The Texas budget for 20 I0-11 has been filed as legislation, and it's more than $2 billion in the red.

Lawmakers have a long way to go before the budget becomes final, but if it looks like the version filed in the state Senate on Tuesday, lawmakers will either have to borrow $2.3 billion from the so-called rainy-day fund or cut state services by that amount.

"This initial budget meets my top priorities by holding the line on state spending, continuing the record local school property tax cuts and funding essential services for the most vulnerable in our society," Lt. Gov. David Dewhurst said.

The main state share of the proposed budget is $83.8 billion.

Comptroller Susan Combs has projected $80.1 billion in available revenue. That means there's a $2.3 billion hole, plus a $1.4 billion shortfall that could result from a constitutional spending cap, tied to investment returns, from a key education fund.

The budget includes $1.5 billion to pay for enrollment growth in Medicaid, the Children's Health Insurance Program, education and prisons.

In addition, the proposal would pour an additional $2.2 billion into public education and more money into transportation and an overhaul of the state's residential facilities for the mentally disabled.

Projected state revenue over the next two-year budget cycle is down as a result of weaker consumer spending.
Lawmakers will start the budget period with about $6.7 billion in the rainy-day fund.

State law does not allow deficit spending. Spending from the fund, which is estimated to grow to $9.1 billion by the end of the 20 IO-ll budget cycle if left untouched, requires a two-thirds vote of both chambers of the Legislature. Public education and healthcare services are the most expensive state-funded programs.

Sales tax receipts, which make up the biggest chunk of state revenue, are still growing, but at a slower pace.