State Representative Gina Hinojosa, the Democratic candidate for governor, has pledged to distribute $1,500 checks to every Texas household from the state’s rainy day fund if she is victorious against Governor Greg Abbott in the upcoming November election.
During a press event held on Tuesday outside Pyburn’s Farm Fresh Foods in Houston’s South Union neighborhood, Hinojosa declared, “The government is broken. It is more, right now, a burden than a help for people. That changes when I’m governor.”
The proposed $1,500 rebate program, which Hinojosa has labeled a “corruption tax refund,” is estimated by her campaign to cost the state $17 billion. This funding would be sourced from Texas’ rainy day fund, officially known as the Economic Stabilization Fund, which serves as the state’s savings account and currently boasts a record balance of $24.8 billion as of November 2025.
Hinojosa’s rebate initiative would require legislative approval and would utilize approximately two-thirds of the current balance, leaving around $10 billion in reserves. Her campaign referenced estimates from the comptroller’s office indicating the fund is projected to grow by approximately $2.5 billion to $3 billion annually, alongside historical data showing the account maintained around $10 billion for several years before significantly increasing after 2022.
“It’s never been hoarded the way it currently is,” she stated, emphasizing that there is no economic rationale for retaining such funds. “This money should be in our economy in Texas.”
In her challenge to Abbott, Hinojosa has adopted a populist approach, accusing him of prioritizing the interests of wealthy donors over the needs of average Texans. Her policy announcement marks the beginning of a week filled with campaign events aimed at demonstrating how the $1,500 checks could assist working families.
Meanwhile, Abbott has centered his campaign for a fourth term around a comprehensive property tax reduction strategy. He proposes eliminating school property taxes for homeowners, enforcing stricter limits on property value increases, and making it more challenging for local governments to raise taxes, even amid regional growth. Although he has largely overlooked Hinojosa during his campaign appearances, he has criticized Democrats for opposing the property tax relief measures he and other Republicans argue would enhance affordability.
Abbott’s campaign did not provide a response to Hinojosa’s proposal when requested for comment.
Recent public opinion polls indicate Abbott holds a lead over Hinojosa by approximately six percentage points. In contrast, the U.S. Senate race between Democrat James Talarico and Republican Ken Paxton is currently tied. Abbott remains a powerful candidate, with an impressive $96 million in campaign funds as of the end of February, compared to Hinojosa’s $617,000. Despite this, Texas Democrats are optimistic that a favorable political climate, driven by dissatisfaction with the Trump administration, rising living costs, and anti-incumbent sentiment, could enable them to secure a statewide seat for the first time since 1994.
In detailing her proposal, Hinojosa accused Abbott of “hoarding” funds in the rainy day account and positioned her plan as a means to provide essential relief to Texans while ensuring the state retains necessary financial reserves. She vowed to declare the “affordability crisis” an emergency on the first day of her administration, allowing state lawmakers to address the rebate proposal promptly when the legislative session commences in January.
“There is one fight in this country, and the fight is this: Is this going to be a state that is by and for the people, or is this the billionaires’ world and we just live here?” Hinojosa remarked. “This helps to give Texans what they need right now to be able to afford to live and thrive in Texas.”
Established in 1988, the rainy day fund was designed to assist Texas in navigating variable economic conditions. Primarily funded through oil and gas tax revenues, the account has experienced significant growth in recent years, with projections from the Texas comptroller’s office indicating it could surpass the cap on its balance, potentially reaching $28.5 billion by the end of fiscal year 2027.
The Texas Constitution imposes a limit on the fund’s maximum balance, determined by a formula based on the amount of general revenue deposited during the preceding biennium. Additionally, the fund is required to maintain a statutory minimum balance of $12.4 billion for the 2026-27 biennium, as outlined by the comptroller’s office.
Since its inception, state lawmakers have authorized a total of $17.4 billion in expenditures from the rainy day fund, as reported by the comptroller’s office. These funds have been allocated to various initiatives, including water infrastructure projects, disaster relief, and public education. As the fund continues to grow, lawmakers have engaged in intense discussions over the appropriate levels and methods of spending from it.
Hinojosa contended that her rebate proposal represents one of the few policy initiatives that could garner broad support from a supermajority of lawmakers. “We are paying into a system that is working against us, and I can’t think of anything else where we would all come together and have the votes to spend that kind of money to benefit real Texans,” she stated. “I can’t imagine any politician voting against $1,500 to their constituents.”
In order to utilize funds from the rainy day account to address budget deficits, three-fifths of state legislators must consent, while a two-thirds majority is necessary for other legislative purposes.
