aid.
Yeah!
Much higher demand with both the lack of jobs right now and the certainty of working at Starbucks or Wal-Mart in the future without an education.
And Perry wants TX to opt out of Medicaid, forgoing many federal $Bs
To Help His State Budget, Gov. Rick Perry Wants To Hurt His State Budget By Opting Out Of Medicaid
Not only would Perry be turning away millions in federal spending, Perry would actually be “taking billions out of the state economy that goes on to support hospitals and other providers,” Volsky notes. Thus, “hospitals and doctors would have to swallow the costs of caring for uninsured individuals who will continue to use the emergency room as their primary source of care,” which further burdens the state budget.
The actual “lose-lose” outcome of Perry’s proposal has led many health policy experts to question its legitimacy and sincerity. Perry’s eagerness gut Medicaid while providing no actual viable alternative to cover the poor pushed one Texas hospital’s chief to call his idea “so bizarre as to be unworthy of consideration.”
http://thinkprogress.org/2010/11/09/...exas-medicaid/
Heres the other side of the story...I'm not advocating it, just posting in the interest of fairness...
The Challenge
The Medicaid program is a joint state-federal en lement program designed to provide health care to eligible low income individuals. The Texas Medicaid program primarily serves low income children, pregnant women, elderly, and people with disabilities. Texas expenditures for Medicaid more than doubled between 1996 and 2006, and the program currently accounts for 26 percent of the Texas state budget. Funding for Medicaid continues to compete with other critical programs and priorities, while increasing health care costs have eroded employer-based coverage. In addition to surging Medicaid caseloads and increasing medical costs, 25 percent, or 5.5 million people in Texas, do not have health insurance. This places additional pressure on Medicaid. Public hospitals report spending billions of dollars a year for care provided to the uninsured.
Action / Initiative
After Governor Perry’s 2007 State-of-the-State address, which set forth his vision for reducing the number of uninsured Texans, the 80th Legislature responded by passing Senate Bill 10, which incorporated Governor Perry’s Medicaid reform initiatives. Senate Bill 10 required HHSC to: promote preventive care and reduce hospital care for non-emergent conditions; study the use of health savings accounts; design tailored benefit packages for certain Medicaid recipients to meet special health care needs more effectively; expand breast and cervical cancer treatment; and study premium assistance programs for small employer health benefit plans. The resulting Medicaid reform waiver was submitted to the Centers for Medicare and Medicaid Services (CMS) in April 2008 and is still pending federal approval.
The Outcome
While CMS has yet to approve the Texas waiver, the governor continues to push US Health and Human Services Secretary Sebelius to approve these state-specific, market- driven reforms. Through the waiver, Texas proposes to create the Texas Health Opportunity Pool (HOP) trust fund by optimizing federal funding sources. Through this fund, Texas will transform access to health care for the uninsured from a heavy reliance on hospital-based care to increased access to primary and preventive care. Texas will provide HOP premium subsidies for uninsured adults and older children (age 19-20) living in households with family income at or below 200 percent of the federal poverty level (FPL)—approximately $41,300 for a family of four. Under the HOP, all consumers will be required to pay something toward the cost of their health care.
Consumers will have a choice among health care coverage options, placing an emphasis on consumer ownership of primary and preventive services. Parallel reform initiatives will address uncompensated care issues, including establishing financial incentives for hospitals to implement strategies to reduce uncompensated care costs.
Through the governor’s leadership, the state is on track to achieve cost savings and cost avoidance, thanks to reform efforts that generate more rational health-care spending on the uninsured, decrease the number of uninsured Texans, improve access to individual and employer-sponsored health coverage, and increase overall system efficiency and effectiveness.
"Under the HOP, all consumers will be required to pay something toward the cost of their health care."
Damn, a socialist "mandate" in TX?
With private insurers upping their rates by up to 30% for next year, increasing co-pays and deductibles, sometimes to catastrophe level, a hard-core public option is the best solution, spreading the nations health costs over the entire populace.
I find it amusing how much pleasure the liberals in this forum are getting over the fact that Texas will have to deal with a deficit this year.
The simple fact is that whether the deficit is 8 Billion or 28 Billion, they will deal with it by cutting government expenditures instead of raising taxes.
I think this is a good thing. Don't you?
texas deficit doesn't affect you, just like california doesn't affect me.
get the point?
It's a good thing if you don't need assistance. I don't need any assistance but many people do rely on govt help at this time. So I take no pleasure in knowing that the most vulnerable in our society are going to suffer because we live in a red state.
I guess it's ok to stick it to people who won't vote for you anyway. But we are a christian nation!
Sounds like you partially answered your own question.
I'm not sure what your angle in on this, so this next statement isn't necessarily targeted at you.
I don't understand why people think everyone should go to college and that we should make higher education accessible to everyone. I'm consistently amazed at the increasingly poor quality of students admitted to the university each year. If we did a better job at the K-12 levels, not everyone would feel the need to go to college because they'd actually have the skills to do something - ANYTHING - after high school. Instead I have to spend time every semester explaining how to calculate a percentage change between two numbers or calculate the area of a triangle.
With that said, I haven't gotten a raise from the university in six years. There hasn't been the budget for it. We absolutely need a balanced budget, but at some point people should be worried that the budgets cuts at the university level are going to drive away the talent in those ranks. While I'm not an educator that the state should worry about losing, I am an example of someone who it is almost becoming not worth it anymore to teach.
I reached that point about 14 years ago. Glad you can hang in there.
We are reaping the consequences of our bizarre fling with outcome based education. Coupled with Bush's disastrous "No Child Left Behind" and the systemic defunding of voc-ed programs during the 80's and 90's, we were left with a student population that was being averaged into mediocrity. When every one is deemed qualified to attend college, soon no one will be.
Just got an email that says the administration is expecting 20-33% budget cuts to come down. That's a lot of coin, hopefully quality of education won't suffer.
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