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Comptroller states the obvious about the deficit

Obvious if you’ve been paying attention, anyway.

The Texas comptroller told the House Appropriations Committee on Thursday that she can’t imagine solving the current budget crisis through cuts alone.

Susan Combs spoke at a hearing designed to be a reality check for conservatives who think the budget can be balanced by slashing state services. The current two-year budget cycle is $4.3 billion short and, under the Texas Constitution, that deficit must be made up by Aug. 31.

The state is also facing another projected $27 billion shortfall in the next two-year budget, but that was not the subject of Thursday’s hearing.

Committee Chairman Jim Pitts, a Waxahachie Republican, asked Combs to testify after he introduced a bill to spend $4.3 billion from the state’s Rainy Day Fund to cover the deficit. In opening Thursday’s hearing, he tried to communicate the gravity of the problem, which left lawmakers silent and stone-faced.

“The budget adopted by the Legislature last session, and signed by the governor, exceeded the comptroller’s measure of available revenue,” Pitts said. “This committee, and this Legislature, has very limited options: the use of the Rainy Day Fund, further reductions … or deferring payments into the next biennium.”

While Combs never called on the committee to dip into the Rainy Day Fund, she presented a detailed history of how it had been used in the past and how spending it would not hurt the state’s credit rating. She also examined the other options.

“I don’t know how you can get to $4.3 billion in cuts,” Combs said. She warned that even if the recession ends, that doesn’t mean revenues will return to levels seen in 2005, when the Texas economy was booming.

Pitts filed his bill to use Rainy Day Funds for the current biennium’s deficit earlier this week. He hasn’t gone as far as some of his colleagues in suggesting we may need to use it for more than just that, but he’s certainly made no bones about this. Not having to dedicate any current revenue to last biennium will help – not enough, of course, but it will help. I just hope his Republican colleagues are listening.

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  1. […] the Kuff notes that quite a few Republicans are now talking about using the Rainy Day Fund. Will they have the guts to go against Governor […]