Texas Forecasts $194.6 Billion Budget for 2026-27

Texas lawmakers will have $194.6 billion available for general-purpose spending during the 2026-27 biennium, as outlined by Texas Comptroller Glenn Hegar's biennial revenue estimate. This represents a slight decrease of 1.1% compared to the previous budget cycle, attributed to a smaller beginning balance rather than a drop in revenue. Sales taxes remain the largest revenue source, expected to account for 61% of tax collections, with a 9% increase projected over the next two years. The state's Economic Stabilization Fund, or Rainy Day Fund, is anticipated to exceed its constitutional cap for the first time, providing additional funds for general spending. Despite the positive financial outlook, Hegar cautions lawmakers to consider the economic challenges faced by Texans due to rising costs of living. The 89th Texas Legislature is required to pass a balanced budget during its 140-day session, which begins with more than 2,400 bills already filed.