Texas is staring down the barrel of a budget shortfall that could reach $25 billion or higher. It's a staggering figure, considering that California was practically brought to its knees over a $20 billion budget deficit. That was in a state that spends twice as much as Texas.
Media outlets have reported on the shortfall and what it could mean for the state. For example, KUT's Ben Philpott told us how cuts could affect everything from criminal justice to education, while KUT's Erika Aguilar reported on how it could result in higher business taxes. The Dallas Morning News even told us how budget cuts could imperil a program that provides life-sustaining drugs to HIV patients, illustrating that for some people, the state budget is truly a matter of life and death.
But the issue hasn't been as big on the campaign trail. Last week, the Texas Observer implored the gubernatorial candidates to starting explaining how they would handle the looming crisis. Today, the Houston Chronicle's Gary Scharrer reports that while a monster deficit looms, candidates have remained silent.
State budget writers could close prisons, eliminate the Department of Public Safety, scrap economic development and environmental protection, board up several other state agencies and still not reach enough savings to avoid cutting education and human services, said Eva DeLuna Castro, a budget expert at the Center of Public Policy Priorities.
Candidates running for election Tuesday, however, have steered clear of details about the cuts for obvious reasons, they said. No one wants to talk up taxes or campaign to starve public education.
KUT News spoke with Eva DeLuna Castro, a budget analyst at the progressive Center for Public Policy Priorities about the severity of the cuts.
KUT News: This seems like a serious issue but yet it's not high on the radar of candidates for governor.
Eva DeLuna Castro: One reason not to completely panic now is that there is no revenue estimate yet for 2012 and 2013. But right now, state revenue is down because of the recession, and we know that just for current services, schools, healthcare, all of that is going to cost more. So we have some numbers, but we just don't have the big missing number: What is going to happen with the economy and state taxes over the next two years?
KUT News: We often hear that when it came to the recession, Texas "dodged a bullet."
DeLuna Castro: No. We did not dodge a bullet. Sales tax collections have been down for more than a year. The Rainy Day Fund is there and that will help solve a lot of our budget problems, but the main thing that covered up the problems until now is the Recovery Act money that we got last year. That's really what helped postpone this debate until 2011.
KUT News: Can you explain how serious this budget shortfall is?
DeLuna Castro: The number that's being thrown out most often is somewhere between $18- to $25-billion, I think, most recently. That's out of our general revenue, not all the money that's being spent. Out of general revenue, that's about a 20 percent budget problem. That's what makes it impossible to protect education, and health and human services. Eighty-four cents of every dollar that's being spent in the budget is for elementary and secondary schools, for higher education, and for health and human services. You can't cut the budget by 20 percent without starting to cut in those areas.
KUT News: It's easy to understand that $20 billion is a lot of money, but it's hard to wrap one's head around exactly what that means in terms of government services.
DeLuna Castro: The most recent example is 2003. I think it's safe to say that what was cut in 2003 is what would be cut this time around. What happened in 2003 is that tuition was deregulated for public universities. That's one thing that a lot of Texas families will notice right off the bat; they'll have a higher tuition bill if their son or daughter is attending a public university or community college. If you're a state employee, you've already seen cuts to state employee health care, and that's probably another cut that will be discussed. Shifting costs to local school districts, meaning that property taxes go up. There are a lot of things that will happen that don't necessarily mean a cut in services, but it does mean we will pay for it some other way.
KUT News: California was just dealt a massive $20 billion deficit.
DeLuna Castro: Yeah, and they spend twice as much as we do.
KUT News: Right so they have more fat to trim, you might say.
DeLuna Castro: Right.
KUT News: But that was considered a crisis, and we don't seem to be talking about it in those terms here yet.
DeLuna Castro:No, and again, I think it's because we don't have part of the equation. We don't have a revenue estimate. If [Texas] Comptroller [Susan Combs] tells us in January that the economy is going to recover really quickly, and that state revenues will be back to what they used to be, that really helps mitigate the situation. But if she gives a very flat or slow growth projection, then we will be talking about cuts to health care and education. Some people may only care about the road being congested on the way to work. The way to reduce that is to make people pay tolls. So there are things that you have to pay for it one way or the other, just avoiding the issue doesn't solve the long-term problem.
KUT News: Is this the biggest issue that's not being talked about in this election cycle?
DeLuna Castro: Probably. There are other regulatory issues. There hasn't been a lot of discussion about how Texas could be better prepared for health care reform. About half of Texans have insurance through the private market, not because of a public program. There are things we need to do right now to make sure that more Texans get the most out of their private health insurance policy that they can. But if we wait till the last minute to act on that, a lot of good opportunities could go by. There are things we could be doing right now. For example, making sure there's enough nurses and doctors and specialists to see all the people who are going to be having health care in the next few years. That's not something you can do overnight. And there's not a lot of discussion about that either.