State revenues take $1 billion hit due to oil and gas industry

A welded-steel fence blocks the entrance to a closed man-camp in the 80-acre tract called Rancho Agave in Carrizo Springs, Texas, Wednesday, February 11, 2015. A drop in the price of crude oil has led to lower prices at the pump for consumers. The price went from a high of over $100 to around $50 per barrel of oil. less A welded-steel fence blocks the entrance to a closed man-camp in the 80-acre tract called Rancho Agave in Carrizo Springs, Texas, Wednesday, February 11, 2015. A drop in the price of crude oil has led to lower ... more Photo: JERRY LARA, San Antonio Express-News Photo: JERRY LARA, San Antonio Express-News Image 1 of / 36 Caption Close State revenues take $1 billion hit due to oil and gas industry 1 / 36 Back to Gallery

AUSTIN — Texas’ fiscal picture is nearly $1 billion worse than State Comptroller Glenn Hegar predicted when he lowered his revenue projection last year, thanks largely to the faltering oil and gas industry.

“Overall, it continues to be a drag on the overall state economy and the overall receipts into the state treasury,” Hegar said in an interview with the San Antonio Express-News, noting that effects of the oil-and-gas industry’s struggles ripple beyond areas where the energy business is concentrated.

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The state still has enough money to support the current two-year state budget, which passed its halfway point when the state closed the books on the 2016 fiscal year on Aug. 31, Hegar said. That’s because lawmakers left several billion dollars unspent when they crafted the spending plan last year.

The savings proved fortuitous when Hegar revised his revenue estimate last October, predicting that tax collections over the two-year budget period would be $4.6 billion less than his original forecast at the start of 2015.

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But tax receipts and other revenues combined in fiscal year 2016 fell a total $960 million more than even that revised estimate, Hegar said.

That total reflects tax collections that were $1.6 billion less than anticipated — such as sales and oil-and-gas tax revenues — offset by higher-than-expected income in areas including the lottery and vendor drug rebates to the state, according to Hegar’s office.

Of the total, $651 million is a dip in money that’s available to support general spending. The overall lagging revenues also put another dent in money available for transportation and for the state rainy day fund.