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Friday, June 25, 2021

Bill to Strengthen Spending Limits Sent to Governor

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Legislation to strengthen the state’s spending limit is on its way to the governor’s desk.

Texas’ current constitutional spending limit only applies to state tax revenue not dedicated by the Constitution, which constitutes about half of the total state budget.

Senate Bill 1336 by State Sen. Kelly Hancock (R–North Richland Hills) will change that.

Instead, the bill caps the growth of state spending at the rate of population plus inflation.

An exception is made, however, for “an appropriation to pay costs associated with recovery from a disaster declared by the governor,” as well as funds dedicated to tax relief.

Hancock’s bill would subject all state funds—but not federal funds—to the growth limit.

The bill passed largely on party lines out of the Senate and House, with most Democrats opposing the measure.

Strengthening the state’s spending limit has long been a priority of conservatives. Previous efforts, however, had been thwarted in the legislature.

Abbott is expected to approve the proposal in the coming days. It will go into effect for the next biennial budget, Fiscal Year 2023-2024.

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