TX GOVT 2306, Chap. 11, Homework, Prof. Clark, DMC

True or False: Texas has a reputation for being a "low service, high tax" state.

False. (Texas has a reputation for being a "low service, low tax" state.)

True or False: The Permanent University Trust Fund was established in 2009 to provide funding to universities seeking to achieve national prominence as research institutions.

False. (The Permanent University Trust Fund was established in 1876 to contribute to the support of the University of Texas and Texas A&M University systems.)

True or False: The Texas debt burden is relatively high compared to that of other states.

False. (The Texas Constitution requires a constitutional limit on the debt of the state. Consequently, the Texas debt burden is relatively low compared to that of other states.)

True or False: The bulk of federal funds expenditures are in two areas: health and human services and transportation.

False. (The bulk of federal funds is dedicated to health and human services and education.)

True or False: UT Austin and Texas A&M receive funds from the National Research University Fund.

False. UT Austin and Texas A&M are already considered to be national research institutions and therefore do not qualify for this fund.

Match the following responsibilities or tasks in the budget process to the office that carries them out. a) collect state taxes b) certify appropriations bills c) exercise a line-item veto after an appropriations bill is passed d) develop a strategic plan for the state e) prepare fiscal notes regarding costs and impacts of proposed legislation f) prepare a general appropriations bill

The Governor: c) exercise a line-item veto after an appropriations bill is passed d) develop a strategic plan for the state The Legislative Budget Board: e) prepare fiscal notes regarding costs and impacts of proposed legislation f) prepare a general appropriations bill The comptroller of public accounts: a) collect state taxes b) certify appropriations bills

True or False: Texas does not have a personal income tax.

True.

Watch the animation on the relative tax burden on Texans of different income levels and determine which of the following statements are accurate. a) Texas's taxes are mostly regressive. b) In terms of a percentage of their income, the richest Texans pay the least state taxes and the poor pay the most. c) Texas's progressive state income tax helps keep the percentage of income paid in taxes relatively equal across different income levels

a) Texas's taxes are mostly regressive. b) In terms of a percentage of their income, the richest Texans pay the least state taxes and the poor pay the most. (Texas has no state income tax, progressive or otherwise, and the percentage of income paid in taxes is not relatively equal.)

Which of the following statements about Texas public financing are correct? a) The state budget involves huge amounts of money. c) A significant amount of state revenues lies outside the direct control of the legislature. b) Federal expenditures shape the state's budget. d) Legislators have a relatively free hand when it comes to making budget cuts.

a) The state budget involves huge amounts of money. b) Federal expenditures shape the state's budget. c) A significant amount of state revenues lies outside the direct control of the legislature. (The number of trust funds and dedicated funds make it difficult for legislators to make changes to many programs. Education funding is one of the few large options for legislators to reduce when needed.)

What is the name of funds in which federal monies go to a state based on that state's spending for a program? a) matching funds b) General Revenue Funds c) bonds d) categorical grants

a) matching funds (One of the largest sources of revenue for Texas is the federal government's matching funds.)

What are the two largest sources of revenue for local government in Texas? a) property taxes b) state income tax c) block grants from the federal government d) sales taxes

a) property taxes d) sales taxes (Though block grants are an important source of state funding, they are not one of the two primary sources.)

Government and public policy in Texas are funded mostly from which of the following sources? a) sales tax b) federal aid c) tourism d) severance taxes on oil and natural

a) sales tax b) federal aid d) severance taxes on oil and natural (Although Texas is a popular tourist destination, revenue from taxes related to tourism do not make up a significant portion of the state's overall revenue. State revenue comes from a variety of sources.)

Study the infographic below on the levels of taxation of different economic groups in Texas, and determine which of the following statements are accurate. a) As a proportion of income, the tax burden falls lightest on the poorest Texans and heaviest on the richest Texans. b) As a portion of their income, the top 1 percent of Texans pay the most in taxes. c) As a portion of their income, the bottom 20 percent of Texans pay more than do the top 20 percent. d) In terms of dollars, the top 1 percent of Texans pay the most in taxes.

b) As a portion of their income, the top 1 percent of Texans pay the most in taxes. c) As a portion of their income, the bottom 20 percent of Texans pay more than do the top 20 percent. (Texans in the top 1 percent pay the most dollars in taxes; however, as a portion of their income they pay the lowest percentage, at 2.9 percent of their total income. Taxes in Texas are largely regressive; the poor in general pay more as a percentage of income in taxes than do wealthier Texans.)

Watch the animation on taxes in Texas and how they compare to other states in America, and determine which of the following statements are accurate. a) Proponents of Texas's current income tax status argue that it helps the state attract more businesses to the state. b) Critics of states that lack state income taxes argue that the tax burden in such states is not distributed equally c) Relatively few states in America do not have a state income tax.

b) Critics of states that lack state income taxes argue that the tax burden in such states is not distributed equally c) Relatively few states in America do not have a state income tax. a) Proponents of Texas's current income tax status argue that it helps the state attract more businesses to the state.

Look at the Budget cycle and determine which of these is correct. a) The budgetary process begins in the governor's office. b) The final stage of the budgetary cycle is with state agencies. c) Both chambers of the legislature process the budget at the same time. d) The budgetary process begins with a public hearing for agencies.

b) The final stage of the budgetary cycle is with state agencies. c) Both chambers of the legislature process the budget at the same time. (The budgetary process begins with instructions to all agencies.The budgetary process begins with instructions to all agencies. The budgetary process is complicated and features many constitutional constraints.)

Which issues will likely continue to dominate public finance in Texas over the next biennium? a) decreasing demand for federal funds for health care b) an increasing population and related needs for increased services c) growing anti-government feeling encouraging cuts in services d) positive economic conditions in the short term

b) an increasing population and related needs for increased services c) growing anti-government feeling encouraging cuts in services d) positive economic conditions in the short term (In all likelihood, there will be an increase in demands that the federal government pay for expanded federal initiatives in health care.)

When it comes to a budgetary surplus, conservative think tanks have suggested which of the following uses? restoring cuts to health care refunds for taxpayers restoring cuts to education increasing spending on classroom needs

b) refunds for taxpayers (Some conservative think tanks in the state argue that a surplus means taxpayers overpaid and should be given a refund.)

Tax rates that place more of a burden on low-and middle-income taxpayers than on wealthier taxpayers are called a) nonreformist taxes. b) regressive taxes. c) progressive taxes. d) marginal propensity rates.

b) regressive taxes. (Regressive taxes do not take into account a person's income. The sales tax is an example of a regressive tax.)

Which constitutional factors affect the way the budget is made in Texas? a) Tea Party restriction on government spending b) restrictions on dedicated funds c) time limits imposed by the biennial legislature d) Pay-As-You-Go Limit

b) restrictions on dedicated funds c) time limits imposed by the biennial legislature d) Pay-As-You-Go Limit (Although many in the Tea Party oppose government spending, their objections are political and not a formal constitutional factor. The length and specificity of the Texas Constitution impose many limits on the budget-making process.)

In which of the following cases did the Texas Supreme Court rule that school districts need to have some meaningful discretion in setting property tax rates? a) Plyer v. Doe b) San Antonio Independent School District v. Rodriguez c) West Orange Cove ISD v. Neeley d) Fisher v. Texas

c) West Orange Cove ISD v. Neeley (Because of West Orange Cove ISD, the legislature required school districts to reduce their school property tax rate to avoid setting a statewide constitutional limit on property taxes. The fallout from West Orange Cove ISD and the insufficient efforts to recoup the lost tax revenue helped contribute to the state budget deficit.)

Which of the following is Texas's general sales tax on retail purchase? a) 7.25 percent b) 9.25 percent c) 8.25 percent d) 6.25 percent

d) 6.25 percent (Texas's sales tax is 6.25 percent. It is the most important single tax financing the Texas government.)

Which process does the legislature use to authorize spending money on programs and services? a) general obligation bonds b) state spending c) revenue bonds d) appropriations

d) appropriations