HOUSTON --Rick Perry is preparing to enter his third term as Texas governor, and he's looking ahead to what he will have to do to cut $27 billion from the state budget. Even though the celebration is paid for through private money, the goal of these changes is to save money at a time when the state is facing a budget deficit of as much as $27 billion. We talked to Governor Perry in his office the day before he's scheduled to be sworn in, and it was a reminder that it's much easier to run for governor than it is to govern. Perry says he is facing huge cuts everywhere in the state's budget and nothing is safe, yet there's still room to celebrate. Perry says he's happy to be back in office but has an honest look now at Texas' troubles. The governor's biggest challenge will most likely be how to deal with the deficit. Two months ago, Perry won a historic third full term, telling the feds to back off and that Texas will do better because we know better. But on the eve of his fourth oath of office, that promise of better tomorrow is slightly overshadowed by the budget reality today. "There is a sober bit of a feel to the inaugural," Perry said. Texas is facing at least $15 billion in spending cuts, and the actual number may be twice as high. "I get it, this is your money. This is not my money," Perry said. "The idea that we saw anybody is untouchable in this process is not a good idea to have." Specifics though will have to wait, except on a law to end sanctuary cities -- the one idea Perry is pushing early and often. He closed his campaign knocking Houston's police policy and hit the Houston Police Department again on Monday. "The City of Houston prohibited their police officers from asking for an individual's immigration status. Arizona requires it," Perry said. "We give people discretion and I think that is the sensible approach." We're told his inaugural speech will have big ideas, but not necessarily a play for national attention. "You're not running for President?" we asked Perry. "Correct," he replied. Despite a busy nationwide speaking tour, Perry still says he has the job he wants. "I don't mind playing Paul Revere here and travelling across the country, because I think it is going to take a monumental effort of governors and citizens standing up and saying Washington leave us alone," Perry said. Perry will likely say a lot of things that will attract national attention and probably one of few people who believes he's not running for anything bigger than Texas' governorship. As for HPD's policy, there's no formal proposal facing the legislation as of now, and don't look for one tomorrow. The inauguration is expected to draw a crowd of about 10,000 people. It's scheduled to start at 11am Tuesday.