Resources
Biennial Revenue Estimate (BRE): Article III, Section 49a, of the Texas Constitution requires the comptroller of public accounts to submit to the governor and legislature upon its convening a statement showing the financial condition of the state treasury at the close of the last fiscal period and an estimate of the probable receipts and disbursements for the current fiscal year, as well as an itemized estimate of the anticipated revenue to be credited during the succeeding biennium.
Budget 101: A Guide to the Budget Process in Texas: a step-by-step explanation of the budget process in Texas.
Fiscal Size-up: A biennial document prepared by Legislative Budget Board staff that describes state agency operations and summarizes the appropriations made during the preceding legislative session.
General Appropriations Act (GAA): Otherwise known as the state budget, this is the law that appropriates biennial funding to state agencies for specific fiscal years and sets provisions for spending authority.
Legislative Appropriation Request (LAR): A formal request for funding made by each state agency and institution. This request is in accordance with instructions developed by the Legislative Budget Board and Governor’s Office of Budget, Policy, and Planning. The agency request is prepared according to the approved strategic planning and budget structure for that agency.
Texas Stimulus Impact: this site serves as the state’s stimulus tracking website, as mandated through the American Recovery and Reinvestment Act of 2009. Currently, this site helps track approximately $14 billion of the total $18 billion in federal stimulusflowing through Texas government.
Where the Money Goes – the state’s online expenditure database that allows users to search through state spending data according to agency, broad spending categories, or by detailed purchase code. The site also allows users to see which vendors are being paid by the state.
The development of the biennial Texas budget begins every spring of even-numbered years and concludes the following year. This well-orchestrated ritual is a demanding, complex set of activities that requires decisive leadership and cooperation from all levels of government.
Texas’ budget process begins with the governor who, in cooperation with the Legislative Budget Board (LBB), develops a statewide mission statement. This mission statement outlines the governor’s grand vision for the future of Texas and provides the foundation on which state agencies begin outlining department goals and formulating strategic plans.
Provided with instructions from the Governor’s Office of Budget, Planning, and Policy (GOBPP) and the LBB, state agencies are tasked with designing a long-term strategic plan to detail how they seek to accomplish organizational goals. In addition to the strategic plan, an agency must also complete a comprehensive Legislative Appropriation Request (LAR) to propose their budget. An LAR is a formal request for appropriations based on the agency’s strategic plan and uses performance measures to identify how it intends to justify those expenditures. Once they have been developed, both the LARs and strategic plan are sent back to the GOBPP and the LBB for review.
After receiving the LARs and strategic plans, the LBB and the GOBPP initiate public hearings to discuss each agency’s proposals. Throughout the course of these proceedings, the relevance of selected performance measures is examined and budget items scrutinized. Each LAR must then be submitted to the LBB, GOBPP, State Auditor’s Office (SAO), and the Office of the Comptroller of Public Accounts. This step is critical to the budget process because LARs provide financial data necessary for the LBB to prepare the general appropriations bill.
Prior to the beginning of the legislative session, the LBB prepares a draft of the general appropriations bill (the state budget). Contained within this draft are “performance measures, the maximum number of full-time equivalent (FTE) positions allowed per agency, specific enumerated instructions and contingencies on some expenditures (called riders), the amount of funding recommended by the LBB, and the method of financing each agency’s appropriation.”[1] Often times, the funding level requested by a state agency and the funding level recommended by the LBB differ. To highlight these differences, the LBB publishes the Legislative Budget Estimate, which details previous agency spending and requested appropriations for the upcoming legislative session.
At the start of the legislative session, the general appropriations bill is filed in both the Texas House and Senate at the same time. This allows both houses to review the draft in equal time and without favor. Traditionally, the final appropriations bill sent to the governor alternates between the Senate and the House each biennium. To assist the Legislature in knowing how much revenue is available to spend, the Office of the Comptroller produces the Biennial Revenue Estimate (BRE) during the first few days of session. The BRE is especially important because the Texas Constitution forbids the legislature from spending more revenue than the state anticipates receiving.
Having gathered all necessary documents, the Senate Finance Committee (SFC) and the House Appropriations Committee (HAC) independently interview agency officials to assess their budget recommendations. Throughout these proceedings, both the SFC and HAC make changes to the budget – this process is known as “mark-up.” Upon concluding the “mark-up” process, the bill is debated in full before each chamber, resulting in a vote and eventual passage.
Resolving disputes between the House and Senate versions of the bill is the next step in the budget process. A conference committee consisting of five members from each chamber is convened and chaired by the sponsor of the appropriations bill. Once conference committee members agree on a modified appropriations bill, a final draft of the bill (known as a “conference report”) is sent back to each chamber for final approval. Assuming the appropriations bill passes both houses, the bill is sent to the Office of the Comptroller.
The comptroller is constitutionally mandated to certify that sufficient revenue exists to pay for the items in the appropriations bill. Once the bill is certified, it is then sent to the governor’s office for signature. The Texas Constitution grants the governor line-item veto authority to eliminate any budgetary items. However, the legislature can override his authority, if it is still in session and gets a two-thirds vote in both the House and Senate.
The Texas budget is implemented beginning on September 1 of every odd-numbered year. To ensure that state agencies are correctly implementing policies and procedures, the LBB and SAO monitor budget compliance. Any alterations to the budget must be agreed upon by the governor and the LBB.
Source: Legislative Budget Board, Budget 101
