No way out
Tue March 15, 2011 12:58 am

I keep looking for the plan that will get us out of the budget mess, and I have come to the conclusion that there is no plan--at least, not in the House. What needs to happen is that conservatives have to vote on a budget that has a lot of cuts. They can't vote to use the Rainy Day Fund before they vote on cuts. So why is Pitts trying to get a vote on using the Rainy Day Fund now? An increasing number of R's wants to use the Rainy Day Fund, but if Republicans vote for spending first and cuts second, they could get in big trouble with the voters. Surely there is a way to let them vote for the draconian budget and send it to the Senate.

Meanwhile, the governor's office is playing coy. Last Thursday, during some tense exchanges before the committee, Ken Armbrister wouldn't be pinned down on whether the governor had drawn a line in the sand over using the Rainy Day Fund. It sure looks like Perry is maneuvering to blame the House for any failure that occurs.

Then, today, it appeared that Pitts thought he had reached a deal with the governor's office. I obtained this summary, or minutes, of the committee meeting:

The House Committee on Appropriations, under the direction of Chairman
Pitts, met today in the Capitol Extension for testimony on House Bills 4
and 275.

HB 4
By Pitts. Relating to making supplemental appropriations and giving direction
and adjustment authority regarding appropriations.
- left pending.

HB 275
By Pitts. Relating to making an appropriation of money from the economic
stabilization fund for expenditure during the current state fiscal biennium.
- left pending.

(2:00) The committee convened at 2:00 p.m.  Chairman Pitts said the
committee is awaiting representatives from the Governor's Office.

(2:02) John Heleman of the Comptroller's Office said sales tax
collections have increased "more than estimated" and yielded an
additional $300 million for this fiscal year (FY11).  Responding to
Chairman Pitts, Mr. Heleman said the current biennium shortfall is $4
billion.

(2:04) Chairman Pitts said there will be substitute to H.B. 4, which
will include $50 million in cuts recommended by the governor.
Responding to Chairman Pitts' inquiry of using only budget cuts and no
Rainy Day Funds for the remaining 6 months of the biennium, Mr. Heleman
said any budget cuts would be "exceptionally large."

(2:06) Rep. Hochberg asked if the next biennium revenue projections are
"based off this year," Mr. Heleman answered there has been "no change"
for FY12-13.

(2:08) Rep. Giddings detoured the hearing regarding the "Non-Tax
Collected Revenue Survey."  Discussion ensued.

(2:14) Rep. Villarreal inquired about revised estimates for the Rainy
Day Fund due to increased cost of oil, and Mr. Heleman said its estimate
is unchanged.

(2:16) Mr. Heleman informed Rep. Schwertner the "net effect" of H.B. 4
is $800 million.

(2:17) Rep. Giddings returned to the "Non-Tax Collected Revenue Survey."
Wayne Pulver of the LBB joined the discussion and stated the funds
listed don't require an appropriation to be expended.

(2:22) Responding to Vice Chairman Turner, Mr. Heleman said the Rainy
Day Fund is projected to have $9.4 billion.

(2:24) Discussion ensued regarding the Rainy Day Fund and FY12-13, with
Chairman Pitts asserting his "intention" to not use any Rainy Day Funds
for the next biennium.  Responding to Rep. Button, Chairman Pitts said
federal law required the expenditure of ARRA funds; "cuts alone" will
not close the current budget shortfall; the Comptroller is "out of
options;" and warned of furloughing state employees and not meeting
obligations to schools for July and August of this year.

(2:41) Rep. Hochberg asked Rep. Otto about the likelihood of another
budget shortfall (similar to this current shortfall) during next session.
Rep. Otto said his "gut feeling" is there will be another shortfall
in the 2013 session.  They offered competing philosophies of the Rainy
Day Fund.

(2:50) Rep. Aycock and Mr. Heleman discussed the 2003 shortfall, in
which $1 billion from the Rainy Day Fund was utilized.

(2:54) Chairman Pitts said "several" attempts to reach the Governor's
Office had been unsuccessful.  He stated private admissions had been
made by the Governor's Office of using the Rainy Day Fund and his hope
for a public acknowledgement [by the governor].

(2:57) Rep. Schwertner and Mr. Heleman discussed the oil and gas revenue
components of the Rainy Day Fund.

(3:00) Chairman Pitts said the committee awaits representatives of the
Governor's Office.

(3:02) Rep. Chisum inquired about property tax valuations and Rep. Susan
King inquired about the Enterprise and Emerging Technology funds.

(3:07) Chairman Pitts said the committee "called every budget person at
the Governor's Office and no one's answering their phone."

(3:07) Chairman Pitts said the committee's upcoming schedule is to vote
on H.B. 4 and H.B. 275 tomorrow (Tuesday) at 7:00 a.m. and to address
all pending items at 8 a.m.  On Wednesday, the committee will send H.B.
1 to the printer and vote out H.B. 1 on "probably" Tuesday, March 21.

The House Committee on Appropriations adjourned at 3:09 p.m.

* * * *

Most readers can infer from the 3:00 statement by Pitts--that the committee was awaiting representative of the governor's office--that Pitts thought they had a deal. But then the governor's office took a powder.

This is very strange behavior by the governor. He just ought to come out and say yes or now to using the Rainy Day Fund. That's the big holdup.

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