More Cuts? State Agencies Told to Submit Budgets Minus 10 Percent

More cuts may be on the way to the budgets of state agencies like Texas A&M.

Tuesday, Governor Rick Perry, Lieutenant Governor David Dewhurst and Texas House Speaker Joe Straus directed all state agencies to prepare a budget proposal for Fiscal Year 2014-2015 that would feature 10 percent reductions from their current budget levels.

Click here to see the letter from the Legislative Budget Board to state agencies

Click here to see the LBB's instructions

"Unlike Washington where spending increases are automatic, Texas has maintained a balanced budget by forcing government to look for savings first – ensuring taxpayers' hard-earned money is put to its highest and best use," Dewhurst wrote in a statement.

Agency leaders were also told their Fiscal Year 2013 budgets could face additional cuts.

For FY 2014 and 2015, the agencies were told to show how they would reduce baseline requests by that 10 percent, but in five percent increments, for both general revenue funds and general revenue dedicated funds.

"These instructions offer important guidance as we plan for the next biennium," Straus said in a statement of his own. "While our revenue growth has been healthy this year, we must plan conservatively, which is why we have asked agencies to hold the line on spending. By identifying possible spending reductions in the next biennium, agencies can prioritize their most critical functions and programs. These instructions will also leave us prepared for a slowdown in revenues as the national economy struggles to recover. I look forward to working with state agencies as they identify efficiencies and plan responsibly for our state's future."

The office of Governor Perry issued the following statement Tuesday afternoon:

SAN ANTONIO – Gov. Rick Perry today announced the Governor’s Office and Legislative Budget Board (LBB) have directed state agencies to develop their legislative appropriations requests for the 2014-2015 biennial budget, including identifying 10 percent savings (in five percent increments) in general revenue-related funding. The governor discussed the directive and his commitment to keeping Texas on the path to prosperity at a discussion about the Texas economy hosted by the Greater San Antonio Chamber of Commerce and emceed by talk radio host Joe “Pags” Pagliarulo.

“Every two years, state leaders and agencies take a fresh look at our budget to ensure each taxpayer dollar is spent efficiently by our state government to keep Texas the best place to live, work, raise a family and start a business,” Gov. Perry said. “Identifying potential savings early in the budget process reiterates our ongoing commitment to the responsible fiscal policies that have made Texas the epicenter of job creation in the U.S., including keeping our taxes low, spending in check and government running efficiently.”

The Governor’s Office and LBB letter provides a starting point for state agencies as they prepare their budget requests for the 83rd Legislative Session, and is similar in scope to directives provided by leadership in previous years to begin the budget writing process. Requests must be submitted to the Governor’s Office and LBB by the end of August.

The directions in this letter support the priorities Gov. Perry has outlined in the Texas Budget Compact to ensure the state remains committed to fiscally responsible governing:
1) Practice truth in budgeting
2) Support a Constitutional limit of spending to the growth of population and inflation
3) Oppose any new taxes or tax increases, and make the small business tax exemption permanent
4) Preserve a strong Rainy Day Fund
5) Cut unnecessary/duplicative government programs and agencies

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