In the recently released September issue of Fiscal Notes, the comptroller’s office examines the considerations that went into the preparation of the updated Certification Revenue Estimate (CRE) — and the myriad uncertainties our revenue estimators face. Those uncertainties included the remarkable economic turmoil produced by the COVID-19 pandemic and the subsequent collapse in oil and gas demand, prices and production.
“Predicting the course of Texas’ enormous, complex and dynamic economy is a difficult task in the best of times, and much more so in the face of a truly unprecedented event such as the pandemic,” Texas Comptroller Glenn Hegar said. “At present, the bottom line is that we don’t expect ‘normal’ economic conditions to return this year. Our job is to follow the events and trends that affect the state economy — and to keep our state leaders and Texans at large informed about what we’re seeing.”
The July 2020 forecast relied on a variety of social, economic and even psychological assumptions about the country’s recovery, including the question of whether social gathering limitations and other restrictions will be lifted before the end of 2020. It remains unclear, for example, whether state or local officials will order more restrictions on social gatherings or business operations.
“We have to consider human behavior,” Hegar said. “Even when restrictions are lifted or loosened, when will people feel safe going to the movies again? When will they feel comfortable packing into stadiums or attending conferences and conventions? It’s difficult to predict how consumers will respond in the aftermath of such unprecedented events."
This special edition of Fiscal Notes is the second issue exploring the economic impact of COVID-19 on the Texas economy. View the May 2020 Recessions and Revenues edition for a look at how Texas has fared in past recessions.
Fiscal Notes furthers the comptroller’s constitutional responsibility to monitor the state’s economy and estimate state government revenues. It has been published since 1975, featuring in-depth analysis concerning state finances and original research by subject-matter experts in the comptroller’s office.
For questions about how the agency functions are continuing during the outbreak, visit the COVID-19 News page or the Virtual Field Office. Fiscal Notes is available online and can be received by subscribing via the comptroller's website.