Conservatives in the Texas Legislature opposed to tapping the state’s rainy day fund to make ends meet in a tight budget have argued that a high balance in the savings account is necessary to protect Texas’ sterling credit ratings.
But for Comptroller Glenn Hegar, the biggest threat to the state’s credit is a $33.5 billion and growing liability to the two major state pension systems – and the best way to solve that problem down the road might be to use money from the rainy day fund, which is the largest of its kind in the country.
“Long-term balance sheet issues don’t need to be resolved today, and ironically that’s one of the reasons they tend to get pushed a little bit further and a little bit further,” said Hegar, adding that as the “CFO of Texas” it’s his responsibility to sound the alarm about the growing pension problem.
As lawmakers jostle over whether to tap the rainy day fund this year, Hegar is pitching an ambitious restructuring of the fund that could change the debate in future years.
Excerpt by: Sean Collins Walsh – American-Statesman Staff