Special Session Is In Full Swing – Education Is Coming Up Short

After Republicans finally reached agreement over the most contentious area of budget negotiations – education funding – Democrat Senator, Wendy Davis, successfully filibustered a key piece of legislation, SB 1811, and forced a special session. Governor Rick Perry called a special session on Monday, May 30. The special session began promptly at 8:00 a.m. the following morning and can last as long as 30 days. The first two items on the governor’s list are the non-revenue and school finance bill, SB 1811, and Medicaid reforms that were part of SB 23.

Democrats may have spoiled the sine die parties, but Republicans hold a majority in the House and Senate, and Governor Rick Perry has the power to determine what issues are heard during the special session. Since he first called a special session, he has already added congressional redistricting to the agenda. There is speculation that he may add a few more Republican “wish list” items that didn’t pass during the regular session, but that remains to be seen.

Democrats and third party groups are making headlines by claiming that the Legislature should use the special session to tap into the Rainy Day Fund to support public education. Texans are getting their first chance on Thursday, June 2 to testify on the school finance plan being debated in the Legislature. However, Lt. Governor Dewhurst warned that the Senate would no longer use the rule requiring two-thirds vote to bring up legislation, so any attempts to block legislation by Democrats won’t be possible.

It appears that the calls to use more from the Rainy Day Fund will continue to be ignored. Lt. Governor Dewhurst stated that “we’re not going to renegotiate the budget. We’re going to move Texas forward.” However, it is rumored that many House members are having second thoughts about the budget they already voted for and its effect on their local school districts. Odds favor that the status quo remains, and the budget that was passed during the regular session stays largely intact during the special. However, assuming that is what happens, it will be interesting to see how the large cuts from the budget play out for legislators when they get home. Legislators have reacted to a November electorate that clearly called for cuts in spending and no new taxes; but will voters be happy with the reality of these cuts? That is the question making many legislators nervous, and if there is significant blow-back from parents and other community leaders, legislators will need to start thinking about ways to restore at least some of the funding cut from this year’s budget.

Keep in mind that many of the cuts for this budget were achieved by pushing large payments to public education into the next biennium. That means next session’s legislators will face a shortfall that will likely need to be covered by an immediate injection of money from the Rainy Day Fund. That Rainy Day Fund has essentially been spent by the next legislative session. If voters demand funding for education be restored going forward, where will legislators get more money to do that and close the gap caused by the ongoing structural deficit caused by the property/franchise tax swap of 2007? That’s the multi-billion dollar question facing legislators and the state as a whole.

To read more on Texas’ special session, please visit the San Antonio Express-News and San Angelo Standard Times.

The Final Countdown – How Do Voters Feel About The Texas Budget Crisis?

It is down to the wire for the Texas Legislature to pass the budget for the next biennium, which ends this coming Monday, May 30. Texas lawmakers agreed to an $80.6 billion two-year spending plan on Saturday, May 21 when a 10-member conference committee, along with Lt. Governor Dewhurst and House Speaker Straus, compromised on the House and Senate budget plans. Lt. Gov. Dewhurst stated that final approval is hinged on the passage of several bills – mainly financing public schools and universities. Four days later, and with only four days left in the regular session, the House and Senate have yet to agree on education funding.

An article in The Statesman dated May 25 states that the two chambers have until Thursday to reach an agreement on how to appropriate the $4 billion reduction in state school aid. House leaders want a temporary fix that takes six percent off the top of each school district for the next two years, but by 2013, school funding would return to its present levels. On the other hand, Senate leaders say this approach would add to the pile of budget problems in 2013. Some of the troubles already in queue for 2013 are the $4.8 billion in projected Medicaid costs not covered in this budget.

It’s been harped on that the Senate, House, and Governor Perry do not want to spend the Rainy Day Fund or raise taxes to solve the budget shortfall, but a recent poll by the University of Texas / Texas Tribune shows how voters feel about the state’s budget crisis. When it comes to the $9.4 billion Rainy Day Fund, 43 percent of voters agree the state should spend some or all of the money to balance the next budget, and 39 percent say it should be left untouched. Texas voters want cuts, but they oppose major cuts to education and health and human service: 85 percent oppose cuts to public education, 86 percent don’t want cuts to Medicaid, and 90 percent say no to cutting the Children’s Health Insurance Program. Unfortunately for voters, these areas are subject to the largest funding reductions.

Also according to the poll, when asked if they preferred to balance the next budget with spending cuts, by raising revenues, or something in between, only four percent of voters would choose to balance the books with new revenue and 18 percent said it should be balanced with budget cuts. Voters and legislators agree that budget cuts are necessary, but voters retreat when specific programs like education and Medicaid are brought to the chopping block. The Texas Legislature has tough decisions to make, but it is important that they consider the effects of their final decisions on future budgets. After all these cuts and no new sources of revenue added to the mix, when the 2013 budget discussions begin there will be no more money to strike without severely underfunding critical programs that matter most to voters.

To read more about the Texas Legislature’s $80.6 billion two-year agreement and education and Medicaid funding concerns, please visit Bloomberg.

Will There Be A Special Session? Senate Leadership Thinks So, Gov. Perry Disagrees

The end of Texas’ 82^nd Legislative session is May 30 – that’s just over ten days – and the Legislature continues to delay important budget measures. Finance measures that are critical to balancing the budget were delayed in the House on May 18 as lawmakers struggled to reach an agreement. “We’re one day closer to a special session,” Senate Finance Chairman Steve Ogden, R-Bryan, said after House Appropriations Chairman, Jim Pitts, R-Waxahachie, postponed the House’s consideration of revenue and education bills. Part of the delay was due to the 200 pre-filed amendments to Senate Bill 1811, which is a Senate education bill that must pass to balance the budget. House leaders are hoping to convince lawmakers to withdraw the amendments before considering the legislation on May 19 – if it happens as scheduled.

Despite Senator Ogden’s pessimistic outlook on the budget wrapping up by deadline, Governor Rick Perry remains optimistic, stating a budget “absolutely” can pass before regular session ends. The main hang up is funding education. Senator Ogden stated that the two chambers should agree where they can and “then go to a special session to work on our disagreements.” Most of the quibbling is between Republicans. To that end, Representative Pete Gallego, D-Alpine, thinks the arguing is a result of the GOP “starting to understand how incredibly deep these cuts are going to go into the public education system […] Reality is sinking in.”

On Tuesday May 17, Comptroller Susan Combs raised her estimate of revenue available for 2012-12 spending by $1.2 billion; but those numbers don’t close the $4 billion gap between the House and Senate on education spending. Governor Perry is pushing the deep cuts of the House but Lt. Governor Dewhurst is siding with the Senate. There is a clear divide between the two chambers and the executive office. Inflexibility on everyone’s behalf is preventing the Texas budget from being solved with the resources at hand, and no one is actively looking for new revenues to end the stalemate … yet. So far, discussion has focused entirely on solving this year’s budget crisis, but some members, particularly in the Senate, and even outside business interests are concerned about how Texas will grapple with a similar revenue shortfall next session when further cuts and accounting measures will not be as much of an option.

To read more about the delays in the House, visit San Antonio Express and The Houston Chronicle. For details on the new revenue estimates and the budget divide, please visit Star-Telegram.

The Clock Is Ticking On The House And Senate Budget Debate

The Texas Legislature is feeling the pressure of the looming deadlines imposed by the end of this legislative session on May 30. The only thing the Legislature must accomplish during regular session is passing the state budget, but that task seems to be the most difficult with a $15 billion-plus deficit and two very different budget plans from the House and Senate.

The Senate Finance Committee decided on Thursday, May 12 to take an additional $800 million from the Rainy Day Fund for the current budget, not the one two years from now. In total, the Senate proposed withdrawing $3.97 billion from the emergency fund and $3.1 billion has already been authorized by the House. However, Governor Perry has claimed he will not support using more than $3.1 billion, and the House is not likely to agree to using more either.

The House wants to keep its deep budget cuts but the Senate wants to spend more. These differences are creating a gridlock in the budget debate and time is running out with just over two weeks of session remaining. As time counts down, it is becoming apparent that the House may be unwilling to move from their $164.5 billion two-year plan, and the Senate is not willing to compromise funding for certain programs like education and Medicaid. As Senator Steve Ogden warned, “If the House doesn’t show some more flexibility, we’re going to special session.”

$8.3 billion is the magic number dividing the House and Senate chambers. No one wants to see important things such as education and public service programs go underfunded, but Texas has a daunting budget deficit that cannot be overlooked. The clock is ticking for the Texas Legislature to come to an agreement, but additional non-tax revenue sources must be found if the Senate and House are to agree on a budget. The Rainy Day Fund and the Senate’s accounting maneuvers are not appealing to the House or Governor Perry, and they are certainly not a long-term solution to solving Texas’ budget woes.

To read more about the Texas budget debate, please visit The Statesman and San Antonio Express-News.

Budget Update: Senate Finally Passes Its Budget After Week Delay

The Texas Senate has finally passed its budget for the next biennium after Senate Finance Committee Chairman, Steve Ogden, has been trying to gather a two-thirds majority for days. Senate leaders decided to use a procedural maneuver to avoid the seemingly impossible two-thirds agreement in the chamber. Republicans bypassed Democratic opposition by using a special Senate rule that allows House bills to be considered on Wednesday and Thursdays only with a majority approval, and the Senate budget proposal originated in the House. Senators voted along party lines on Wednesday, May 4 with a 19-12 vote to approve the budget plan.

The delay in the Senate’s decision was caused by the Rainy Day Fund and whether or not the state should use more of the emergency money to close budget shortfalls. Republicans argued that the reserve fund should be left untouched in case there is a state emergency, but Democrats disagreed and claimed that without the money, schools and public services would be underfunded. Senator Ogden offered an amendment that removed the rainy day money from the budget, which garnered additional conservative Republican support but lost some Democrats. The compromise allowed the budget to move forward, but the Senate and House still need to review their non-tax revenue measures. Nonetheless, the Senate has remained true to its promise that it will make cuts to the budget and not raise taxes; and at least that is something the House and Senate will have in common when both chambers meet to debate the Texas budget.

Now the bill is headed to the House-Senate conference committee to be debated by select Senators and Representatives before it is sent to both chambers for final approval. However, some leaders believe the Senate has surrendered much of its bargaining power by removing the additional rainy day funding and splitting the vote along party lines. The House bill already proposes using $3 billion from the Rainy Day Fund and given the Republican majority in both houses and Governor Perry’s commitment to preserving reserve funds, it is probable that the two chambers will need to utilize new, non-tax revenue sources and not the Rainy Day Fund to close the budget deficit for the next biennium.

House Appropriations Chairman, Jim Pitts, has confirmed that members will look at non-tax revenue bills the week of May 9^th. The Texas Legislature’s time is running short to dig up enough revenues without raising taxes and their list of options is short.

To read more about the budget, please visit The Statesman or Quorum Report.

House Passes Redistricting Maps And The Senate Continues Budget Debate

After much deliberation that lasted into the early morning, the House passed its redistricting map around 3:00 a.m. on Thursday, April 28 with a 92-52 vote. Legislators’ emotions peaked and the debate was heated as many of them fought to keep their legislative seat. The new maps turned several Republicans and a few Democrats against each other by pairing some of the current districts, which means two current legislators will be running against their colleague for one seat in the next election. More can be read about the long redistricting debate at The Texas Tribune’s website. The new House redistricting plan protects most of the Republican two-thirds majority, yet some Republican members want the map to increase conservative seats and limit the number of losses. However, Republican leaders have so many seats to defend that they cannot draw enough safe districts to protect every incumbent in future elections. Empower Texas has more details on the House redistricting maps.

In the other Texas chamber, the Senate Finance Committee is struggling to gain the necessary votes it needs to debate its budget plan on the Senate floor. The main reservation is the provision to use an additional portion of the state’s Rainy Day Fund to pay for more spending. The Statesman’s website provides more detail on the Senate’s budget dilemma. Governor Rick Perry has already stated he will not support additional money from the Rainy Day Fund for balancing the state budget, and the House has already proposed using $3 billion from the $9.4 billion emergency reserve to pay for the left over deficit from last biennium. The current debate over using Rainy Day Funds centers around whether the next two year budget should use these funds. Lt. Gov. Dewhurst has sent some mixed signals on the issue. His latest position seems to be that he supports using $3 billion for the budget, but only as a “contingency”. In other words, he’s betting that the news from the Comptroller will improve, and there will be no need to use these funds as the economy improves and more revenue flows into the state’s treasury over the next several months. The Senate has decided to postpone redistricting until it has passed its budget plan.