Proposed Budget - Fiscal Years 2026-2027
On February 2, Texas Governor Greg Abbott released his budget priorities for the fiscal 2026-2027 biennium. Funds available for general-purpose spending for the fiscal 2026-2027 biennium are estimated at $194.6 billion, a 1.1 percent decrease from the 2024-2025 biennium. General revenue-related funds are estimated at $176.4 billion for the fiscal 2026-2027 biennium. Revenue from all sources is estimated to total $362.2 billion for the biennium. The Economic Stabilization Fund (ESF) is projected to be $28.5 billion at the end of the fiscal 2026-2027 biennium.
Proposed Budget Highlights
The governor’s budget priorities center around making Texas more affordable, achieving educational excellence, supporting a healthier Texas, making investments in energy, bolstering infrastructure, expanding the state’s economy, and strengthening public safety. Recommendations include the following:
Making Texas More Affordable
- Return funds to taxpayers by way of property tax relief.
- Require two-thirds voter approval for all property tax rate increases at all local government entities and that all property rate elections be held on the November uniform election dates.
- Raise the Business Personal Property exemption to support more small businesses.
Achieving Education Excellence
- Establish a Universal Education Savings Account program to allow funding to follow the student to the educational setting of their parent’s choice.
- Invest in teaching professionals by increasing compensation, including expanding the Teacher Incentive Allotment.
- Expand access to high-quality educator preparation programs and improve teacher supports in the classrooms.
- Reform the special education funding system to better ensure all students receive needed services.
- Provide additional funds for safety enhancements to school facilities and to increase the School Safety Allotment.
- Expand career preparation options available to students in high school by increasing funding for K-12 career and technical education, strengthening career exploration and advising programs, and investing in strategies to improve math performance.
- Provide funds for the Texas Education Agency (TEA) to increase staffing capacity for complaints and investigations to rapidly address complaints of statutory violations and inappropriate employee conduct in Texas schools.
- Direct funds to the Strong Foundations program to improve access to instructional materials and help ease teachers’ workloads.
- Increase the charter facilities allotment for the next biennium.
Higher Education
- Support the formula funding recommendation made by the Texas Higher Education Coordinating Board (THECB) for community colleges for the 2026-27 biennium.
- Support the THECB’s request on financial aid that will increase financial predictability, achieve education portability, and sustain academic achievement for Texas students.
- Appropriate additional funding to support Texas State University and the University of North Texas moving to Level 1 funding.
- Implement the recommendations of the Healthcare Workforce Taskforce and consider investments in unfunded grant programs to increase the number of nurse faculty and preceptors in the state.
- Explore opportunities to provide a reliable and stable funding source for institutions to expand master’s and doctoral healthcare professional programs in the state.
Supporting a Healthier Texas
- Make additional investments in behavioral health services and supports for children in the state with the most complex needs.
- Fund a new case management system to be the System of Record to improve agency operations and outcome for the children, adults, and families served by the Department of Family and Protective Services (DFPS).
- Fully fund the Healthy Texas Women program.
- Appropriate additional funds to support the continued recruitment and retention of community attendants.
- Support continued access to life-saving opioid reversal medications through the successful naloxone distribution program at The University of Texas Health Science Center at San Antonio.
- Invest funds to maintain and enhance the successful One Pill Kills campaign.
Critical Investments in Energy
- Fully fund all Texas Energy Fund (TEF) programs to further expand and enhance grid reliability in Texas.
- Create the new Texas Nuclear Development and Deployment Fund.
Bolstering State Infrastructure
- Create the Texas Cyber Command to better anticipate cyber threats, defend against and respond to cyberattacks, and promote cyber awareness.
- Invest in the state’s water infrastructure by appropriating a one-time investment to programs at the Texas Water Development Board (TWDB) and creating an ongoing dedicated revenue source for Texas water projects.
- Continue to fund the Port Access Account Fund and the Ship Channel Improvement Revolving Fund to allow for critical improvements to keep Texas ports competitive and spur further economic growth.
- Approve funding for at-grade rail crossings and distribute funding to local governments to enhance the safety and economic efficiency for at-grade crossings.
Expanding the State’s Economy
- Provide additional funding to the Texas Moving Image Industry Incentive Program (TMIIIP) to ensure Texas remains competitive in the film industry.
- Direct additional funds to the Texas Semiconductor Innovation Fund (TSIF) to further strengthen and solidify Texas’ leadership in semiconductor manufacturing.
- Appropriate additional funding to the Space Exploration and Aeronautics Research Fund (SEARF) to strengthen Texas’ competitive edge in the rapidly growing aerospace sector and further establish the state as a global hub for aerospace innovation.
- Reauthorize and fund the remaining six business court regions.
Strengthening Public Safety
- Continue funding border security until the federal government assumes operational control to keep Texans safe.
- Establish and fund a grant program administered by the Governor’s Public Safety Office that would provide local Texas law enforcement agencies with funding to install bullet-resistant windshields in their vehicles.
- Open the Texas Law Enforcement Peer Network (TLEPN) program to additional first responders and expand its funding to meet the growing needs of those it serves.
- Provide funding to support programs focused on recruiting high-quality applicants and retaining the brave officers that keep our communities and schools safe.
- Consider providing funding for the state to purchase its own aviation resources to respond to future disasters.
- Increase operational support for the Texas Veterans Commission (TVC) to provide high-level quality assistance in every aspect of veteran needs.
- Appropriate funds to ensure the Texas Emergency Services Retirement System (TESRS) is on a path towards actuarial soundness and becomes fully solvent.