DALLAS — Texas will not be able to resolve a $4.3 billion revenue shortfall by the end of fiscal 2011 through budget cuts, state Comptroller Susan Combs warned legislators Thursday.

She said the budget-balancing options available to lawmakers include spending reductions, delaying state aid to local school districts until fiscal 2012, and tapping the rainy-day fund.

Testifying before the House Appropriations Committee at the request of chairman Jim Pitts, R-Waxahachie, Combs said previous Legislatures had drawn the budget stabilization fund down to zero without causing chaos or damaging the state’s bond ­rating.

“I don’t know how you’d get to $4.3 billion through cuts alone,” she said. “I really don’t know how you’d do it. There’s no free lunch. The rainy-day fund was established for a rainy day. The question is not should it ever be used. The question is to what ­extent.”

The fund, which was established in the late 1980s, currently contains $8.2 billion but is expected to grow to $9.4 billion by the end of the next biennial state budget on Aug. 31, 2013.

Pitts has introduced a bill to take $4.3 billion from the rainy-day fund to balance the current budget. That would allow the state to use $4.3 billion of revenue in the fiscal 2012-13 ­biennium.

Combs said resolving the $4.3 billion shortfall in fiscal 2010-11 would address part of the projected shortfall of $27 billion over the next two years.

If the extra money is not available, Combs said, the rainy-day fund would be tapped to repay $7.8 billion of one-year tax revenue anticipation notes issued by the state in August 2010.

The constitutional amendment establishing the rainy-day fund also requires the fund to be tapped to pay those notes, the comptroller said.

“We have to pay that money back,” Combs said. “We have to pay our bills. I will pay our bills.”

Texas borrows billions every August to make payments to local districts, and then repays the notes as revenues come in, she said.

“It is a cash-flow thing,” Combs said. “Most states do this. Unlike other states, we just do one big one a year rather than four to 10 over the 12 months.”

Combs said the size of the rainy-day fund is only a minor factor in determining the state’s bond rating. Drawing down the fund would have very little effect on Texas’ issuer ratings of triple-A from Moody’s Investors Service and Fitch Ratings, and AA-plus from Standard & Poor’s.

“There is no magic number below which we cannot go and maintain those ratings,” she said. “We’ve always gotten good ratings, but we have to maintain our obligations.”

The rainy-day fund fell to $8 million in fiscal 1994 and was almost depleted in 2003, according to Combs.

“The rating agencies look more at the willingness of the Legislature to resolve revenue shortfalls, and the overall conservative nature of state spending,” she said. The rainy-day fund has not been tapped since 2003.

John Heleman, director of the comptroller’s revenue estimating division, attributed most of the current budget gap to a $3.8 billion shortfall in state sales taxes, which account for 64% of all state tax collections.

The rainy-day fund receives revenue from Texas’ oil and gas production taxes.

Pitts said he expects the Appropriations Committee this week will consider his bill to take $4.3 billion from the rainy-day fund. He said if lawmakers approve the measure, he would not propose using the fund in fiscal 2012-13.

“I feel like this is our one bite of the apple,” Pitts said.

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