GOVT 2306: Chapter 11- Public Finance in Texas

A balanced budget is required for the state of Texas by the

Texas Constitution.

According to the Welfare Spending Limit,

the state cannot spend more than 1 percent of the state budget during any two-year period on assistance to or behalf of needy dependent children and their caretakers.

According to the authors of your textbook, one important consequence of a biennial (two-year) budget is that

government agencies must project their budgetary needs well in advance of any clear understanding of the particular problems they may be facing.

All corporations in Texas must pay the __________ tax.

franchise

Compared to most other states, per capita state government expenditures in Texas are

among the lowest of all states.

In a progressive tax system,

the wealthy pay a larger portion of their income in taxes.

It is unlikely that Texans will have an income tax in the foreseeable future because

a state constitutional amendment requires that the electorate approve an income tax by referendum.

One way to reduce the regressive nature of the Texas tax system would be to

implement a state income tax.

Stage agencies create their own strategic plan to

provide the information the Legislative Budget Board needs to make funding recommendations.

Texas is regarded as providing a __________ level of government services while having a __________ rate of taxation.

low; low

The Economic Stabilization Fund (ESF), commonly known as the Rainy Day Fund, was established to allow

the state to access additional funds during times of financial distress in the state, with the approval of three-fifths of the members of both the House and Senate.

The General Revenue Funds budget is for

nondedicated revenue that functions as the state's primary operating fund.

The Legislative Budget Board (LBB) was created by a 1949 law to

recommend appropriations for all agencies of state government.

The __________ is the second largest educational endowment in the United States.

Permanent School Fund

The responsibility for preparing an initial draft of the budget belongs to

both the governor and the legislature; Texas has a dual budget system.

The revenue generated by the sales tax is

larger than the revenue generated by any other tax.

The settlement the state reached with tobacco companies

has provided a major source of nontax revenue for the state.

Those who favor the state's current tax system, which has no income tax, argue that it

makes the state attractive to businesses.

What is the consequence of the requirement that the comptroller must certify that all bills proposed in the legislature are within available budget projections?

Texas has a "pay-as-you-go" limit to its budget process.

When the government is authorized to spend a specific amount of money, this is known as

an appropriation