Texas comptroller: State’s finances not as ‘dire’ as expected, still impacted by pandemic

Texas

AUSTIN (KXAN) — The coronavirus pandemic has caused steep declines in industries across Texas, but the effect has not been as “dire” as expected, according to Texas Comptroller Glenn Hegar.

On Monday, Hegar addressed the Legislative Budget Board, which is made up of members of the Texas House and Senate, who are tasked with laying the groundwork for the legislature’s crafting of a budget.

Hegar said sales tax revenue and consumer spending has exceeded his expectations in the months since he last addressed the Legislative Budget Board in July when he forecasted a $4.6 billion budget shortfall in the next biennium.

Revenue from hotel occupancy and alcoholic beverage taxes still faces steep year-over-year declines, as does revenue from oil and gas taxes, but Hegar said sales tax revenue and consumer spending has been a “bright spot.”

“Overall, in the second half of the fiscal year 2020, sales taxes fell by 4.8% relative to a year ago while many other revenue sources exhibited double-digit declines over that time.”

Hegar said the incoming legislature will still face a challenging budget process, given that members will not have a multi-billion-dollar surplus to pull from as they did in the previous session.

The legislative session begins in January.

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