Texas’ coffers will continue to overflow, with a nearly $18.3 billion balance projected at the end of the current biennium, according to a state revenue estimate released Thursday.
State Comptroller Glenn Hegar said while the legislature approved $176.28 billion in general-purpose spending for the fiscal 2024-25 biennium that began Sept. 1, his office estimates revenue will total about $194.57 billion, which would mark a 24.8% increase over the previous biennium.
Hegar said the estimate was conservative given “the significant uncertainty and potential risks to the economic outlook.”
“It may well turn out that robust economic growth, and consequently revenue growth, will continue unabated,” he said in a statement. “But it would not be prudent to simply assume that will be the case.”
Growth in sales taxes, the largest source of state funding for the Texas budget, has slowed, rising just 2.8% last month compared to September 2022.
Hegar’s January forecast of a $32.7 billion surplus at the end of the fiscal 2022-23 biennium spurred lawmakers to pass — during a July special session — a massive state-funded property tax cut that will be put before voters in November in the form of a constitutional amendment.
The latest estimate, which incorporated legislative actions and an updated economic forecast, arrived ahead of Monday’s start of a third special legislative session ordered by Gov. Greg Abbott.
In fiscal 2024, Texas’ state highway and economic stabilization funds will each receive $3.06 billion based on oil and gas severance taxes collected in fiscal 2023 and an estimated $2.76 billion each in fiscal 2025, according to the comptroller’s office. The economic stabilization fund will also receive a $2.52 billion transfer this fiscal year and is projected to have a fiscal 2025 ending balance of $23.77 billion.