How Texas funds highways and its impact on other programs during recessions

Texas uses formulas for how much money goes to highways. They are guaranteed a certain portion of the revenue. That could mean less money for other programs that don't have guarantees.

This is from In a coronavirus-induced recession, should highway spending keep its protected status? by MICHAEL TAYLOR of The San Antonio Express-News.

Excerpts:

"The State Highway Fund has an unusual funding mechanism, so here’s a primer on how it works.

Sales taxes are Texas’ largest source of revenue, making up 57 percent of all state revenue. The state is budgeted to collect $35.6 billion this year and is on track, even with lowered expectations, to collect at least $33 billion. But here’s the thing: After sales taxes reach $28 billion, the State Highway Fund automatically gets the next $2.5 billion. This puts it first in line, ahead of all other state spending priorities."

"Oil and gas extraction tax revenue above a certain threshold (based on a level of production set in 1985) gets split between the State Highway Fund and the rainy day fund. Also, 35 percent of taxes on motor vehicle sales and rentals above $5 billion are sent to the State Highway Fund."