Budget Agreement Hinges on Key Legislation

Updated May 20, 11:30 p.m.: 

Despite looming deadlines, the House postponed on Monday a vote on Senate Joint Resolution 1, which would allow voters to decide whether to set up a fund for water infrastructure projects. The budget deal conferees reached on Friday hinges on that legislation, which must be approved by the House on Tuesday.

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As House Appropriations Chairman Jim Pitts expressed optimism that the Legislature would approve a budget in time to avoid a special session, others were still expressing uncertainty as a pair of critical votes were set to take place Monday.

The 2014-15 deal that budget conferees reached Friday hinges on the approval of Senate Joint Resolution 1, which would ask voters to create a fund for water infrastructure projects, and House Bill 1025, a supplemental appropriations bill for the 2012-13 budget. SJR 1 is on the House's Monday calendar, while HB 1025 is on the calendar in the Senate.

“I didn’t hear any outcry of negative attitude,” Pitts, R-Waxahachie, said Monday afternoon after a House Republican Caucus meeting on the budget deal. He expressed confidence that the Legislature would avoid a special session on the budget.

“I said if you’re not going to vote for it, please let us know and we’ll try to clear up any questions," he said.

The House will need 100 votes to approve SJR 1, which means the measure will need support from some Tea Party Republicans and Democrats.

"We committed to being for it, but we're not sure where we are right now," said House Democratic leader Yvonne Davis of Dallas. She said Democrats are still working to confirm that their request to add $200 million to public education has been met, before they’ll confirm whether they'll vote for SJR 1. 

Some Tea Party legislators also expressed concern about the deal.

“I am opposed to the infrastructure and water plan, not because I’m against water — because who could be against water? — but because I am concerned about investment in commercial banking,” said state Rep. David Simpson, R-Longview. He warned that the $2 billion could be doled out “based on political corruptions.”

“I have not seen [the budget] completely, but I am very concerned. We’ve spent too much money across the board,” said state Rep. Jonathan Stickland, R-Bedford. “I want to make sure there’s no budget gimmicks, that’s a big part of my platform.”

Pitts said the budget conferees have worked to wean the Legislature off “budget gimmicks,” by stopping the diversion of $400 million in dedicated revenue to certify the budget.

Gov. Rick Perry has threatened to call back lawmakers for a special session if lawmakers do not meet his demands to include business tax relief, transportation funding and $2 billion set aside for water infrastructure projects. The budget conferees decided to call on voters to establish water fund through SJR 1, then move $2 billion from the Rainy Day Fund, a financial reserve made up mostly of oil and gas revenue, to finance the water projects through HB 1025.

Related to the water infrastructure funding goals, the House and Senate on Monday each passed House Bill 4, by state Rep. Allan Ritter, R-Nederland, that outlines the framework for how the water fund would offer loans for projects like pipelines, reservoirs and conservation projects.

It would be headed by a three-member board appointed by the governor.

The final version of HB 4 that passed included a House amendment that would give preferential treatment to projects that use American-made products.

Regarding SJR 1, Pitts said he believes the House has enough support to pass the measure. “There’s a lot of moving parts to this bill, but I think we’ll get the votes,” he said.

Although the Legislative Budget Board is still finalizing the numbers, Pitts said the 2014-15 budget approved by the conferees on Friday is roughly $1.2 billion more than the version previously approved by the House.

“As far as the Republican caucus is concerned, they’re very cautious about how we spent the money,” said Pitts. He added that the caucus was “receptive” when he explained where the added money went. For example, budget conferees added $330 million to the Teacher Retirement System and raised Medicaid rates for nursing homes.

Alana Rocha contributed to this report.