Texas Statutes
Subchapter A. Limit on Growth of Appropriations
Section 316.002. Duties of Legislative Budget Board

Sec. 316.002. DUTIES OF LEGISLATIVE BUDGET BOARD. (a) Before the Legislative Budget Board transmits the budget for the next state fiscal biennium as prescribed by Section 322.008(c), the board shall establish:
(1) the limit on the rate of growth of appropriations from state tax revenues not dedicated by the constitution for that state fiscal biennium, as compared to the previous state fiscal biennium, based on the estimated rate of growth of the state's economy from the current state fiscal biennium to the next state fiscal biennium; and
(2) the limit on the rate of growth of consolidated general revenue appropriations for that state fiscal biennium, as compared to the previous state fiscal biennium, by subtracting one from the product of:
(A) the sum of one and the estimated average biennial rate of growth of this state's population during the state fiscal biennium preceding the biennium for which appropriations are made and during the state fiscal biennium for which appropriations are made; and
(B) the sum of one and the estimated average biennial rate of monetary inflation during the state fiscal biennium preceding the biennium for which appropriations are made and during the state fiscal biennium for which appropriations are made.
(b) Except as provided by Subsection (c), the board shall determine the estimated rate of growth of the state's economy for purposes of Subsection (a)(1) by dividing the estimated Texas total personal income for the next state fiscal biennium by the estimated Texas total personal income for the current state fiscal biennium. Using standard statistical methods, the board shall make the estimate by projecting through the biennium the estimated Texas total personal income reported by the United States Department of Commerce or its successor in function.
(c) If a more comprehensive definition of the rate of growth of the state's economy is developed and is approved by the committee established by Section 316.005, the board may use that definition in calculating the limit on the rate of growth of appropriations from state tax revenues not dedicated by the constitution under Subsection (a)(1).
(d) Except as provided by Subsection (e), the board shall determine for the next state fiscal biennium a limit on the amount of:
(1) appropriations from state tax revenues not dedicated by the constitution by multiplying the amount of appropriations from state tax revenues not dedicated by the constitution for the current state fiscal biennium by the sum of one and the limit on the rate of growth of appropriations from state tax revenues not dedicated by the constitution established by the board under Subsection (a)(1); and
(2) consolidated general revenue appropriations by multiplying the amount of consolidated general revenue appropriations for the current state fiscal biennium by the sum of one and the limit on the rate of growth of consolidated general revenue appropriations established by the board under Subsection (a)(2).
(e) If the rate determined under Subsection (a)(2) is a negative number, the amount of consolidated general revenue appropriations for the next state fiscal biennium may not exceed the amount of consolidated general revenue appropriations in the current state fiscal biennium.
(f) To ensure compliance with this subchapter and Section 22, Article VIII, Texas Constitution, the Legislative Budget Board may not transmit in any form to the governor or the legislature the budget as prescribed by Section 322.008(c) or the general appropriations bill as prescribed by Section 322.008(d) until the board adopts:
(1) the limit on the rate of growth of appropriations from state tax revenues not dedicated by the constitution under Section 316.001(b); and
(2) the limit on the rate of growth of consolidated general revenue appropriations under Section 316.001(c).
(g) In the absence of an action by the Legislative Budget Board to adopt the limits as provided by this section:
(1) for purposes of Section 316.001(b):
(A) the estimated rate of growth of the state's economy from the current state fiscal biennium to the next state fiscal biennium shall be treated as if it were zero; and
(B) the amount of state tax revenues not dedicated by the constitution that could be appropriated within the limit established by the estimated rate of growth of the state's economy shall be the same as the amount of those appropriations for the current state fiscal biennium; and
(2) for purposes of Section 316.001(c):
(A) the estimated average biennial rates of growth of this state's population and of monetary inflation shall be treated as if they were zero; and
(B) the amount of consolidated general revenue appropriations that could be appropriated within the limit established by that subsection shall be the same as the amount of those appropriations for the current state fiscal biennium.
Acts 1985, 69th Leg., ch. 479, Sec. 1, eff. Sept. 1, 1985. Amended by Acts 1991, 72nd Leg., 1st C.S., ch. 4, Sec. 19.01, eff. Aug. 22, 1991.
Amended by:
Acts 2011, 82nd Leg., R.S., Ch. 91 (S.B. 1303), Sec. 11.002, eff. September 1, 2011.
Acts 2021, 87th Leg., R.S., Ch. 437 (S.B. 1336), Sec. 1, eff. September 1, 2021.