MONEY, MONEY, MONEY…
Balancing the Texas Budget in 2012-2013
Where Do Our State Budget $$ Come From?
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State Tax Collections Federal Funds -
$ 78 billion
$ 67 billion
Fees, Fines, Licenses Interest and Investment Income Lottery State Land Income Other Sources Total (2 yr budget)
$ 14 billion
$ 6 billion
$ 3 billion
$ 2 billion
$ 10 billion
$180 billion
Source: Texas Fact Book, 2010, Legislative Budget Board. State taxes only, does not include local property taxes.
Where Your State Tax Dollar Comes From
(2010-2011 2-year Tax Revenue Estimate)
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Oil/Gas Prod.
5%
Vehicle Taxes
Other Taxes
8%
8%
Franchise Tax
11%
Gas Tax
8%
Sales Tax
56%
Sin Taxes
4%
Total State Tax Revenue = $78 Billion
Source: Texas Fact Book, 2010, Legislative Budget Board. State taxes only, does not include local
property taxes.
Where Do Our State Budget $$ Go?
(2010-2011 2-year budget)
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Other
9%
Business &
Economic
4
Development
11%
Prisons/Public
Safety
6%
Education
41%
Health and
Human Services
33%
Total = $180 Billion
Source: Texas Fact Book, 2010, Legislative Budget Board. State taxes only, does not include
local property taxes.
The Texas Budget Deficit, 2012-2013
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The Challenge:
Eliminate the Budget Deficit
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The Texas budget must be balanced
Imagine that you are a Texas State Senator
As members of the Texas Senate you must find
solutions that you can live with
Options:
 Use
some or all of the Rainy Day Fund
 Raise revenue
 Cut spending
One Option for Reducing the Deficit:
Spend the Rainy Day Fund
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Would you support using
some or all of the Rainy
Day Fund to reduce the
deficit?
The Rainy Day Fund*
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Potential Revenue
for 2012-2013
Beginning balance
Growth during 2012-2013
$8.2 billion
Total Rainy Day Fund
Available
$9.6 billion
$1.4 billion
* The Texas Rainy Day Fund comes from a variety of sources with most of the
money coming from a portion of natural gas and oil tax revenues.
Closing the Budget Gap: Raise Revenue
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Raise Existing Taxes
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Create New Taxes
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Soda Tax, Quality Assurance Fee
Eliminate Tax Exemptions and Discounts
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Sales Tax, Franchise Tax, Gasoline Tax, Cigarette Tax, MotorVehicle Tax, Beer Tax
Sales Tax Holiday, high-cost natural-gas exemption, 10%
property tax appraisal cap, optional homestead exemption
Other Revenue Options
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Allow slot machines in existing gambling sites
Closing the Budget Gap: Reduce
Spending
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Cut existing programs (some examples)
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Education
 Cut $25 million in grants to help school districts build science labs (program total is $59.5 million)
 Reduce financial aid spending ($50 million)
 Eliminate dropout prevention for teen parents ($10 million)
Health and Human Services
 1% reduction in Medicaid provider payments ($64 million)
 Temporary hiring freeze from HHS agencies ($8.9 million)
 Close 50 beds at Terrell state hospital ($27 million)
 Eliminate services for 8090 seniors or persons with disability receiving Medicaid LTC services at home
($96.2m)-DADS
 Reduce comprehensive rehabilitation services by 70% and not provide services to approximately 840
clients ($23.6 million)- DARS
 Reduce prevention and early intervention programs by 84% ($73.7 million)
 Reduce state mental health hospital capacity, community mental health services for adults and children and
substance abuse intervention services ($136.7million)
Prisons
 $239 million to prison and parole system, including eliminating the substance abuse treatment program.
Did You Eliminate the Deficit?
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How did “the Senate” vote on the Rainy Day Fund?
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How did “the Senate” vote on raising revenue?
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How did “the Senate” vote on cutting existing
programs?
What Does the Budget Deficit Mean for
AARP Members?
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Balancing the budget with a large deficit will be extremely
challenging
There will be a lot of attention on the big budget items (i.e.,
Education and Health and Human Services)
Medicaid is a large part of the health and human services
piece of the budget and vulnerable to cuts
Medicaid is the primary payer of long term care services like
nursing home and care in the community (helps pay for twothirds of all nursing home stays)
Protecting Seniors who need Long Term Care
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The proposed 10 percent cut to long term care providers
would take a heavy toll on consumers who use Medicaid
nursing homes and community care.
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Places nursing home residents at risk by reducing staff and care for
our must vulnerable seniors.
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For the seniors who depend on community-based long-term care
programs, the rate cuts will make it harder to find people willing to
do this important work.
What Can You Do To Help?
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Let your state elected officials know you want them to
protect seniors who need long term care.
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Protect current funding levels for nursing home and community
care.
Lets not push seniors from community into more expensive
nursing homes.
Your state elected officials:
Want to Read More About the Texas
Budget?
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Texas Fact Book, 2010
Texas Legislative Budget Board
http://www.lbb.state.tx.us/Fact_Book/Texas_FactBook_2010.pdf
Budget 101: A Guide to the Budget Process in Texas
Senate Research Center, January 2009
http://www.senate.state.tx.us/SRC/pdf/Budget101-2009web.pdf
Rainy Day Fund: The Texas Tribune, January 7, 2011
http://www.texastribune.org/texas-taxes/rainy-day-fund/