Texas this fiscal year will "have more money in reserve than the other 49 states combined."
Texas Lt. Gov. Dan Patrick, Feb. 25 in a radio interview
Texas state Comptroller Glenn Hegar issued his two-year state revenue forecast in January, in which he said the state's rainy-day fund will have a balance of nearly $8.5 billion when fiscal 2015 ends. Per Patrick's statement, then, all the other states together should be expecting to end their 2015 fiscal years with less than $8.5 billion, combined.
A fall 2014 report by the National Association of State Budget Officers initially had us thinking Patrick was on to something. In the Fiscal Survey of States, a section headlined "Year-End Balances" said that, generally, states have made progress rebuilding budgetary reserves since revenues plummeted during the Great Recession of 2009-10. State budgets passed into law for the 2015 fiscal year show reserve balances nationally totaling $53.1 billion, the report said. And, the report said, "a disproportionate share of state budget reserves are concentrated in Alaska and Texas, which account for $20.6 billion, or 38.8 percent, of states' reported total balances in fiscal 2015."
For more perspective, we sought guidance from the Pew Charitable Trusts, which in July issued a report on how states might build rainy-day funds. By email, spokeswoman Sarah Leiseca passed along analyst Brenna Erford's conclusion that Patrick got it wrong.
At the moment, per Pew, Texas has $10.3 billion in reserve funds (rainy-day funds plus ending balances) providing enough for state government to operate for 79.1 days. "The only state with more reserve funds currently is Alaska, with $13.3 billion, providing enough for the state to operate for 181.9 days," Erford said.
Going forward, Erford noted, the NASBO fall 2014 report indicates Texas projecting a reserve balance of about $8 billion through the end of the 2015 fiscal year, which would run second to the projected year-end reserves for Alaska, $11.4 billion. "According to these data, the sum total of reserves in California, New York, Ohio, Massachusetts, Florida and Indiana is greater than Texas' reserves, providing clear evidence, Alaska withstanding, that Texas' reserves are not more 'than the other 49 states combined,' " Erford said.
With a nudge from Michael Leachman, a state budget expert at the Center on Budget and Policy Priorities in Washington, we spotted charts in the NASBO report indicating the 50 states together in fall 2014 were projecting 2015 fiscal year-end reserves, meaning regular balances plus rainy day fund set-asides, of about $53 billion — with Texas accounting for $10.7 billion of that and Alaska $10 billion. An adjoining chart indicates Texas ending fiscal 2015 with $8 billion in its rainy-day fund alone compared with other states together winding up with about $34 billion in such funds.
Texas appears to have bigger balances than many states. But its predicted totals don't dwarf all other states' projected savings combined.
After we looked over the charts, Patrick's office told us he made "an unintentional error" in the radio interview. By email, spokesman Alejandro Garcia said Patrick takes pride in the state stockpiling reserves, but he meant to talk up jobs created in Texas versus jobs created in all other states combined "as he ad-libbed the comment."
Indeed, what he celebrated turned out to be incorrect and ridiculous.
We rate it Pants on Fire!
W. Gardner Selby, PolitiFact Texas
Edited for print. Read the full version at PolitiFact.com.