A continuing deterioration in the Texas economy has put Democratic Gov. Mark White on a collision course with his campaign promise to avoid raising taxes.
Last week, for the third time this year, White and state legislators were told that previous estimates of available revenues for the 1984-85 biennial budget were too high, making it almost certain that Texas will be forced to institute its first tax increase since 1971.
Last Thursday, state comptroller Bob Bullock slashed his revenue estimate by an additional $953 million, blaming the decline in world oil prices, the continued slump in the domestic oil industry and the ripple effects of Mexico's devalued peso.
Last January, only days before White was inaugurated, Bullock cut his September, 1982, revenue projection by $1.5 billion, and in March he lopped off $867 million.
The multiple revenue reductions are the result not only of the weakened Texas economy, with an unemployment rate of 9 percent, but also new projections that suggest the economy here may continue in the doldrums after other states begin to bounce back.
Tony Proffitt, director of tax estimating and research for the comptroller's office, blamed the situation on oil and gas. Texas, he said, is "an energy-producing state more so than we wanted to believe."
Every $1 decline in the price of oil costs the state $40 million in taxes, Proffitt said. As a result, declining oil prices have forced down revenue projections. The latest revenue estimates are based on an assumption that crude oil prices in Texas will average about $25 a barrel in fiscal 1984, with only modest growth in fiscal 1985.
In addition, the devaluation of the Mexican peso continues to devastate retail trade, especially along the border, where sales in some cities have declined more than 60 percent.
Between March and April, the comptroller's forecast of sales tax revenues fell $660 million.
The latest revenue forecasts would still leave Texas legislators about 8.6 percent more money for the 1984-85 biennium than the 1982-83 biennium, and will allow the state to end the current 1982-83 budget year with a surplus of $630.5 million.
But when compared to the budget proposals offered by White and by the state's Legislative Budget Board (LBB), the arithmetic becomes much gloomier.
Bullock's latest estimates leave the legislative budget about $2.4 billion in the red. White's budget, presented to the legislature in March, now shows a potential deficit of about $2.2 billion.
The Texas constitution prohibits deficit financing.
White called the new revenue forecasts "overly pessimistic," and said actual revenues might be higher. Since January, however, he has been backpedaling from his oft-stated campaign pledge to avoid new taxes, while at the same time adhering to his recommendation to raise teacher salaries a minimum of 24 percent.
In his March budget, he skirted the tax issue by offering the legislature various "alternatives" for balancing the budget, such as raising luxury taxes, financing highway construction through revenue bonds or cutting some programs. But he refused to recommend which course the legislature should follow.
Last week he repeated his belief that if taxes need to be raised, the legislature should begin with his luxury tax.
But others here, led by Democratic Lt. Gov. Bill Hobby, are advocating a significant increase in taxes, including a sales tax hike and higher taxes on oil and gas production. A 1 cent hike in the sales tax would raise about $2 billion during the 1984-85 biennium.
Naturally, politics are involved in the fight. Democrat Bullock already has announced he will run for governor in 1986, and each revenue forecast has been greeted with skepticism by White's supporters, who believe Bullock is attempting to maneuver the governor into an embarrassing reversal on the tax issue.
Some here believe White cannot avoid confronting the tax issue much longer. They say that the man who ran against the economy in last fall's election may soon find he can no longer run from it.