Incentives Under Fire

Gov. Rick Perry’s office has asked a member of the Emerging Technology Fund’s advisory committee to consider resigning over a recent investigation into a stock deal — the latest dustup involving state incentive funds, which state lawmakers may target in the next legislative session.

The Emerging Technology Fund provides money for research into future money-making technologies. A similar effort, the Texas Enterprise Fund, encourages companies to move to Texas or expand their operations in the state.

Andrew Wheat of Texans for Public Justice, a progressive watchdog group, believes that over the past year, the funds have been used as little more than a campaign tool for Perry's re-election bid. “On the one hand, you are presenting something to the voters as being an unmitigated success that makes you particularly qualified for re-election,” Wheat says. “And on the other hand, it’s your office that’s charged with administering the program itself.”

Audio: Ben Philpott's story for KUT News

For years, both Republican and Democrats have criticized the funds. Some think the government shouldn't be picking favorites in the free market by using state tax dollars, while others worry about how the money is distributed.

State Rep. Jim Pitts, R-Waxahachie, the chairman of the House Appropriations Committe, thinks the funds should remain in place as long as the governor’s office is removed from the equation. During the 2009 legislative session, Pitts took issue with a $50 million grant awarded to Texas A&M University — Perry's alma mater — to build a pharmaceutical research lab, grilling the governor’s office on the money and asking Texas A&M officials why they chose the Enterprise Fund to secure funding. “Why’d you go to the governor’s office to build a building? And are we going to have that from now on? Instead of going through the Legislature for a university to build a building, you’re going to go to the governor’s office,” Pitts said during a committee hearing.

No matter who administers the funds after the 2011 session, both will likely have less money to hand out, with lawmakers trimming billions of dollars from the next state budget. But Perry spokeswoman Katherine Cesinger says they're still a worthy investment for the Legislature and taxpayers. “We can see the return on those investments — whether that means the emerging technologies into the marketplace here in Texas, the commercialization of those technologies here in Texas, as well as continuing to attract businesses from all over the country,” Cesinger says.