Did the House Get Rolled on the Budget?
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Last week, after the budget conference committee started laying out its compromise agreement, the general impression around the Lege seemed to be that on the single most important bill of the session, the House had been steamrolled by the Senate. The conferees, in keeping with the stated priorities of Dan Patrick and the Senate, had agreed to include about $1.3bn for property tax relief and about $800m for border security over the forthcoming fiscal biennium. They also stuck with the Senate figure for public education—an additional $1.5bn compared to the 2014-15 biennium, as opposed to the $2.2bn the House had authorized in its version of the budget. The conferees also abandoned a House provision on Medicaid: the lower chamber had proposed an additional $460m for Medicaid reimbursement payments (in an effort to encourage more doctors to accept Medicaid payments), the Senate had not, and the conference committee abandoned the idea.
Some representatives were disappointed, understandably enough. The House passed its version of the budget on a 141-5 vote, and its sales tax relief proposal–the rival to the Senate’s plan for property tax relief–unanimously. (The Senate passed its budget later with a similarly huge 30-1 margin, but it’s easier for leadership to twist people’s arms in a chamber with only 31 members—especially this year, clearly.) And some representatives, additionally, were surprised. In addition to the fact that the House has been unusually cohesive this year, they had the more internally consistent approach to the process, the more experienced conferees, and on public education, at least, probably the more popular position.
From my perspective, both chambers won some and lost some, and the impression that the House lost overall is due to the fact that the House lost on a handful of visible issues, as a result of circumstances beyond their control; and if the House was going to lose, that was the best way to do it. How I see it, below the jump.
First, the conference budget is pretty close to the budget as originally passed to the House; the discrepancies noted above are indeed notable, but they add up to about 2% of the total. It’s also pretty close to the Senate’s version of the budget, but keep in mind that the budgets were pretty close to begin with, and since this is a “House budget year”, the Senate’s budget was an amended version of HB1, with most of its major components having originated in the House. The conference budget’s approach to pensions, for example, is aligned with the pensions bill that passed in the House. Transportation funding will be expanded (beyond the expansion authorized by voters last year) by ending diversions from the Highway Fund, as Joe Straus has advocated for some time. A Senate proposal to dedicate part of the motor vehicle sales tax, from Robert Nichols, fizzled out. On border security, too, the House’s approach has effectively been adopted; the conference budget basically takes the $565m plan the House passed in March and adds some $330m. Since Patrick has been advocating for more border security spending, the price tag suggests that it’s the Senate plan, but since the extra money is mostly for overtime pay and new hires, I’d call it a bigger version of the House plan.
There are really only two major components of the conference budget that seem like Senate plans to me. The first is about half a billion dollars for crumbling state facilties—an unglamorous but worthy effort on the part of Kevin Eltife. The other, of course, is the property tax relief. Based on Dennis Bonnen’s anhedonic layout last night, and the skeptical questions offered by both Republicans and Democrats at the back mic, I gather the House isn’t thrilled about this minor and ephemeral “relief” either. But in the absence of intervention from Greg Abbott (the governor), all the House could really do was what it did. Using his sales tax cuts as leverage in the negotiations, Bonnen was able to talk the biennial cost of the plan down by about a billion dollars, and he flatly refused the Senate’s scheme to exempt property tax relief from counting against the spending cap. The Senate nonetheless got a hefty property tax relief plan, worth about $1.3bn this biennium. That explains the House’s other two losses: to stay under the spending cap (with a little bit of breathing room), the conferees gave up about $700m for public education, about $500m for Medicaid, and a few bits and pieces here and there.
The more startling sacrifice (at least for an inveterate Medicaid troll, like me) is the underfunding of public education. Having heard some truly woeful math and science on the floor of both chambers this session, I think we should consider withdrawing from Medicaid altogether, and turning all our roads to gravel, so we can throw money at public schools in the hope that it will help. However, since we still haven’t heard the final word from the courts on this most recent round of school finance lawsuits, public education is the one area of the budget likely to be expanded by a third party, regardless of what the Lege does or fails to do. The House, however, doesn’t seem to see it that way. One Democratic representative told me earlier today that we can’t really count on the court to help the schools, since the state’s softening economy, in conjunction with the imminent franchise tax cuts (House version, incidentally), will likely mean a precarious revenue picture by the time the ruling arrives. A Republican representative, meanwhile, offered the inverse concern: had the House school finance plan passed, the state might have been able to implement it without court interference; since it didn’t, the courts are presumably going to step in, and require much more money than the conference budget allows. So between the property tax relief and the public schools, it’s not surprising that the House has some heartburn.
But as a political matter, at least, there’s a silver lining for the House: since they lost on those issues, they can’t be blamed for winning. Patrick and the senators—and perhaps Abbott—now own the trivial property tax relief, and the underwhelming support for public schools. Most Texans probably won’t notice. But some will. Patrick, in fact, may be one of them; his statement on the “legislative accord” between the chambers is the least triumphal press release he’s sent all session.