Texas revenue falls short $9.1 billion

AUSTIN (KXAN) - Comptroller Susan Combs called her 2010-11 Biennial Revenue Estimate decidedly cautious.

"Fiscal '09 and the first part of 2010, especially, are likely to under perform what we're used to," Combs said.

The estimated General Revenue for 2010 is $77.1 billion, $9.1 billion less than 2008. However, the difference in usable money is closer to $7 billion due to $3 billion being set aside for property tax relief. Part of the reason the revenue has decreased is due to the decline in motor vehicle sales.

"The motor vehicle sales tax, normally a $3 billion per year tax, is expected to drop 21.9 percent in fiscal 2009," said Combs. Sales tax also is lagging, along with expected collections from the new franchise tax.

The outlook for jobs is equally grim. While the state added 250,000 jobs in 2008, Combs predicts there will be 11,000 jobs lost by the summer of 2009. However, there is a projected gain in jobs projected in the fourth quarter of the year.

"I would expect job losses to come from the major sectors in the economy, which is the service sector, oil and gas and construction," said Combs.

When it comes to foreclosures, Texas remains in better shape than other states. One in every 1,176 Texas households faced foreclosure. It is a small number compared to the one in every 218 California households and one in every 76 Nevada households, according to the Comptroller.

The bright spot in this cloudy forecast is the rainy day fund. It currently holds $6.7 billion, more money than it ever has. Though it requires a two-thirds vote by the Legislature for use, Combs said it is another pot of money that is available if needed. Her final outlook is Texas will rebound by 2011.

"We have been cautious," she said. "I think our optimism will be justified in a year or year and a half."