Liveblog: Texas Legislature Passes $15 Billion In Cuts

State Sen. Steve Ogden, R-Bryan, pauses during Memorial Day services in the House chamber on Saturday that honored fallen Texas soldiers.
State Sen. Steve Ogden, R-Bryan, pauses during Memorial Day services in the House chamber on Saturday that honored fallen Texas soldiers.

After final debates in the House and Senate, Texas lawmakers passed a two-year state budget on Saturday that cuts $15.2 billion from current spending — most of that in health and human services — but avoids increased taxes and leaves $6.5 billion untouched in the state's Rainy Day Fund.

The vote in the House was 97-53 and 20-11 in the Senate.

Our liveblog of the debate begins right after this description of what's in the budget approved by House and Senate negotiators. (Scroll down for updates.)

Still ahead is a Sunday vote on a critical piece of legislation — SB 1811 — that provides $3.5 billion in non-tax revenue for the 2012-13 budget and that revises school finance formulas to cut $4 billion from what the state would otherwise owe public school districts — and that's not counting funding for the estimated 80,000 new students that enter Texas schools each year.

The proposed 2012-13 budget is $15.2 billion smaller than the current budget. That's an 8.1 percent cut in all funds spending — a modern record — and it's an even bigger cut when inflation and population growth are figured in.

The biggest cuts are in education and in health and human services, which together make up 75 percent of the total budget. The proposed budget cuts 17.2 percent, or $11.3 billion, from health and human services, and cuts $844 million from public and higher education. What amounts to 1.1 percent cut comes from removing funding for discretionary grant programs for full day pre-kindergarten, remedial reading and math tutoring, and library resources. But on top of that, as part of the budget package, lawmakers will vote Sunday on a new set of school finance formulas. Without that change in law, schools are due to get $4 billion less than they'll get under current law.

Higher education gets a cut of about 4.3 percent.

The health and human services cuts are deceptive. Budget writers lopped $4.8 billion off of their estimates of what Medicaid will cost over the next two years. The idea is that costs might drop because of changes in law, including new managed care provisions passed by the Legislature, or that a recovering economy will simultaneously increase state revenue and lower the need for services. Lawmakers return in 2013 for their next regular session, and if neither of those things happen, they say, they've got at least $4.8 billion set aside in the state's Rainy Day Fund to cover their bet.

So-called general revenue spending — the part of the budget that comes from state taxes and other state revenue, totals $86.8 billion, or $1.6 billion less than the current budget. That difference would be larger if federal stimulus money was added back in. Lawmakers balanced the current budget with that federal stimulus money; general revenue spending, if that's included, is $9.9 billion smaller in the new budget than in the current one.

The higher education cuts include $180 million in formula funding and a  10 percent reduction to health-related institutions. Community colleges don't lose any formula money, but they and the other institutions don't get any money for expected larger enrollments. Special items funding at state colleges and universities gets cut by 25 percent, or $215 million. Financial aid for students is gut by $150.4 million, including cuts in TEXAS Grants, Texas Equalization Grants, scholarship grant sand B-On-Time funds. The state is cutting what it spends on group insurance for higher education employees by $99.3 million.

The budget for border security nearly doubles, to $219.5 million from $111 million in the current budget.

Funding for the Texas Emission Reduction Plan will drop 43 percent, or $98.3 million, in the new budget.  Grants for local parks disappear, and state funding for two small but high-profile programs — boll weevil eradication and brush control — are being halved.

Business and economic development programs are being cut by $2.7 billion, most of it federal money, including some stimulus funds that are no longer available.

Spending on transportation will increase $3.9 billion, including $3.3 billion in general obligation bond proceeds.

Liveblog

by Ross Ramsey
Senate Finance Chairman Steve Ogden, R-Bryan, told members that the budget cuts were made "not because we wanted to but because the public demanded it."

"This has been the single most challenging process I have been involved in since running for the Texas House. "
by Emily Ramshaw
Over here in the House, Pitts is laying out the resolution needed to take up the budget.
by Ross Ramsey
Ogden says lowering Medicaid estimates was only responsible because there's enough Rainy Day money to cover it.

He says, "We will not be short more than $5 billion under the most pessimistic scenario that I'm aware of."
by Ross Ramsey
Odgen: Without new revenues, "You've got to make a decision on what is an appropriate cut and what is a draconian cut."
by Morgan Smith
Ogden tells Sen. Rodney Ellis that even with the $4 billion less in state funding to public schools: "You can still get a first class education in Texas, all you've got to do is want one."
by Emily Ramshaw
House passed budget resolution, now taking up the actual budget.
by Emily Ramshaw
Pitts, in the House, says conference committee version of the budget is an improvement: We added nearly $1.2 billion (for public education). We increased funding for financial aid. We added funding for community colleges. "Combined we increased funding for higher education by more than $850 million."
by Morgan Smith
Ellis tells Ogden he's a great policy mind but a "good spinner" too. He's speaking against the budget, which he says makes the most severe cuts in state history.

"We won't use the word severe, let's use largest," responds Ogden.
by Emily Ramshaw
Pitts in the House: "Some may argue we have not added enough money. Some may argue we added too much. In reality that budget we passed in April dangerously underfunded critical parts of state government."
by Ross Ramsey

by Emily Ramshaw
Pitts: "This budget doesn't hurt our economy. In fact the investments we're making in higher education, transportation funding and cancer research alone will create thousands of jobs within the next biennium. Your vote should not be a party vote."
by Morgan Smith
"For the vast majority of people that I represent, and most members on this floor represent, most people in Texas are nowhere near middle class...and I dont think that this budget...does justice to them and answers the hard questions," Ellis says, adding, "I don't think anyone on this floor would have gotten defeated or will be defeated if we used the Rainy Day Fund. That's about someone else's political aspirations."
by Emily Ramshaw
Pitts says cuts to nursing homes have been largely averted: "We added $173 million so the only reduction our nursing homes have received is a 3 percent reduction they took in 2010-11."
by Emily Ramshaw
Pitts: We are only now making our way out of the worst recession since the great depression.... This is a budget that expects this state to live within its means but also provide the means for this state to continue to grow and continue to prosper.
by Morgan Smith
"If we will just tighten our belts for two years," says Ogden, "We'll be able to do a lot better job with the budget in two years," because of the improving economy.
by Emily Ramshaw
Hochberg at the back mic, questioning the level of financial aid in the budget. "You would agree with me that that number still is substantially below the current biennium number of students receiving aid."
by Morgan Smith
Lucio says he's voting nay against the budget "with a lump in my throat" because of the respect he feels for Ogden. He adds: "I hope next session we can make a firmer commitment to our bipartisan tradition like our two-thirds rule...it protects us from short-term thinking." Recall that the Senate passed HB 1 using an arcane rule that allowed them to avoid collecting the two-thirds votes needed to bring it for consideration on the floor.
by Morgan Smith
Ogden says he's frustrated that the Legislature didn't vote for the "billions of dollars" outside the state treasury — like the Tobacco Fund — to cover some of the budget hole. "Texas, once again, is not broke, it has billions of dollars in money, what we are dealing with is a cash flow problem," he says.
by Emily Ramshaw
Villarreal at the bac mic now: Saying that despite Pitts' claims it's an improvement, "other health care providers are going to see an additional 27 percent cut relative to current service funding."
by Emily Ramshaw
Villarreal launches into women's health and family planning services. "My understanding is the cuts implemented on this House floor remain. And when you aggregate what the changes are... there's a drop of about 66 percent." ($60-some million)
by Emily Ramshaw
Villarreal says 280,000 will no longer have access to family planning services. Rep. Zerwas, who's on the conference committee, acknowledges: "It's a significant number."
by Morgan Smith
Ogden pushing the argument that the improving economy is going to ease budget woes next time around hard. He says the Legislature made the cuts because "the state's electorate demanded that we do them."
by Morgan Smith
Sen. Whitmire's up on the mic now, challenging Ogden on the point that the electorate wanted the cuts. He asks: So did voters two years ago want us to spend $15 billion more then? Who were we responding to then?
by Emily Ramshaw
Pitts: "I cannot go through every line item in this budget" — as the line at the back mic grows.
by Morgan Smith
Whitmire says that Ogden has to distinguish between wanting reductions in Washington government and state government. "Because I think in Texas voters still want us to provide basic services," he says.
by Morgan Smith
"I think you make a good point," Ogden tells Whitmire, about the fear of Washington spending, "But what's going on in Washington had a dominating impact on what we did here."
by Emily Ramshaw
Gallego at the back mic: "There are more kids in the public school of this state now than there were two years ago. But there's not more money going to the schools than there was two years ago." Pitts says some of these issues will be addressed tomorrow when the House takes up SB 1811, a fiscal matters bill.
by Emily Ramshaw
Gallego: Questioning why Article III, education, was left for the end. "It would seem to me, what happens is, you decided how much to spend on everything else, and what was left over is what public ed gets."
by Morgan Smith
Whitmire trying to pin Ogden on a comment he made last week saying that the budget wouldn't force school districts to layoff employees. Ogden says it's true, districts have three options: 1. Spend their reserves 2. Raise property taxes or 3. Tighten their belts in other areas.
by Emily Ramshaw
Pitts: The majority of the members in this House had a desire not to raise taxes. I heard the election results in November.
by Emily Ramshaw
Castro asking how much revenue was raised by new fees.
Pitts: The only fees we increased since we left this chamber was bills that passed this chamber, and bills that passed the Senate chamber, that increased fees to pay for certain projects. I think it was $23-25 million.
by Morgan Smith
Whitmire asks Ogden about his remarks on opening day about the importance of reforming the business tax, something lawmakers didn't get around to this session.

It brings in about $4 billion less than anticipated, Ogden says, and that is making it much more difficult to keep property taxes low.

"Behind Medicaid," he says the business tax, "is the single biggest problem I can think of."
by Emily Ramshaw
Rep. Reynolds speaking in opposition to the budget. Says Pitts should be commended for his hard work. But says HB 1 is disastrous. "We chose to look at short-term solutions and gimmicks, using bandaids and chewing gum... to get us through the session."
by Morgan Smith
Freshman Sen. Jose Rodriguez tells Ogden: "Democrats are invited to the dance but left stranded on the dance floor."
by Ross Ramsey
House Democrats want a new set of school district runs that don't include the $830 million the federal government has released to Texas. They contend including it distorts what the new school finance formulas actually do. The school formulas — up for approval in House and Senate tomorrow — are key to making this budget balance. Here's the Democrats are saying, from their letter to House Speaker Joe Straus (the signers are Garnet Coleman, Jessica Farrar, Pete Gallego, and Sylvester Turner):


These funds are not included in HB 1 and are not part of the school finance package being presented to legislators. Because we are preparing to consider legislation and a budget that negatively impacts our school districts by $4 billion, we request the Legislative Budget Board provide a revised analysis without the Edujobs funds to more accurately reflect the impact our local districts will feel upon passage of HB 1 and SB 1811.


by Morgan Smith
Sen. Judith Zaffirini up now: "Budget is a compromise between the House's horrific budget and the Senate's awful alternative."
by Emily Ramshaw
Rep. Otto speaking for the budget: "This is by far the most difficult budget any of us on Appropriations have worked on." He said the budget is "the best we can do on the priorities of the House with the resources we have."
by Emily Ramshaw
Rep. Davis: "We keep saying we're not raising revenue but we're feeing them to death. It's flooding and we need to be using those (Rainy Day) monies."
by Emily Ramshaw
Democrats in the House keep speaking out agains the budget. Conference committee members are defending their hard work. Crownover up now.
by Morgan Smith
In the Senate, Democrats all start out their anti-HB 1 harangues with Ogden love-fests. "I love the way that you pinch your cheeks" when you get nervous, says Sen. Leticia Van De Putte.
by Morgan Smith
Not surprisingly, prospective U.S. Sen. Dan Patrick is the first Republican to stand up to speak on HB 1.

"So this budget is a budget that lives within our means and does not raise taxes?" he asks. "Yes," Ogden says.

And here we go with the vote.
by Morgan Smith
20 ayes, 11 nays: the Senate has adopted the conference committee report on HB 1.
by Morgan Smith
And Lt. Gov. David Dewhurst's press release has already popped into my inbox:

"When we started this process, liberal interest groups were clamoring for a $10 billion increase in spending. The Texas budget shows Washington and the other 49 states that it's possible to make government live within its means without raising taxes. This budget makes a historic $15 billion cut from current spending, while still providing ample funding for our good teachers, our school children and our seniors."
by Ross Ramsey
The vote was all of the Republican senators plus Hinojosa, the vice chairman of Finance.
by Emily Ramshaw
Castro suggests that gaming should've been considered, because it's not a mandatory way to raise revenue: "That never had a serious discussion in this legislative session."
by Emily Ramshaw
Rep. Villarreal: "This budget is a betrayal of Texas families."
by Emily Ramshaw
Villarreal: "We had other choices we could have made, but the Legislature failed to have the courage to do what's right for all of Texas. Budget cuts will have a disproportionate effect on women."
by Ross Ramsey
Hinojosa was the only Democrat to vote for the budget. He's the vice chairman of Finance.

by Ross Ramsey
Ogden was all smiles after the vote. Even the senators who voted against the budget showered him with praise for his work on it.



All of the photos here were shot by Bob Daemmrich for the Tribune.
by Emily Ramshaw
Rep. Turner: "Come May of 2013, this budget... will run out of money. Providers in our hospitals will not be paid. And what we have done... is that we have placed $4.8 billion on what I call the Medicaid mastercard."
by Emily Ramshaw
Turner: This budget is shaky at its best. And for all of my conservative friends, no taxes - true - no rainy day fund - true - but deferrals, some speedups, funding that's questionable all exists.
by Emily Ramshaw
House passes budget 97-53. Among Republicans voting against: Simpson, Pena, Van Taylor.
by Julián Aguilar
House adopts conference committee report on HB 1. Republican "no" votes include Peña (Edinburg) V. Taylor (Plano) Simpson (Longview) and Torres (Corpus Christi)
by Julián Aguilar
House adjourns until 1p.m. Sunday.

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