Conference Committee Unveils Negotiated Budget

Texas lawmakers on Thursday unveiled the final negotiated version of the state budget for the next two years after weeks of haggling in closed-door meetings.

The latest budget — formally, the conference committee substitute for Senate Bill 1 — would spend $338 billion of both state and federal money over the next two years on schools, retirement, health insurance, law enforcement, property tax relief, utilities infrastructure, highways and more.

Most of that money would come from within the Lone Star State: more than $157 billion would come from either the state General Fund or from state accounts that have specific, constrained purposes.

Between those two state sources, the negotiated budget represents a roughly 3.6% spending increase over what lawmakers approved last session, or about $5.4 billion more on balance across the ten regions of state government outlined in the state constitution.

Some departments saw far larger increases than others. The biggest raw increase went to public safety and criminal justice agencies, which overall are set to receive about $5.7 billion more this upcoming biennium than in the current two-year budget cycle — an increase of more than 42%.

Others experienced significant cuts, including “General Government” agencies, which includes the state comptroller’s office, the state employee retirement system, the secretary of state, the Texas Historical Commission and the office of the attorney general. Under the revised budget, they collectively stand to lose about $6.6 billion in combined general funds and directed funds, a 49% cut from the last session’s budget.

Most of that is due to the end of the coronavirus relief fund and one-time spending on border security, according to the Legislative Budget Board’s summary of the budget.

Public school funding

Public education also is set to receive new money this session, contingent on the passage of House Bill 2, the lower chamber’s flagship public school funding bill.

Funding for HB 2 would total $8.11 billion over the next two years, a historic amount of spending that primarily would go toward increasing salaries for teachers and to a lesser extent support staff.

More than half of that money would go toward increasing pay for teachers, but not support staff or administrators, based on years of experience and the size of the district, ranging from $2,500 to $8,000 per year. It also would expand teacher benefits and performance bonus programs.

Support staff would be entitled to a separate bucket of money in the form of a $45 allotment per student, and special education funding would be restructured to partly fill a funding gap.

Despite that investment, school districts and teachers around the state had asked lawmakers for more money after years of high inflation during the pandemic to help restore the spending power they had in 2019, the last time the state increased its per-student school allotment.

Democrats in the House this session managed to negotiate a larger increase to that figure, the basic allotment, but Lt. Gov. Dan Patrick, the president of the Senate, was adamant that the final version of the bill not increase the basic allotment, and instead prescribe how districts can use the extra funding.

But districts are facing a diverse set of pressures and difficulties, and without flexibility to spend that money to target their own unique needs, superintendents have said they still would be operating with ongoing deficits.

Negotiators attempted to circumvent Patrick’s condition by including a $1.3 billion “Adjusted Basic Cost Allotment” that aims to help districts pay for rising fixed costs in their districts, including insurance, transportation and utilities.

The House and Senate will have a chance to vote on the budget today, on Friday afternoon, at the earliest, according to a press release from nonprofit Texas 2036.

The last day of the session is Monday, June 2.