84(R) - 2015
Vote Yes; Amend
Proposing a constitutional amendment to dedicate certain money to the purpose of retiring state debt early.
A fiscal note dated March 17, 2015 anticipates no significant fiscal impact to the State or units of local government.
The cost to the state for publication of the resolution is $118,681.
House Joint Resolution 8 would amend Section 49-g, Article III of the Texas Constitution to require that funds that are normally transferred to the Economic Stabilization Fund, but are diverted to the General Revenue Fund when the Economic Stabilization Fund has reached the maximum constitutional amount of money it can hold, be appropriated only for the purpose of retiring state debt early.
Vote Recommendation Notes
The Economic Stabilization Fund was established as a special fund in the state treasury and serves as a "rainy day" fund. It is funded by transfers from general revenue from oil and natural gas production tax revenues, unencumbered general revenue surplus, interest earned on the fund's balance, and any additional money appropriated to the fund by the Legislature.
Section 49-g (g), Article III of the Constitution caps the maximum balance of the fund for each fiscal biennium at a maximum of 10 percent of the total amount deposited in general revenue during the previous biennium, excluding investment income, interest income, and amount borrowed from special funds. In order not to exceed this cap, any revenues that would normally be appropriated to the Economic Stabilization Fund but are in excess of the cap must currently remain in general revenue.
House Joint Resolution 8 would instead dedicate this excess amount, if any, to retire state debt early.
House Joint Resolution has the potential to reduce the scope of government by reducing both state debt and spending. Instead of leaving extra money to spend to government by leaving these revenues in the general revenue fund, the more responsible choice of using these revenues to retire state debt early would be made.
We support House Joint Resolution 8 but think it would greatly benefit from being amended to include the requirement that any such revenues used to retire state debt early be used in addition to the already existing annual debt service paid from the general revenue fund, and not instead of it.