By: Leach H.B. No. 1025
A BILL TO BE ENTITLED
AN ACT
relating to the constitutional limit on the rate of growth of
appropriations.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 316.001, 316.002, and 316.006,
Government Code, are amended to read as follows:
Sec. 316.001. LIMIT. (a) For purposes of this subchapter,
"consolidated general revenue appropriations" means appropriations
from:
(1) the general revenue fund in the state treasury;
(2) a dedicated account in the general revenue fund in
the state treasury; or
(3) a general revenue-related fund in the state
treasury as identified in the biennial statement required of the
comptroller under Section 49a, Article III, Texas Constitution.
(b) The rate of growth of appropriations in a state fiscal
biennium from state tax revenues not dedicated by the constitution
may not exceed the estimated rate of growth of the state's economy.
(c) The rate of growth of consolidated general revenue
appropriations in a state fiscal biennium may not exceed the
estimated rate of growth of the state's economy.
(d) For purposes of this subchapter, the estimated rate of
growth of the state's economy is the average biennial rate of growth
of this state's population during the state fiscal biennium
preceding the biennium for which appropriations are made and during
the state fiscal biennium for which appropriations are made,
adjusted by the average biennial rate of monetary inflation in this
state during the same period, as determined under Section 316.002.
(e) The legislature finds that, for purposes of Section 22,
Article VIII, Texas Constitution, the average biennial rate of
growth of this state's population during the state fiscal biennium
preceding the biennium for which appropriations are made and during
the state fiscal biennium for which appropriations are made,
adjusted by the average biennial rate of monetary inflation in this
state during the same period, is an appropriate measure of the
estimated rate of growth of this state's economy.
(f) For purposes of this subchapter, an appropriation to pay
for a rebate of state taxes must be excluded from computations used
to determine whether appropriations exceed the amount authorized by
Subsection (b) or (c).
(g) The Legislative Budget Board shall determine the rates
described by Subsection (d) using the most recent information
available from sources the board considers reliable, including the
United States Bureau of Labor Statistics' Consumer Price Index and
the Texas Demographic Center.
Sec. 316.002. DUTIES OF LEGISLATIVE BUDGET BOARD. (a)
Before the Legislative Budget Board transmits [submits] the budget
for the next state fiscal biennium as prescribed by Section
322.008(c), the board shall establish:
(1) the limit on the rate of growth of appropriations
of state tax revenues not dedicated by the constitution for that
state fiscal biennium, as compared to the previous state fiscal
biennium, by subtracting one from the product of:
(A) the sum of one and the estimated average
biennial rate of growth of this state's population during the state
fiscal biennium preceding the biennium for which appropriations are
made and during the state fiscal biennium for which appropriations
are made; and
(B) the sum of one and the estimated average
biennial rate of monetary inflation during the state fiscal
biennium preceding the biennium for which appropriations are made
and during the state fiscal biennium for which appropriations are
made; and
(2) the limit in the rate of growth in consolidated
general revenue appropriations for that state fiscal biennium, as
compared to the previous state fiscal biennium, by subtracting one
from the product of:
(A) the sum of one and the estimated average
biennial rate of growth of this state's population during the state
fiscal biennium preceding the biennium for which appropriations are
made and during the state fiscal biennium for which appropriations
are made; and
(B) the sum of one and the estimated average
biennial rate of monetary inflation during the state fiscal
biennium preceding the biennium for which appropriations are made
and during the state fiscal biennium for which appropriations are
made [the state's economy from the current biennium to the next
biennium;
[(2) the level of appropriations for the current
biennium from state tax revenues not dedicated by the constitution;
and
[(3) the amount of state tax revenues not
dedicated by the constitution that could be appropriated for the
next biennium within the limit established by the estimated rate of
growth of the state's economy].
(b) Except as provided by Subsection (c), the board shall
determine for the next state fiscal biennium a limit on the amount
of:
(1) appropriations of state tax revenues not dedicated
by the constitution by multiplying the amount of appropriations of
state tax revenues not dedicated by the constitution for the then
current state fiscal biennium by the sum of one and the limit on the
rate of growth of appropriations of state tax revenues not
dedicated by the constitution determined by the board under
Subsection (a)(1); and
(2) consolidated general revenue appropriations by
multiplying the amount of consolidated general revenue
appropriations for the then current state fiscal biennium by the
sum of one and the limit on the rate of growth of consolidated
general revenue appropriations determined by the board under
Subsection (a)(2) [the estimated rate of growth of the state's
economy by dividing the estimated Texas total personal income for
the next biennium by the estimated Texas total personal income for
the current biennium. Using standard statistical methods, the
board shall make the estimate by projecting through the biennium
the estimated Texas total personal income reported by the United
States Department of Commerce or its successor in function].
(c) If the rate determined under Subsection (a)(1) is a
negative number, the amount of appropriations of state tax revenues
not dedicated by the constitution for the next state fiscal
biennium may not exceed the amount of appropriations of state tax
revenues not dedicated by the constitution in the current state
fiscal biennium. If the rate determined under Subsection (a)(2) is
a negative number, the amount of consolidated general revenue
appropriations for the next state fiscal biennium may not exceed
the amount of consolidated general revenue appropriations in the
current state fiscal biennium [If a more comprehensive definition
of the rate of growth of the state's economy is developed and is
approved by the committee established by Section 316.005, the board
may use that definition in calculating the limit on
appropriations].
(d) To ensure compliance with this subchapter and Section
22, Article VIII, [Section 22, of the] Texas Constitution, the
Legislative Budget Board may not transmit in any form to the
governor or the legislature the budget as prescribed by Section
322.008(c) or the general appropriations bill as prescribed by
Section 322.008(d) until the board adopts:
(1) the limit on the rate of growth of appropriations
of state tax revenues not dedicated by the constitution under
Section 316.001(b); and
(2) the limit on the rate of growth of consolidated
general revenue appropriations under Section 316.001(c) [has been
adopted as required by this subchapter].
(e) In the absence of an action by the Legislative Budget
Board to adopt the limits [a spending limit] as provided by this
section:
(1) for purposes of Section 316.001(b):
(A) [in Subsections (a) and (b),] the estimated
rate of growth in the state's economy from the current fiscal
biennium to the next fiscal biennium shall be treated as if it were
zero;[,] and
(B) the amount of state tax revenues not
dedicated by the constitution that could be appropriated within the
limit established by the estimated rate of growth in the state's
economy shall be the same as the level of appropriations for the
current fiscal biennium; and
(2) for purposes of Section 316.001(c):
(A) the estimated rate of growth in the state's
economy from the current fiscal biennium to the next fiscal
biennium shall be treated as if it were zero; and
(B) the amount of consolidated general revenue
appropriations that could be appropriated within the limit
established by that subsection shall be the same as the level of
appropriations for the current fiscal biennium.
Sec. 316.006. LIMIT ON BUDGET RECOMMENDATIONS. Unless
authorized by majority vote of the members of the board from each
house, the Legislative Budget Board budget recommendations:
(1) relating to the proposed appropriations of state
tax revenues not dedicated by the constitution may not exceed the
limit on appropriations from those sources adopted by the committee
under Section 316.005; and
(2) relating to the proposed consolidated general
revenue appropriations may not exceed the limit on appropriations
from those sources adopted by the committee under Section 316.005.
SECTION 2. Section 316.007(a), Government Code, is amended
to read as follows:
(a) The Legislative Budget Board shall include in its budget
recommendations:
(1) the proposed limit of appropriations from state
tax revenues not dedicated by the constitution; and
(2) the proposed limit of consolidated general revenue
appropriations.
SECTION 3. Section 316.008(a), Government Code, is amended
to read as follows:
(a) Unless the legislature adopts a resolution under
Section 22, Article VIII, [Section 22(b), of the] Texas
Constitution, raising the proposed limit on appropriations from
state tax revenues not dedicated by the constitution, the proposed
limit is binding on the legislature with respect to all
appropriations for the next fiscal biennium made from those [state
tax] revenues [not dedicated by the constitution]. The proposed
limit on consolidated general revenue appropriations is binding on
the legislature with respect to all appropriations for the next
fiscal biennium made from those sources unless the legislature
adopts a resolution raising the proposed limit that is approved by a
record vote of three-fifths of the members of each house of the
legislature. The resolution must find that an emergency exists,
identify the nature of the emergency, and specify the amount
authorized. The excess authorized under this subsection may not
exceed the amount specified in the resolution.
SECTION 4. The changes in law made by this Act apply only in
relation to appropriations made for the state fiscal biennium
beginning September 1, 2019, and subsequent state fiscal bienniums.
Appropriations for the state fiscal biennium that begins September
1, 2017, are governed by Sections 316.001, 316.002, 316.006,
316.007, and 316.008, Government Code, as those sections existed on
December 1, 2016, and the former law is continued in effect for that
purpose.
SECTION 5. This Act takes effect September 1, 2017.