Texas Parks and Wildlife warns Fund 9 could go negative by 2029; seeks $40 million biennial plug and longer-term fixes

The Texas Parks and Wildlife Department told its commission on May 27 that the agency’s primary operating account for fisheries, wildlife and law enforcement — Fund 9 — is on an unsustainable path and could reach a negative balance by fiscal year 2029 without intervening measures.

“Based on current revenue and expense projections, the general unrestricted portion of Fund 9 will reach a negative balance as early as fiscal year 2029,” Executive Director David Yoskowitz told the commission. He said the cause is a long period of relatively flat license sales combined with rising operating costs and inflation since the last fee increase in 2010.

Chief Financial Officer Reggie Pegues gave a fiscal snapshot showing the department expended $855.6 million in FY25 and that Fund 9 provided roughly $174 million of that total. He said law-enforcement costs take a disproportionate share of the unrestricted Fund 9 balance because many other revenue streams are statutorily restricted to specific divisions.

Pegues described the department’s projections: “Expenditures are based on continued FY26 and FY27 levels and revenues based on current estimates,” he said, explaining that under those assumptions the general Fund 9 sub-account declines steadily and is forecast to be negative within the next three budget cycles.

To stop the decline, staff recommended three broad strategies: stricter expense controls, reassigning some costs to general revenue, and increasing revenue. Yoskowitz and Pegues said a plausible near-term package is a one-time biennial "plug" of roughly $40 million combined with an ongoing revenue improvement of about $7.5 million per year to sustain program delivery.

Options under consideration include a method-of-finance swap that would shift some game-warden and cybersecurity costs to the state’s general revenue (reducing pressure on Fund 9), modest license fee adjustments, targeted taxes used for natural-resource purposes, and efforts to reduce license churn. Yoskowitz cited other states’ approaches — one-time infusions in Tennessee and New Mexico, and dedicated taxes in Missouri and Oregon — as possible models to study.

Commissioners pressed staff on specifics. Several members favored exploring tying license fees to the consumer price index to avoid periodic large increases that can depress participation. Michelle Diaz, director of communications, described a multi-channel "drip" renewal campaign (email, text) the agency already uses to recover lapsed customers; data presented to the commission showed a 57 percent churn rate for fishing licenses and a 43 percent renewal rate in that cohort, a target staff said could yield material gains if improved.

Chief Operating Officer Craig Bonds said the agency has investigated an automatic renewal feature but faces technical and legal barriers tied to how payment information can be tokenized and stored under state procurement and information-technology rules. Staff said they will keep pursuing solutions and return to the commission in August with additional analysis on CPI-indexing, the lifetime-license pricing model, and potential revenue sources such as transfers from Fund 64.

Chairman Paul Foster directed staff to prepare a legislative and budget strategy incorporating a range of options and to report back with quantified estimates. No formal policy change was adopted at the meeting; several related rule- and budget-authority items were placed on later agendas for public comment or publication of proposed rules.