Five Percent Biennial Reduction Plans Target Funding for Grants to Local Governments

June 26, 2020

Legislative News

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The Legislative Budget Board has provided additional guidance about plans to reduce the state budget for the current biennium. In anticipation of a revenue shortfall for the current and upcoming biennial budget, state leaders in May directed state agencies, appellate courts and institutions of higher education to submit plans to reduce their current budgets by 5%. The instructions for the plans identify reduction categories, including one for grants, loans and pass-through funds to cities and counties. State-funded grants and pass-through funds that may be subject to 5% reductions include funding for indigent defense, community supervision and corrections departments, equipment and training for volunteer fire departments, and various criminal justice and public safety grants. According to the letter sent by Gov. Greg Abbott, Lt. Gov. Dan Patrick and Speaker Dennis Bonnen, behavioral health programs are exempt from the 5% reductions. This exemption presumably extends to grants to county jails and local mental health/behavioral health authorities for mental health and substance abuse services.

Reductions that conflict with the Texas Constitution or federal law are prohibited. However, reductions that require statutory changes are permitted. It is likely such reductions would be contingent on legislation enacted by the 87th Legislature when it convenes in January 2021.

As more information becomes available, TAC staff will provide updates regarding 5% reduction items that target counties. For information, email Zelma Smith.