Under Joe's leadership, the Texas House has kept the state on a fiscally prudent course by controlling spending, reducing taxes, and saving billions of dollars in reserves. Texas continues to have one of the leanest and most efficient budgets of any state in the country.
With Joe at the helm, the Texas House has put the state on sound fiscal footing by:
Limiting spending. When the national recession caused a severe budget shortfall in Texas in 2011, Joe insisted that the House balance the state budget by reducing spending instead of raising taxes. When the national economy improved, the House continued to show considerable fiscal restraint. In the 2013 and 2015 legislative sessions, the House took a significant step toward ending that practice by reducing or eliminating fees and ensuring that more of the money the state collects is used as promised.
Reducing taxes. In the 2015 legislative session, the Legislature reduced taxes by more than $4 billion. The Texas House led the way in reducing the state's margins tax by 25 percent across the board. The Legislature also increased the homestead exemption, providing needed relief for rising property taxes, and abolished an annual fee on hundreds of thousands of Texas professionals. Under Joe's leadership, the House has also approved significant tax relief for small businesses by increasing the small-business exemption in the margins tax.
Staying beneath the spending cap. During each legislative session that Joe has been Speaker, the House has kept spending beneath the limit spelled out in the Texas Constitution. That limit says that spending cannot grow faster than the economy. In fact, the House has resisted efforts to weaken the spending cap.
Protecting the Rainy Day Fund. Under Joe's leadership, the House has consistently put more revenue into the state's Rainy Day Fund in order to protect against a severe economic downturn or a natural disaster. The Legislature has put billions of additional dollars into the Rainy Day Fund during Joe's time as Speaker, and the balance of the Fund is projected to exceed $11 billion at the end of the current budget cycle. This robust reserve fund has also helped the state maintain a strong credit rating. In addition to the money in the Rainy Day Fund, the Legislature left about $5 billion in General Revenue unspent in the most recent session, which will also help legislators respond to future changes in economic conditions.
Increasing transparency. Since 2012, Joe and his House colleagues have made it a priority to ensure that the taxes and fees collected by state government are used for their intended purpose. For more than 20 years, the state consistently and increasingly collected fees for a specific purpose, but instead of using that money as promised to taxpayers, it was held in the state treasury so it could be counted to balance other areas of the budget. For example, a fee that was assessed on some electric bills in order to help pay for a utility discount for low-income Texans was instead used to justify spending on other programs. In the 2013 and 2015 legislative sessions, the House took significant step toward ending that practice by reducing or eliminating fees and ensuring that more of the money the state collects is used as promised.