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Stacey Vanek-Smith: The Great Recession has hit state budgets hard. The governor of Texas had been touting its financial health. But now the Lonestar state is facing money troubles of its own. From KUT in Austin, Ben Philpott reports.

Ben Philpott: The Texas legislature doesn't meet again until 2011. And when it does, lawmakers will be greeted with a $10 [billion] to $17 billion budget shortfall. To fix that, they'll try to "scrub" the budget. It sounds much nicer than cutting. Lawmakers replace some government workers with computers or outside contractors.

Arlene Wohlgemuth: Well we call that low-hanging fruit.

Arlene Wohlgemuth is a former state lawmaker. She helped scrub the budget during the state's last fiscal crisis in 2003.

Wohlgemuth: I think most of the low-hanging fruit has been picked. I think they're going to have to get the ladder and get way up in the tree to find that efficiency. But they're going to have to do it.

State agencies have already been asked to cut their current budgets by 5 percent. Another 5 percent cut to state agencies is expected in the next budget. That's only going to save a couple billion. Texas does has an economic stabilization fund -- also called the rainy day fund -- that will have about $8 billion in it. State Comptroller Susan Combs says that should be good enough:

Susan Combs: There is no chicken little sky is falling. We have a hole, we have shovels, we know how to fill it. And fortunately we've got a pile of cash over in the rainy day fund with which we can fill the hole.

That's if it's on the low end of the projected budget gap. The high end, about $17 billion, could mean even more cuts and the possibility of increased taxes. But Republicans control the state legislature, and just aren't too keen to raise taxes.

From Austin, I'm Ben Philpott for Marketplace.