Yep. Our Republican Lt. Governor Dewhurst agrees with House Appropriations Chairman Jim Pitts, R-Waxahachie that the state budget shortfall could reach up to $18 billion. (That was in the link that I posted at #99.)
When Gov. Perry says “if” that’s appropriate because we have biennial budgets in Texas. We won’t know how much the shortfall will actually be until the current budget expires in August 2011. It’s estimated to be $18 billion. Perry and Dewhurst have already implemented spending cuts for this fiscal year. Those cuts will reduce that $18 billion shortfall by about $2 billion.
No, it doesn’t necessarily mean big cuts in jobs, education, schools, health, services, etc. Remember we have $10.5 billion in the rainy-day fund that can be applied to the remaining $16 billion shortfall. That would reduce the deficit to $5.5 billion right off the bat.
That $5.5 billion could be addressed in numerous ways. They’ve talked about more tax holidays to generate more revenue and allowing casinos/gambling which will also generate significant revenue. Additional spending cuts are a given. Nobody’s arguing that, but again - we’re nowhere near being bankrupt or needing a federal bailout.
"I think it's a number that somebody just reached up in the air and grabbed," Perry said in a TV interview that aired late Thursday.
On Friday, Rep. Jim Pitts, the House's top budget writer, stood by his $18 billion shortfall estimate, which he explained in detail last month while warning colleagues about painful choices they will face next session.