|FOR IMMEDIATE RELEASE|
October 10, 2019
Texas Comptroller Glenn Hegar Releases Certification Revenue Estimate
(AUSTIN) — Texas Comptroller Glenn Hegar announced today the release of the Certification Revenue Estimate (CRE) for the fiscal 2020-21 biennium.
Before each regular legislative session, the Comptroller’s office issues a Biennial Revenue Estimate (BRE) that estimates how much revenue will be available for spending in the state’s next two-year budget cycle. After the session, the agency releases the CRE to provide the detailed basis by which the Comptroller certified the budget, to revise estimates in the BRE to reflect legislative activity and current economic information and to take into account final revenue numbers for the recently ended fiscal year.
As a result of legislative actions and an updated economic forecast, the Comptroller’s office now expects revenue available for general spending in 2020-21 to total about $121.76 billion, up 9.6 percent from the 2018-19 biennium. This revenue will support the $118.86 billion in general-purpose spending called for by the 86th Legislature and will result in a final balance available for certification of $2.89 billion.
“In fiscal 2019, the Texas economy continued to grow at rates among the highest in the nation,” Hegar said. “We are projecting continued expansion of the Texas economy in this biennium. The most likely scenario is one of steady expansion at a pace below that of the 2018-19 biennium. Risks to this estimate include ongoing uncertainty about trade and national economic policy, slowing global economic growth and volatility in energy prices resulting from instability and potential conflict in the Middle East.”
The State Highway Fund (SHF) and Economic Stabilization Fund (ESF; the state’s “Rainy Day Fund”) both receive funding from oil and gas severance taxes. Fiscal 2020 transfers will total $1.67 billion each to the ESF and SHF; fiscal 2021 transfers are projected to be $1.59 billion to each fund. After accounting for interest and investment earnings by the ESF, along with expenditures authorized by appropriations made in recent legislative sessions, the CRE projects a fiscal 2021 ending Rainy Day Fund balance of $9.35 billion.
Also, based on a constitutional amendment passed in 2015 and because annual state sales tax revenue exceeded $28 billion, an additional $2.5 billion will be deposited to the SHF in each year of the 2020-21 biennium. This amendment also stipulated that when motor vehicle sales tax revenue collected in any fiscal year exceeds $5 billion, a portion will be transferred to the SHF. The CRE projects that the threshold will be met for the first time in fiscal 2020 and that $35 million will be transferred to the SHF from motor vehicle sales tax collections in the 2020-21 biennium.
“I will continue to monitor the Texas economy and state revenues closely and will keep the public informed of significant events as they arise,” Hegar said.