CPPP Defends LBB Dynamic Model of Proposed Budget from Attack by TTARA

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Scott McCown /(512) 320-0222 x 109

March 30, 2011

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On March 29, 2011, Dale Craymer of the Texas Taxpayers and Research Association wrote Chairman Pitts criticizing the Legislative Budget Board’s dynamic impact statement for Committee Substitute House Bill (CSHB) 1, suggesting that it is not a useful tool for evaluating the proposed budget. In fact, the dynamic impact statement is a very useful tool and suggests that an alternative that takes a balanced approach using rainy day dollars and adding new revenue is preferable to CSHB 1. As we explain briefly in this letter, spending rainy day dollars from the Economic Stabilization Fund to avoid cuts in state spending is a way to increase revenue without a tax increase, and there are other ways to increase revenue that are better for the economy than cutting state spending.