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Wednesday, January 19, 2011

LAWMAKERS FACE SHORTFALL OF UP TO $30 BILLION

The 2011 Texas Legislature convened in a big hole. A huge, $30 billion, hole, in fact. And leading budget writers in both the House and Senate — backed by state leaders — say they will focus on spending cuts — not new taxes or the state’s Rainy Day Fund — to fill it. As expected, that means the first-draft budgets will take some big slices out of spending on Medicaid, the second largest state expenditure after public education:

  • “We will prioritize what’s important in this state,” said Gov. Rick Perry. “We will fund those. And we will craft a budget that meets those revenue projections.”
  • “It is impossible to balance the budget without making cuts in” health care and education, said Senate Finance Committee Chair Steve Ogden (R-Bryan). Together those two items make up more than 81 percent of general revenue appropriated in the biennial budget. Medicaid will cost the state an additional $4.5 billion this budget cycle due to the end of the federal stimulus money lawmakers used last session to help fund the state’s health care programs.
  • Lt. Gov. David Dewhurst said a Senate version of a base budget for the next two years would eliminate 8,000 state employee slots.
  • House Appropriations Committee Chair Jim Pitts (R-Waxahachie) said the initial House plan would mean fewer state workers and fewer state programs. He also predicted it would spark outrage from legislators’ local school districts and hospital and nursing home administrators.

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