Perry Tells State Agencies to Cut Even More

Gov. Perry announced today that state agencies should be prepared to cut 10% from their budget requests for the next biennium. Though the Legislature will write the budget when it convenes in January, budget requests from agencies serve as a starting point for legislators to make their decisions.

There are some exceptions to this mandate, including school finance, some aspects of Medicaid, the Children's Health Insurance Program, eligibility staffing at Health and Human Services and state pensions and benefits.

This directive comes on the heels of a 5% budget cut for state agencies in the current biennium, as well as a pledge from Speaker Straus that there will be no new taxes during the next session.

Texas is facing a projected $18 billion deficit for the next budget cycle. Because the Texas Constitution mandates that the state budget be balanced, Texas will either have to make significant cuts to services or find ways to raise revenues, through taxes and fees. Some legislators have suggested that gambling legislation could also raise revenue.