AUSTIN (AP) - Money, money, money. There seems to be less of it every day.

In a session already marked by money problems, lawmakers learned Wednesday that they need to come up with even more cash to balance a $1.8 billion shortfall in the current budget. The revelation sparked some legislators to point angry fingers at Comptroller Carole Keeton Strayhorn.

Some members of the Senate Finance Committee accused Strayhorn, a Republican, of hiding the severity of the state's fiscal woes from lawmakers until earlier this month because of a heated campaign season.

Republicans swept every statewide office in the November election.

Throughout the campaign, Strayhorn and Republican Gov. Rick Perry had repeatedly said they expected a budget shortfall of $5 billion. But after Election Day, Strayhorn warned the news would be worse and on Jan. 13 she said the shortfall would be $9.9 billion through 2005.

"We don't need any smoke and mirrors or hiding the ball on us for whatever reason," said Sen. Robert Duncan, R-Lubbock.

Strayhorn said she told lawmakers when she realized holiday sales were weaker than expected.

"No one has the crystal ball, but the minute we saw what was happening, I told not only the Legislature but all the people of Texas. I will continue to tell it like it is," she said.

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BUSINESS TAX:

A loophole that allows some businesses to avoid paying state franchise taxes is unfair and should be eliminated, Gov. Rick Perry said.

Perry said that he and the Legislature feel that the so-called "Delaware Sub" loophole should be closed. "The individuals who are using loopholes to not pay taxes is inappropriate," he said.

Under the practice, companies incorporate on paper in Delaware or in other states where taxes are lower. Then they legally organize into a virtually tax-free partnerships here.

Dell Computer Corp., SBC Communications and some large Texas newspapers are organized this way and avoid a state franchise tax, Texas' main business tax. The businesses say they pay their fair share of taxes, including property taxes.

Perry declined to say whether he favors removing some exemptions from the state sales tax.

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PROVE IT:

A Senate bill filed Wednesday would require homeowners insurance companies to immediately file with the state their current and projected premium rates for the next six months.

Filed by Sen. Troy Fraser, R-Horseshoe Bay, it also would allow state officials to collect companies' credit scoring formula and other premium data.

The bill will get a committee hearing Thursday, marking the start of lawmakers' work this session to get control over the homeowners insurance market, where some homeowners have seen premiums increase as much as 200 percent.

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STRAYHORN'S FAVOR

Comptroller Carole Keeton Strayhorn proposed that future state revenue surpluses be split between the emergency Rainy Day Fund and a new sales tax holiday at Christmas that she calls "Returning the Favor."

"In times like these, just imagine the benefit 'Returning the Favor' would have been for Texas families, Texas merchants and the Texas economy," she said.

The plan would require a state constitutional amendment.

Far from having a surplus this year, Texas is facing a $9.9 billion budget shortfall.

Already, Texans have an August sales tax holiday for certain back-to-school goods. Strayhorn's new plan would include an expanded list of eligible items.

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AND:

About 200 adults and children rallied on the Capitol steps to urge lawmakers against making budget cuts that would reduce children's services.

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QUOTE OF THE DAY:

"You're going to hear a lot of whining from people who say we don't have enough money to keep children alive." -- Rep. Lon Burnam, D-Fort Worth, speaking to the children's rally and criticizing lawmakers who may want to cut services.