Enrolled Bill Summary

Senate Bill 1, the General Appropriations Act, appropriates almost $113.8 billion for the FY2002-FY2003 fiscal biennium beginning September 1, 2001. That amount, from all funding sources except interagency contracts, reflects an expenditure increase of 11.6 percent over FY2000-FY2001. Of the biennial appropriations, $66.2 billion, or 58.2 percent, is derived from general revenue, both dedicated and undedicated. Another $34.8 billion, or 30.6 percent, comes from federal funding.

Education receives almost $48.7 billion, an increase of 7.6 percent over the preceding biennium, and includes $452.2 million to cover a projected deficit in the Teacher Retirement System of Texas health insurance fund. Of the $35 billion appropriated for health and human services, $25 billion is for the Medicaid program and includes $1.3 billion for Medicaid caseload growth and annualization of 2001 rates, $206.1 million to cover a less favorable federal matching rate than in the preceding fiscal biennium, and $392.1 million to fund a 24th Medicaid payment in the fiscal biennium, rather than 23 payments as were appropriated for in the last biennium. Total funding for health and human services represents a 17.1 percent increase.

Business and economic development, including transportation, is funded at $13.9 billion, an increase of 9.1 percent over the preceding biennium. Public safety and criminal justice receives $8.3 billion and includes $146 million for salary increases and to extend the career ladder for correctional officers, parole officers, and other correctional personnel. Total funding for public safety and criminal justice represents an increase of 2.5 percent. Natural resources receives $2 billion, an increase of two percent. That funding includes $179.7 million to the Texas Natural Resource Conservation Commission for petroleum storage tank remediation and program administration.

Senate Bill 1 satisfies all four constitutional spending limits. The "pay-as-you-go" limit, which requires comptroller certification that certain expenditures are within available revenue, is below the limit by $100 million. The rate of growth of certain appropriations from undedicated state taxes, which is limited to the estimated rate of growth of the state's economy, is $1.6 billion below the spending limit, excluding contingency appropriations, and will still be below the limit if all contingency appropriations are certified. The limit on the amount of state funds that may be spent on welfare grants to needy dependent children and their caretakers is one percent of the state budget in the biennium, or $1.138 billion. The amount appropriated to Temporary Assistance for Needy Families for the biennium is $243.2 million, or $894.5 million less than the one percent limit. Debt service payable from general revenue, excluding certain constitutionally dedicated revenues, is limited to no more than five percent of the average annual unrestricted general revenue for the three preceding fiscal years. The estimated level for FY2002 is 1.6 percent.