Budget Busters
 

  System Benefit Fund Increase

Should the State of Texas continue to charge a fee on your monthly utility bill for the purpose of reducing utility rates for select customers?

The System Benefit Fund is paid for by a fee on your monthly utility bill and is used to operate the Public Utility Commission. In the current biennium, the appropriation for the system benefit fund increased $67.7 million, or 24.2%. The appropriation increase was used to increase the Low-Income Discount Program subsidies, the largest line-item in the Public Utility Commission budget. The Low-Income Discount program provides for an average $37 rate decrease for an estimated 420,000 electricity users in Texas at a cost of $132.3 million in increased fees on utility bills.
     


  Lottery Retail Commissions and Marketing

Should the State of Texas continue to spend 5% of the total lottery revenues to provide retailer commissions and marketing to increase the number of lottery tickets sold?

The amount of money spent on retailer commissions in the 2010-2011 budget is $190.7 million total and $60 million in media marketing. The retailers that sell the most number of lottery tickets receive the most amount of money from this fund. The majority of the lottery ticket sales, however, are in low-income neighborhoods in which the average resident cannot afford to play the lottery on a daily basis. The residents in the areas in which the most number of lottery tickets are sold in Texas spend as much as 3% of their total income on the lottery, on average. Encouraging lottery sales in these areas through retailer commissions means there is less money circulated in the local economy and more money. In addition, this is an additional $250.7 million that could be used for public education, which is the stated intent of the Texas Lottery.
     


Budget Fixers
 

  Education Tax Credits

Do you support the use of education tax credits to create scholarship opportunities for students in the public education system and save the state money?

Education tax credits are used in ten other states to allow individuals and corporations to donate money to provide scholarships for deserving children to attend the school of their choice. Donations to scholarship funds are deducted from state taxes and provided directly to the student through a qualified non-profit organization. The students who choose to attend a private school using the scholarship fund would no longer be counted for school finance purposes, so the school districts would be able to save money. Various studies compiled by the Texas Public Policy Foundation have concluded that Texas could save as much as $500 million per year if an education tax credit program were enacted.
     


  Zero-Based Budgeting

By common practice, there are five different types of approaches to use as a starting point for a state budget: zero-based budgeting, current-services budgeting, program-based budgeting, traditional/incremental budgeting, and performance-based budgeting.

Each biennium, the budget must be based from some number that is generally accepted by the Governor, the Legislature, and the agencies. The definition of the base figures are the starting point for the negotiations during the Legislative Session and the basis for the final budget that is ultimately approved by the Legislature, Comptroller, and Governor.

Zero-based budgeting is intended to disregard current spending and agency operations so the budget for each agency can be "built from the ground up" each biennium. Policy makers would be required to analyze, scrutinize, and justify each program and the effectiveness of the agency each biennium. This form of budgeting is also known as "building blocks" so the Legislature can fund the core functions of each agency starting from a budget of zero each biennium.
     


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