Money's Not the Only Thing

Coming soon to a House near you: The first real look at how this bunch votes on tough issues.

The budget — and its companion, a supplemental appropriations bill — will hit the floor at the end of next week. That's the first potentially divisive material to reach the full House this session. It could provide some clues to the coalitions and combatants in legislative debates ahead over contentious issues like Voter ID, college tuition, unemployment insurance, and so on.

It'll also be a test of sorts for House Speaker Joe Straus, who won that office, in part, on a pledge to let members run the House instead of following a strong hand on the tiller.

The holiday break is the last one before the end of the session, and the prospects are pretty bleak for anyone who's not trying to kill legislation. The slow start and the crush of bills promise a gnarly traffic jam over the next few weeks.

Those ^%$#@*!!! Deadlines!

When this last legislative break is over, there will be seven weeks left in the session. And the last three of those form a procedural tourniquet that cuts the flow of bills until time's up. Here's the calendar, courtesy of the elves who make the whole machine function.

Click on the image to download a printable copy.

$178.4 Billion in Ten Minutes

In a 10-minute meeting, the House Appropriations Committee unanimously sent a $178.4 billion budget to the full House for a vote next week; a day earlier, that panel voted out a supplemental bill adding $3.3 billion in federal spending and subtracting $3 billion in general revenue spending to the current budget's total.

The panel earlier passed a separate supplemental bill that would spend $864.7 million to patch up Galveston and other areas ravaged by Hurricane Ike. Much of that funding is now in the supplemental bill.

Pitts is hoping to have that legislation in front of the entire House on Thursday of next week and the full 2010-2011 budget on the floor the next day. Pitts says he'll ready to go through the weekend on the budget debate if that's what it takes to pass the bill.

The House's proposed budget includes $11 billion in federal stimulus money and actually cuts general revenue spending (by using federal stimulus dollars where state dollars would otherwise have been used). Overall, analysts from the Legislative Budget Board told the panel that this version increases the budget by 5.1 percent over current spending, or about $8.7 billion over the next two years.

Last week, the Senate passed its version, which is bigger, spending $182.2 billion. Both versions leave the balance of the state's Rainy Day Fund alone (it's expected to total $9.1 billion at the end of the biennium), and neither included $556 million in federal stimulus funds for Unemployment Insurance, which the governor has said he'll oppose.

Details, Details

The supplemental appropriations bill totals $3.3 billion or $290 million, depending on whether you're counting spending or just the effect the bill has on general revenue. The former is how humans look at it; the latter is the way state budget-writers see it.

Whichever.

The fiscal note on the bill — HB 4586 — details the spending. Some highlights: The bill sends money to the state's junior colleges to pay for health benefits, a complicated and long-simmering issue between the schools and the state. There's money for salaries and wages and overtime and such — $125.1 million — at the state prison system. Almost $700 million is going into Medicaid and Medicare programs. And there's a good-sized list of spending related to damage from hurricanes and other natural disasters.

Much of the money is from the federal stimulus package, and the difference in those two spending numbers comes because state budgeteers are using stimulus money to supplant state spending. In effect, they're using federal money where they would ordinarily use state money, and leaving the state money in the Rainy Day Fund, which they hope to protect for two years. They expect to need that money more in two years than they need it now.

• The 2010-2011 budget includes money for bonuses of up to $1,000 for retired educators and state employees and a $1,000 bonus to state employees (not including state judges, higher education employees and some others), and a five percent pay increase for prison guards and others in the adult and juvenile prison systems.

The "wish list" of items that got into the bill but that don't have funding totals $14.6 billion.

As in the Senate plan, House budget writers used some of the federal stimulus money to leave the balance of the Rainy Day Fund untouched. They poured in $11 billion in federal funding and took out general revenue spending of $5.5 billion. They hope Comptroller Susan Combs' numbers hold and that that swap will leave $9.1 billion in the RDF for the next budget.

The Appropriations Committee version of the budget is here, and the more readable, less detailed summary of it is here.

What a Difference a Month Makes

Requiring voters to bring photo identification to the polls would cost the state $2 million, according to the fiscal note attached to the bill that came to the House from the Senate.

That's the amount, according to the note — a sort of financial impact statement — that the Secretary of State would spend to make sure Texas voters know what the rules are when they go to the polls.

"The bill would require the Secretary of State, in cooperation with appropriate nonprofit organizations and with certain political parties, to establish a statewide effort to educate voters regarding the identification requirements for voting. The agency estimates that this would cost $2 million out of General Revenue Funds for fiscal year 2010. The bill would make no appropriation, but could provide the legal basis for an appropriation of funds to implement the provisions of the bill, and a contingency rider for $2 million is included in the proposed Senate appropriations bill."

That's from an April 5 Fiscal Note. When the Senate voted, they were using the March 5 Fiscal Note. And that education program wasn't in the bill. But there was a discussion on the floor, when Senate Finance Chairman Steve Ogden said he had included $2 million in the state budget to pay for the SOS' new duty.

The voter ID hearing started off as you might have expected, with several members stating their positions for and against — the aginners were more vocal.

"We have found no documented cases of in-person at the polls voter impersonation... so, I ask, what is this bill about?" asked Rep. Rafael Anchia, D-Dallas. He went on to call low voter participation "the beast in the room" and suggested that's what lawmakers should work on.

Rep. Betty Brown, R-Terrill, was quick: "I just want to quote a senator... who said, 'We want to make it easy to vote, but hard to cheat.'"

And Rep. Mark Veasey, D-Fort Worth, called voter ID a racial issue. "Is this right?" he asked. "Can you really sleep with yourself at night knowing that most of he people who are going to be denied the right to vote are black or brown or poor?"

And then the members settled into hours of testimony from experts, with public testimony set for Tuesday. Weather forecast for that one: Expect scattered rallies and signage, lost citizens in the Pink Building, scarce to nonexistent parking in the area of the Texas Capitol, and a fair number of TV cameras.

Full Pot

If House members are going to vote on gambling this session, state Rep. Edmund Kuempel, R-Seguin, wants them to do it all in one vote.

With 16 gaming bills on his committee's agenda, Kuempel said his intent was to let folks have their say on all of it, then to put all of it into one omnibus gambling bill. His plan is to get the legislation out of the Licensing & Administrative Procedures Committee in a week or so.

What the omnibus bill will look like is anyone's guess. The bills under consideration run the gamut from relatively modest (local elections to legalize slot machines) to grandiose (Las Vegas-style resort-casinos).

Sheldon Adelson, CEO of Las Vegas Sands Corp., stole the show at the morning portion of the hearing, lasted into the evening after a break while the House was in session. If Donald Trump is seeking a mentor, a likely candidate for the position is Adelson, whose corporation is named after the iconic casino he razed to build his Venetian Resort Hotel and Casino. Adelson might have lost more money in the past 12 months ($22 billion, according to Forbes.com) than Trump has ever had.

Testifying in favor of HB 1724 and HJR 70 by Rep. Jose Menendez, D-San Antonio, (which we wrote about here) Adelson showed committee members glitzy renderings of his multibillion-dollar resort-casinos in Las Vegas, China and Singapore.

Menendez's bills would allow the construction of up to 12 casinos — seven in urban areas, two on the Gulf Coast and three to-be-decided later — plus one each for Texas' three recognized Indian tribes. The bill would also allow slot machines at racetracks. A minimum of 12 percent of gross slot revenues would go to increasing purse money for racing.

Adelson said if casinos are legalized, the state's major metros would be attractive candidates for his kind of destination resorts, complete with convention centers, hotels and restaurants; those, and not the gambling, are the real economic drivers for surrounding areas, he said.

Suzii Paynter, director of the Christian Life Commission, the ethics and public policy office for Texas Baptists, says she's not against the kind of economic development Adelson is proposing.

"We're all for convention centers, golf courses and hotels," she says. "Bring a resort. Just leave out the slot machines."

Paynter has three main arguments against proposed gaming legislation: 1) Casino proponents won't be able to follow through on their revenue estimates; 2) Legalizing slot machines may trigger federal law exceptions, allowing Indian tribes to construct full-blown casinos (also, she says, allowing casinos might entice some 27 out-of-state tribes with Texas connections to begin legal action to build their own casinos here); and, 3) What she calls "the predatory nature of the business model" of gambling, bringing addiction, bankruptcy and crime to surrounding communities.

At the other end of the spectrum from Menendez's broad legislation, HJR 99 by Rep. Chente Quintanilla, D-El Paso, would allow voters to approve gambling county-by-county, in the same way local voters have control over liquor laws.

Witnesses from the Kickapoo tribe near Eagle Pass are concerned that legalizing gambling elsewhere will hurt their gaming operations, the proceeds of which keep the tribal government operating. If casinos are legalized, the Kickapoos want to be able to establish their own casino off their reservation, presumably nearer to a major metro area like San Antonio.

Former state Rep. Pat Haggerty, R-El Paso, who's now a bingo lobbyist, wants slot machines allowed in bingo halls (and American Legion halls, etc.) if they're going to be allowed in places like casinos and racetracks, too.

Entergy II

The Texas Supreme Court, revisiting Entergy v. Summers, a controversial decision on a worker injured on that utility's property, landed in the same place they landed the first time. The court ruled that Summers, who worked for an Entergy contractor, doesn't have a case against the utility. At issue: Whether a premises owner who provides workers' compensation coverage for the employees of an independent contractor still has the liabilities of a premises owner, or is treated as a general contractor without that liability. The court chose the latter, in what amounted to a 6-3 decision.

The new opinion is here, with concurrence, another concurrence, and a dissent. The original opinion, from August 2007, is here.

The reactions? Labor called it a kick in the teeth and said the ruling "flies in the face of clear legislative intent." Becky Moeller, president of the Texas AFL-CIO, accused the justices of playing to their campaign supporters and ignoring the law. She got an echo from Texas Watch, which said the ruling "jeopardizes community and workplace safety, undermines corporate accountability, and ignores more than a decade of legislative intent."

Business groups were pleased with the new ruling. Dick Trabulsi with Texans for Lawsuit Reform said the court "ignored a firestorm of criticism from personal injury trial lawyers and followed the law as written. Courts should always interpret statutes to mean what the words of the statute plainly say, just as the Court did today." The Texas Association of Manufacturers agreed with that, saying the ruling "upholds a century of precedent."

Several pending legislative proposals would change the law to what the unions and their lawyers thought it was before the two Entergy rulings.

Flotsam & Jetsam

Judge Sharon Keller's hearings — she's accused of refusing a death penalty appeal because it came in after the 5pm closing time — will be held on August 17.

Convicted killer Michael Wayne Richard was executed by the state hours later. The State Commission on Judicial Conduct says Keller, the presiding judge of the Texas Court of Criminal Appeals, should be punished. She's the head of the state's highest criminal court. The highest civil panel — the Texas Supreme Court — chose state District Judge David Berchelmann Jr. of San Antonio as the "special master" to run the trial and to make recommendations to the commission. And that panel's decision could be appealed to the Supremes.

• The state's public school finance formulas need tweaking soon to keep that system from becoming unconstitutionally imbalanced, according to a report from the Legislative Budget Board. The LBB suggests lawmakers could put more money into school finance or change the formulas for doling out that money. The Legislature had a special session three years ago to bring that funding system into compliance with the Constitution. That's when they passed the current business margins tax and the current school formulas. But the repairs turned out to be short-lived; LBB estimates the difference between per student funding in richer and poorer school is increasing. What had been a 12.8 percent difference in 2006 has grown to an estimated 15.2 percent this year — nearly $900 per student. In a classroom of 25 students, that's a $22,500 per year difference, or enough to pay half the salary of a new teacher.

• That's not the only glum report from the Legislature's finance department — there's a new primer on teacher and state employee benefits, and the state's pension funds. The headlines, you've read: The big pension funds lost money in the market during the last six months, and retirees still gotta get paid. The proposed budgets for the next two years take care of the immediate expenses on pensions, but if the balances stay low, it's another potential hickey in a few years. And health insurance is in the report, too. This report, unlike the first one, doesn't contain recommendations. But some of the holes it describes are deep.

• Roger Williams, who's hoping to become the next U.S. senator from Texas, picked up endorsements from U.S. Rep. Kay Granger, R-Fort Worth, and from basketball coaching icon Bobby Knight, who retired after leaving the head job at Texas Tech University. The Granger pickup is a two-fer; she'd been mentioned as a potential replacement for Kay Bailey Hutchison herself, and this nod to Williams takes her out of it. Insert the usual caveat: Hutchison, considering a run for governor, hasn't quit yet and isn't required to do so even if she makes the governor's race.

• The federal stimulus will cost Texas 131,400 jobs by growing government at the expense of the private sector, according to a study done for the Texas Public Policy Foundation by Arduin, Laffer & Moore Econometrics. That report assumes federal help for unemployment insurance (opposed by the Guv and pushed by many lawmakers) would lead to permanent increases in UI taxes on business. They estimate the drag on the private sector would cost jobs, and recommend lowering taxes to free up business money so those businesses will increase employment in their part of the economy.

• Sales tax revenue for the state totaled $1.6 billion in March, down 3.8 percent from the same month in 2008. Comptroller Susan Combs blamed weakness in retail trade, mining and construction, and other sector. For the year-to-date, the numbers are still outpacing last year even with the March drop. For the first three months of this year, sales tax payments were up 1.9 percent over the same period the year before.

• Texas is fining the Plainview Peanut Co. $14.6 million for alleged food safety violations. Those problems were discovered after a salmonella outbreak traced to a Georgia company was blamed for nine deaths and hundreds of illnesses. The fine is apparently the largest ever levied by the Texas Department of State Health Services, but the treasury might never see the money: The company is in bankruptcy.

• Around lunchtime on April 16, students at the University of Texas plan to walk out of class and march on the State Capitol as a protest against legislation that would allow concealed handguns on state university campuses. We found out about it from management; they sent a memo to teachers to alert them to the walkout.

Political People and Their Moves

Dewey Brackin made partner in the government affairs section at Gardere Wynne Sewell’s Austin office. He's a former assistant AG and specializes in the food and beverage industry's dealings with regulators and lawmakers.

Gov. Rick Perry appointed John Chupp of Arlington to the 141st Judicial District Court, replacing Judge Len Wade of Fort Worth. Chupp's an attorney with the Guerrero Law Office; Wade's leaving the bench to join a Fort Worth law firm.

The Guv wants Olen Underwood of Willis to continue on as presiding judge of the Second Administrative Judicial Region for four more years.

Perry named Larry Holt of College Station to the Texas State Library and Archives Commission. Holt's an attorney.

Gerry Evenwel of Mt. Pleasant — the retired director of benefits for Pilgrim's Pride — is Perry's newest appointee to the Correctional Managed Health Care Committee, charged with developing a health plan for Texas prison inmates.

And Perry named Glyn Crane of Longview, Carolyn Harvey of Tyler, and Ann Schneider of Austin to the Aging and Disability Services Council. Crane is president of Troy Business Forms. Harvey is director of nursing at Behavioral Hospital of Longview. Schneider is a former nurse and founder of several healthcare businesses.

The Dallas-based Allyn & Co. won Pollie Awards — the Oscars of political advertising — for ads it did for state Sen. John Carona, R-Dallas, and for its campaign for Smoke-Free Dallas.

Quotes of the Week

Rep. Betty Brown, R-Terrell, talking about the difficulty of Asian-American monikers with a witness testifying before the House Elections Committee: "Rather than everyone here having to learn Chinese — I understand it's a rather difficult language — do you think that it would behoove you and your citizens to adopt a name that we could deal with more readily here?"

Rep. Leo Berman, R-Tyler, talking to the Austin American-Statesman about Voter ID legislation: "There's so much fraud that even the district attorney or the attorney general won't prosecute it. If they did, they'd have to stop prosecuting murderers and rapists."

Sen. John Carona, R-Dallas, on his push for local option taxes to pay for roads: "I won't be accused of sitting on my bottom and doing nothing. When we arrive here, we take the easy jobs and the tough ones. I do not want to be a talk-radio Republican. I want to be a problem-solving Republican."

Judge Eric Clifford of Paris, quoted in the Los Angeles Times about the decision to send Aaron Hart, who has an I.Q. of 47, to prison for 100 years on sexual molestation charges: "It was a sad situation. I was about to cry. The jury was crying. Everybody looked at everybody like, 'What the hell do we do?' The only option we were presented was prison. We don't have any facilities in the state of Texas for any type of care for somebody like that."

Former President George W. Bush, quoted in The Dallas Morning News on cleaning up after his dog Barney: "It dawned on me, for eight years I was dodging this stuff and now I'm picking it up."

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Texas Weekly: Volume 26, Issue 14, 13 April 2009. Ross Ramsey, Editor. Copyright 2009 by Printing Production Systems, Inc. All Rights Reserved. Reproduction in whole or in part without written permission from the publisher is prohibited. One-year online subscription: $250. For information about your subscription, call (512) 302-5703 or email biz@texasweekly.com. For news, email ramsey@texasweekly.com, or call (512) 288-6598.