Texas Must Spend Less to Tax Less

Originally published on Substack.

​​Texas leaders are finally talking about spending restraint. That is welcome. But Texans should not confuse a smaller agency request with a smaller government.
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Governor Greg Abbott, Lt. Governor Dan Patrick, and Speaker Dustin Burrows recently directed most state agencies⁠ to reduce their base budget requests by 3% for the 2028–29 biennium.

Abbott promised “strict standards of efficiency and accountability,” Patrick said the guidance would keep Texas on a “fiscally conservative path,” and Burrows called it the baseline for a conservative budget focused on affordability and property tax relief. Those are worthy goals.

Now comes the hard part: proving it.

Three Percent of What?

A 3% reduction sounds substantial until taxpayers ask the obvious question: 3% below what?

Is the “base” last session’s agency request, the amount lawmakers appropriated, actual spending, or some administratively adjusted figure? The announcement does not make that comparison clear enough.

That matters because agencies are not being ordered to cut state spending by 3%. They are being asked to request 3% less from a baseline, while retaining the ability to seek additional money through exceptional items. Public education, Medicaid caseload growth, debt service, employee benefits, and education savings accounts are among the major exemptions.

Without clear accounting, agencies and lawmakers could maneuver around the target, increase total appropriations, and still claim a fiscal victory during an election year.

Texans deserve transparent budgeting that shows, side by side, the last appropriation, current estimated spending, the proposed appropriation, and the population-growth-plus-inflation benchmark.

Compare Apples to Apples

The correct comparison is appropriations to appropriations, not spending in one period against appropriations in another. Mixing those measures is an apples-to-oranges comparison that can disguise government growth.

On an apples-to-apples basis, state funds appropriations increased 42% over the last two budget cycles, while population growth plus inflation increased about 25%.

As I said in our joint statement from fiscal conservatives⁠, spending has substantially outpaced the average taxpayer’s ability to pay. Without actual appropriations cuts, the 3% request policy risks becoming “window dressing for political points in an election year.”

Jeramy Kitchen put it well: the goal should not merely be a smaller request but “restoring a culture of fiscal responsibility.” Bill Peacock noted that state funds appropriations have risen $110 billion, or 78%, over ten years, feeding a system organized around special interests. JoAnn Fleming was even more direct: conservatives did not fight merely to slow government growth. “We fought to shrink government.”

Property Taxes Still Rise

State leaders also cite $51 billion in property tax relief. But policymakers should explain exactly how that figure is calculated.

It is not all school district maintenance and operations rate compression. It also includes homestead exemptions and other tax preferences. Those are not economically equivalent.

Broad-based compression lowers rates for everyone. Exemptions narrow the tax base, shift burdens among property owners, and require more state tax revenue to finance the same level of government.

Meanwhile, total local property tax levies reached $89.4 billion in 2025, up roughly 22% since 2021. Historic “relief” alongside rising total levies tells us the underlying problem remains: excessive state and local spending.

Cut the Budget, Then the Tax

Texas can eliminate school district M&O property taxes through recurring surpluses dedicated to permanent rate compression. But those surpluses should come from disciplined budgeting, not temporary revenue windfalls or larger tax collections elsewhere.

Lawmakers should cut appropriations, keep future growth below population growth plus inflation, eliminate lower-priority programs, and strengthen state and local spending limits.

Real fiscal conservatism is not measured by press releases or shifting baselines. It is measured by a smaller government, lower tax burdens, and more freedom for Texans.

Spend less. Tax less. Let Texans prosper.