Chapter 11

Question 1

Texas is considered a _________________ state.

Answer 1

low tax–low service

Question 2

The Texas Constitution requires the state to maintain a

Answer 2

balanced budget.

Question 3

The “pay-as-you-go limit” in the Texas budgeting process means

Answer 3

that the comptroller must certify that all bills proposed in the legislature are within available budget limit projections.

Question 4

In theory, Texas has a “dual-budget” system, which means that the responsibility for preparing an initial draft of the budget is shared by the ____________ and the ____________.

Answer 4

governor; legislature

Question 5

The organization that was created by a 1949 law to recommend appropriations for all agencies of state government is the

Answer 5

Legislative Budget Board (LBB).

Question 6

The most important single tax financing by the Texas government is the

Answer 6

sales tax.

Question 7

One of the attractive features of Texas to businesses has always been the absence of a(n) _____ tax.

Answer 7

income

Question 8

Supporters of an income tax in Texas argue that it would

Answer 8

reduce the regressive nature of the Texas tax system, which falls too heavily on lower-income individuals.

Question 9

Next to taxes, the second largest source of revenue for Texas is

Answer 9

federal funds.

Question 10

Texas’s largest single state expenditure is that for

Answer 10

public education.

Question 11

The second-largest expenditure by the state is for

Answer 11

health and human services.

Question 12

The _____ budget is a nondedicated revenue account and is Texas’s primary operating fund where most state taxes and fees flow.

Answer 12

General Revenue Funds

Question 13

Many of the funds in the Texas state budget lie

Answer 13

outside the direct control of the state legislature.

Question 14

Among the 50 states, where does Texas rank on per capita state government expenditures?

Answer 14

at the bottom

Question 15

In order for a personal income tax to be put in place in Texas,

Answer 15

the measure would have to be approved by voters in the state first.

Question 16

At 6.25%, the state sales tax in Texas is

Answer 16

one of the highest in the country.

Question 17

A major source of nontax revenue comes from

Answer 17

a settlement the state reached with tobacco companies.

Question 18

The official name of the Rainy Day Fund in Texas is actually the

Answer 18

Economic Stabilization Fund.

Question 19

The _____ Fund was established through a state constitutional amendment in order to provide funding for universities seeking to achieve national prominence as research institutions.

Answer 19

National Research University

Question 20

According to the authors of the textbook, probably the biggest constraint on the budgetary process has to do with

Answer 20

time limits.

Question 21

The Welfare Spending Limit in Article III, Section 51a of the Texas Constitution provides that the amount of money the state pays to or on behalf of needy dependent children and their caretakers not exceed _____ percent of the state budget in any biennium.

Answer 21

one

Question 22

The Texas legislature addressed the 2011 budget crisis by

Answer 22

making spending cuts concentrated in education and health care.

Question 23

Which office is responsible for advising the Texas governor on fiscal matters?

Answer 23

the Governor’s Office of Budget, Planning, and Policy

Question 24

What information provides the basis for the Legislative Budgeting Board’s funding recommendations for each state agency?

Answer 24

the agency’s strategic plan

Question 25

Aside from the Great Recession, what was the other major cause of the financial shortfall faced by the 2011 state legislature?

Answer 25

property tax reform