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Home | Tag Archives: texas budget

Tag Archives: texas budget

Texas Gov. Greg Abbott instructs state agencies to trim budgets by 5% to prepare for “economic shock”

Texas’ top Republican leaders on Wednesday asked certain state agencies and higher education institutions to “submit a plan identifying savings” to reduce their budgets by 5% for the current biennium — an attempt to tighten financial belts amid the economic fallout from the coronavirus pandemic.

Those entities, according to a May 20 letter from Gov. Greg Abbott, Lt. Gov. Dan Patrick and House Speaker Dennis Bonnen, have until June 15 to submit their plans to the Legislative Budget Board and the governor’s office.

REFERENCE:  Read the letter to state agencies from Gov. Greg Abbott, Speaker Dennis Bonnen and Lt. Gov. Dan Patrick instructing them to trim budgets by 5%.  (148.5 KB) DOWNLOAD

The letter also identified a number of agencies that are exempted from the 5% reduction “given the importance of the state’s response to COVID-19 and the continuity of critical government functions.”

Among those agencies: The Texas Department of State Health Services, the Texas Workforce Commission, the Texas Military Department and the Texas Department of Public Safety. The letter also says that funding for school districts, Child Protective Services and behavioral health service programs is also exempted from the request for reductions. The agencies and programs included in the exemptions make up a majority of the state’s general revenue funding, according to the Legislative Budget Board.

“We are confident that Texas will get back to work and continue leading the nation in job growth, economic innovation, and business creation,” the letter from the three officials reads. “However, it will take months until we know the true extent of the economic ramifications of COVID-19, and how combating this virus will impact state finances. To prepare for this economic shock, we must take action today to ensure that the state can continue providing the essential government services that Texans expect.”

The trio suggested that agencies consider “cost saving strategies,” such as “foregoing any capital expenditures that can be deferred, any avoidable travel expenditures, any administrative expenses that are not mission critical, and keeping unfilled any open positions that are not essential to the COVID-l9 response.”

Last month, Bonnen, an Angleton Republican who is retiring at the end of his term, sent a memo to Abbott and Patrick suggesting that state agencies “identify and execute” 5% budget cuts. Bonnen wrote that “a small 5% course correction now, with nearly 17 months for implementation … is a far more achievable goal than having to attempt a much larger cut with a much shorter window for execution.”

Other lawmakers and Republican officials have also suggested that action be taken sooner rather than later during the legislative interim in an attempt to offset some of the economic devastation caused by the pandemic before the Legislature reconvenes for its regular session in January.

State Sen. Jane Nelson, a Flower Mound Republican who chairs the Senate Finance Committee, wrote in a recent letter responding to one of her GOP colleagues that “it is both reasonable and necessary for agencies to reduce their FY 20-21 spending — and to start immediately.” Nelson also suggested that, as she meets with state agencies to review future appropriation requests, she will “begin at ZERO.”

Meanwhile, Comptroller Glenn Hegar announced at the beginning of the month that Texas’ sales tax revenue — the state’s largest source of funding — had dropped about 9% from what the state collected the same month last year, and warned that the figure would continue to “show steeper declines” in the coming months as data continues to come in.

To that end, Abbott, Patrick and Bonnen made clear in Wednesday’s letter that “it may become necessary to make additional budget adjustments” as the state’s revenues continue to come into focus. Hegar, who is expected to provide his revised fiscal forecast in July, has already said that the current state budget will be billions of dollars out of balance.

Author: Cassandra Pollock – The Texas Tribune

Texas’ biggest cities scramble to figure out what the 2019 legislative session will cost them

DALLAS — During this year’s legislative session, Fort Worth Mayor Betsy Price was among scores of city leaders who actively opposed yet another series of attempts by state officials to limit how much money local governments collect. But with lawmakers determined to reform the local property tax process, she and other mayors had little luck fighting off what many city officials considered attacks on local control.

By the time the Legislature adjourned in May, lawmakers had passed bills that limit how much property tax revenues local governments can collect without voter approval, prohibit the use of revenue-generating red-light cameras and eliminate some fees telecommunications companies pay to local entities.

“We have actually worked on this for the last three or four sessions, but it really feels like it escalated this session,” Price told The Texas Tribune. “They don’t have a full grasp of cities, our spending and what we do.”

That’s left many local officials scrambling to calculate how much money cities will forgo in coming years as many city councils prepare their budgets for the next fiscal year.

One of the most impactful pieces of legislation is Senate Bill 2, which established that starting next year, cities, counties and other taxing units need voter approval before levying 3.5% more property tax revenue than the previous year. In May, Moody’s published a report warning that the homeowner savings would be minimal “but budgetary impact on governments would be significant.”

But two other laws might also impact local budgets. Cities are already planning to sue the state to stop Senate Bill 1125, which bans cities from charging telecommunications companies a right-of-way fee. And there’s also the ban on red-light cameras, devices that Austin, Dallas, El Paso and Fort Worth were quick to take down after the bill prohibiting them passed.

“Obviously the major problem for us is the 3.5% cap, and we will have to live with that or call for an election,” Price said. But she’s also worried about the other two new laws. “They are a double whammy; we lost over $10 million from the red-light camera ban and the telecommunications fee,” she said.

This is what Fort Worth and other cities are considering as they prepare their new budgets and get ready for the new property tax collection cap that goes into effect next year.


In the state capital, the city government is projecting a budget shortfall of $52.6 million by 2023-24, due to property tax reform. To get a reference, the general fund budget for the 2018 fiscal year was $1 billion. But city officials still say that the tax reform will be felt.

“The 3.5% cap will make it more difficult for the city to fund the priorities of the Austin community,” said Ed Van Eenoo, deputy chief financial officer for the city’s budget office. “It will make it harder for us to hire additional police, fire and other personnel as the city continues to grow, and tougher to absorb annual cost increases in wages, rents and insurance premiums.”

In terms of the telecommunications franchise fee, Austin expects to see a reduction of $4 million in revenue next year and $5.6 million each year after that.

Finally, it is not clear yet how much the ban on red-light cameras will affect the city’s budget, but most of the revenue coming from the devices doesn’t end up in the hands of the city. In the 2018 fiscal year, Austin ended up getting $83,698 of the $777,516 collected. The city’s share was used for street safety projects. Seventy-eight percent of the revenue went to the lease and operation of the equipment and the state controller took a cut of $83,698.

Although the city’s contract with a vendor was supposed to last until 2023, the city stopped issuing tickets June 1.


According to the latest budget overview presented to the City Council last month, if SB 2’s property tax reform had been in effect in September 2018, Dallas would have needed $25.1 million more in revenue or expense reductions to balance its budget for this year.

In the same presentation, city officials said the loss of the telecommunications franchise fee will cost $6.6 million next year and $9 million for the 2021 fiscal year. While that sounds small considering the city has about a $3.6 billion budget, Dallas needs the money to fund already approved raises for police and firefighters, which will create $5.3 million in new expenses next year, according to The Dallas Morning News.

The ban on red-light cameras will force another $1 million loss this year. For next year, the loss is estimated to be $2.4 million.

El Paso

The border city’s officials estimate that if property tax reform had been in place this year, it would have cost $7 million. To put that in context, El Paso’s general fund for 2019 was $428.6 million.

Before the new legislation passed, the city collected about $3.8 million from the telecommunications franchise fee, according to a city spokesperson. Officials estimate the new law will cost them about $2.7 million.

Finally, El Paso’s red-light cameras used to bring in about $1 million, but only half of that would stay in the city to pay for administrative costs and street safety measures. The rest would go to the state. The cameras were turned off June 2, though people fined before that are still required to pay their fees.

El Paso estimated the total cost of all these reforms is $10.2 million, an amount that could fund 170 police officers, the entire library system, or the entire public health and museum departments of the city.

Fort Worth

If the property tax reform bill had been in effect this year, the city would have forgone $4.5 million, according to officials’ assessment. To put this in context, the general fund budget is more than $731 million.

This year, Fort Worth collected $6.3 million in cable franchise fees and $7 million in telephone fees. The city projects a loss of $4 million based on the new telecommunications franchise fee law.

The ban on red-light cameras will cost an estimated $4 million, typically used for traffic safety. All of the cameras were disconnected after the signing of the bill.


In the last four years, Houston’s property tax revenue increase has averaged 2.48% annually, and officials say that the new mandated cap is unlikely to affect the city. Houston has had a voter-approved cap since 2006, which relies on a formula that factors in population change and the consumer price index. If SB 2’s property tax reform measures had been applied previously, it would have affected Houston only in two of the last five years.

With the telecommunications franchise fee, on the other hand, the city stands to lose between $17 and $27 million each year. Officials argue the law violates the Texas Constitution, which “expressly prohibits public property from use by private entities for less than market value,” according to a statement.

The ban on red-light cameras won’t impact Houston. City officials got rid of their cameras in 2011, after a voter referendum banned them.

San Antonio

According to Jeff Coyle, San Antonio’s director of government and public affairs, if the property tax reform cap had existed in the last decade, it would have cost the city $81 million.

“The current year, our general fund revenue would have been $37 million smaller than it is,” Coyle said. To put that in context, for fiscal year 2019, the general fund was $1.26 billion. San Antonio has not raised its property tax rate in 27 years.

The telecommunications franchise fee law will cost the city around $7.3 million.

But, like Houston, San Antonio doesn’t have to worry about the ban on red-light cameras; the city didn’t use the devices.

Carla Astudillo contributed to this story.

Author:  JUAN PABLO GARNHAM –  The Texas Tribune

With conflicting budget estimates, will Texas teachers get the pay raises they anticipated?

When state lawmakers passed their landmark $11.6 billion school finance law in late May, school employees were eager to see how mandatory raises would affect their paychecks.

A month later, they’re scratching their heads, struggling to decipher complicated changes and conflicting financial estimates that might not net teachers as much money as they expected.

Before lawmakers voted nearly unanimously to approve House Bill 3, which drastically overhauled Texas’ outdated school funding system, they received estimates from the state on how much additional money each of their school districts would likely receive over the next two years. But the estimates came with a warning: They could change significantly once the calculations were performed using local data.

Ahead of the upcoming school year, districts are now redoing those calculations themselves — and some are coming up short. That could pose a problem for teachers, nurses, counselors and librarians, since under HB 3, school districts are supposed to use a portion of the new money on those employees’ raises and benefits. (School boards must approve their budgets by either a June 30 or an Aug. 31 deadline.)

Georgetown ISD, for example, is projecting $5.9 million in new money in the upcoming school year, much less than the $10.3 million state estimate. And it will shell out about $9 million in recapture payments, which the state takes from wealthier districts to subsidize poorer ones — not the $3.5 million the state estimated in May.

Cypress-Fairbanks ISD, a large suburban district in the Houston area, should’ve expected $30 million more in the upcoming school year, according to the state estimates. But school board members approved a budget in late June that projected just $14 million more, according to Karen Smith, the district’s chief financial officer.

To remain competitive as employers, both districts are going beyond the state’s requirement to use 30% of the new money to increase salaries and benefits. Georgetown ISD is including $3,000 raises for teachers, counselors, librarians and nurses with more than five years of experience. Cypress-Fairbanks ISD approved a budget millions of dollars in the red that includes $25.4 million in raises for classroom teachers, librarians, counselors and nurses and $10.8 million in raises for all other employees.

Teacher pay raises quickly became a bipartisan rallying cry during the 2019 legislative session that finished up in May. But instead of the statewide $5,000 raisemany teachers advocated for from the get-go, lawmakers approved a set of guidelines for salary bumps that would end up leaving the dollar amounts largely up to district leaders.

There is not yet an official statewide summary on what compensation packages look like across school districts, but eventually districts will be required to report that information to the Legislature. Meanwhile, the state has been providing guidance on how to interpret the new law through videos and PowerPoint presentations.

Without an across-the-board pay raise mandate from the state, teachers and other school employees have been looking left and right at neighboring school districts to judge how they’re going to fare. Some report having heard nothing from their school districts so far this summer, as they anxiously monitor the news from across the state.

Sunnyvale ISD Superintendent Doug Williams found that the state’s calculation for how much more his tiny school district would receive was pretty accurate: just under $600,000. But school districts in the vicinity, which include large, urban Dallas ISD, are getting millions more, meaning they’ll be required to offer bigger raises.

To stay competitive, Sunnyvale ISD’s school board approved larger pay raises than required by law, ranging from $1,800 for beginning teachers to $2,700 for the most experienced. “We have been blessed to be able to attract and retain great teachers,” Williams said. “We just want to make sure we are able to continue.”

In some school districts, local teachers’ unions and associations are butting heads with administrators as they advocate for higher raises and larger employer contributions to health insurance. After adopting a budget with 5% raises, Laredo ISD’s officials told frustrated teachers they are waiting for more guidance from the state before they consider raising salaries further.

In Houston ISD, the teachers union successfully threatened a no-confidence voteagainst the superintendent if trustees didn’t pass a budget with pay raises by later this month, arguing the delay would make them less competitive for hiring. After a contentious meeting, the board ultimately approved a deficit budget containing raises of 3.5% to 8%, depending on school employees’ experience levels. The budget also increased the minimum wage for school employees by $2 an hour.

For third grade writing teacher Huyenchau Vu, who watched the Legislature’s initial proposal for $5,000 raises dissolve, a 3.5% raise means a boost of less than $2,000 a year and less than $100 per paycheck. “It goes back into paying for everything, not necessarily into a savings account,” said Vu, who just finished teaching summer school at Houston ISD and will start her third year teaching in August.

She and her colleagues have been taking notes about the higher starting salaries and raises for Houston-area districts such as Aldine ISD and Alief ISD, but not necessarily because they’re trying to jump ship. While Vu would appreciate more money, she is also worried about the sustainability of the Legislature’s funding increase and is glad Houston ISD appears to be more “realistic” in its budgeting decisions than its neighbors.

“They’re paying their teachers a lot more knowing it’s just over the next two years that we’re receiving money from the state of Texas to put into these teacher salaries,” she said. “After that, no one’s sure what’s going to happen.”

Read related Tribune coverage

Author: ALIYYA SWABY – The Texas Tribune

Op-Ed: Arsonists that put out their own fire

By now, you probably have heard that the just-concluded Texas legislative session included a massive $11 billion piece of legislation that overhauls many of the long-ignored issues in the state’s public education system.

Good for them.

Republican Governor “They Can Pry the Guns from My Cold Dead Hands” Abbott along with far Right radio host turned Lieutenant Guv “I wish I was Rush Limbaugh” Patrick, flanked by other right winged leaders of the state, made quite a show when signing the bill at a public elementary school (a place many of them have tried avoid like a Honduran asylum seeker coming over the Laredo border crossing).

The Republican Party is taking credit and calling itself the “party that gets things done (Expect that branding or something similar, to be used in the 2020 election.) Look kids, we passed some legislation like you elected us to do! We get things done!™.

Abbott stated at the bill signing: “You could not overstate the magnitude of the law that I’m about to sign because this is a monumental moment in public education history in the state of Texas. We did something that was considered to be highly improbable, and that is to be able to transform public education in the state of Texas without a court order forcing us to do so.”

The law, House Bill 3 (HB3) which includes increase in funding per student from the state, a teacher pay raise, property tax relief, and a controversial merit pay provision, pumps badly needed dollars back into a system that, for the most part, the exact same one Republican legislature has done its best over the years to slowly dismantle.

So they plugged some of the the holes on the leaky dyke of Texas public education that they have purposely ignored for years and have actually created most of the holes themselves. What heroes they are. They really “Get Things Done!™”

In their orgasmic celebration of actually doing something useful, they seem to have collectively forgotten:

  • The billions of dollars that were eliminated from the public schools during the 2011 session that just now, HB3 makes up for, almost a decade later?
  • The emphasis on Charter schools over the past 4 or 5 legislative sessions, where public schools had to fight for scraps like vultures while rabid Republicans engorged themselves on the ideas of funding charter schools at the expense of public schools and attempting to create a voucher system?
  • Finally, that for almost the exact amount of time that the Republicans have been running the show in Austin, the state and federal courts have consistently ruled that the funding measures have been unconstitutional, and that students living in property poor districts have chronically been unequally funded compared to their property rich peers?

The Texas Republicans have, with HB3, tried to fix a set of problems that they themselves, over a period of decades, had created and then take credit for undoing the damage as if they were some kind of Anne Sullivan miracle workers.

Lookie here kiddos: We gave tax relief to overburdened local tax payers that we created because we didn’t want to pay for education using state tax dollars. Aren’t we good?™ We Get Things Done!™

Indeed, Abbott will use this “historic victory” as some kind of legislative miracle that only he and the other Republicans were able to accomplish. “We did something that was considered to be highly improbable…” Abbott said about the legislation.

This “miracle” is not unlike the arsonist who sets the fire, and then claims to be a hero for putting it out. This tactic seems to be a popular one with Republicans these days, as we have seen from the Trump administration which has created quite a few “fires” that it then tries to put out, saying that only their administration was capable of such a feat.

We have seen this from the manufactured crisis on the southern border that to the phony tariff war with China. (Don’t be surprised if a fake war with Iran is started as another fire that will be started to divert attention away from domestic legal issues.)

And while I suppose we should be somewhat grateful to the Republicans for even attempting to partially fix the education problems that they themselves created, one can’t help but wonder if they would have done ANYTHING had it not been for the recent gains of Democrats in the Texas house after the 2018 election.

Did Beto’s near defeat of “Look-at-me-now am-sexy-because-I-have-a-beard™” Cruz have something to do with their all-of-a-sudden come to Jesus moment of needing to reform education? Surely if they could have passed HB3 in 2019, they could have done so in 2017, or ’15, or ’13, or ’11…You get the idea.

They have controlled both houses of the Texas legislature for decades. Why now? What makes 2019 special? Perhaps the pictures of all those angry teachers marching on various state capitols because THEIR Republican controlled legislatures screwed them for years made some of those good old boys take notice.

More probably, the recent shift from red to purple in a once solid sea of crimson had more to do with it than any type of compassionate feelings towards Texas teachers or children.

Only time, and the 2020 election, will tell.


Author: Tim Holt is an educator and writer, with over 33 years experience in education and opines on education-related topics here and on his own award-winning blog: HoltThink. He values your feedback.

Feel free to leave a comment.  Read his previous columns here.

Texas Comptroller Hegar Gives Lawmakers Cautiously Optimistic Revenue Estimate for 2019 Session

At a time when legislators are vowing to spend more money on public schools and slow the growth of Texans’ property tax bills, the state should have enough money at its disposal to do just that.

That is, if its newest predictions hold true.

Texas Comptroller Glenn Hegar on Monday offered a cautiously optimistic outlook for the Texas economy, telling lawmakers they will have about 8.1 percent more state funds available to budget for public programs — primarily schools, highways and health care — in 2020 and 2021. Hegar projected there would be about $119.1 billion in state funds available for the next two-year budget, up from $110.2 in the last two-year budget.

But falling oil prices in the last month, along with heightened uncertainty in the U.S. economy and international financial markets, led Hegar to deliver a “cloudy” forecast with some trepidation.

“We remain cautiously optimistic but recognize we’re unlikely to see continued revenue growth at the unusually strong rates we’ve seen in recent months,” he said.

In the odd-numbered years when the legislative branch of Texas’ state government convenes in Austin, the comptroller traditionally kicks things off by gazing into a crystal ball of financial modeling. The result is the biennial revenue estimate, delivered as a Powerpoint presentation in an underground Capitol auditorium, which guides lawmakers as they decide what to spend on public programs or tax cuts in the coming years. The amount of money available can vary greatly, depending on how the state’s economy performs.

Meanwhile, the state’s savings account, known as the rainy day fund, is projected to reach a record high balance of $15 billion. Lawmakers will debate whether to dip into that Economic Stabilization Fund to pay for bills coming due from the last two-year budget period, including Hurricane Harvey recovery, and in the upcoming two-year budget.

Advocates for greater investment in public schools reacted positively to the revenue estimate, saying lawmakers now have no excuse not to increase spending, given a growing budget and unprecedentedly large savings account balance.

“This is good news,” said Eva DeLuna Castro, a state budget analyst at the left-leaning Center for Public Policy Priorities. “This is enough to not cut state services.”

One note of fiscal underperformance was slower growth in motor vehicle tax collections. Hegar noted that car and truck sales did not yield enough tax revenue to reach $5 billion per year, which will result in slightly less funding available for the state highway fund than lawmakers had planned for.

Two years ago, Hegar offered a more gloomy revenue estimate, citing low oil prices and other fiscal issues. But the Texas economy outperformed those expectations, and Hegar revised his estimate in July 2018 to announce that the state was on track to bring in $2.8 billion more than what his office had originally predicted for 2018-19.

That was thanks to rising oil prices and production, and to a thriving economy in which Texans displayed a ravenous appetite for spending. Sales tax dollars are the largest source of funding for the state treasury, making up about 60 percent of its income.

“Not only is our economy producing jobs and opportunities, it is generating the revenue we need to meet our growing needs and make historic investments in education, which is key to the future of Texas,” Jane Nelson, the chair of the Senate Finance Committee.

The July announcement had little to do with the upcoming two-year budget cycle that lawmakers will plan for in the legislative session beginning Tuesday. Instead, the extra $2.8 billion will help lawmakers plug some holes in the current two-year budget cycle, for bills the state racked up starting in 2018. Lawmakers this year will pass a backward-looking “supplemental” budget to pay for those bills coming due, which include some costs of Hurricane Harvey recovery and a roughly $2 billion underfunding of the Medicaid program for the poor and disabled.

In July, Hegar said Texas was in the midst of an “economic expansion exceeding our expectations.”

Disclosure: The Center for Public Policy Priorities has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune’s journalism. Find a complete list of them here.

Author:  EDGAR WALTERS –  The Texas Tribune

With Record $12.5b in Texas’ Savings Account, Lawmakers set $7.5b Minimum Balance

As Texas’ savings account swelled to a record high of $12.5 billion this week, a group of state lawmakers on Friday unanimously agreed that the state should leave more than half of it untouched over the next three years.

The joint Economic Stabilization Fund Balance Select Committee voted to keep the Rainy Day Fund’s minimum balance unchanged at $7.5 billion — the same figure they chose in 2016, ahead of their last legislative session.

The unanimous decision by the panel means that stewards of the fund can invest more money in higher-return investments, as they hope to keep it growing at a rate that is at least equal to inflation. If lawmakers had chosen to raise the account’s minimum balance, it would have required more money to remain available for emergency spending, thus limiting investment potential.

The question on lawmakers’ minds Friday was whether leaving the minimum balance unchanged could affect the state’s credit rating; State officials told them that ratings agencies like to see states have a healthy amount of cash on-hand for emergencies.

“This sufficient balance will ensure the maximum transfer of resources to transportation and allow a greater return on our investment for a significant portion of the Rainy Day Fund,” state Sen. Jane Nelson, a Flower Mound Republican who co-chairs the committee, said in a statement. “It also protects our credit rating by demonstrating Texas’ commitment to keeping sufficient reserves on hand to address financial challenges.

Lawmakers are preparing for a legislative session that begins in January in which the billions in the Rainy Day Fund could potentially play a role in discussions on two major issues – overhauling the way the state and local governments fund public education, and putting together a state aid package for coastal communities still recovering from Hurricane Harvey.

Another effect of Friday’s decision is that lawmakers in 2019 can withdraw a larger amount from the fund without jeopardizing revenue for state highways.

Before 2014, most of the state’s taxes on oil and gas production went into the Rainy Day Fund. Then Texas voters approved a plan to divert some of that tax revenue to the State Highway Fund. Friday’s vote maintains the status quo, in which those automatic transfers would stop going to the state highway fund if the savings account dips below the established minimum balance ($7.5 billion). So long as there is more money in the account than that, oil and gas revenue will be split between highways and the state’s savings account.

Earlier this week, Texas Comptroller Glenn Hegar announced he had transferred $1.4 billion into the Rainy Day Fund, raising its current balance to $12.5 billion, a record high. (Phillip Ashley, an associate deputy comptroller, told lawmakers on Friday that the fund balance will fall to $11.8 billion next year as state agencies spend money on projects the Texas Legislature approved in 2017.)

Hegar has said that credit ratings agencies would like to see Texas invest more of the fund — the largest of its kind in the country — to improve the state’s long-term fiscal health, rather than letting the money depreciate.

“It is crucial that Texas use this amazing asset to maintain our strong fiscal position and our state’s AAA credit rating,” Hegar said in a Thursday statement. “That’s why I have asked the Legislature to authorize me to invest a portion of the fund in a more prudent and responsible manner and use the returns to address the types of long-term liabilities that have crippled the finances of states such as Illinois and New Jersey.”

In the past, lawmakers have made hefty withdrawals from the Rainy Day Fund, which was created in the 1980s during an oil downturn, without affecting the state’s credit rating. A representative of the Comptroller’s office told lawmakers Friday that the fund’s balance is only one of many indicators credit agencies use to determine their ratings. Texas currently has a AAA rating, the highest possible.

A proposal to allow the comptroller to invest a larger portion of the fund failed during the 2017 legislative session. Backed by Hegar, the bill would have created an endowment within the Rainy Day Fund that supporters said could boost the state’s savings by billions in coming decades.

Nelson said Friday she would pursue legislation in 2019 that would increase the fund’s investment potential and end the role of the joint committee she co-chairs.

Author: EDGAR WALTERS – The Texas Tribune

Texas Lawmakers Punt on Setting a Spending Cap for 2019 Session

Some of the state’s political leaders, including House Speaker Joe Straus and Lt. Gov. Dan Patrick, took the unusual step Friday afternoon of declining to set the state’s spending cap after calling a meeting to do just that.

Straus and Patrick met Friday meeting in their role as part of the 10-member Legislative Budget Board, a group whose responsibilities include setting a limit each session for how large the next two-year budget can be based on projections of Texans’ personal income growth.

Typically, the board of state lawmakers sets the spending cap late in November before an upcoming legislative session. Friday’s meeting was scheduled with that action in mind. But Straus, who is retiring in January, said the board would instead vote on a spending cap at an unspecified later date, saying there was no reason to rush into a decision that lawmakers might come to “regret.”

Straus told reporters he wanted to give the next speaker more time to consider his options, noting that the board had similarly postponed a spending cap decision in 2006. State Rep. Dennis Bonnen, who has drawn the support of most of the state House to become the next speaker, was also at the meeting as another member of the Legislative Budget Board, but did not comment on Straus’ decision.

The Texas Constitution requires that certain spending in the budget can’t grow faster than the state’s economy, but doesn’t specify how to measure that growth. State lawmakers have long used projections of personal income growth as a proxy. The 10-member budget board fielded growth estimates from the Comptroller’s office and four other financial forecasters, all of whom projected a growth rate for the state between 8 and 11 percent.

The spending cap only covers nondedicated revenue, those parts of the budget that are funded by taxes but are not required by law to go to specific programs. While the legislature can vote to break the cap, it’s a politically dicey move that lawmakers have worked to avoid in recent years.

In 2016, facing a sluggish economy, the budget board adopted a spending cap of 8 percent, limiting the state’s spending covered under the cap at about $100 billion. But actual state spending for that budget cycle, which is ongoing through most of next year, is expected to be well below that amount. Lawmakers will pass a supplemental budget when they meet in 2019, to plug leftover holes in state spending in the current budget cycle and to address additional costs from Hurricane Harvey.

Tom Currah, the chief revenue estimator for the Texas Comptroller, told the board that the state’s unemployment rate of 3.7 percent was “the lowest it’s been” and that lawmakers should “expect continued economic growth.” In January, the comptroller will issue an estimate for how much tax revenue the state expects to collect over the next budget cycle.

Author: EDGAR WALTERS – The Texas Tribune

Texas Governor Signs $217 Billion Budget, Vetoes $120 Million

Texas Gov. Greg Abbott signed the state’s two-year budget Monday, giving his approval to the $217 billion document crafted by the Legislature.

But the governor did cut about $120 million from various programs through a mechanism known as a line-item veto — including measures meant to improve the region’s air quality and assist the colonias, impoverished areas on the Texas-Mexico border.

The budget, the product of a compromise agreed to by state lawmakers last month, “addresses the most pressing challenges faced by our state,” Abbott said in a prepared statement.

“This budget funds a life-saving overhaul of Child Protection Services, continues to fund the state’s role in securing our border, and ensures that the workforce of today and tomorrow have the resources they need to keep Texas’ economy growing and thriving,” Abbott said.

Abbott vetoed about $860,000 for an initiative to help Texans living in colonias, impoverished areas on the Texas-Mexico border. He said the state budget already included other sources of funding for Texans living in colonias.

Environmental programs suffered some of the heftiest cuts.

For example, Abbott cut about $87 million for the state’s Low-Income Vehicle Repair Assistance Program, saying it had done little to improve air quality in Texas. That program helps low-income Texans in some urban counties get funding to help repair or replace their cars if they fail emissions tests.

Abbott compared it to the Cash for Clunkers program, established under former President Barack Obama, which he called an “ill-conceived and dubious” program.

“That’s disappointing,” said Cyrus Reed, conservation director for the Texas chapter of the Sierra Club. “He’s actually taking the money away that [Texans] paid for a specific purpose and not allowing it to go to that purpose.”

Abbott also cut $6 million for air quality planning at the Texas Commission on Environmental Quality. The governor said he opposed the program because it would pay for bicycle use programs, carpooling awareness campaigns and other environmental items that “can be funded at the local government level.”

About $2 million intended for a study on brackish groundwater was also defunded.

Other items vetoed by the governor include $150,000 for a Legislative Law Clinic at the University of Texas, funding for state education employees who study dual-credit programs and about $4.7 million for “safety education” at the Texas Department of Public Safety.

Abbott’s veto of the environmental programs was made possible by a nonbinding opinion from Texas Attorney General Ken Paxton that expanded the governor’s veto authority. The opinion held that Abbott could defund budget riders — directives to state agencies that are included in the budget but do not actually make any appropriations. The debate over Abbott’s veto power was a point of contention after the 2015 legislative session.

Kiah Collier contributed to this report.

This is a developing story that will be updated.

Uncertainty, Deep Tension Mark the End of the 85th Regular Session

Texas’ 85th legislative session has come to an uncertain, rancorous end after a 140-day period that saw the state extend its rightward march and tensions between the two chambers reach new heights — largely because of disagreements within the ruling Republican Party.

Lawmakers gaveled out Monday afternoon — first the House, then the Senate — under a cloud of uncertainty over whether Gov. Greg Abbott would call a special session, which Lt. Gov. Dan Patrick has been pushing for to deal with a number of incomplete priorities. Abbott was coy Monday morning, saying he would announce his decision “later in the week” — and making clear that he would be in charge in the event of an overtime round.

“I would normally say, ‘I’ll see you in 18 months,’ God willing,” Patrick told senators as the chamber prepared to adjourn for the last time in the regular session. “But we’ll see you a little sooner than that.”

The final day was also consumed by a scuffle on the House floor that seemed to embody some of the sharpest tensions of the session: State Rep. Matt Rinaldi, R-Irving, traded accusations with House Democrats after Rinaldi said he called immigration authorities on people in the gallery protesting the state’s new “sanctuary cities” law. The dustup punctuated a session in which Democrats and Republicans alike waged fierce battles over illegal immigration, abortion and LGBT rights.

“This session has been very, very difficult and emotional in many different ways, in many layers, over contentious issues, and there are enough of us here to remember a time in Texas when respect and decorum ruled the day,” state Rep. Celia Israel, D-Austin, said Monday at a news conference held by House Democrats. “It’s just ironic — my senior members that have been here dozens of years have told me this is the worst session they’ve ever seen.”

Even after both chambers gaveled out Monday afternoon, the fault lines were clearer than ever. Patrick issued a statement that accused the House of killing several of his priorities, including those related to property taxes and bathrooms, which the lieutenant governor said remain “must-pass legislation.” Straus, for his part, issued a statement saying his chamber “feels very good about where we ended up, and now we look forward to returning home.”

The session got underway on Jan. 10 in the shadow of Comptroller Glenn Hegar‘s dour revenue estimate, in part due to the downturn in oil prices, ensuring budget writers had their work cut out for them. For weeks, the two chambers sparred over the best way to balance the budget, with the Senate using an accounting trick to free up $2.5 billion — Straus called it “cooking the books” — and the House turning to the state’s savings account, colloquially known as the Rainy Day Fund.

Budget writers ultimately struck a deal that relied on a bit of both methods.

The session also opened against the backdrop of a new Republican administration in Washington led by President Donald Trump. Texas Republicans were hopeful Trump would provide some relief for a state that spent the last eight years at war with a Democrat-led federal government, but the benefits ultimately appeared to be limited.

On one of the items where Texas Republicans have long sought assistance from the federal government — border security — budget writers maintained the current spending level of $800 million.

That did not mean Trump’s influence was not felt under the pink dome. His hardline stance against illegal immigration dovetailed with Abbott’s push for a ban on “sanctuary cities,” arguably the most rancorous proposal of the session. After the Senate passed the legislation, Senate Bill 4, House leadership sought to water it down, an ultimately unsuccessful endeavor thanks to a polarizing amendment by state Rep. Matt Schaefer, R-Tyler.

The amendment allows law enforcement officials to ask the immigration status of anyone they detain — not just those they arrest. Its passage, mainly along party lines, marked something of a coming-out party for the newly formed House Freedom Caucus, a group of 12 conservative lawmakers who spent the session working to advance their priorities through their knowledge of the rules and procedure.

“Our fingerprints are on many pieces of policy,” Schaefer said in an interview earlier this month, “and that’s not by accident.”

The sanctuary cities ban was one of four emergency items Abbott declared in his State of the State address, and he signed it into law weeks before the session concluded. He did so without advance notice on a Sunday evening on Facebook Live, spawning another round of protests against the bill.

While Abbott, Patrick and Straus were generally on the same page regarding SB 4, they were far more splintered on a “bathroom bill” that would require transgender people to use the restroom that matches their birth gender. Patrick charged into the session vowing to fight for it, while Abbott kept his distance and Straus made clear he viewed it as potentially bad for the state’s economy.

There were few big surprises regarding the issue during the first half of session. The Senate approved its bathroom bill, Senate Bill 6, early on and sent it to the House, where it languished amid continued resistance from House leadership. But in April, the House debuted what some had hoped would be an alternative to SB 6, House Bill 2899, and got the governor to break his silence — Abbott called it a “thoughtful proposal.”

Still, HB 2899, which would have invalidated local trans-inclusive policies and school accommodations for transgender students, remained stuck in a House committee — even as it accrued a total of 80 co-authors. The issue wouldn’t show signs of life again until after a remarkable turn of events that began May 11, when the Freedom Caucus, at a boiling point with House leadership, went on a bill-killing spree that claimed what is known as the sunset safety net bill. In the House, the failure of the measure, which keeps some state agencies from shuttering, meant the Senate would have to pass it to avoid a likely special session.

Patrick seized the opportunity, vowing to hold the bill hostage until the House acted on a bathroom bill and property tax reform. Abbott aligned himself with Patrick, calling them priorities in the home stretch — but stopped short of threatening a special session over them.

“It definitely, I think, kind of shifted the balance, so to speak, or shifted the playing field on what was going to get done in the session or whether there was going to be leverage at all for this issue or the property tax issue,” one Freedom Caucus member, state Rep. Matt Krause of Fort Worth, recalled Sunday.

With time running out, the House worked to appease Patrick, passing measures that dealt with the two issues more narrowly than the lieutenant governor had preferred. The period marked the apex of pressure that Patrick had been applying on the House since the session’s early days, hoping to bend it to his chamber’s more conservative will.

“I think Speaker Straus did a terrific  job of being basically the voice of reason in that regard,” state Rep. John Zerwas, R-Richmond, said Monday, reflecting on the Senate pressures. The House had its priorities, Zerwas added, “we got them done, and the lieutenant governor had some of his priorities that didn’t really sync up with our leadership here, so you know, I think ultimately that’s how the political process works. I think we got done the things the state, the citizens, expect us to get done.”

In the final days of the regular session, there appeared to be some hope lawmakers could work out a deal to avoid overtime — Abbott sounded optimistic as of Friday morning. But whatever chance there was for compromise seemed to plummet over the weekend, when the chamber leaders held dueling news conferences — twice — to assign blame to the other side for putting lawmakers on the brink of a special session.

By Monday morning, Abbott, known for his aversion to special sessions, was striking a somewhat different tone. Asked at a bill-signing ceremony whether he planned to call lawmakers back to Austin, he raised the possibility for the first time in 140 days. “I’ll be making an announcement later this week,” the governor said.

Read related Tribune coverage:

  • In some ways, the standoff over the bathroom bill had been years in the making.
  • Abbott signed a bill Monday morning that allows ride-hailing companies like Uber to return to Austin.

 Author:  PATRICK SVITEK – The Texas Tribune

Texas Legislature Sends $217 Billion Budget to Gov. Abbott

Both chambers of the Texas Legislature voted Saturday evening to approve a $217 billion, two-year budget that would boost funding for the state’s beleaguered child welfare agency, increase the number of state troopers on the Texas-Mexico border and avoid serious reforms to the state’s much-criticized school finance system.

The final vote in the House was 135-14. The vote in the Senate was 30-1.

Scrounging for cash in a tight-fisted legislative session, budget leaders from both chambers agreed to a compromise that settled a bitter debate over how to finance the state budget. The two-year budget is shored up by both $1 billion taken from the state’s savings account, often referred to as the Rainy Day Fund, and an accounting trick that would use nearly $2 billion from a pot of funding intended for highway projects. The House had favored tapping the Rainy Day Fund and leaving the transportation funding alone. The Senate had taken the opposite position.

“The budget today is a product of what is a true compromise” between the Texas House and Senate, said state Rep. John Zerwas, R-Richmond, the lower chamber’s lead budget writer. The two legislative chambers originally unveiled budgets that were nearly $8 billion apart.

Across the Capitol, Senate Finance Chairwoman Jane Nelson, R-Flower Mound, laid out the budget compromise to the upper chamber at the same time.

“This budget is smart. This budget is compassionate. It makes huge advances in several of our priority areas,” Nelson said.

Added Lt. Gov. Dan Patrick, who presides over the Senate, after the vote, “The budget has settled where the Senate wanted it to settle.”

The compromise proposal was skimpier than the original budget draft that the House voted out in April. In the House, the final version won the approval of Tea Party Republicans who had originally opposed the House version, while losing the support of almost one-third of the chamber’s Democrats.

State Sen. Sylvia Garcia, D-Houston, was the lone no vote in the upper chamber.

“This budget is more of the same and fails Texas families,” Garcia said in a statement. “There’s no new money for pre-k, there’s continued spending on more border militarization, and it continues to shortchange education and healthcare.”

The budget includes funding to cover growing enrollment at public schools, but it reduces state funding for schools by about $1.1 billion. That funding is offset primarily by growth in local property taxes.

Zerwas said state officials anticipated there would be a shortfall of around $1 billion that lawmakers will need to address when they return to the Capitol for the next regular session in 2019. The budget does not fully fund expected cost growth in certain programs, most notably Medicaid, the federal-state health insurance program for the poor and disabled.

Lawmakers set aside more than $500 million in additional funds for the state’s child welfare system, which has lately faced a shortage of foster homes and front-line Child Protective Services workers. In addition, lawmakers used funding from the Rainy Day Fund to make repairs to various state buildings including mental hospitals, state-supported living centers for people with disabilities, and the historic Alamo.

State lawmakers had less money at their discretion this year in crafting the next two-year budget. By cutting taxes in 2015, the Legislature reduced state revenue available to them for this session by about $4 billion. Lawmakers also dedicated nearly $5 billion that year to highways — a move that voters later approved in a statewide election — which left fewer dollars for priorities like health care and education.

In addition, a moderately sluggish economy slowed revenue growth, leaving the state’s coffers emptier than state officials had projected.

“We started with a sizable shortfall, but we are ending this session with a balanced budget that invests in some very important priorities,” House Speaker Joe Straus said in a prepared statement. “We’re keeping overall spending low while improving child protection and mental health care.”

One point of contention that riled House Democrats was the budget’s treatment of pre-Kindergarten funding. Lawmakers directed $236 million to go to a “high-quality” program for youngsters, but state Rep. Eric Johnson, D-Dallas, criticized that proposal because it would divert existing school funds, rather than adding new ones. Johnson said he worried that Texas was asking school districts to raise their standards for pre-Kindergarten programs, “but we’re not giving them the resources to do it.” Johnson voted against the budget.

Another debate in the House revolved around a state-funded health care program for children with disabilities. The two-year budget would slightly boost payments to speech, physical and occupational therapists treating needy children in the state’s Medicaid program, but that would amount to a restoration of only about one-quarter of the funding cut by the Legislature two years ago. The House wanted more funding for therapy services, but the Senate opposed spending any more, Zerwas said.

State Sen. José Menéndez, D-San Antonio, said he had hoped for more funding to pay therapy providers.

“I appreciate the 25 percent rate therapy increase but I’m not sure how far that will go,” Menendez said. “I’m concerned we have providers leaving and I’m not sure we have the full picture of why they’re leaving.”

State Sen. Charles Schwertner, R-Georgetown, who led health and human services negotiations on the budget, said a provision of the budget will require state officials to track how many therapy providers are available to Medicaid enrollees, “to make sure we’re not dropping he ball on any lingering or growing concerns.”

On higher education funding, a topic that sparked controversy early in the legislative session, budget writers mostly avoided a major overhaul of university funding that the Senate had championed. The upper chamber had pushed for the elimination of a budgeting tactic known as “special items,” through which universities and colleges get dollars for specific projects allocated outside the standard funding formulas. The House opposed the elimination, saying it was too drastic of a move to take without further study.

In the end, the chamber’s budget negotiators decided to study the issue instead of making immediate changes. Though the preservation of “special item” funding will come as a relief to university officials, many schools will still feel some pinch in overall state funds.

Comptroller Glenn Hegar must certify that there is enough revenue available to cover the appropriations in the budget before Gov. Greg Abbott can sign it.

Author:  EDGAR WALTERS –  The Texas Tribune

State Senator Rodriguez, Rep. Gonzalez Vote For New Texas Budget

Austin – The Texas Legislature today voted on the state budget in both the House and Senate. Sen. Rodríguez joined the House members of the El Paso delegation in voting for the budget.

“This was a tough vote,” Sen. Rodríguez said. “There are missed opportunities in the budget that will hurt the state’s ability to continue competing in the future.”

In a news release, Senator Rodriguez pointed out a particular gap, saying “while the state added enough money to account for overall growth in the number of students, maintaining a per-student funding level of $5,140, it did not account for inflation, which means the dollar per student doesn’t go as far. It also undercounted our Medicaid obligations over the next two years; this means that it projects a lower number than we’ll actually have, something that has become routine and that ensures each session begins with an “iou” of between $1 billion and $2 billion.”

“Instead of prioritizing these needs, the state instead put nearly $1 billion into ‘border security,’ a phrase that inaccurately frames our communities as threats, instead of as the opportunities that we are. El Paso and other border communities are important to the state and nation for trade, cultural exchange, and great places to live and work,” Sen. Rodríguez added.

On her vote, Representative Mary E. González said, “I’m proud to have helped secure funding for Texas Tech Health Science Center- El Paso’s future dental school, to continue funding crucial special items for UTEP like their pharmacy school, to maintain funding the state’s Rio Grande Compact lawsuit so that our farmers receive their fair share of water, and to support an additional $32 million for an intelligent transportation system at two El Paso ports of entry in order to increase security measures and expedite trade.”

“Even in a tough budget session, we were able to protect key El Paso interests,” added González.

The Health and Human Services budget includes $500 million in increased funding to Child Protective Services, which will pay for nearly 600 new caseworkers. It provides additional funding for mental health services, including a total of $160.5 million to address community mental health services added capacity, waitlists, collaborative grants for jail diversion, and psychiatric hospital beds.

Other budget highlights include an additional $350 million for the Teacher Retirement System, $71 million to the TEXAS Grant Program, and $44 million for Graduate Medical Education (GME).

“It is said that a budget is an expression of priorities. If so, much in this budget, like border security funding, represents misplaced priorities,” Rodríguez said. “But it also attempts a careful balance of interests, based on hard numbers and factual data. We’ve made the mistake of constraining ourselves to the point where we struggle to meet our needs, even though we have the means to do so. Without doing something extraordinary, this budget reflects the best effort this body is able to make.

“It is in that spirit that I vote for this budget, ” Senator Rodriguez said.

Some El Paso area highlights:

  • Texas Tech University Health Sciences Center-El Paso received $142 million for the biennium, including a rider to establish the dental school.
  • UTEP received $229.2 million for the biennium, including continued support for the pharmacy school.
  • EPCC received $63.6 million for the biennium.
  • Intelligent Transportation System: Authorization for $32 million for a system to streamline commercial traffic at the Zaragoza Bridge and Bridge of the Americas.
  • McDonald Observatory: $5.2 million for the biennium.
  • Rio Grande Compact / Texas-New Mexico Water Lawsuit: $500,000, and allowance for increments of $1 million.
  • 8th Court of Appeals District, El Paso: $3.374 million for the biennium.


Analysis: A High-Stakes Budget Duel – If Texas Lawmakers Want One

The Senate doesn’t like the House’s hit on the Rainy Day Fund. The House doesn’t like the Senate’s delay of a deposit into the state’s highway fund. Neither wants to raise taxes. But all is not yet lost — unless they want to fight about it.

While the Texas House and Senate are reconciling the differences in their proposed state budgets, they’re still wrestling over which money to spend — a debate that imperils the only legislation they must pass to avoid going into overtime this summer.

The House’s dependence on tapping the state’s swollen savings account is a no-no in the Senate. That’s a $2.5 billion difference.

The Senate wants to delay a newly established deposit into the state’s highway fund, a bit of magic that would fill a $2.5 billion hole in their proposed budget. The House has questioned its constitutionality and, perhaps more importantly, has said it would violate the House’s official rules.

It’s a classic end-of-session legislative standoff, fueling speculation of extra legislative sessions after the current session’s Memorial Day finish, of government shutdowns and political posturing. The two budgets are always different; the end of every legislative session features a committee of 10 members — five from the Senate, five from the House — who iron out the differences and then take a negotiated settlement back to their chambers for final approval.

Their differences over spending are significant this year — they usually are. But their squabble over what money to spend is a new wrinkle.

Neither side has endorsed a full-tilt raid on the state’s $10.2 billion economic stabilization fund, better known as the Rainy Day Fund. But the House would hit that savings account for $2.5 billion. Senators have talked about using the fund for one-time expenses — long overdue repairs to state hospitals for Texans with mental illness, for example — but not for ongoing operations.

The Senate wants to balance its budget with an untested accounting trick that delays, from one budget cycle to the next, a transfer from the state’s general fund to its dedicated highway fund. Such bookkeeping dodges are commonplace in Texas state government; delaying an expense avoids red ink in one period and pushes it to the next, for a future Legislature to remedy.

This one is different because the transfer itself — using sales tax windfalls for highway spending — was only added to the state Constitution in November 2015. This is the first time it’s been available for financial chicanery.

The regularly used bag of tricks involves normal and large payments the state makes to local school districts, to retirement funds for state employees and teachers. Pushing one or more of those from one period to another pushes the red ink along and helps balance a current, tight budget.

In fact, the House is using its own delay of payment to local schools to balance its budget — a $1.9 billion shift. That one is time-tested — proven to be beyond the interest of voters or anyone else who’s not an accountant or a bond dealer.

Texas Attorney General Ken Paxton tried to clear up the legality of the Senate ploy, saying last week in a nonbinding opinion that he believes a judge would side with the Senate. That’s important, but it doesn’t answer the violation of the House rules cited in a letter to the AG from an attorney for House Speaker Joe Straus — a foul that would allow any member to raise a state budget-killing objection.

On the Senate’s end of the building, Lt. Gov. Dan Patrick has objected, a little more strongly each time, to using the Rainy Day Fund to get through a tight budget year. He’s not creating a rule, but in the Senate, what this lieutenant governor says amounts to the same thing.

As a practical matter, Texas lawmakers have plenty of options even if they stay out of savings, leave the transportation money alone, don’t raise taxes and don’t cut the spending they’ve planned. They have plenty of other tricks in their bags — tricks that have been used before and that have not been challenged on either end of the Capitol.

It’s not a matter of finding a way to fix this — there are plenty of ways. It’s a question of whether fixing this is what Texas legislators — and their leaders — want to do.

More columns from Ross Ramsey:

  • Some Texas lawmakers want to kill the franchise tax that so many businesses hate. So far, so good. But it might leave a hole in the state’s pocket when it inevitably comes time to rebalance the state’s financing for public schools.
  • The state of Texas has been on a losing streak when it comes to redistricting and voter ID laws, with federal judges repeatedly finding that the state intentionally discriminated against minorities. Whose legal advice were they following?
  • If you’re in favor, Texas lawmakers will meet with you and put your legislation on the fast track. Others have to wait, sometimes for weeks, for a chance to talk for a few minutes in a committee hearing room in the middle of the night.

Author: ROSS RAMSEY –  The Texas Tribune

How do the Texas House and Senate Budgets Compare?

The House and Senate have passed their own versions of a budget, but crucial differences remain.

Now the two chambers must reconcile their funding priorities before they can agree on a final draft and send it to the governor.

At first glance, the House’s $218.1 billion budget and the Senate’s $217.7 billion budget do not seem far off.

But on some of the most hot-button issues, including public education and health care, the chambers took markedly different approaches about what to fund, how to fund it, and what to cut.

Here’s a look at how the two budget proposals compare, using information from the Legislative Budget Board.

Total budget

tx budg

The House and Senate are pretty close on their total spending, but their methods of finance vary greatly. The House would use $2.5 billion from the Rainy Day Fund, the state’s savings account that currently has a balance of more than $10 billion. The House also freed up $1.9 billion for the next two-year budget by delaying a payment for public schools.

The Senate, on the other hand, finds extra revenue by delaying a $2.5 billion payment to the highway fund that voters overwhelmingly approved in 2015 to boost the state’s efforts toward addressing congestion. House budget writers have argued that that accounting trick is unconstitutional.

Medicaid funding

tx budg2

Medicaid, the federal-state insurance program for the poor and disabled, is one of the Legislature’s largest funding requirements. The House Medicaid budget includes $63.2 billion (of which $25.8 billion comes from state revenue), while the Senate budget would spend $63.9 billion (of which $26.2 billion comes from state revenue).

Despite the program’s expected growth due in part to how fast the state’s population is growing, the House budget assumes it can cut costs by $2.6 billion because of “increased federal flexibility” under the Trump administration.

Neither the House nor the Senate budget covers the projected cost of medical inflation.

Related story: Texas House budget writers send budget to full House with massive health care cut

Public education funding

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Public schools are another of the Legislature’s largest expenses, and the vast majority of that spending goes through the Foundation School Program. Texas public schools are expected to grow by more than 80,000 students annually, meaning the state needs to spend more in its next budget to maintain the current levels of spending per student.

The House budget would spend $42.1 billion on public schools. While that’s less than current state spending on schools, House leaders are also working on adding another $1.5 billion into public education through a separate school finance reform package favored by House Speaker Joe Straus. The House budget also pushes $1.9 billion into the next two-year budget cycle by delaying a payment to schools.

The Senate budget, meanwhile, would spend $42.0 billion, but it would cut state spending on schools by $1.8 billion. That is mostly made up for by revenue collected by local governments from rising property taxes.

Related story: Texas Senate approves its budget, shifting school costs to local taxpayers

Child Protective Services and foster care funding

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Amid a crisis in the state’s child welfare system, lawmakers in both chambers voted to boost funding for Child Protective Services and foster care. Both the House and Senate are spending more money to tackle many of the same child welfare priorities, including hiring more CPS caseworkers and continuing pay raises for many frontline workers.

Yet each chamber’s budget only boosts funding by about half of what CPS told lawmakers it needed to address its most pressing problems. The House budget would boost spending for vulnerable children’s programs by about $546 million, while the Senate budget includes a $429 million bump.

Related story: Houston foster child’s death spurs concern over placement shortages

High-quality pre-kindergarten funding

tx budg5

The fight over pre-kindergarten funding has been one of the main political flashpoints of the legislative session so far. Texas Gov. Greg Abbott called on lawmakers to fund $236 million for his preferred “high-quality” pre-K grants — “or not at all.” Neither chamber is currently on track to heed his words. The House set aside $117 million for “enhanced pre-kindergarten capacity,” while the Senate offered $65 million for a “public-private partnership” for pre-K programs.

Related story: Texas Senate panel tentatively votes to defund Abbott’s pre-K program

Border security funding

tx  budg6

Despite a Republican president in the White House who has vowed to dramatically boost federal border security efforts, both chambers are largely committed to the surge in border funding they approved in 2015, which pays mostly for the stationing of state troopers in counties near the Texas-Mexico border.

But where the House and Senate disagree is whether to maintain the current surge or boost it even further. The House approved $653.1 million, which would maintain the current level of trooper deployment, while the Senate approved $800 million, which includes a plan to hire 250 new troopers and 126 additional support staff.

Related story: Texas poised to maintain most of its border funding for Trump’s first years

Tapping the Rainy Day Fund

 tx  budg7

Another touchy subject this year is whether lawmakers are willing to use their savings account to help weather tough times. The House proposal would use $2.5 billion from the Rainy Day Fund, which currently has a balance of more than $10 billion fed largely by state taxes on oil and gas production.

The Senate’s budget does not touch the fund, instead relying on an accounting trick involving transportation funds that has drawn sharp criticism from House leaders. Abbott has recently declined to take a firm position on the Rainy Day Fund, though he told lawmakers earlier this year he was confident they could balance the budget without “looting” their savings account.

Authors: Chris Essig and Edgar Walters – The Texas Tribune

State Senator Rodríguez’s statement on the Senate Budget

Austin – State Sen. José Rodríguez released the following statement on S.B. 1, the Senate’s version of the state budget, which passed the Senate unanimously Tuesday:

Passing a budget is our basic responsibility, one that none of us take lightly. It is for this reason that I vote now in favor of it, although I do have some serious concerns. This is a start, and that’s what I’m voting for, so that we may move the process forward and make it better. 

Three cycles after the draconian cuts of the 82nd Legislature, we have made incremental progress. However, we have the ability to do much more. 

This session, as last session and the session before, we have the means to make up lost ground. 

 Unfortunately, it seems that the majority of this body prioritizes tax cuts over education and other essential government functions.

That is why I voted against SB 17, and against SB 2, just to give two examples of bills that will 1) limit the funds available for future school funding, and 2) limit local government’s ability to set priorities and respond to emergencies – especially so for rural counties, as we heard repeatedly. I plan to vote against SB 9, which would set a new, even more stringent limit on spending. Given how tight we’ve been, I’m not sure what policy purpose is served by tying the hands of future legislatures.

The state’s “Rainy Day Fund” continues to grow.  We now have more than $10 billion and are estimated to have almost $12 billion by the end of the 2018-19 biennium.  We should be using the Rainy Day Fund to ensure that we’re adequately funding our schools and health and human services.  

The basic allotment provides for per-student funding of $5,140 in the 2018-19 biennium. This is the same amount as the last biennium, so we’re falling behind. 

We also are cutting our higher education institutions – $332 million from universities, state colleges, and technical schools.  

Further, the federal budget proposal from the White House has major cuts in financial aid and research. So Texas higher education may take a double hit. 

In both cases, quality educational development is economic development, a proven way for nations – and states – to prosper. 

We are not spending enough on health care, and it’s unclear how we will pay for the Medicaid shortfall left by last session’s underfunding of almost $2.6 billion. 

For DPS “border security,” the agency is allocated almost $500 million under the Secure Texas heading. Adding up other funds, we’re looking at another $800 million for the biennium. 

Members should remember, and the public should be aware, that what happened during the “border security” vote in 2015 was that we took DPS out of the Highway Fund, and placed it in General Revenue. 

The majority voted to do that despite a lack of data then, and now. There are as many drugs, gangs and guns in Texas communities as there were before this started, because it never was a border issue.  If that had been the choice, without the rhetoric of “border security,” I don’t think members would have been as willing to set DPS against education, which is what we now face. 

I will continue advocating for education funding, for health care, for higher education, and for other special programs that make a difference in Texans’ lives, from the relatively small amount of $5 million for Relocation Services Contractors who play such an important role for people with disabilities to funding for the Adult Career Education grant program that is so important to my community to fully funding the critical Texas-New Mexico water lawsuit, as we did last session. 

With all that, this budget has some good things. CPS is funded at $430 million, which includes $300 mil for $1,000 raises for 828 additional caseworkers. That is not enough, according to experts and the agency itself, but it’s a huge step forward. It’s not a huge line item, but $25 million for school broadband access, which will help draw down hundreds of millions in federal funds, is a great investment. This budget provides $244 million for mental health care, which includes $64 to eliminate wait lists for community mental health services. 

All of these items are critical needs, but not all critical needs are addressed by SB 1.

I am voting for this budget with the understanding that it is a start. We have the resources to build upon this start.

Groups Push Texas Legislature to Fund Full-Day Pre-K

AUSTIN, Texas – Children’s advocates are aiming to convince the Texas Legislature to fund all-day pre-kindergarten classes in the 2018-2019 budget and beyond.

The Children’s Defense Fund-Texas and others hold a roundtable discussion in Austin Friday, to share reasons to permanently fund what is now a temporary, grant-based program.

Patrick Bresette, the fund’s executive director, says expanding pre-K will bring major benefits to some of the state’s neediest children.

“When you enter a session with some concerns about the overall revenue available, there are competing priorities,” he states. “But it’s hard to argue that putting some money at the front end of these early childhood programs shouldn’t be one of the highest priorities. The return on investment, the return on human capital and development, are just enormous.”

House Bill 4, which created the program, was a top priority of Gov. Greg Abbott in the 2015 session, but lawmakers only approved enough funding to support half-day classes.

Bresette says the goal this time around is legislative approval of the entire $236 million requested to fully fund the program.

He says research shows that pre-K classes are having the most impact on children in high poverty districts, such as those in inner cities and the Rio Grande Valley.

“Particularly in the areas of the state with a significant number of low-income families, and those who are English language learners, we know two things: Pre-K can be one of the most important tools to getting those kids jump-started, and that we’re only meeting a fraction of the demand,” he stresses.

Bresette adds that school districts say they need pre-K funding to be both reliable and sustained as part of the state’s overall education budget, in order to meet families’ needs.

“The districts are really looking for a more stable source of funding, as opposed to year-by-year,” he states. “I think that if we were to step up and really put the funding that was there to provide a full-day pre-K, you would see an enormous number of families taking advantage of that program.”

The Children’s Defense Fund is partnering with Texans Care for Children and the Texas Education Grantmakers Advocacy Consortium in backing the Pre-K program.

Author: Mark Richardson – Public News Service

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