AUSTIN (KXAN) — This past week brought a run of good economic news for the Lone Star State. CNBC put Texas at the top of its annual list ranking the best states for business. Austin beat out several other cities to become the location for the Army’s New Futures Command. And, a surge in oil prices is boosting the state budget outlook.
The Comptroller’s Office raised the state’s revenue estimate by $2.8 billion. That’s welcome news for lawmakers who face a list of big expenses, like bills from Hurricane Harvey and an underfunded Medicaid system.
“The state’s economy has been performing better than expected,” explained Tom Currah, the chief revenue estimator for the Texas Comptroller’s Office. “That’s translated into revenues running ahead of our projections from October.” Currah added that an improving economy is boosting the state’s sales tax collections.
Despite the bright budget outlook, there is some cause for concern. A looming trade war, sparked by tariffs launched by President Donald Trump, is having an impact in Texas. “The retaliatory tariffs that have been imposed have been directed toward agriculture,” said Senator John Cornyn, R-Texas.
Sen. Cornyn says he’s also hearing from constituents concerned about the uncertainty of ongoing North American Free Trade Agreement negotiations. The trade agreement supports about 8 million American jobs, according to Cornyn.
Even with the uncertainty, current conditions are encouraging to those tracking state revenue. “Oil prices and oil revenue is running far ahead of what we forecast back in October,” Currah said. “Also the U.S. economy is doing better than we expected, and that brings Texas along too.”