What Will You Say When You Get Home?

Imagine you're a House member and the Senate has handed you a chance to vote to cut school property taxes in half, to replace them with a penny-and-a-half addition to the state sales tax and an expansion of that tax to a bunch of stuff that's not taxed now, and to kill the Robin Hood system of finance that's so unpopular with voters. Fast-forward to a town hall meeting after the session. Somebody asks why you didn't fix school finance while you were in Austin. The senator says she voted to kill it and halve property taxes, and then hands the microphone to you.

After weeks of showing pieces of a school finance plan to senators, lobbyists, reporters and other officeholders, Lt. Gov. David Dewhurst finally detailed the proposal, starting with a first page featuring the signatures of the co-sponsors—every member of the Senate.

Local school property taxes would drop to a dime, for local enrichment and only if local voters approve. A new state property tax would be capped at 75 cents, effectively replacing about half of the current local property tax. School districts would no longer send "excess" tax revenues to the state or to other school districts that aren't so well off; everything but local funding would come from the state. School districts would get a promise that the new system would give them at least as much money as they get under the current system.

Sales taxes would rise from the current 6.25 percent to something between 7.5 and 7.85 percent. Most non-medical services would be taxed. Car and truck sales taxes would go up. And the Senate bill would create a task force to study funding formulas and refinements of the plan and to try to figure out what would constitute "excellent public education." If the proposal has holes in it, that task force could presumably find some patches in time to make recommendations to the next Legislature.

Tax bills are supposed to start in the House, according to the constitution. The Senate plan skirts that by leaving the plan in the hands of voters—in the form of a constitutional amendment for November's ballot. Texas voters could say whether they wanted to swap the current system for the Senate's proposal. There was some talk of grabbing a House bill and replacing the contents with the Senate proposal, thus giving the Senate bill a House origin, but that was out of favor late in the week.

Instead of sending the plan to the Senate Education Committee, Dewhurst sent it to the Senate Committee of the Whole (staffers call it the COW) and to zip it to the House. That should happen within a week, leaving the House to sweat over the handling of such an attractive nuisance.

Dewhurst had several education and business lobby groups standing with him and the senators at the official rollout. They're for it, but caution that they haven't seen every detail and note that details are hard on school finance plans. One recurring complaint is that property taxes, unlike sales taxes, are deductible. Texans who itemize on their taxes—about 20 percent of taxpayers—would lose that deduction. Dewhurst said he's talked with members of Congress about restoring sales tax deductions, and that they're looking into it. That would require major federal legislation, to put it mildly.

A bigger, albeit hazier, worry is that there's little time left to explore unintended problems that might come out of a sweeping piece of legislation, and the whole mess is best left for a special session. House Speaker Tom Craddick this week named 23 House members to a panel that—with four as-yet unnamed appointees of Gov. Rick Perry—will study school finance and adequacy of funding after the legislative session ends. Dewhurst, however, is pushing to get it on the November ballot, and has pushed them into a corner. If it dies now, it'll either die in the House or on the governor's desk.

A Surprise That Wasn't Surprising

Everybody who's been paying attention knew Sen. Bill Ratliff, R-Mount Pleasant, was doing a total rewrite of the House's tort reform legislation, and the real questions are over how much tort reform is in his version, which is quite a bit different from the House exhibit. The initial reactions were muted. The high-profile change was the swap of a hard $250,000 cap on non-economic damages in medical malpractice cases for a more flexible cap that lets a plaintiff seek payment, in egregious cases, from more than one defendant and for more than a total of $250,000. Ratliff also moved a lot of the detail work out of statute and into the control of the courts. Limits on attorney fees, for instance, would be set by court rules, not in state law. Ratliff handed it out and set more committee hearings for next week; the House might not see this one for two weeks or more.

Legislators may not be finished voting on tort reform bills, but some of the report cards are already out. Texans for Lawsuit Reform sent an eight-page slick color flyer to supporters that blasts "plaintiff lawyer-legislators" for trying to water down the legislation, praises Speaker Tom Craddick and the bill sponsor, Rep. Joe Nixon, R-Houston, and then charts the members of the House for the percentage of votes they cast in accordance with Nixon's position.

Forty members—all Republicans—got perfect scores of 100 percent, voting with Nixon on everything. Almost that number—36—voted against Nixon on every amendment counted by the group. Of those, 36 were Democrats. Now that they've rated everybody and sent the results to members, the group will come back to ask for support once again. TLR folks say they weren't trying to be provocative, but some members who talked to us about the mailers were clearly provoked.

Chop Shop

They don't have time for school finance, but the Texas House is making a run at congressional redistricting before the end of the session. Rep. Joe Crabb, R-Atascocita, put a proposed map up on the website of the Texas Legislative Council and set hearings for the first Friday and Saturday in May. Because of the time on the legislative clock, those will probably be the only meetings, and Democrats are raising hell because that Saturday is a municipal election day around the state (which ties up both voters and elected officials who might want to come). Crabb says he called the meeting a week early and set it for a Friday and a Saturday to give people time to make plans—that appears to be that.

To get a map in place, he'll have to get it out of committee, through the House and through the Senate within four weeks. If that all works, it would then go to the U.S. Department of Justice, which would decide whether the new map comports with civil rights laws. If it survives all that and there are no court challenges that delay it further, it could be in place for the 2004 elections.

Democratic House members are kicking, but probably don't have the votes to provide more than a speed bump. In the Senate, as we've previously said, it's dicey. A plan would require 21 votes there, and there's still no evidence that that many senators want to vote on congressional redistricting.

A Senate fight over the issue could rekindle animosities that began two years ago, when Lt. Gov. David Dewhurst (then the state's land commissioner) and other members of the Legislative Redistricting Board drew maps that infuriated several senators. Dewhurst successfully patched over the wounds and has generally enjoyed a good session with senators; a redistricting fight could transform what has been a fairytale into Mary had a Little Lamb—with a Side of Creamed Spinach.

The first Crabb proposal—the only one available at press time, but one that was widely rumored to be a stalking horse—came out of a two-part directive he gave to aides to Speaker Tom Craddick. Crabb says he asked for a map that would increase minority representation in the Texas congressional delegation—or at least would increase the chances for minority candidates to get elected—and also for a map that would put more Texas Republicans in the U.S. House. That second requirement is a GOP staple: with control of all Texas statewide offices, 88 of 150 seats in the Texas House and 19 of 31 seats in the Texas Senate, they think Republicans ought to have more than 15 of the 32 seats in the Texas delegation to the U.S. House. His plan could give them 18 to 21 seats, depending on election outcomes.

Winners and Losers in Crabb's Bucket

Crabb says he doesn't have but one map, and says it might get amended, but it's what he's running with. The closest high-on-the-ballot race in last year's elections pitted Republican Dewhurst against Democrat John Sharp. Dewhurst won that contest with 51.8 percent of the statewide vote. You can use the numbers from that race as a rough measure of the partisan splits in Crabb's map.

• U.S. Reps. Joe Barton, R-Ennis, and Chet Edwards, D-Waco, would share a district that gave Dewhurst 56.4 percent of its vote.

• Incumbents Chris Bell, D-Houston, and John Culberson, R-Houston, would reside in a district that gave Dewhurst 63.2 percent of its vote.

• Henry Bonilla, R-San Antonio, would have to defend a Democratic district with Lloyd Doggett, D-Austin—one that gave 50.5 percent of its lieutenant governor votes to Sharp. But that's a big improvement for Bonilla, whose current voters elected him while they were giving 57.2 percent of their votes to Sharp. He'd also cover less turf—the new district includes parts of four counties, while the old one stretches west to El Paso and south to Laredo.

• The successor to Larry Combest, R-Lubbock, would share a district with Charlie Stenholm, D-Abilene. Combest quit and will be replaced after a special election this month. In the proposed district, 59 percent of the voters chose Republican Dewhurst over the Democrat last year.

• Ralph Hall, D-Rockwall, would be paired with Jim Turner, D-Crockett, in a district where 59.4 percent of the voters preferred Dewhurst. Hall votes with the GOP most of the time and isn't a top target, but they'd like to elect a Republican when he leaves and would like to send Turner home. Hall won reelection last year in a spot where Sharp attracted a meager 40.6 percent of the vote.

• Jeb Hensarling, a freshman Republican from Dallas, would be paired with Pete Sessions, R-Dallas, in a strongly Republican district that is adjacent to Hall's, where one or the other could relocate and run in friendly territory.

• Ruben Hinojosa, D-Mercedes, and Solomon Ortiz, D-Corpus Christi, would both live in a solidly Democratic, Hispanic district. But one of the two would be out of a job.

In theory, that would replace five congressional Democrats with five Republicans, but that's not the whole story. U.S. Reps. Martin Frost, D-Dallas, and Gene Green, D-Houston, are Anglo Democrats representing minority districts. They'd be morphed into Anglo districts with Republican voting records. Democrat Nick Lampson of Beaumont would see a rearrangement that left him with a district that leans to the Republicans instead of one that leans to the Democrats. Democrat Max Sandlin of Marshall's district leans slightly GOP now; it would lean a little more in the new map, where 55.4 percent of voters preferred Dewhurst. Two Republicans would remain on the partisan front line. Ron Paul of Surfside is in a district that split almost evenly between Dewhurst and Sharp (though it's Sharp's home turf and voted strongly against other Democrats). Lamar Smith, R-San Antonio, would be out of entirely safe turf and into light surf; the proposed district voted 50.8 percent in Sharp's favor.

If you lost count, that's seven new districts. On paper, five lean to the Democrats and two to the Republicans. Four have clear Hispanic majorities. One is on the Dallas-Tarrant line. Another is similar to Bonilla's current district, stretching from San Antonio to El Paso with big voter pools in Bexar and Webb counties. The third includes all or part of Cameron, Hidalgo and Nueces counties with a distinct bias toward Cameron County. The last is entirely in Harris County. In one new district in Harris and Fort Bend counties, 72.6 percent of the voters are either Black or Hispanic. The last two open districts are two-thirds Anglo; by the numbers, both would be in the GOP's column. One is in west Texas, with a Midland-Odessa gravitational pull; the other starts in Tarrant County and oozes west.

With end-of-session deadlines for House bills less than two weeks away, congressional redistricting is a crapshoot. Crabb says he'd have to get a bill out of committee within a week—that would include hearings, amendments, votes and everything else—and the rules require a floor vote before May 14. It's dumb to predict results late in a session, so just say this: The odds are very long.

Nothing Special Yet

With a little over four weeks to go, the Capitol's amateur bookies are talking about whether there will be a special session on the state budget. Hold your bet until the third week of the month, when the state's revenuers weigh in with new forecasts on the state economy and taxes.

By the time many readers see this, the House and Senate budgeteers will already have met to size each other up before the argument over which pieces of whose spending plans will get into the final version. But as we write, we know only half the names. On the House side, where the Senate budget has been kindly rejected, the conferees are: Talmadge Heflin, R-Houston; Vilma Luna, D-Corpus Christi; Sylvester Turner, D-Houston; Jim Pitts, R-Waxahachie; and Arlene Wohlgemuth, R-Burleson. The Senate is sending in Teel Bivins, R-Amarillo, because he's the chairman of Senate Finance. His four comrades had not been named at press time.

Also in the works is the official side-by-side comparison of the House and Senate plans. The two budgets are not far apart if you're looking only at the bottom lines, but there are big differences inside. For instance, the House decided to move $524 million from health and human services into education. They hung that on the Health and Human Services Commission, which at the last minute obliged them with a drop in projected caseloads and costs to provide that money. And a group of House Republicans who'd been chafing over the budget was calmed by the injection of new money. The Senate plan has the money in health and human services. Differences like that are rippled through the budgets, and they always are and they can and likely will be worked out during regulation play.

An Unhappy Referee

The biggest difference between the two plans, however, is the one under the purview of Comptroller Carole Keeton Strayhorn. It's not on the spending side, but on the source of funds side. The House is financing its budget with program cuts and reorganizations that haven't all been spelled out. Strayhorn dug into that a week ago, saying the budget was short some $2.9 billion on the House side. The Senate budget is short, too, by $2.4 billion. Some of that money, as in the House plan, will come from legislation that's working its way through the pipeline. But the Senate is also almost $1 billion more reliant on delayed and deferred payments that give the comptroller the hives.

The House and Senate both moved about $800 million in payments to public schools from the last day of the budget into the first day of the next budget. That makes it that much easier, on paper, to balance the budget. The Senate also delays payments to state employee and teacher retirement systems, among other things. Strayhorn is griping publicly about how irresponsible she thinks that is, but pulls up short of saying she won't certify a budget that relies on that kind of money. Bivins says the smoke and mirrors he's using are no different from what's been used in the past and adds that he's been around to see the Legislature pay these things back in good times. He and others see it as less unattractive than a tax bill or a package of new gambling measures, and the state's lenders—in the form of bond-rating companies—have gone along in the past.

The "October Surprise" we wrote about a couple of weeks ago is out of the House budget, but it's in the Senate version, and it is giving the comptroller heartburn. It says the comptroller should cut the budgets in state agencies by October if she can't find enough money to pay for what the House and Senate put in the budget. That would make her the cowpoke in the black hat if the money were short. It would give her new powers. And, she says, it's unconstitutional and ought to come out. The Senate's budgeteers say it's been in previous budget bills, but Strayhorn made a point of saying it subjects the whole budget to a legal challenge that she thinks the state would lose. Message: The Legislative Budget Board, a group of lawmakers that can meet when the Legislature is not in session, should do whatever cutting is necessary. By the comptroller's reckoning, ten black hats are better than one.

Place that Bet in Two More Weeks

Comptroller Strayhorn was caught short in a press conference when asked about why she has a problem now with something she's certified before. The Houston Chronicle gave prominent play to a quote: "Well, I, uh, and, and—let me say this is a work in progress." Asked whether she would certify a spending plan with the Senate's tricks included, she ducked, saying she won't say what's certifiable and what's not until she's seen a final budget.

The state's franchise taxpayers have to have their returns in the mail by May 15, and the comptroller will know within a matter of days whether that money—a significant source of revenue, but not the biggest—is meeting projections. They'll have April sales tax returns well in hand, and they'll have all of the information they're going to get before Strayhorn nails down her estimate of revenue available to fund the next budget. If the numbers she issued in January hold, and if she and the Senate come to terms on their financing, the budget part of the session won't force the Legislature into overtime. If the numbers are bad, or the impasse too wide, go find your bookie.

Flotsam and Jetsam

It's hard to pass an ethics bill in any Legislature, because a good piece of legislation often requires members to vote against their own interests. Legislation that was supposed to be up for a House vote this week got delayed in a flap over a rule limiting amendments; when it started getting angry, Rep. Steve Wolens, D-Dallas, stepped in and delayed the bill until Monday. Oddly, that little bit of open government could hurt the bill. Wolens gave House members who've already had two weeks to pore over the legislation another five days to think up amendments. There is a faction of lawyers who work for big firms who don't like a provision that would prevent them from voting on legislation that's being lobbied by the firms that pay them. There is another faction of lawyers worried about losing paychecks—some legitimately and some not—from getting legislative continuances that delay trials while lawyer/lawmakers are in session. Think of a problem with political campaigns that might be fixed by a new law, and you can find a lawmaker who won office by employing just that loophole. Two other items that have been much talked about, but are missing from the bill: Identification of employers and occupations of campaign donors in contribution reports, and disclosure of the total amount of cash a candidate has on hand. That's required of judicial candidates, but nobody else.

• Taxes on smokes might be the revenue measure that wouldn't die. A buck-a-pack tax on cigarettes raises almost $1.5 billion and voters—both Republicans and Democrats—say they wouldn't mind. The advocates have kept up the pressure, and a last-minute dash for money could end up with a smoke tax attached to it. Bug in the soup: Gov. Rick Perry and others have said no new taxes.

• The Defense of Marriage Act, a legislative snarl in previous sessions, is on its way to the governor for his signature. It prevents the state from recognizing same-sex unions granted by other states, something the state already doesn't do. For all the noise, it finally passed the House 118—9.

• Eleven senators, led by Rodney Ellis, D-Houston, signed a letter to Lt. Gov. David Dewhurst saying they won't vote for a bill that would allow the same jury to decide whether someone is mentally retarded after their death-penalty trial has taken place. The senators, all Democrats, say it would fairer, and would save time and money, to make the determination on mental retardation before the trial. They have the votes to block consideration of post-trial determination.

• Things that make you go Hmm: The House passed a bill—HB 1592—that makes it illegal for someone to perform surgery while they're intoxicated and thus hurts the patient. But there's an exception, added in an amendment: If the doctor acted in an emergency, it's okay. And the definition of an emergency appears to include someone who's been sent to a hospital emergency room and is in "imminent danger of serious bodily injury or death."

• Quorum Direct, the Austin-based consulting firm started by Craig Casselberry, has signed
"strategic agreements" with similar firms in Washington, D.C., and Chicago. Casselberry says the setup will help his corporate clients who need the public affairs, issue advocacy and lobbying in other places.

Political People and Their Moves

We waited until she actually left to see if it would actually happen: DeAnn Friedholm, one of the most knowledgeable health and human services policy people in Texas, has moved to South Africa to advise that country's government as it beefs up its health and human services. You can show her expertise in three words: Friedholm understands Medicaid...

Stuck: Texas Supreme Court Justice Priscilla Owens' second nomination to the 5th U.S. Court of Appeals. Democrats who killed the first nomination in committee are strangling the second with a filibuster, prompting her former court colleague John Cornyn, now a U.S. senator, to start a group of Senate tenderfeet who want to change the judicial selection process...

Press Corps moves: At the end of the legislative session, Connie Mabin will leave the Associated Press Austin Bureau for a promotion and a job closer to home. She'll be the correspondent in charge of AP's Cleveland, Ohio, bureau, overseeing six reporters there...

Abe Hernandez, a federal public defender, was named to represent former Attorney General Dan Morales, who is charged with mail fraud and conspiracy. Morales didn't name his own lawyers by a judge's deadline, and Hernandez was assigned to represent him. Morales told reporters he has the means to pay a lawyer and will have one on the payroll soon...

Leslie Ingram, scheduler for Lt. Gov. David Dewhurst, is moving to New Jersey (just think of it) with her new spouse. Amy Maxwell, already an aide to the Lite Guv, will take over that job...

Galveston County Democratic Party Chair Mary Ellen Brennan, elected to a fourth term just last November, told supporters she'll resign at the end of the month...

From now on, we'll spell it this way: Steve Koebele. Sorry, sorry, sorry.

Quotes of the Week

Conservative activist Grover Norquist, quoted in The New York Times on government budget problems around the U.S.: "I hope a state goes bankrupt. I hope a state has real troubles getting its act together, so that the other 49 states can say, 'Let's not do that.' We need a state to be a bad example, so that the others will start to make the serious decisions they need to get out of this mess."

Oklahoma state Sen. Angela Monson, president of the National Conference of State Legislatures, in the Washington Post: "Clearly, state budgets are awash in red ink. Nearly every state has revised its outlook downward this year. Core programs are being cut everywhere."

Lt. Gov. David Dewhurst on the Senate's proposed state budget: "We didn't steal anything, but we have begged and borrowed... so that we could provide core services that we believe are essential."

Texas GOP Chair Susan Weddington, on a tape of a conference call on the state budget with State Republican Executive Committee members that was obtained by the Houston Chronicle: "If you're used to getting a government subsidy, you don't like it when you don't get it. But it doesn't mean you're going to be harmed. It doesn't mean you're going to be without any other options." She added that families who lose Children's Health Insurance Program coverage would buy their own and "maybe have a little less disposable income or a little less inheritance from Mom and Dad."

Sen. Jane Nelson, R-Flower Mound, defending part of the proposed state budget: "If one grandmother who really needs our help is put out on the street, then I will personally go get her and take her into my home." Sen. Eliot Shapleigh, D-El Paso, in reply: "You better get a big car."

U.S. Rep. Tom DeLay, R-Sugar Land, on minority opposition to his push for congressional redistricting in Texas: "If they turn it down, they are more Democrat than they are minority. And they are representing the Democratic Party and not their people."

U.S. District Judge Sam Sparks, telling Dan Morales to step up his efforts to hire a defense lawyer, quoted by the Austin American-Statesman: "I don't know how calling press conferences and saying all this is going to help get you a lawyer, but maybe it does. Maybe you're going to get one out of the telephone book. I do not know. All I know is this case is going to start to progress."

Michael Hinojosa with the Texas Association of School Administrators, at the official announcement of the Senate's school finance plan: "Sometimes people who say things can't get done get interrupted by people getting things done."

Texas Weekly, Volume 19, Issue 43, 5 May 2003. Ross Ramsey, Editor. George Phenix, Publisher. Copyright 2003 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 biz@ texasweekly.com. For news, email ramsey@ texasweekly.com, or call (512) 288-6598.