Water plan still has no fund­ing

Fund

Austin American-Statesman - - COMMUNITY NEWS - Con­tin­ued from B

da­tion.

De­whurst’s rec­om­men­da­tion fits within Perry’s Texas Bud­get Com­pact, a con­ser­va­tive fis­cal agenda the gov­er­nor an­nounced ear­lier this year.

“An ad­e­quate Rainy Day Fund is crit­i­cal to our abil­ity to re­spond to and re­cover from dis­as­ters and emer­gen­cies, whether they’re nat­u­ral or man-made,” the com­pact states.

“When we do pay money out of the fund, it’s im­por­tant it be used ex­clu­sively for one-time­only needs, and never be tapped sim­ply to meet on­go­ing ex­penses.”

The Leg­is­la­ture cre­ated the Eco­nomic Sta­bi­liza­tion Fund in 1987 from oil and gas taxes to deal with swings in the state’s econ­omy due to the un­sta­ble price of pe­tro­leum prod­ucts. Law­mak­ers have drawn from the fund in 12 of the past 22 years.

In 2003, Perry and the Leg­is­la­ture nearly drained the fund when the Texas econ­omy suf- fered and tax rev­enues plum­meted. The fund was last tapped in 2011 when Perry and law­mak­ers used $3.7 bil­lion to make up a bud­get deficit, a move re­quired by the Texas Con­sti­tu­tion.

But tap­ping the fund to cre­ate an in­fra­struc­ture devel­op­ment bank is more in keep­ing with how Repub­li­cans want to use the fund in the fu­ture. Perry tapped the Rainy Day Fund to cre­ate his Texas En­ter­prise Fund in 2003 and his Emerg­ing Tech­nol­ogy Fund in 2005.

Perry uses those funds to per­suade com­pa­nies to open shop in Texas or in­vest in promis­ing star­tups al­ready in the state.

A well-de­signed water in­fra­struc­ture devel­op­ment bank could be­come a self-sus­tain­ing way for Texas to pre­vent ma­jor water short­ages as the state’s pop­u­la­tion con­tin­ues to sky­rocket.

A water plan ap­proved last year by the Texas Water Devel­op­ment Board said the state should even­tu­ally spend $53 bil­lion over the next half-cen­tury on new reser­voirs, dams, pipe­lines and wells. So far the Leg­is­la­ture has not set aside a penny to im­ple­ment the plan.

The bank could be­come a re­source for lo­cal gov­ern­ments dur­ing the early devel­op­ment of new water re­sources. Those gov­ern­ments could even­tu­ally pay back the bank through their con­struc­tion bud­gets, De­whurst

The bank could be­come a re­source for lo­cal gov­ern­ments dur­ing the early devel­op­ment of new water re­sources.

said.

Texas is also fac­ing a trans­porta­tion cri­sis af­ter years of shrink­ing in­come from fuel taxes and $17 bil­lion in bor­row­ing for road build­ing. Rather than raise fuel taxes, the Repub­li­can­con­trolled Leg­is­la­ture has been al­low­ing the Texas De­part­ment of Trans­porta­tion to cover its bud­get with voter-ap­proved bond money, an ap­proach that will end next year when the last of that money runs out.

Fi­nally, there is an­other good rea­son to tap the fund: It could max out. The Texas Con­sti­tu­tion lim­its the fund to 10 per­cent of gen­eral rev­enue col­lec­tions and the present limit is $12.1 bil­lion. Once the fund reaches its limit, those oil and gas rev­enues start go­ing into the state’s nor­mal cof­fers.

Tap­ping the fund for a spe­cial pur­pose gives the state’s lead­er­ship greater con­trol over how the money will be spent.

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