Gov. Rick Perry today ceremonially signed House Bill 1 from the 82nd Regular Session and Senate Bill 2 from the special session, which provide a balanced budget for the 2012-13 biennium without raising taxes, allocating more than half of state funds to education, and preserving $6 billion in the state's Rainy Day Fund. Provisions in the budget also extend to 2014 the small business tax exemption that was passed in 2009, a measure that Gov. Perry fought to continue and that will keep taxes low for thousands of small businesses across the state. The governor was joined by Rep. Jim Pitts, Rep. John Smithee, Americans for Prosperity-Texas Director Peggy Venable and Liberty Institute President and CEO Kelly Shackelford.
"As the session opened, there was no shortage of voices saying we'd have to raise taxes or bleed our reserves dry to balance our budget," Gov. Perry said. "We know higher taxes kill jobs and hurt Texas families, and we know our Rainy Day Fund might be a lifesaver as natural disasters and an uncertain national economy remain a threat. We followed the directions laid out by voters last November, and balanced our budget by prioritizing and reducing spending without raising taxes. I'm proud of Texas lawmakers' hard work to accomplish this goal, which positions Texas for continued job growth and ongoing prosperity for Texas families in the years to come."
The governor credited Texas' successful approach to job creation and relative economic strength to the tough decisions state leaders have made to keep state spending restrained and taxes low, noting that money does more good in the hands of employers, employees and families than in the hands of government. He also highlighted the importance of maintaining the predictable regulatory climate, fair legal system and world-class workforce that continue to make up the formula for Texas' economic success.
"Passing HB 1 this session was truly the hardest job I have ever had, and we couldn't have done it without the governor's help," House Budget Chairman Jim Pitts said. "We passed a budget that cuts $15 billion in government spending, does not rely on any new taxes, and does not touch the state's Rainy Day Fund."
Additionally, Gov. Perry reiterated his call for a federal balanced budget amendment, which would require Washington, D.C., to follow Texas' footsteps of fiscal discipline, as well as make the tough decisions necessary to restrain out of control spending that has already amassed trillions in debt that future generations will be on the hook to repay. This measure would remove the uncertainty of our nation's financial health, opening the door to the economic growth and job creation our nation needs to prosper.
"The new Texas budget is proof positive that a government can live within its means, even in tough economic cycles," Rep. John Smithee said.
Gov. Perry is the only governor since World War II to sign budgets that reduce general revenue spending from the previous biennium. Under his leadership, Texas has been the nation's job creation capital, creating more than half of America's net jobs in the past two years alone and more private sector jobs in the last 10 years than any other state. Additionally, according to a USA Today examination of data released by the Bureau of Economic Analysis, Texas moved past New York over the past decade to become the nation's second-largest economy. Texas' unemployment rate has also remained well below the national average and in June, Texas added 32,000 jobs, more than any other state.
"While protecting the Rainy Day Fund, Texas legislators balanced our budget without raising taxes - Congress and the federal government could learn from the Lone Star State," Americans for Prosperity-Texas Director Peggy Venable said. "It is not by accident that Texas is a beacon of fiscal responsibility and the top state for job creation. It is thanks to strong conservative leadership and policies that create an environment for prosperity and job growth."
"We are so thankful that Texas is not Washington, D.C., and Gov. Perry and the Texas Legislature have shown the rest of the country how to pass a balanced budget without raising taxes," said Kelly Shackelford, president/CEO of the Liberty Institute. "Fiscal responsibility protects families, brings greater prosperity, and protects our freedoms by not ballooning government. This is why so many people and businesses are moving to Texas."
"Gov. Perry kept his promise to the small-business community when he vowed to extend the million-dollar exemption while passing a budget that did not raise taxes on job creators," NFIB/Texas Executive Director Will Newton said. "Extending the exemption not only helps small businesses struggling to stay afloat; it encourages new entrepreneurs to get their businesses off the ground. We applaud the Governor and the Legislature for sparing 28,000 businesses from a new tax and continuing to make Texas a business-friendly state."