Thu April 16, 2015 3:25 am By Erica Grieder

On Tuesday, on a 30-1 vote, the Senate passed a budget for the forthcoming 2016-17 biennium. Their version, which proposes $211.4 billion in all-funds spending for the two-year cycle, is almost two billion dollars larger than the House’s, which passed on April 1st, but the spending breakdown is similar, and broadly sound. The most notable and controversial budget-related discrepancy between the chambers has to do with tax cuts. The House is calling for $4.9 billion in biennial tax cuts, as laid out by Ways and Means Chair Dennis Bonnen: a 25 percent cut in the franchise tax rate plus a cut in the state sales tax rate. The Senate proposal, which works out to $4.6 billion, proposes franchise tax cuts and property tax relief.

Both proposals are ominous from a certain perspective. Democrats in both chambers have argued that the money would be better used for critical priorities like public education, higher education, roads, or water. And even Republicans have agreed; Kevin Eltife, in the Senate, has been the most vocal skeptic of the session’s tax-cut fever, arguing that it would be better to use the revenue available to tackle the state’s fiscal obligations, such as public pension liabilities. As I’ve written before, I’m with the skeptics; Texas already has one of the lowest average state tax burdens (and one of the lowest average tax rates) in the country, and one of the lowest rates of state spending per capita. We could always aspire to spend less, like Wyoming, but we have five million children enrolled in public school, and their enrollment is closer to five; more concretely, no one has proposed $4.7 billion in biennial spending cuts, or admitted that they’re happy to let their counterparts in the future take the blame for proposing the tax hikes that will be inevitable in the absence of such cuts.

On the other hand, if you’re in the “death to all taxes” camp, the two proposals may seem equally appealing, because they’re about the same size; as Senate Finance Chair Jane Nelson put it, “we’re both right.” And Governor Abbott is apparently similarly agnostic. Back in January, he threatened to veto any budget that didn’t include some business tax relief, and in his state of the state he specifically called for $2.2 billion in property tax cuts. But yesterday, as R.G. wrote, he offered the clarification that he wouldn’t necessarily veto a budget that doesn’t include property tax relief, and indicated that he is open to considering either tax-cut package.

In my view, this was an unnecessary clarification on Abbott’s part. He had never threatened to veto a budget that doesn’t include property tax relief and—state of the state notwithstanding—it doesn’t really make sense to demand that the state cut a tax that it is constitutionally barred from levying in the first place. However, it was probably a worthwhile clarification, because the House and Senate are apparently prepared to go to war over this. Last week, on the day that Bonnen (joined by most of the House Republican caucus) laid out his preferred tax cuts, Lieutenant Governor Dan Patrick issued a blistering statement about that chamber’s proposal, and yesterday he reiterated the arguments on behalf of the Senate’s plan. Since Nelson is the chair of Senate Finance, her expressed agnosticism is telling. But since Patrick is the lieutenant governor, the Senate can be expected to follow his lead.

In the end, I expect the House to prevail, because Bonnen’s plan is better than Patrick’s for at least half a dozen reasons.

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Wed April 15, 2015 3:58 pm By R.G. Ratcliffe

From the outside, Governor Greg Abbott since his state of the state address in early February has seemed like the man out of the mix in the legislative session. But then maybe Abbott has been like the great and powerful Oz, a man behind the curtain making things happen unseen.

“I am involved in the process on a daily basis. An easy example is I had an hour-long meeting this morning” with Lieutenant Governor Dan Patrick, Speaker Joe Straus and Comptroller Glenn Hegar, the governor told reporters earlier today.

But on one of the biggest issues of the session—the debate between the House wanting sales tax cuts and the Senate wanting property tax cuts—Abbott wouldn’t take sides today. He wants a substantial cut in the state franchise tax for business, but otherwise the fight is up to the Legislature.

“The strategy here is we want to reduce taxes in a way that will most profoundly lead to job creation,” Abbott said. “Now, we are having a robust discussion about other ways to reduce taxes. There is the possibility of property tax reductions, the possibility of sales tax reductions on top of the margins tax reduction. I feel there’s going to be at least and maybe more than one way to reduce taxes in Texas.”

Abbott said the only thing he absolutely will not accept is a budget that does not cut the business franchise tax. “With regard to the veto word, I don’t want to go throwing that out there loosely,” Abbott said, though he gave a bigger nod to property tax cuts than sales tax cuts. “Property tax relief is important to Texas, and property taxes are too high in Texas.”

On his key issues, Abbott said he is happy with the Legislature’s progress. He said the House and Senate budgets are close; border security legislation is just a question of how much to spend; and his staff continues to work with lawmakers to pass ethics legislation.

“We’re reaching agreement on virtually every meaningful issues that we’re dealing with some small gaps to close,” Abbott said.

(Photo: Governor Greg Abbott/By Bob Daemmrich)

Wed April 15, 2015 11:30 am By Paul Burka

It was with considerable sadness that I learned of the passing of Arthur “Buddy” Temple III, a former Democratic state representative from Lufkin during the speakership of Billy Clayton and a onetime candidate for governor. The Temple family is one of the great Texas dynasties, and one that has contributed immeasurably to the East Texas region where the Temple timber empire thrived. In 1982, I wrote a cover story about the history of the Temples (“The King of the Forest”) and their contribution to East Texas.

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Wed April 15, 2015 10:41 am By R.G. Ratcliffe

The House may be ahead of the Senate in getting bills out of the chamber, but the Senate has drawn first ink from Governor Greg Abbott.

The very first bill that Abbott’s signed into law during his tenure, on April 2, was SB 219 by Senator Charles Schwertner. The bill essentially was a clean-up measure on Health and Human Services functions, but initially met opposition from the Texas Home School Coalition. However, the coalition’s concerns were addressed in the Senate.

The second bill, signed on April 8, was Senator Jane Nelson’s SB 293 to expand the state’s major events fund eligibility. The groups eligible for state dollars now will include ESPN or an affiliate, the National Association for Stock Car Auto Racing (NASCAR) and the Ultimate Fighting Championship. Primarily, this bill was for the Texas Motor Speedway in Fort Worth, but also had support from Circuit of the Americas in Austin.

Get your motors running. I’m sure other bills in the future will receive fanfare from the governor’s office.

Tue April 14, 2015 4:38 pm By R.G. Ratcliffe

This past weekend, one of the 11 natural gas wells on the property of the Lake Arlington Baptist Church started spewing mud as crews began using hydraulic fracturing (fracking) at the site to extract natural gas. As a precaution, residents of 50 homes were evacuated, although there was no sign that an explosion was imminent.

“It honestly never had concerned to us at all up until last night,” nearby resident Jim English told The Dallas Morning News. English, who built his home in 1998, said up until this weekend the gas wells were mostly just a nuisance because of the service trucks. “It’s just an eyesore to me, and I don’t get any royalties off it, so it might as well go away. It was fine when it started, but it just keeps getting to be more and more.”

For Arlington Fire Chief Don Crowson, the leak was evidence that the Legislature is about to take public safety out of the hands of local officials through bills to keep cities from regulating the drilling of oil and gas wells in their communities.

“I’m concerned there is a potential that local control may be lessened. It is exactly local control that keeps the local community safe,” Crowson said.

Arlington has 56 pad sites with 306 gas wells, Crowson said. While the Fire Department has responded to gas releases and other incidents at pad sites in the past, Crowson said this was the first time an emergency well control team had to be called in.

The above map from the Texas Railroad Commission goes a long way toward explaining why Denton voters last year approved a ban on the drilling of gas wells within the city limits—despite a $1.1 million public relations campaign against the initiative financed by the oil and gas industry.

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