Telethons tend to be high-profile, big-bucks shindigs that generate both awareness of and funding for a particular needy cause.
As needy a cause as Texas’ budget may be, heightened awareness of its woe is hardly needed and it’s difficult to imagine Capitol phones being jammed by kind-hearted donors.
Of course, a Texas Telethon could be quite a spectacle. Imagine music by the Singing Senators, fancy dancing by the Hoofin’ House-folk, a magical money demonstration by the comptroller’s office and, if we’re lucky, a quick-draw demonstration by the governor. Add to that performances by public school children whose teachers are facing layoff, public workers who are themselves facing layoff and ... the possibilities are endless.
It would be one heck of a production, but it’s unlikely many donors would have their heartstrings tugged and checkbook opened sufficiently to tally a telethon take of $27 billion, much less the lower shortfall projection of $15 billion.
In reality, the state is not going to be saved by telethons, bake sales and garage sales on the revenue side or turning down the thermostat, reducing food and entertainment cost, giving up nonessential luxuries and clipping coupons on the expense side — or any combination of the two.
Most Texas families who look down the road into the financial future to see the income is being overtaken by the expense don’t have the option of demanding a bigger paycheck. Most employers in the state are facing the same issues as families, the state and local government.
But that family can get off the path to bankruptcy by a series of small steps: cutting expenses — some of which they’d rather not — and finding small ways to increase income.
Just as the family might have a garage sale and then rent out the garage to the neighborhood punk band for rehearsals, so might the state — in a manner of speaking.
The Legislature did the right thing by taking expenses to the bone. Now, lawmakers are putting back in what we can’t do without. That leaves a gap, and the only way to fill it is to raise revenue. There are a variety of one-time revenue sources — sell some state property, juggle some payments and such — but with tax hikes off the table, the state needs to find some new recurring revenue.
One such source is finding a way to collect sales tax on online purchases. It is estimated the state loses $600 million a year because no one pays sales tax for online purchases from out-of-state vendors. Legally, Texans who make those purchases are obligated to pay use tax in lieu of sales tax. The use tax rate is the same as the sales tax rate.
The problem for the state is out-of-state retailers such as Amazon.com won’t collect tax on sales in Texas and few Texans voluntarily pay the use tax owed. And, with 25 million or so residents being potential use tax scofflaws, the state would need an army of auditors to make collections. The best solution would be the growing trend among states that could force online retailers to collect taxes based on where their customers live.
Add to that $600 million a year the potential of $1.2 billion a year from gambling. Gambling itself is not a cure-all for state finances, but it would keep at home a big chunk of the estimated $2.4 billion a year Texans tote to — and, for the most part, leave at — casinos in neighboring states.
Texans may be willing to roll those dice, according to a Texas Tribune/UT poll that found 56 percent supported it.
Together, online sales tax and gambling could net the state $1.8 billion a year. It wouldn’t plug the budget deficit, but it’s more viable than a telethon.