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Texas Budget Bill Could Tap Rainy-Day Fund

DALLAS — The Texas Senate Finance Committee approved a two-year, $176.5 billion budget Thursday that could draw up to $3 billion from the state's rainy-day fund.

The proposal will be considered this week by the full Senate.

The budget bill calls for spending $12 billion more than the $164.5 billion measure adopted March 23 by the House and $7 billion less than the current biennial budget.

Unlike the House budget, the Senate version would draw $3.1 billion from the $9.4 billion rainy-day fund unless state Comptroller Susan Combs certifies that much additional revenue is available before the end of the fiscal 2012-2013 budget.

The Senate bill includes $80.7 billion of general fund spending, up from $77.6 billion in the House-approved measure but $1.4 billion less than the fiscal 2010-2011 budget.

The House has already approved taking $3.1 billion from the rainy-day fund to balance the current budget.

The Senate will consider the supplemental budget bill this week, along with the Finance Committee's two-year budget.

The Senate version contains a $4.3 billion revenue shortfall, but Finance Committee chairman Steve Ogden, R-Bryan, said the revenue picture could change as lawmakers consider measures to bring in more money.

"It doesn't generously meet the needs of Texans, but I think it's adequate," Ogden said. "I'm going to fight for this bill."

Drawing on the rainy-day fund is essential to balancing the two-year budget, according to Ogden.

He said the fund would total $5 billion to $6 billion at the end of the next biennium, even with the withdrawal of $3.1 billion now and another $3 billion over the next two years.

The rainy-day fund will serve "as a backstop" if revenues are not sufficient, Ogden said.

"I think we're right, and we're going to fight for this," he said. "This is not politics, in my view. This is our best effort to do the best we can on behalf of the state."

Gov. Rick Perry has said he would not sign a budget bill balanced by the rainy-day fund.

Rep. Jim Pitts, R-Waxahachie, chairman of the House Appropriations Committee, said there is not the two-thirds majority in the House needed to tap further into the fund.

The committee also adopted a school funding plan that will cut $4 billion from current spending, compared to $7.8 billion in the House bill.

Neither bill provides additional funding for an expected 180,000 new students over the next two years.

The school aid bill, sponsored by Senate Education Committee chairwoman Florence Shapiro, R-Plano, amends the funding formula to make cuts from 1% to 8% in state aid to local education.

She said most of the state's 1,014 districts will see cuts in their state funding of 5% to 7%.

"This bill is about meeting a financial crisis and shares this downturn in all districts," Shapiro said.

Ogden said it was essential to maintain state spending on public education at or near current levels.

"I think this bill has the potential for saving public education in Texas," he said. "If we don't pass it, public education is in big trouble."

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