ATR Urges Texas Legislators to Preserve the Rainy Day Fund


Posted by Patrick M. Gleason on Friday, March 18th, 2011, 2:48 PM PERMALINK

As 82nd session of the Texas legislature turns its attention to the 2012-13 biennium, Americans for Tax Reform urges lawmakers to bring expenditures in line with revenue without using anymore of the rainy day fund. While it is disappointing that lawmakers have already tapped a portion of the fund for the current biennium, Gov. Rick Perry is correct in ruling out any reliance on the rainy day fund in the ’12-’13 biennium. That is not only a good policy decision, it is a necessity.

The fact is there are there are known budgetary challenges looming on the horizon; as such, further depletion of the important taxpayer safeguard that is the rainy day fund would threaten the state’s fiscal stability.

Texas, like many states, is on the verge of realizing a significant spike in Medicaid costs. Implementation of Obamacare will only make matters worse, exacerbating the projected increase in state Medicaid expenditures. According to a recent study from the Texas Public Policy Foundation, even assuming ObamaCare is repealed, state spending on Medicaid in Texas will rise by $10 billion in the ’14-’15 biennium. Under ObamaCare the increase in Medicaid costs for the Lone Star State jumps 50% to $15 billion for that budget cycle.

It is incumbent upon conservatives in the Texas legislature to do everything in their power to prevent their constituents from getting hit with this unconstitutional legislation which raises taxes by $500 billion over the next decade and will tie the hands of state budget writers. That’s why ATR is supporting HJR 24, Rep. Ken Paxton’s Healthcare Freedom Act. 

Accounting for 70% of jobs created since ’08, Texas emerged from the recession five months before rest of the country not by accident. Texas has been then economic powerhouse of the nation for more than a decade thanks to a low tax burden and predictable regulations. Preserving the remainder of the rainy day fund and avoiding all tax increases, as Texas legislators did in 2003, will send a strong message to the business community and investors that the Lone Star State isn’t about to do anything to diminish its hospitable tax and regulatory climate.

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