State coffers overflowing assuring franchise tax cut

The Leghislative Budget Board met this week for a briefing by the State Comptroller's office on the finnancial state of the state.  Everythink is looking good for the Texas economy.  Revenue projections are so good that the 2.5% franchise tax cut will live for another year.  Here's a few interesting facts from the meeting:

  • If Texas were a country, it would have the 12th largest economy in the world, just behind Canada and ahead of Australia.
  • The Texas housing market is better than the US with new housing starts up 9.2% and multi-family houksing starts up 18.4%
  • Existing home sales are approaching an all time peak with housing inventory down to 3.8 months (2.0 months in Austin).  This is the tightest home market in 30 years.
  • Vacancies are below 10% for Class A office space in all Texas major metopolitan markets.
  • Oil and gas prices have been consistent between $95-$100 per barrell for the last three years, exceeding projected expectations (one reason Texas tax revenues are doing very well).
  • The oil and gas boom provides $150 million sales tax revenue per month; that does not include severence taxes.
  • Employment growth is running 3.2% this year and projected to stay at 3.0% in 2015.
  • The unemployment rate continues to decline and is projected to average 5% in 2015.
  • Inflation is expected to continue low beetween 1.5% and 2.0%
  • Texas population growth has been stable at about 1.7% over a number of years and is expected to continue at that rate for the forseeable future.
  • The Rainy Day Fund is expected to total $8.4 billion by the end of FY 2015.
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