Senior Politics Writer
AUSTIN __ A proposed $336.1 billion state budget advanced in a key Texas Senate committee Wednesday, setting it up for a floor debate as soon as next week as lawmakers figure out how to spend taxpayers’ money for the next two years.
Passing a balanced spending plan for the 2026-27 cycle, which starts in September, is the only task the Texas Constitution requires lawmakers to do during their regular biennial legislative session.
The House will put forth its own spending plan in the coming weeks, and then the two chambers will negotiate over key differences. The final budget bill will be sent to Gov. Greg Abbott for his signature, expected in June.
Here are key takeaways from Senate budget writers’ initial proposal, known as Senate Bill 1.
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The bill includes $6.5 billion for property tax relief, including $3 billion to increase the homestead exemption to $140,000, up from $100,000.
Another $3.5 billion would be used for tax compression on the school district level. Abbott made property tax cuts a cornerstone of his agenda for the last two sessions after Texas reported some of the highest rates in the country.
Budget writers included $10 billion across 29 state agencies for mental health programs and services, including new or expanded inpatient hospitals and new mobile youth crisis outreach teams.
The largest chunk of the budget focuses on public schools. The bill funds the Foundation School Program, which directs funding to schools, at $70 billion. The funding includes $5.1 billion earmarked for teacher pay and $500 million for school safety and security.
Abbott has stressed his top priority this session is to pass a voucherlike proposal that would funnel public dollars to private schools.
Officials estimate an education savings account program would cost the state about $1 billion in its first year, the 2026-27 school year. That money is included in the budget bill.
Budget writers included $6.5 billion to continue Operation Lone Star, Abbott’s border security mission that has cost the state $11 billion since it was created in 2021.
Most of the funding would be divided between Abbott’s office, the Texas Military Department, which oversees the Texas National Guard, and the Texas Department of Public Safety, which sends troopers to the border from other parts of the state.
The funding proposal includes the creation of more than 560 new commissioned officers for DPS to help with staffing problems created in the agency by Lone Star.
More money would flow to the state’s criminal justice efforts, which would help fund pay raises for corrections officers as well as retention and recruiting efforts to address staff shortages
SB 1 includes $9.8 billion for the Texas Department of Criminal Justice, an increase of 13% over last cycle, and nearly $1 billion to the Texas Juvenile Justice Department.
The bill adds $850 million to establish a Texas State Technical College endowment fund to support capital projects.
Abbott has made career and technical training a priority agenda item this session.
The bill includes $35.8 billion for highway projects, planning, design and construction across the state.
About $100 million would pay for 550 additional employees at state driver license offices. Lawmakers have spent the last few years trying to solve the long wait times at the offices, where appointments for licenses and renewals can involve wait times up to weeks or months, depending on the location.
Karen Brooks Harper has covered Texas politics in and out of Austin for nearly 30 years. She's also covered the cartel wars along the TX-MX border, Congress in Mexico City, and 6 hurricanes, among other stories. Raised on blues and great food in the MS Delta, she lives in ATX with her family, her guitar, and her boxing gloves. In that order.
