House and Senate to Negotiate TxDOT Funding Compromise

Representatives from the House and Senate are preparing to spend the next week informally negotiating a compromise proposal to boost funding for the Texas Department of Transportation, with the goal of fully passing a measure by next Friday.

Senators convened briefly Friday to accept House Joint Resolution 2, a transportation funding measure passed by the House a day earlier. Senate Transportation Chairman Robert Nichols, R-Jacksonville, made clear that version was dead on arrival in the Senate by immediately amending the bill to replace its text with language similar to a proposal the Senate had passed earlier. Senators voted unanimously to accept Nichols’ amendment and then passed that new version of HJR 2.

Lt. Gov. David Dewhurst then appointed Nichols and four other senators — Kevin Eltife, R-Tyler; Juan "Chuy" Hinojosa, D-McAllen; John Whitmire, D-Houston; and Tommy Williams, R-The Woodlands — to represent the Senate in negotiations on working out differences between the two proposals. The House is not scheduled to convene again until Thursday, preventing House Speaker Joe Straus from formally appointing members to a conference committee on the bill until then. Dewhurst said he has arranged with Straus for members from both chambers to negotiate informally in the interim, with the hope that a compromise can be reached by Wednesday and presented to both chambers on Thursday.

“As of today, we have 11 days left in the special session to address some significant policy differences with the House on transportation … I believe that time is of the essence,” Dewhurst said.

Both measures are projected to increase TxDOT’s funding by close to $1 billion a year. The agency has said it needs about $4 billion a year in extra revenue to maintain current congestion levels.

Since Gov. Rick Perry added transportation funding to this year’s first special session last month, lawmakers have been working on a measure that would take advantage of the current oil drilling boom to help address cash-strapped TxDOT without raising taxes or fees.

A majority of House and Senate members favor a plan that would ask voters to approve a constitutional amendment that, if approved, would divert some of the oil and gas tax revenue earmarked for the Rainy Day Fund toward road construction and maintenance. The two chambers disagree on the mechanics of the diversion and whether there needs to be a “Rainy Day Fund floor” in place that would automatically block the diversion if that fund’s balance falls below a certain level.

The version that senators approved Friday would divert the Rainy Day Fund’s future oil and gas production tax revenue to the state highway fund as long as the Rainy Day Fund’s balance is above $6 billion.

The House version is more complicated, not only boosting TxDOT’s funding but also putting an end to a long-standing and much-criticized diversion of a nickel of the state’s 20-cent-per-gallon gas tax to the state’s school fund. The House plan would not impact education funding but change the revenue source that a small portion of the state’s overall education budget comes from, according to supporters of the measure. The House plan does not include a “Rainy Day Fund floor” provision.

Dewhurst said he was hopeful both sides could find a workable compromise that includes “a stable funding proposal for transportation that also safeguards our Rainy Day Fund with a floor.”

Nichols said he was entering the negotiations with an open mind.

“There are positive things on both approaches,” he said.