DALLAS — Beginning his thirteenth year as governor of Texas, Rick Perry called for a constitutional amendment that would allow $1.8 billion in tax relief and a budget that would use $3.7 billion from the rainy day fund for water and transportation projects.

"Adequate provision for water and transportation infrastructure is one of my top priorities for this budget cycle," Perry noted in his budget presentation.

Perry's proposed budget would dedicate $960 million of available general revenue and $840 million from the Economic Stabilization Fund, commonly known as the "rainy day fund," for tax relief.

According to Texas Comptroller Susan Combs, the legislature will have $101.4 billion available for general-purpose spending in fiscal years 2014-2015, an increase of approximately 12.4% over the current biennium. Perry's budget, including $4.7 billion from the $11.8 billion rainy day fund, comes to $106.1 billion for the two-year period.

Perry said that requiring that State Highway Fund monies only go to transportation would provide about $1.3 billion for road construction and maintenance over two years.

"What I am proposing will support critical water and transportation systems across our state, addresses our needs both short- and long-term, and ensures both water and traffic will continue to flow in Texas for generations to come," the governor said.

Perry also called for legislation allowing universities in South Texas access to the Permanent University Fund that provides annual funds for the University of Texas and Texas A&M University systems. The PUF also guarantees bonds for the two systems.

Perry spoke a day after House Speaker Joe Straus voiced support for the water infrastructure program that is expected to be bond funded. Lt. Gov. David Dewhurst, who presides over the Senate, has also supported the plan.

Texas has grown from 20 million to 26 million since 2000, and that number is projected to swell to 36 million by 2036, Straus said. Complicating the funding for education is the fact that three million of the five million enrolled in Texas public schools are economically disadvantaged and a million speak little English, Straus said.

Perry, who rose from his position as lieutenant governor to replace George W. Bush after he ran for president in 2000, is the longest-serving governor in the state's history and has the second-longest tenure in American history behind Iowa's current Gov. Terry Brandstad. Perry, who was last re-elected in 2010, has indicated that he might seek another four-year term in 2014.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.