AUSTIN – The Texas Public Policy Foundation urged the Texas House of Representatives to pass HB 2785 by Rep. Ken Paxton (R-McKinney), scheduled for floor debate later today. The bill would provide an additional 9-cent property tax cut on top of the 50-cent cut passed during last year’s special session.

“I have been around this process long enough to understand that whatever money is kept in Austin gets spent by Austin,” said the Honorable Talmadge Heflin, a Visiting Research Fellow at the Foundation and a former chairman of the House Appropriations Committee. “We will have plenty of money left after meeting the state’s fundamental needs, and we should send at least some of that back to the taxpayers.”

Some legislative leaders have expressed reservations that the state might face a budget deficit in 2009 if they were to cut taxes now. To rebut that concern, the Foundation has produced longer-term budget projections that show not only that Texas will have a multi-billion dollar cash balance after passing HB 2785 and HB 735 (the repeal of the TIF phone tax), but that the Legislature would return in 2009 to an even larger cash balance than it will finish this session if it doesn’t.

“The state has a $14.2 billion cash balance and the state’s economy is strong,” said Byron Schlomach, the Foundation’s Chief Economist. “The only reason not to cut taxes now is to support bloated spending in the future.”

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