AUSTIN) — Texas Comptroller Glenn Hegar announced today he recently completed the transfer of more than $2.91 billion into the State Highway Fund (SHF) and the Economic Stabilization Fund (ESF; commonly known as the “Rainy Day Fund”). Each fund received nearly $1.46 billion, or 50 percent of the total transfer.
“The Rainy Day Fund and the State Highway Fund are key components of Texas’ long-term economic success and help provide the foundation needed for our future growth,” Hegar said. “Texas is experiencing a strong economic recovery, and our population continues to boom as more and more people and businesses seek out the jobs and opportunities created here in Texas. We must continue to invest in the infrastructure needed to maintain our fiscal health and keep our economy growing while at the same time acknowledging the uncertainty that remains and setting aside dollars to ensure we can weather future downturns.”
Texas bases the transfer amounts on crude oil and natural gas production tax revenues above 1987 collections. If either tax generates more revenue than the 1987 threshold, Texas transfers a sum equal to 75 percent of the excess.
In November 2014, voters approved a constitutional amendment allocating at least half of these severance taxes to the ESF. The remainder went to the SHF for use on non-toll highway construction, maintenance, and right-of-way acquisition.
According to the Texas Constitution, the ESF transfer must occur within 90 days after the end of the fiscal year. When fiscal 2021 ended on Aug. 31, the ESF balance was $10.3 billion.
With this most recent transfer, the new balance will be about $11.4 billion, not accounting for the currently outstanding spending authority of approximately $1.43 billion. As a result, the balance in the ESF will change as agencies spend down this remaining appropriation authority and realize the investment earnings.