Texas Senate chamber

The Texas Senate chamber at the Texas Capitol on Aug. 16, 2017.

AUSTIN — The Texas Senate approved a plan to spend $117.9 billion in state general revenue and billions more in federal and other funds after a pandemic-induced economic collapse never materialized.

Sen. Jane Nelson, Finance Committee chair, of Flower Mound, said years of conservative fiscal policy and smart investments helped Texas to weather a year of Covid restrictions that heavily impacted some sectors of the state economy.

"Throughout last year, things were looking pretty bleak," she said. "But never underestimate Texas. We have proven our resiliency time after time, and because of our commitment to smart fiscal policy, we are able to bring forward a budget that will keep Texas strong, safe, healthy and prosperous."

In all, the budget approved by the Senate will spend $250.7 billion in state, federal and other funds, and slightly increases state revenue spending by 2.6% — well within constitutional spending limits, Nelson said.

Maintaining funding commitments to public education and teacher pay were a major concern coming into this session when the state's economic picture still looked uncertain. In 2019, the Legislature passed sweeping education spending reforms, putting billions more into schools and teacher salaries. Senate Education Committee chair Sen. Larry Taylor of Friendswood, who carried that measure in the Senate, said the bill increased teacher pay an average of $5,200 for educators with five or more years of service. An incentive pay program created to let districts find and pay bonuses to their best teachers paid out $40 million to nearly 4,000 teachers, an average increase of more than $10,000 in annual pay for those skilled educators. Those programs remain fully funded this session, Taylor said.

The bill also maintains last session's $1,000 increase for the basic allotment, the main variable used in the school funding formula, and increases total education spending $3.1 billion over the last biennium to keep up with expected enrollment growth over the next two years.

The budget approved Tuesday does not include any money from the $1.9 trillion aid package approved by Congress in early March. The state is expected to receive just under $17 billion in direct aid, with another $10 billion going directly to local municipalities and a $12.2 billion chunk of funds for education spending. The session ends May 31, and it's looking increasingly unlikely that the funds will arrive before lawmakers go home for the interim.

One factor in the delay is a lack of clarity about federal requirements that come with those funds. As state officials work to get that clarity, Nelson said it isn't wise to accept funds when we don't know what strings are attached.

"We also need to be very, very cautious about committing and obligating funds when we don't know all the details because we cannot have that money clawed back and be on the hook for expenditures," she said.

As to the interim question, Nelson said there are a few options she and others are considering to ensure lawmakers have input in how federal aid dollars are spent between the end of this session and January 2023. Appropriations Committee chair Rep. Greg Bonnen of Friendswood, Nelson's counterpart in the House, has filed a measure which would create a special panel consisting of the speaker of the house, the lieutenant governor and the chairs and vice-chairs of each chamber's budget committees. This panel could meet during the interim and would have a say over what federal aid funds the state accepts. Should it clear the House, Nelson said she expects to carry that bill in the Senate.

The Senate reconvened at 11 a.m. today.

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