Conference Committee Approves Most of Texas Budget

Sen. Steve Ogden, R-Bryan and Rep. Jim Pitts, R-Waxahachie.
Sen. Steve Ogden, R-Bryan and Rep. Jim Pitts, R-Waxahachie.

House and Senate negotiators have reached agreement on everything in the state budget except for public and higher education and a section of general provisions that can be used later to make sure the numbers in the budget balance.

They left some controversial issues — like funding for family planning — for later. And the leaders of the conference committee — Appropriations Chairman Jim Pitts, R-Waxahachie, and Sen. Steve Ogden, R-Bryan — said they need to resolve their differences over education quickly if they're going to finish a budget during this regular session.

Time is running short. The conferees have to agree on a budget and coordinate that with other pieces of legislation that plug in, including a group of "fiscal matters" bills that generate money for the budget with cuts, accounting tricks and other measures, and on two bills that cover a nearly $4 billion deficit in the current budget, which runs through the end of August.

Those other bills are scheduled for debate in the House on Wednesday and have to win approval without much change or there won't be enough money to cover the budget the conference committee has been working on. Senate Bill 1811 is a critical piece of that; it includes a provision that would accelerate collection of the state's business tax that would raise about $800 million but that faces some opposition in the Legislature.

Lawmakers are also hoping Comptroller Susan Combs will make more money available. She's been waiting to see what that business tax will produce — it was due this week — before making any adjustments to her forecasts. Sales tax returns lagged for the first year of the two-year budget period, but have been growing at a robust rate for the last several months. As a result, some budget writers expect her to raise her estimate of what will be available to spend, and expect to hear one way or the other in the next few days.

The health and human services section of the budget approved by the committee tonight is, according to the Legislative Budget Board, is about $4.8 billion out of balance.

Rep. Sylvester Turner of Houston, one of two Democrats on the 10-member panel, questioned some of the numbers in that health and human services budget, asking, "Is this real, or is this hopeful?"

"It's a stretch," admitted Rep. John Zerwas, R-Houston. "But it's absolutely certain it won't happen if we don't try."

Zerwas said some of the spending levels are based on hopes that efficiencies and changes in programs will save that much, and said "about $1 billion" can be put in the hopeful category.

"Is that a billion on top of what you're not funding?" Turner asked, referring to lowered Medicaid estimates that might force lawmakers to come back in 2013 to make up the difference between what that program actually costs and the lower amount set aside for it in the budget.

The chairmen as much as said the budget will fall short in that regard; Ogden assured reporters after the meeting that the money will last "long enough to take care of any shortfall during the next regular session." (Lawmakers return in early 2013.) If the budget is short then, they can talk about a supplemental appropriations bill to make up any difference. He has previously said that that's one reason to leave some money in the Rainy Day Fund — to cover any shortfalls that are baked into the budget being written now.

Earlier Monday, the Senate approved a $3.97 billion withdrawal from the state's Rainy Day Fund to cover that current deficit. That's $855 million more than the House used; if the House goes along, that could make that same amount available for the 2012-13 budget.

And Pitts said he plans to take his fiscal matters bills to the House on Wednesday, whether the conference committee has reached agreement on the public and higher education spending in the budget or not. They won't know the full size of the new budget until those bills are out and the budget is complete, and Pitts said he doesn't have a running tally.

"We haven't added it up yet," Pitts said.

The two were vague about the real deadline for settling the budget. There have been some conversations about passing a budget with everything but education included, but they're still trying to get everything done so that no special session is needed. Tonight, they agreed on eight of the 10 articles in the budget, leaving just that education package and the general provisions that are always the last thing done. When does it really have to be done?

"Sometime this week," Ogden said, declining to fix a date. "Sometime this week."

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