Capital Budget Rider Appropriations (APS 026)

Overview

Applicable to

State agencies.

Policy

The Texas Comptroller of Public Accounts (Comptroller’s office) requires state agencies to transfer amounts from their direct appropriations to centrally established appropriations in the Uniform Statewide Accounting System (USAS) to fund their capital budget appropriations. Agencies process payments from these unique appropriations.

Rationale

Transferring capital budget appropriations into different appropriation numbers within USAS allows the Comptroller’s office to:

• Verify appropriations are spent only for capital budget items.
• Track transfers between capital budget line items.
• Approve reappropriation of unexpended balances between appropriation years (AY).

Legal Citation

Government Code, Section 403.011; General Appropriations Act (GAA), Article IX, Section 14.03, 88th Legislature, Regular Session.

Legend

Definitions

Capital Budget

Capital budget appropriations are available for the acquisition of assets with a biennial project cost or unit cost of more than $500,000.

Capital budget expenditures include:

• Acquisition of land and other real property (except for right-of-way purchases made by the Texas Department of Transportation [TxDOT]).
• Construction of buildings and facilities.
• Repairs or rehabilitation of buildings and facilities.
• Construction of roads (except for such expenditures made by the TxDOT).
• Acquisition of information resource technologies (including for purchase or contract for computer time, facility resources, maintenance and training).
• Transportation items.
• Acquisition of capital equipment and items.
• Other lease payments to the Master Lease Purchase Program (for items acquired prior to Sept. 1, 2023, only).
• Data center/shared technology services.
• Centralized Accounting and Payroll/Personnel System (CAPPS) statewide enterprise resource planning (ERP) system.
• Cybersecurity projects.

Capital Budget Riders

Capital budget riders do not make additional appropriations, but are additional restrictions placed on appropriations made by the legislature in the GAA.

These riders identify and limit the types of capital budget items agencies are allowed to purchase during a fiscal year and limit the total amount of appropriation that can be spent for such purposes. Capital budget riders also prohibit agencies from spending capital budget funds for any other purposes.

For most agencies, Rider 2 is the capital budget rider.

Authorized Appropriation Transfers

What is/is Not Allowed?

The GAA, Article IX, Section 14.03 (h) states:

1. An agency may transfer appropriations:
   1. From a non-capital budget item to a capital budget item.
   2. From a capital budget item to another capital budget item.
   3. From a capital budget item to an additional capital budget item not presented in the agency’s bill pattern.
2. Without the approval of the governor and the Legislative Budget Board:
   1. The amounts transferred during a fiscal year as provided by Subdivision (1) of this Subsection (h) may not exceed 25 percent of either:
      1. The amount of the capital budget item, as presented in the agency’s bill pattern from which funds are being transferred or
      2. The amount of the capital budget item, if presented in the agency’s bill pattern, to which funds are being transferred.
   2. Appropriations may not be transferred directly from a non-capital budget item to an additional capital budget item not presented in the agency’s bill pattern.
   3. Appropriations may not be transferred to an additional capital budget item that is not presented in the agency’s bill pattern if that additional capital budget item was presented to a committee, subcommittee or working group of the 88th Legislature but was not adopted by the 88th Legislature.
   4. An agency that does not have a capital budget provision following its items of appropriation in this Act may not use funds appropriated by this Act for capital budget purposes.
3. An agency may not transfer appropriations from a capital budget item to a non-capital budget item without the prior written approval of the governor and the Legislative Budget Board.
4. An agency may transfer appropriations into data center consolidation, data center services, or shared technology services as defined by Subsection (l)(2). An agency may transfer appropriations for data center consolidation or data center services, or shared technology services as defined by Government Code, Section 2054.386 after obtaining the written approval of the Legislative Budget Board.

Note: The base for calculating the 25 percent transfer is the original capital budget amount per item in the GAA.

Unexpended Balances (UB)

The GAA states that unexpended capital budget balances remaining from the first fiscal year of the biennium are reappropriated for the next fiscal year for the same purpose.

Agencies may also have authority to bring forward unexpended balances between years and between biennia based on riders unique to their agency. Unexpended balances of capital budgets between biennia must be coordinated with your appropriation control officer (ACO).

Additional Information

Additional information can be found in the GAA, Article IX, Section 14.03 or in the agency’s bill pattern.

Comptroller Responsibilities

Introduction

The Comptroller’s office assigns and profiles unique appropriation numbers in USAS for each item in an agency’s capital budget rider.

Appropriation Number Assignments

The table below shows how the Comptroller’s office assigns numbers and profiles capital budget rider appropriations.

Appropriation Type	Number Range	Effective Period
2 – Construction	40000 – 49999	AY plus 4 years
1 – Non-construction	50000 – 59999	AY plus 2 years

The second digit of the appropriation number represents the second digit of the legislative session for which the riders are applicable.

Example: Construction

If an agency received one capital budget appropriation from the 88th Legislative Session for construction of buildings and facilities, an appropriation number assigned to it would be 48001.

Agency Requirements

Introduction

Agencies are required to:

• Complete the Capital Budget Allocation Schedule.
• Profile Program Cost Accounts (PCAs) in USAS.
• Transfer amounts representing capital budget from direct appropriations.

Complete Capital Budget Schedules

Each July, agencies are required to complete the Capital Budget Allocation Schedule. For the schedule and a sample of a completed schedule, see Establishing Appropriations by Method of Finance, Rider, Capital Budget and Transfer Schedules (FPP A.020).

Establish Profile PCAs in USAS

Agencies must establish profile PCAs. The PCA indicates the direct strategy program code from where the capital budget is originally appropriated in the GAA.

Multiple PCAs may be established for each capital budget appropriation if combinations of direct strategies, program codes and funding sources are needed.

For more information and guidance on profiling PCAs, read about the Program Cost Account (26) profile in USAS Coding Instructions (FPP Q.010).

Establish Original Budget

Agencies are required to establish original capital budget balances by transferring amounts from their direct appropriations into the newly established capital budget appropriations for the upcoming appropriation year. These original budget transfers are due at the same time as other appropriation budgets.

Process Payments

Agencies are required to record capital budget expenditures in the appropriate capital budget appropriations. Additional information on processing payments can be found in eXpendit.

Transactions to Establish Original Capital Budget

Committed Budgets

To establish a capital budget appropriation with a committed budget, use T-codes 012 and 018. Enter the committed budget transfer in USAS using the coding blocks in the table below.

T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
012/Exp Appn Transfer Out	Direct Appn(s) Determined by Agency	7000	Determined by Agency
018/Exp Appn Transfer In	Capital Budget Appn(s) 40000 – 59999	7000	Determined by Agency

Collected Budgets

To fund a collected budget:

• Move cash/revenue from the direct appropriation(s) if available.
• Deposit cash/revenue directly into the capital budget appropriation.

To establish a capital budget appropriation with a collected budget, add T-codes 015 and 021.

Note: Cash must also be transferred or deposited directly to provide funding.

Enter a collected budget transfer in USAS using the coding blocks in the table below.

T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
015/Rev Appn Transfer Out	Direct Appn(s) Determined by Agency	3000	Determined by Agency
012/Exp Appn Transfer Out	Direct Appn(s) Determined by Agency	7000	Determined by Agency
018/Exp Appn Transfer In	Capital Budget Appn(s) 40000 – 59999	7000	Determined by Agency
021/Rev Appn Transfer In	Capital Budget Appn(s) 40000 – 59999	3000	Determined by Agency

Revenue Transfer for Collected Budgets

Enter the revenue transfer in USAS using the coding blocks in the table below.

T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
406/Rev Transfer Out	Direct Appn(s) Determined by Agency	3970	Determined by Agency
405/Rev Transfer In	Capital Budget Appn(s) 40000 – 59999	3970	Determined by Agency

Cash-Operating Transfer for Collected Budgets

Enter the cash-operating transfer in USAS using the coding blocks in the table below.

T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
404/Cash Oper Transfer Out	Direct Appn(s) Determined by Agency	7968	Determined by Agency
403/Cash Oper Transfer In	Capital Budget Appn(s) 40000 – 59999	3968	Determined by Agency

Increasing Budgets Above Capital Rider Amounts

Agencies may increase budgets for capital items per the limitations listed in Article IX, Section 14.03(h). Appropriation revisions may not be entered to increase budget authority. Follow the procedures for Committed and Collected budgets provided earlier in the Transactions to Establish Original Capital Budget subsection of this Agency Requirements section.

UB Transactions

*Committed Budgets Unexpended Balance Forward

If a capital budget appropriation was established with a committed budget, use T-codes 040 and 042 to move funds forward to the next year. Enter the committed budget unexpended balance forward in USAS using the coding blocks in the table below.

T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
040/UB Exp Transfer Out	Capital Budget Appn(s) 40000 – 59999	7000	Determined by Agency
042/UB Exp Transfer In	Capital Budget Appn(s) 40000 – 59999	7000	Determined by Agency

*Unexpended balances of capital budgets between biennia must be coordinated with your ACO.

*Collected Budgets Unexpended Balance Forward

If a capital budget appropriation was established with a collected budget, add T-codes 041 and 043. Note that cash/revenue must also be transferred to provide funding.

Enter the collected budget unexpended balance forward in USAS using the coding blocks in the table below.

T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
041/UB Rev Transfer Out	Capital Budget Appn(s) 40000 – 59999	3000	Determined by Agency
040/UB Exp Transfer Out	Capital Budget Appn(s) 40000 – 59999	7000	Determined by Agency
042/UB Exp Transfer In	Capital Budget Appn(s) 40000 – 59999	7000	Determined by Agency
043/UB Rev Transfer In	Capital Budget Appn(s) 40000 – 59999	3000	Determined by Agency

*Unexpended balances of capital budgets between biennia must be coordinated with your ACO.

Revenue Transfer Forward for Collected Budgets

To fund collected budgets, remaining cash/revenue must be carried forward.

Enter the revenue transfer forward for collected budgets in USAS using the coding blocks in the table below.

T-code/title	Appropriation Number	COBJ*	Appropriated Fund/Agency Fund/PCA
405/Rev Transfer In	Capital Budget Appn(s) 40000 – 59999	3974/3975	Determined by Agency
406/Rev Transfer Out	Capital Budget Appn(s) 40000 – 59999	3974/3975	Determined by Agency

*The comptroller object for the collected budget portion of the transactions above should be based on the type of funds transferred. Comptroller object 3974 is for federal funds and 3975 is for all other revenues.

Cash-Operating Transfer Forward for Collected Budgets

Enter the cash-operating transfer forward for collected budgets in USAS using the coding blocks in the table below.

T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
403/Cash Oper Transfer In	Capital Budget Appn(s) 40000 – 59999	3986	Determined by Agency
404/Cash Oper Transfer Out	Capital Budget Appn(s) 40000 – 59999	7986	Determined by Agency

Agency Requirements for TPFA Bond Proceeds

Introduction

If proceeds from the sale of bonds is a method of finance (MOF) for an agency’s capital budget, the Texas Public Finance Authority (TPFA) may be involved in the process.

Agencies will coordinate with the TPFA when the need for these funds arises. TPFA will coordinate with the Comptroller’s office to establish fund profiles as necessary.

Original Budgets

Appropriated Fund 0999 may be used initially because the appropriated fund for bond proceeds may not be known at the beginning of the fiscal year when an agency establishes its original budget.

Therefore, when transferring amounts representing capital budget from direct appropriations into the centrally established capital budget appropriations, Appropriated Fund 0999 may be used. See the instructions in the Agency Requirements section on how to transfer a collected budget.

Note: When establishing the D23 Agency Fund for Appropriated Fund 0999, use GAAP Fund Type 04 for Capital Projects.

Budget Reallocation

Once an appropriated fund has been assigned for the bond proceeds, an agency reallocates the MOF from Appropriated Fund 0999 to the MOF fund within the capital budget appropriation(s).

One capital budget appropriation could be financed by several bond funds. A budget reallocation will be needed for each new bond fund.

Enter the budget reallocation in USAS using the coding blocks in the table below.

T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
021R/Rev Appn Transfer In – Reverse	Capital Budget Appn(s) 40000 – 49999	3000	0999/Determined by Agency
018R/Exp Appn Transfer In – Reverse	Capital Budget Appn(s) 40000 – 59999	7000	0999/Determined by Agency
018/Exp Appn Transfer In	Capital Budget Appn(s) 40000 – 49999	7000	Determined by TPFA/Determined by Agency
021/Rev Appn Transfer In	Capital Budget Appn(s) 40000 – 49999	3000	Determined by TPFA/Determined by Agency

Reallocation of Proceeds

Once an appropriated fund has been issued, TPFA will request a coding block from the receiving agency. TPFA will write up an interagency transaction using a Document Type J to transfer the bond proceeds to the receiving agency and send it to TPFA’s ACO. TPFA’s ACO will enter the document and the receiving agency’s ACO should release it. TPFA/Receiving Agency transfer coding information is below.

Agency	T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
347	404 – Cash Oper Transfer Out	Direct Appn(s) Determined by TPFA	7973	Determined by Agency
Receiving Agy	403 – Cash Oper Transfer In	Direct Appn(s) Determined by Agy	3973	Determined by Agency

TPFA transfers a lump sum to the agency. Each receiving agency is responsible for reallocating the proceeds, if necessary. Document Type J to reallocate TPFA receipts within the same receiving agency and AY is listed in the table below.

Agency	T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
Receiving Agy	404	Direct Appn(s) Determined by Agy	7968	Determined by Agency
Receiving Agy	403	Capital Appn(s) 40000 – 49999	3968	Determined by Agency

Use of Existing Proceeds

Under certain conditions, TPFA may direct an agency to use existing bond proceeds (cash in a particular appropriated fund) from one issuance for another capital budget item.

Under these circumstances, the bond proceeds may be moved between appropriations or even appropriation years but will remain in the same appropriated fund. See instructions above for a cash reallocation involving TPFA bond proceeds.

UB Transactions

Collected Budget Unexpended Balance Forward

Enter the collected budget unexpended balance forward in USAS using the coding blocks in the table below.

T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
041/UB Rev Transfer Out	Capital Budget Appn(s) 40000 – 49999	3000	Determined by TPFA/Determined by Agency
040/UB Exp Transfer Out	Capital Budget Appn(s) 40000 – 49999	7000	Determined by TPFA/Determined by Agency
042/UB Exp Transfer In	Capital Budget Appn(s) 40000 – 49999	7000	Determined by TPFA/Determined by Agency
043/UB Rev Transfer In	Capital Budget Appn(s) 40000 – 49999	3000	Determined by TPFA/Determined by Agency

Unexpended Balance

To fund the collected budget in the new appropriation year, any remaining cash must be carried forward.

Enter the cash transfer forward for bond proceeds in USAS using the coding blocks in the table below.

T-code/title	Appropriation Number	COBJ	Appropriated Fund/Agency Fund/PCA
404/Cash Oper Transfer Out	Capital Budget Appn(s) 40000 – 49999	7986	Determined by TPFA/Determined by Agency
403/Cash Oper Transfer In	Capital Budget Appn(s) 40000 – 49999	3986	Determined by TPFA/Determined by Agency

When a capital budget item is completed and cash remains in the appropriated fund at the agency, TPFA initiates a reversal of the original transfer to begin closing the fund.

Lease of Capital Assets

GAA, Article IX, Section 14.03(g) allows agencies to lease capital assets from the amounts appropriated for capital budgets only if the agency to which the appropriation is made provides a report to the Comptroller’s office specifying the sum of the lease payments to be made during the biennium for the capital budget item being acquired. The Comptroller’s office shall reduce the appropriation made by this Act for the capital budget item in an amount equal to the difference between the appropriated amount and the sum of the lease payments for the biennium.