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While You Were Out

Things do pile up when you're away from your desk for a holiday. All that happened during our 17th annual year-end break was the swearing in of a new president and of a new governor of Texas, the election and swearing in of a new lieutenant governor*, a major shakeup (and 24 hours later, an amendment to the shakeup) of Senate committees, and the release of U.S. Census numbers that give Texas two more seats in Congress after the 2002 elections. Oh, yeah, there's a new estimate on how much money will be available for the next two-year budget. And a mess of people changed jobs.

Things do pile up when you're away from your desk for a holiday. All that happened during our 17th annual year-end break was the swearing in of a new president and of a new governor of Texas, the election and swearing in of a new lieutenant governor*, a major shakeup (and 24 hours later, an amendment to the shakeup) of Senate committees, and the release of U.S. Census numbers that give Texas two more seats in Congress after the 2002 elections. Oh, yeah, there's a new estimate on how much money will be available for the next two-year budget. And a mess of people changed jobs.

The first urgent matter of the session that begins on Tuesday is an emergency appropriations bill to cover budget blowouts in Medicaid and other programs, and to fund a prison pay raise. That's a routine matter, but the numbers are bigger than usual and there are some problems with whether the state has enough money from the right kinds of income sources.

Gov. Rick Perry is still in the process of moving into his new digs in the middle offices of the Pink Building. He named a staff, hired some policy people, fired a group of long-time budget analysts and began a quick statewide tour to announce the start of a higher education push that will mark his work this session and his campaign for a full term as governor two years hence.

Still in the air, as usual: House committees. Speaker Pete Laney is notoriously slow to let loose of a list of who'll be on what panel; his reasoning last time we asked was that the new members hadn't been sworn in and he hadn't been elected to a new term yet. Even if he does make some changes, it would be difficult to upstage the reorganization in the Senate committees (see below).

That asterisk on the term "lieutenant governor" won't be a regular feature, but it underscores a curiosity. Bill Ratliff wasn't elected Lite Guv, at least technically. His fellow senators made him their presiding officer. He'll keep his Senate seat. Unlike a lieutenant governor, he's allowed to vote. Had he wanted to, he could have named himself to whatever committees he wanted to join. He does not, however, get the official title. We're going to call him Lt. Gov. Ratliff, and suspect everyone else will, too, but when it come time for official words, he's "Mr. President" (of the Senate) or the "presiding officer." Finally, if he runs for a full term in the office, he'll have to be clever with the wording. It wouldn't be a re-election campaign, now would it? That said, we're done with the asterisk.

After Ratliff was sworn in and made his brief remarks, somebody zipped onto the floor of the Senate, bounded past the press table and got to the new guy's extended hand before anyone else could. That would be the state's Comptroller of Public Accounts, Carole Keeton Rylander. Her official line is that she likes her job, but she's one of two Republicans—the other is Land Commissioner David Dewhurst—widely believed to be lusting for the Lite Guv's job in the 2002 elections.

That'll play out in its own time, but there will be some early clues on the developing relationships: Ratliff and other budgeteers are hoping Rylander will rescue lawmakers who don't want to vote early in the session to exceed the constitutional cap on spending. This is the finance problem attached to the emergency spending measure. It's boring on paper, but it's dynamite at election time, and lawmakers want a way out. Rylander is in the best position to find an escape route, and is looking for one.

The detailed numbers used in redistricting will be available by April Fools Day, but some big numbers are out: The USA has a population of 281 million. That's 646,947 for every congressional district in the country. Texas has 20.9 million people, enough to increase its number of congressional seats to 32 from the current 30. Another 445,000 Texans would have gained the state one more seat.

A Bag of Surprises, a Plate of Humble Pie

Sen. Rodney Ellis, D-Houston, looked like a cat in possession of a fat mouse while he was standing next to Gov. Rick Perry at a press conference on higher education. Maybe two mice. Perry was announcing that Ellis' higher education grants for Texas students will be the centerpiece of the new Guv's plan for colleges, and he was sharing the spotlight. And Ellis also knew something that the rest of us wouldn't know for a few hours: He will be the next chairman of Senate Finance.

Ratliff won accolades for splitting the committee chairs evenly between Democrats and Republicans. That reflects the reality that with Ratliff mostly acting as a presiding officer and not as a senator, there's a 15-15 partisan split in the upper chamber. Those laurels might have been the headlines on the committee announcements, but for the fact that Ratliff demoted three Hispanic committee chairs and cleared all Hispanics from the Redistricting panel. The slights dominated the coverage, and the new presiding officer applied a tourniquet the next day by amending his assignments, adding one Hispanic to redistricting and proposing a new subcommittee with a Hispanic chairman.

He got boxed by his penchant for efficiency and by what looks like an honest case of color blindness. There were 20 chairmen in the Senate last session if you count two special committees and four subcommittees. Ratliff dissolved the special panel on electric utilities and downgraded Border Affairs to a subcommittee. He killed three subcommittees and Veteran Affairs & Military Installations. He merged Human Services with Health Services. Six opportunities to chair committees died in the re-engineering and senators felt the pain. Hispanic members got a chairmanship on one committee and one subcommittee; both African-American senators won committees; Anglos (22 senators) got nine committees and a subcommittee. Women, both Anglos, got two of the 14 spots.

Troy Fraser, R-Horseshoe Bay, lost his co-chair's seat on redistricting and a subcommittee chairmanship. Mario Gallegos, D-Houston, the other co-chair on redistricting, also was busted. Judith Zaffirini, D-Laredo, kept only half of her Health and Human Services Committee two years ago when it was split; Ratliff recombined it, but put her elsewhere. He later added her to the redistricting committee. Chris Harris, R-Arlington, lost the lead spot on Administration, a panel that combines power over Senate office budgets and over the consideration of local bills. Carlos Truan, D-Corpus Christi, lost out when the Veterans panel was dismantled, but would get it back under Ratliff's proposal to recreate that panel as a subcommittee.

Mike Moncrief, D-Fort Worth, didn't have a committee two years ago but will chair Health and Human Services in Ratliff's lineup. The half that didn't belong to Zaffirini had belonged to Jane Nelson, R-Flower Mound; Nelson got the Nominations Committee. Royce West, D-Dallas, got Jurisprudence. David Cain, D-Dallas, got Harris' old job on Administration.

The Redistricting Committee got the only makeover that immediately caused open grumbling (as opposed to private grumbling and desk-beating). Ratliff, who doesn't like Committees of the Whole, cut the panel from to seven members from 11. Three GOP senators—Robert Duncan of Lubbock, Mike Jackson of LaPorte and Florence Shapiro of Plano—remain. Jeff Wentworth, R-San Antonio, had been at Nominations; he'll chair the apportionment panel. Democrats Ellis, Cain and Ken Armbrister of Victoria round out the panel. Before Zaffirini was added, South Texas had little voice on the panel. Perry's committee was remarkable for geographic balance and its lack of Anglo Democrats; Ratliff's went the other way. He seemed genuinely surprised when the absence of Hispanics was pointed out. But some critics didn't wait for repairs before starting to dogpile: Gonzalo Barrientos, D-Austin, said the new mix takes redistricting in the wrong direction, and told reporters he was "mulling over" whether he regretted his own vote to put Ratliff at the helm of the Senate. Gallegos speculated he was busted for supporting Al Gore for president. Neither gained ground in Ratliff's fix.

Finally, Ratliff gave a chair to each of his five declared opponents in the Lite Guv's race. Armbrister, Teel Bivins, R-Amarillo, J.E. "Buster" Brown, R-Lake Jackson, and David Sibley, R-Waco, each will remain where they were two years ago; Wentworth got an upgrade.

The Senate's Dot Race, Up Close

The Senate's vote to replace Rick Perry was originally supposed to be a complete secret. But some members wanted their votes known. Then, a group of newspapers wanted the whole thing opened up, but they went to the courthouse to lose a game they could have won in their own editorial pages. The papers let the issue slide by for two or three weeks before the editorial types figured out what the news types were writing about. Then, instead of banging the politicos around in editorials until the pressure built up, they did a couple of opinion pieces each and hired lawyers. In the end, the courts sided with the Senate, which commenced to have a closed vote that was strangely open in some ways.

You can't find out, at least through records, how a senator voted unless he or she signed their ballots. Nearly a dozen volunteered their result, but there are enough blanks on the scorecard to allow for some, ah, prevarication. Let 'em go. But look at what they did reveal by making the ballots, signed and unsigned, available after the voting was complete.

The rules of the presiding officer vote called for totals to be revealed after each vote once the race was down to four senators. Sixteen senators removed their names from the first set of ballots, so the race began with 15 contestants. Eight of them got votes in the first round: Sibley, 10; Ratliff, 8; Brown, 6; Armbrister and Zaffirini, 2 votes each; and Bivins, Ellis and Wentworth, 1 each. The bottom three had a runoff, which was won by Ellis, who got 12 votes to 10 for Wentworth and 9 for Bivins.

Ratliff and Sibley tied at 10 votes each on the next round, meaning Ratliff picked up a couple. Brown picked up one, getting 7 votes. Zaffirini got 2. Armbrister and Ellis each got 1 vote. In their runoff, Armbrister got 16 votes and Ellis got 14 (Harris was out of the room on that one).

Ratliff pulled into the lead for the first time on the next round, getting 11 votes. Sibley remained at 10. Brown lost some support and got 5 votes. Zaffirini climbed to 4 and Armbrister got 1 vote. Several senators said later that Democrats were parking their votes with Zaffirini, partly so they could sit back and see how the race would go, and partly to knock Armbrister, a highly visible George W. Bush supporter who was also the only legislative Democrat to join a lawsuit against five attorneys over their fees for winning a large settlement for the state from the tobacco industry.

After that, the results were announced each time. Many senators and other observers seemed surprised to hear that Brown had only 5 votes and that Zaffirini, who had never made public noises about being in the race, had 4, while Sibley and Ratliff were tied at 11. Zaffirini, with the lowest total, fell out, and two of her votes went to Ratliff, one each to Brown and Sibley.

That left Ratliff up a point, and the general assumption seemed to be that Brown's votes would cascade to him. But not all of the Brown voters were anti-Sibley; his votes split down the middle on the next round, and Ratliff was the winner, 16-15.

Senate Miscellany

Lt. Gov. Ratliff's committee assignments are contingent on a new set of Senate rules to allow the deletions, mergers and renaming of committees. That's why some members angered by his initial committee assignments were hopeful they had a lever to use for changes... Ratliff continued the practice of keeping chairs off of Finance, saying they don't have time to do that and another big committee job. It also spreads the power around and eases the pain of not getting a chairmanship.

• The two new members of the State Board of Education owe a little something to the new presiding officer of the Texas Senate. Ratliff was a key player in the bid to unseat Dr. Bob Offutt and to prevent social conservatives from winning the seat opened by the retirement of Will Davis. Ratliff helped hire and pay the consultants who worked on Dan Montgomery's campaign, as did Sen. David Sibley, R-Waco, who played school basketball for Coach Montgomery. Ratliff went out alone to help Cynthia Thornton win her primary last March. Both made it to the board.

Too Much is Not Enough

However you look at it, $5.1 billion is a lot of money. But in a week or so, state budgeteers will have all of us believing that the fiscal outlook is tighter than the bark on a tree.

The $5.1 billion is the amount of additional money the state will have available for the next two-year budget, according to the official estimate from Comptroller Carole Keeton Rylander. Put another way, the state will be able to spend that much more than what it's spending in the current two-year budget. That sounds like a load of dough, and it is.

An accomplished state number-cruncher can drain the happiness out of that estimate in about two seconds. First, the state is about $700 million in the hole on the current budget, so lop off that amount to cover current spending. That $700 million is a recurring amount, too, so lop off another $1.4 billion (it's a two-year budget, remember) to cover that.

With the $3 billion that's left, take care of natural and unnatural growth in current programs, some nickels here and some dimes there, and as a practical starting place, figure there will be something like $1.5 billion left for what an economist would call discretionary funds. Match that up with the various demands for money and we're off to the races.

Rylander said the state will have $60.8 billion available for general spending. Federal and other funds would increase the amount available to $106.8 billion. Among other things, that means the current state budget is probably going to be the last one to come in under $100 billion.

She also said that, because of some automatic fund transfers put in place by the Legislature, a boodle of money will go into the state's Rainy Day fund. Rylander said that account will get $475 million over the next two years, and will top $1 billion shortly after that.

The estimate is based on slowing economic growth; the comptroller's economists think the economy will grow 4.1 percent per year instead of the 6.4 percent average over the last couple of years. Revenues from sales taxes, motor vehicle and motor fuels taxes will drive the higher revenue numbers. The biggest single source of income to the state, sales taxes, should hit $30.6 billion, accounting for half of the state's tax income. That would be a 7.1 percent increase in sales.

There are several stinkers in the spreadsheets. First, franchise taxes are expected to drop 2.1 percent, to $3.9 billion, because of slowing corporate profits and tax breaks. Oil severance taxes are expected to fall 20.7 percent, to $659 million, because prices have held while production dropped. Gas severance taxes should decline by about 2.1 percent, to $1.8 billion.

And the state lottery is expected to continue its decline, dropping 5.9 percent to $1.6 billion. The estimators said the lottery's sales actually climbed a bit, but that the amount delivered to the state declined because of higher prize payouts and a couple of other factors. Rylander herself put it like this: "The lottery continues to mature and continues to disappoint."

And the Search for More Continues

It's hard to sell savings and such when the fiscal outlook is pretty good, but Rylander made a pitch for the four-inch-thick package of proposals she made public between Christmas and the New Year. If it all passed, she said, lawmakers could add $1.2 billion to the amount of money available to spend. In particular, she wants the Legislature to privatize the Worker's Compensation Insurance Fund, a move she says is worth $300 million, all of which would go into the Rainy Day Fund.

Lawmakers have a couple of other sources of money if they need it or want it. Rising property values have lowered what state law requires the state to spend on public education. That technically frees up some money, but legislators are unlikely to reduce education spending.

If the money's there, they have plenty of things to spend it on. If they decide it won't get them dragged into court, they could spend some on health insurance for educators. Another issue to put on the wish list came up during Lt. Gov. Ratliff's first press conference. He said retaining state employees is a big issue, and while he also said he won't push a particular agenda during the legislative session, suggestions from the corner office can go a long way.

Free College?

Gov. Rick Perry started his promised push for higher education with a pitch to eventually provide full college scholarships to every student who wants one. He wants to double funding for the Texas Grants program, and to move the state, eventually, to a student-based funding system for higher education. That would mean that instead of giving each college a set amount of money, the funding would be given to students who would then spend the money on colleges they wanted to attend.

Perry was quick to say that the program, a modified voucher system for higher education, is a long-term goal. That's because it would cost a lot of money and he wants the state to ease into it. Eventually, he said, the state would pay all of a student's tuition, fees and books at public colleges and universities, so long as the student met requirements about college preparatory courses and the like.

Perry's proposal would not pay for scholarships to private colleges. He also said that the proposals worked up by his Special Commission on 21st Century Colleges and Universities and his staff would not end all direct funding for the schools. The state would still have to pay for research and for buildings and property, for instance.

Help Wanted

Look at some of the bigger objects in the new governor's In Box: One empty position on the Texas Supreme Court, one at the Texas Lottery Commission and one at the Public Utility Commission.

Al Gonzales gave about five minutes' notice before leaving the high court to become the president's lawyer, immediately giving Rick Perry a big appointment to make in his first few weeks on the job. And two holdover appointees—Anthony Sadberry and Judy Walsh—are leaving their respective commissions to allow Perry to name some of his own people. Sadberry's term at the Lottery Commission actually ended—ready for this?—on February 1, 1997. Former Gov. Bush never named anyone to replace the Ann Richards' appointee, and he remained in place. Now he says he'll leave as soon as Perry names a new commissioner.

Walsh, an accountant who helped smooth things out at what was one of the state's nuttier agencies and helped lawmakers and her fellow regulators through a ticklish round of regulation reform, says she won't try to win reappointment. Her term was actually over in August 1999.

A Fast Special Election in South Texas

The day before the session starts, Rep. Henry Cuellar will be sworn in as Texas Secretary of State. Back home in Laredo, the wheels are already spinning on the race to replace him.

It's a short run, too: The election will be held before the session is two weeks old, on Saturday, January 20 and early voting starts with the date on this issue, January 8.

The list of candidates includes former Rep. Richard Raymond, a Democrat who now lives in Laredo but who served in the Legislature as a resident of Benavides. Raymond left the Texas House to run for land commissioner in 1998, losing to David Dewhurst. Also in the hunt are Carlos Ygnacio "CY" Benavides, a self-employed businessman; Javier Martinez Jr., a property consultant; and Maria Elena Morales, a lawyer. All of the candidates are Democrats. Martinez is a former legislative aide who worked for Sen. Eddie Lucio, D-Brownsville, and former Rep. Robert Earley.

Political People Overflow Section

Lt. Gov. Ratliff has started naming staff, and he's interviewing for some of his top-level posts. Vatra Solomon will continue as his executive assistant, a job she's had since he was elected to the Senate. Eric Wright, who left the Senate Finance Committee staff a while back to take a job at Public Strategies Inc., is back as chief of staff. Nick Voinis will be communications director; he was most recently at the comptroller's office in a similar post. At our deadline, Ratliff had not named a general counsel or a budget guru, but he was interviewing for those and other jobs. He does have a transition director on board. Don Edmonds, an old friend of Ratliff's who ran the senator's three contested campaigns for office, will be the chief resume herder.

Political People and Their Moves

You won't be seeing Joe Allbaugh around these parts unless the twister hits your trailer park; the enforcer of the Bush Administration in Texas will head the Federal Emergency Management Agency in the federal Bush Administration. Bush also announced what everyone suspected: Karl Rove, his minister of politics, will be Senior Advisor to the President, which means he'll continue to advise Bush on politics. He'll be in charge of three Washington-sounding things: the Offices of Political Affairs, Public Liaison, and Strategic Initiatives... Gov. Rick Perry loaded up his staff while we were out, with a lineup that includes a mix of people who worked him at the Lite Guv's office and some new faces. Returnees include Barry McBee as chief of staff, Ray Sullivan as deputy chief of staff, John Opperman as budget director, Donna White as director of administration, Kathy Walt as press secretary, and Eric Bearse as deputy communications director. The newbies include Bill Jones, a lawyer in the Houston firm of Cash & Jones, as general counsel; Dealey Herndon, former director of the State Preservation Board and a as appointments secretary; Patricia Shipton, a former legislative aide turned lobbyist, as legislative liaison; Victor Alcorta III, who had been general counsel to the Secretary of State, as policy director; Robert Howden, who ran the Austin office of the National Federation of Independent Business, as communications director; and Luis Saenz, who was executive assistant to Comptroller Carole Keeton Rylander, as deputy communications director... Velma Cruz Silva, who had been at the Texas Workforce Commission, is going to work as legal counsel to Sen. Leticia Van de Putte, D-San Antonio... Jane Dees, the spokesperson for Texas Secretary of State Elton Bomer, has left the Pink Building and moved into the eighth floor of the building to the west; she's now working in the press shop of Attorney General John Cornyn... Agriculture Commissioner Susan Combs lost her producer relations exec, Matt Brockman, to the Independent Cattlemen's Association, where he's now the executive director. In his place, she's hired Brian Murray from the Texas Department of Economic Development. That's a rehire, sort-of; Murray worked for TDA from 1985 to 1998 before going over to TDED... Former Rep. Terral Smith, Gov. George W. Bush's legislative liaison, jumped to the Locke Liddell & Sapp law firm to head the government relations team in that firm's Austin office... Judicial spankings: state District Judge Terry Canales got a public admonition from the State Commission on Judicial Conduct for setting fire to some utility polls while he was having a dispute with the power company. He settled up with the company and with federal prosecutors, then got slapped for failing to promote public confidence in the judiciary... Deaths: Rancher Mary Nan West, a former chair of the Texas A&M board of regents who was active in politics and civic groups, from cancer. She was 75.

Quotes of the Week

Sen. Bill Ratliff after winning a Senate election to replace Lt. Gov. Rick Perry: "I'm a little bit overwhelmed. I guess I never thought it would come to this. I guess I was afraid to wish."

Public Citizen's Tom "Smitty" Smith, on Ratliff's personal ban on being lobbied by his brother and his son: "When Lt. Gov. Ratliff is in power, it might be a good opportunity to put into law the policy his family has adopted internally, because other families might not have the same integrity."

Demographer Steve Murdock of Texas A&M University, on the state's 22.8 percent population growth over the last decade: "It means that one of every eight new people in the U.S. was in Texas."

Sen. Jon Lindsay, R-Houston, quoted in the Houston Chronicle on those new census numbers and redistricting: "I see nothing but major conflict. I am beginning to sense it even now."

Vice President Al Gore, talking to the Congressional Black Caucus (and its new chairman) at a swearing-in ceremony: "America is about to see some bold new leadership from the State of Texas. Of course I'm talking about Eddie Bernice Johnson."

U.S. District Judge Janis Jack of Corpus Christi, chilling federal prosecutors with a blast at their confusing environmental case against Koch Industries and prompting them to drop 86 of their 97 charges: "What I'm sitting here wondering is how on Earth you all are going to explain this to a jury, and how you expect to actually get a conviction on this."

Texas Weekly: Volume 17, Issue 26, 8 January 2001. Ross Ramsey, Editor. George Phenix, Publisher. Copyright 2001 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 (800) 611-4980 or email For news, email, or call (512) 288-6598.

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