The Bloody Billion
There’s English at the Capitol these days as politicos try to ax $1 billion from the state budget. Here are the boondoggles, sacred cows, and hidden fat they ought to cut—but won’t.
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There aren’t many smiles in the corridors of the Capitol these days. The Legislature has to slash the state budget by $1 billion, and to make matters worse, the Quorum, everybody’s favorite watering hole, has been sold. On the third floor, supplicants from the state agencies and colleges gather outside the hearing rooms, their faces drawn and anxious. Legislators passing by avoid eye contact with the crowd, like jurors who have already condemned the defendant in their minds.
Numbers alone cannot explain the emotional toll exacted by the budget crisis. Texas is, after all, a low-tax state—forty-fourth in taxes paid per capita, and next to last in tax effort, which measures how much of its potential revenue a state is currently raising. What really accounts for the tension in the Capitol is much the same question that confronted the country as a whole in the late seventies: Is this the twilight of our glory? Or, in Texas terms: Is the boom over for good? Is this the end of the oil era? What will become of us?
To raise taxes is to admit defeat, to concede to diminished expectations. But cutting won’t be easy, for four reasons:
1. Politicians love to talk about fat and waste, but they hate to cut budgets. Every item has a vocal constituency. Cutting makes people mad. Spending makes people happy. Politicians have longer careers when people are happy.
2. You can’t cut the Texas budget without affecting the basics. Education, employee and teacher retirement, and the Big Three agencies (highways, prisons, mental health and mental retardation) account for three fourths of the money.
3. The budget is an intimidating document. Very few legislators even know how to read it, much less what’s in it. And they get no help from the bureaucracy; when money is on the line, candor disappears. The three big lies of the budget process are “We’re already cut to the bone, Senator,” “This program actually makes money for the state,” and “This is one of the most important things the state does.”
4. Every legislator fears that his district’s pet projects will be the first to go. That’s why most legislators seek sanctuary in across-the-board reductions, even though the effect is to cut the essentials and perpetuate the fat. Thus budget writers have handed the Legislature a proposal that decimates faculty salaries at all state universities but ignores the question of whether the state should maintain two universities in Denton.
What might a budget look like if the Legislature put politics aside (ho, ho, ho) for just one session? Here is a proposal for cutting $1 billion by eliminating the frills, waste, fat, and pork barrel while keeping the basics intact—especially higher education, so vital to a Texas without oil. I have added one touch of political realism, though. I’m not going to make cuts in Galveston, my hometown. Galveston has already been cut to the bone, it makes money for the state, and it includes some of the most important things the state does.
One of the more curious items in the proposed state budget is a $423,273 appropriation in 1987 for the Texas Sesquicentennial Commission. The sesquicentennial occurs in 1986.
This is a vestige in the making. Some parts of the budget reflect the Texas of yore—poor, rural, even ignorant—rather than the Texas of today. Yet these items take on a life of their own, swallowing up money in perpetuity, though the problems they were designed to solve long ago ceased to exist.
Target: Merit System Council
Savings: $2.3 million
The council is supposed to make sure that Texas has merit-based personnel management system that conforms to federal standards, whatever that means. It doesn’t matter. Two year ago the feds stopped requiring states to have one. That didn’t prevent the agency from requesting a budget increase.
Target: National Guard and National Guard Armory Board
Recommendation: Unilateral disarmament
Savings: $18 million
Why do we need a state militia? Pancho Villa is dead. State troopers can handle disasters. Restoring order to the East Texas oil field, the Guard’s last mission, hasn’t been necessary since 1931. Today our National Guard plays solider in Honduras, while the State Guard recruits Yankees with the lure of cheap tuition at state colleges. The feds probably won’t let us get rid of the Guard, but we don’t have to pay for it with tax dollars. Enter the armory board. It maintains 143 armories across Texas, many of them on valuable urban land. Relocate the armories, sell the sites, and make these anachronisms self-supporting.
Target: Agriculture Department
Recommendation: Cut marketing 75 per cent
Savings: $8 million
A group of conservative legislators will be out to pare Jim Hightower’s budget this session. They’ll be doing the right thing for the wrong reason. With them, it’s personal. With us, it’s business. Try as he might, Hightower can’t change the fact that the Agriculture Department is the most visible vestige in state government.
Take the marketing program. It is really a public relations program, mainly because the state has no ability to influence marketing in a meaningful way. Once it was designed to get consumers to buy more Texas products, like eggs. Well, we all know where eggs come from. They come from Safeway. Reagan Brown, Hightower’s predecessor, may not have been very smart, but he had enough sense to know that the marketing program was useless, so he turned it into a self-promotion campaign.
Perhaps the agency deserves a little money to help make consumers aware of new Texas products, like wine. Still, why should the state finance PR for farmers but not for, say, oil companies, which are less loved and more important to Texas’ economy?
Target: Prison system freebie groceries
Recommendation: Lock the pantry
Savings: $3.5 million
More than a thousand Texas Department of Corrections employees get free groceries for two from the TDC’s agricultural program. This goody is a double vestige, in that it reflects the days when state employees were badly underpaid and also when the prison system ran things as it damn well pleased. Today TDC salaries range from close to the national average to well above it, and TDC benefits—free housing, free laundry, and special retirement pay, to name a few—are among the best in the nation. Yet the food perk lives on, even if the TDC did have to buy $1 million worth of groceries on the open market last year to keep it going.
Target: Transportation regulation
Savings: $9.3 million
When Texas was a poor state, the Railroad Commission, like the rest of state government, did what it could to nurture homegrown business. In the case of trucking, that meant keeping out the out-of-state competition. This was the sort of policy that used to drive Texas liberals mad, as they heard paeans to free enterprise from the same folks who were granted monopolies by the government. By deregulating trucking, the Legislature could cut $4.5 million from the Railroad Commission’s budget. Another $4.8 million is there for the taking from railroad regulation, which the feds have preempted anyway. Stick to oil and gas, fellas.
Target: Good Neighbor Commission
The commission was created in 1943 after Mexico, angry over the bad treatment of Mexican workers in Texas, refused to let the state participate in U.S.-Mexican contract labor negotiations. At first the commission made enough noise about discrimination that a state senator tried to have the agency abolished. Who then could have foreseen Henry Cisneros or ballots in Spanish or MALDEF or bilingual education? The only thing that hasn’t changed is that the agency is still hard to get rid of.
Target: Governor’s Commission on Physical Fitness
Recommendation: Take a hike
The commission dates back to 1971, when Texans still had the good sense to spend their lunch hours eating barbecue instead of jogging. Do we really need an agency like this during a budget crunch?
Target: Texas Forest Service
Savings: $17.2 million
There was a time when East Texas was a filed of stumps, its forests ravaged by out-of-state timber companies. The small farmers who owned the land had neither the money nor the know-how to reforest the land. Thus the reason for the creation of the Texas Forest Service—seventy years ago.
Today the Forest Service still helps landowners manage their timber. It also provides rural fire protection, something the state supplies nowhere else in Texas. But this isn’t 1915. The small landowner is gone, replaced not only by huge timber companies but also by tax-shelter types and other absentee owners. Only 7 per cent of the agency’s reforestation clients in 1984 were true timber farmers. More than half of the remainder were corporate executives, doctors, lawyers, and other professionals. The Forest Service is providing welfare to the rich. Either it ought to pay its own way or the state should heed the slogan of the Northern timber companies back in 1915: cut and cut out.
Target: Securities regulation
Recommendation: Relax the regs
Savings: $2.2 million
The state’s standards for regulating securities far exceed the federal Securities and Exchange Commission’s full-disclosure policy. Why? Because when Texas was an unsophisticated state crawling with fly-by-night oil promoters, investors needed all the protection they could get. But things have changed. If the Legislature brings Texas in line with the SEC, it could cut regulatory costs in half.
Target: San Antonio Chest Hospital
Recommendation: Sell to Hospital Corporation of America
Savings: $18 million plus the sale price
Back when tuberculosis was a major health problem, the state set up four chest hospitals to treat TB victims. The disease is no longer a major threat, but two of the chest hospitals survive, even though only 22 per cent of their patients suffer from tuberculosis. To fill the beds, the state has slowly slipped into the general hospital business. That may not be such a bad idea in Harlingen, since South Texas has no other hospital for indigents—unlike San Antonio. The state should transfer San Antonio chest patients to Harlingen and cash in the hospital.
Target: UT Health Science Center at Tyler hospital
Recommendation: Hello? Hospital Corporation of America?
Savings: $41 million plus the sale price
Here’s another former TB hospital that the state can’t seem to get a handle on. The state does not support hospitals at UT’s medical schools in Dallas and Houston. Why should Tyler be so privileged?
Target: Natural Fibers and Food Protein Commission
Recommendation: Wash it out
Savings: $3.3 million
In 1941, when cotton was still king, the industry began to worry about synthetic fabrics. The Legislature, persuaded by the threat to the Texas economy, responded by forming the commission. Its 44-year mission: to carry out research promoting the sale of Texas cotton, wool, and mohair. It does this by, among other things, washing sweaters repeatedly to see how they hold up. At state expense. Meanwhile, cotton is in, synthetics are out, and still the washings go on, 5150 in 1984.
MONEY IN THE KITTY SO FAR: $123,517,232
Some boondoggles have been around so long that they are permanent fixtures in the budget. In this category would fall the various institutions Bill Heatly scattered around his West Texas legislative district when he ruled the House Appropriations Committee in the sixties. Others are concealed in footnotes to the budget, known as riders, such as the requirement that the Parks and Wildlife Department spend $40,000 on clearing boat roads at Caddo Lake. But everyone knows what they are. Why doesn’t the Legislature go after them? Because no one wants to endanger his own boondoggle.
Target: Texas air force
Recommendation: Ground it
Savings: $1.6 million
The elite politicians and agencies that have their own airplanes enjoy the greatest perk in state government. The governor has one. The attorney general has one. So do the agriculture commissioner and railroad commissioners. The comptroller and the land commissioner have two. Lowly legislators have to hitch rides on the Department of Mental Health and Mental Retardation’s plane.
The governor deserves an airplane. The prison system off in Huntsville needs its own plane. The Department of Public Safety and the Parks and Wildlife Department need airplanes for enforcement. The rest of these guys ought to use the state aircraft pool, just as the rest of state government has to do.
Target: Brucellosis vaccination program
Recommendation: Put it out to pasture
Savings: $10.2 million
Among the beneficiaries of the Animal Health Commission’s brucellosis program are some of the richest people in the state. Why vaccinate their cattle for free? Cattlemen can afford it.
Target: Advisory Commission on Intergovernmental Relations
Its mission tells you all you need to know to justify its elimination: “to improve coordination between the state and its local governments and the state and federal government.” Actually, ACIR’s mission is to send favored Texas legislators on junkets to exotic locales. Perhaps that is why, in a budget-cutting year, ACIR is slate for a 32 per cent increase.
Target: Slat House at Grand Saline
Yes, it’s peanuts. But it’s indicative of the way the Legislature regularly did business in the bad old days. To protect a pet project, legislators left nothing to chance by decreeing that the money could be used only for that purpose. The Legislature has gotten more subtle in recent years, except for Bill Hollowell, a grizzled veteran who, you will not be surprised to learn, is (1) from Grand Saline and (2) on the budget-writing committee.
The Parks and Wildlife Department, not the Legislature, ought to decide which parks deserve funding. On the other hand, considering what other members of the budget committee have perpetuated over the years, maybe Hollowell is letting us off cheap.
Target: Rodent and Predatory Animal Control Service
Recommendation: Eradicate it
Savings: $4.6 million
Believe it or not, the state employs 106 hunters who are paid with tax dollars to go out and hunt for predators on private land. The landowner does pay something for the service, but the money never reaches the state. Instead it goes to a nonprofit corporation called the Texas Animal Damage Control Association, which has its own stable of hunters doing prey-for-pay work. The way to straighten the mess out is for landowners to reimburse the state directly or, better yet, for the state to get out of the hunting business altogether.
Target: Texas Tech Health Sciences Center
Recommendation: Last man out lock the door
Savings: $96 million
Preston Smith left two legacies from his 1969-73 tenure as governor. One was his comment, upon hearing students chant “Free Lee Otis” in support of an imprisoned black radical: “Why do they want frijoles?” The second was the Texas Tech medical school in Lubbock, a black hole into which state dollars are sucked by the millions. By the way, guess what town Preston Smith calls home.
The Tech med school didn’t make economic sense then, and it doesn’t make economic sense now. Tech has to spend twice as much money per student as any other state medical school—there aren’t enough patients in the Lubbock hospital to give students a broad clinical background, so Tech has had to build extra campuses in such outposts as Amarillo, Odessa, and El Paso.
The original case for Tech was that Texas needed more doctors (it had only three medical schools in the sixties) and West Texas especially needed doctors. Today the state had eight medical schools and a surplus of doctors. West Texas is at last getting its share. But not from Tech, where the best students, like the best students everywhere, compete for glamour residencies far from Lubbock.
Target: Agricultural Experiment Station
Recommendation: Stop giving away the store
Savings: $6 million
For once the problem is not the quality of the work. It’s what happens after the work is done. The Ag Experiment Station, part of the far-flung A&M empire, has devised all sorts of agricultural miracles. For example, since 1963 the agency has bred 83 new strains of grain sorghum, making the crop far more resistant to disease. One such strain, the male parent for half of the sorghum planted in the country, by itself increased seed industry profits by 10 per cent.
But the super-Aggies neither patent their work nor collect royalties or license fees from it. They practically give it away to seed companies—in the case of grain sorghum, collection $35,000 for a product that cost more than $1 million to develop. California’s experiment station collections $2.5 million a year in royalties; our Aggies can do better than that.
MONEY IN THE KITTY SO FAR: $242,473,259
III. Sacred Cows
The state budget is full of untouchables—a.k.a. sacred cows. Some breeds of sacred cattle, like 4-H clubs and black colleges, are also vestiges, for they are survivors from an era when Texas was rural and segregated. But they belong here. What all sacred cows have in common is that their supporters regard the slightest budgetary intrusions as an assault on the Texas way of life.
Target: Texas Commission on the Arts
Recommendation: To the slaughterhouse
Savings: $8 million
What makes the arts a sacred cow? Just check out the names on the commission and its committees—they’re full of people like Mrs. T. Boone Pickens and Mrs. Trammell Crow. Their weapons are wealth, influence, and the ability to make anyone who votes against the arts feel as if his tastes run to deer heads, beer bottles collections, and black velvet paintings.
But vote against it they should. The arts are a luxury, and when you’re broke, luxuries must go. Moreover, state money is not being used to rescue starving young Picassos from auto-mechanichood. Most of the money parceled out by the commission goes to groups with the biggest budgets and the most support, such as the Houston Symphony, the Dallas Symphony, the San Antonio Festival, the Contemporary Arts Museum, even oil-rich UT and A&M.
The Legislature should take to heart the fate of a former state senator who decided that his constituents could benefit from more exposure to culture. A wealthy man, he imported at his own expense an opera troupe, complete with orchestra, for an extended stay in his district. When the opera left, so did the senator’s wife—with a flutist. Sometimes it is better to be a philistine.
Target: Tuition equalization grants
Recommendation: Good riddance
Savings: $41 million
While the state faces a crisis in funding its own colleges, it is spending a whopping $41 million in 1984 and 1985 to subsidize student tuition at private colleges. If this seems inconsistent, that’s nothing new for TEGs. Back in 1971, when church schools like Abilene Christian and Baylor were lobbying for state aid to parochial college students, they were also lobbying against state aid to parochial secondary school students. They won on both fronts.
The original justification for TEGs was that it cost the state less to pick up part of the private school tuition than to build more public universities. In practice, every state senator still wanted a new college in his district, and most got one. Now schools like East Texas State are empty, but the Legislature goes right on paying students to attend church schools. If we’re going to pay people to go to school, why not pay them to go to East Texas State?
Target: Vocational education
Recommendation: Close up shop
Savings: $68.5 million
We’re in favor of voc-eds as much as the next guy, but things have gotten out of hand. Funding formulas award schools substantially more money for voc-ed than for basics. The extra money is only one reason for voc-ed’s large constituency. Voc-ed is a case of the state’s spending futile millions to keep alive a disappearing lifestyle. No wonder school reformer H. Ross Perot found voc-ed more resistant to change than athletics. What Perot couldn’t accomplish directly, however, he accomplished obliquely. By requiring that schools spend more time on the basics and by reducing excused absences for livestock shows, his reforms left students less time for voc-ed. Right now voc-ed is overfunded by at least 15 per cent. As for the complaints that without voc-ed, kids won’t learn anything practical, well, reading and writing have their uses too.
Target: Prevailing wage
Recommendation: Stop kidding ourselves
Savings: $20 million
Even organized labor has a sacred cow. Workers on state construction projects must be paid the “prevailing” wage in a community. That is supposed to keep the state from exploiting workers; in fact it allows workers to exploit the state. “Prevailing wage” is a euphemism for “union scale”—and in Texas, nobody pays union scale except governments. In the next two years that will cost taxpayers at least 10 per cent more than is necessary on at least $200 million worth of construction.
Target: Black colleges
Savings: $44 million
Why are black colleges the biggest sacred cow in all of state government? Because anyone who even hints that these institutions might have outlived their usefulness is vulnerable to that most damning of epithets: “racist.” But the real question should be, Why do blacks insist on viewing Prairie View A&M and Texas Southern as sacred cows anyway? Are the interests of Texas blacks really served by two substandard institutions that exist in the first place only because Texas was once segregated? Only 27.5 per cent of TSU law students pass the bar exam. Would the figure be lower if they attended the University of Houston? Or would it be higher?
Combining Texas Southern with the University of Houston, just a few blocks away, would save a forth of its budget. Turning Prairie View into a junior college and sending its graduates to state universities would halve its budget. The savings would be enormous, both in dollars and in souls.
Target: Agricultural Extension Service
Recommendation: Deep-six 4-H
Savings: $37 million
Talk about vestiges! Talk about boondoggles! Talk about sacred cows! The Agricultural Extension Service has it all.
A vestige: The service was established in 1915, when Texas was almost totally rural. It’s original mission was to spread the word about modern farming methods to the backwoods. Today it also helps run 4-H clubs and gives out hints-from-Heloise advice on family living. One Houston legislator calls on it regularly for such tidbits as how to get ink stains out of shirts (a paste of baking soda and vinegar, he says).
A boondoggle: The Extension Service is notorious as one of the fattest agencies in the budget. A typical story: Once a legislator tried to persuade A&M to move its regional diary expert from Dallas to Erath County, where the diary farmers actually lived instead A&M insisted on a second position at a cost of $100,000.
A sacred cow: The Extension Service is protected by its long tenure, its presence in all 254 counties, and its political connections—this is the first year since 1976 that the chairman of the House Appropriations Committee has not been an A&M employee. While legislative budget writers were cutting the rest of higher education by 26 per cent, they reduced the Extension Service by less than 1 per cent.
Maybe, just maybe, some farmers out there haven’t learned modern farming methods yet, so we‘ll leave that part of the Extension Service’s budget—$43 million—alone for now. But there is no reason in this day and age for the State of Texas to spend $37 million on household hints and 4-H clubs for kids who’ll be living in Dallas and Houston ten years from now.
MONEY IN THE KITTY SO FAR: $490,973,259
IV. Bad Ideas
From rent control to Amtrak, government is famous for sponsoring great ideas that turn out bad. Texas has more than its share.
Target: Automated Information Systems Advisory Council
Recommendation: Sack AISAC
Agencies need computers. Computers are expensive. AISAC monitors agencies. Agencies spend less on computers. What’s wrong with this picture? Since its creation in 1981, AISAC has examined 470 proposals to buy computers, for a total of $189.4 million. It has rejected exactly zero.
Target: Texas prison system
Recommendation: Stop hiring outside lawyers on the Ruiz case
It’s one thing to pay and win; it’s another to pay and lose. How could the state’s own lawyers do any worse? We might as well lose on the cheap.
Target: Ethics Advisory Commission
The commission’s job is to answer legislators’ queries on problems arising under the ethics law passed in 1983. Why not use the ethics division in the Secretary of State’s office, which already gives ethics advice to state and local politicians? Because if a legislator goes through the Ethics Advisory Commission and follows its advice, he is protected against criminal prosecution. But if he goes through the Secretary of State’s office and follows its advice, he has no such protection. The Legislature set up the commission solely to keep its errant members out of jail. The state pays enough for the Legislature without adding $120,000 in criminal defense fees.
Target: Full-day kindergarten for rich kids
Recommendation: Cut back to half-day
Full-day kindergarten—the single largest item in our list—started out as a legislative accident. It quickly became a bad idea. At the end of the special session on education reform last summer, the Legislature inadvertently changed the way the state funds local school districts to run kindergartens. Currently the state picks up the tab for a half day for all kids, plus an additional half day for poor and non-English-speaking kids. Because of the mistake, the state will have to pay for a full day for everybody come September. Undoing the error won‘t be easy. The major beneficiaries of the mistake will be politically influential, wealthy districts that now must use local money to pay for full-day kindergarten. Soon they will be able to use state money instead. This gift will undo one of the major achievements of the education reform bill, which narrowed the gap between rich and poor districts. The Capitol will be filled with apple-pie rhetoric about full-day kindergarten while these wealthy districts try to hold on to their windfall. Don’t believe it.
Target: Texas Research Institute of Mental Sciences
Recommendation: Trim TRIMS
Savings: $29 million
TRIMS, as it is known, has been a bad idea since its creation in 1957. Relatives of mental patients wanted a Houston-based hospital so that local patients wouldn’t be shipped to out-of-town institutions. The medical community, led by the Baylor College of Medicine, coveted a state-funded research center. TRIMS was supposed to be both, but in fact it hasn’t functioned very well as either.
The Legislature has finally given up on TRIMS as Houston’s primary mental health facility; next year the new Houston Psychiatric Hospital will open its doors. As for research, the Department of Mental Health and Mental Retardation has complained for years that TRIMS produces nothing of value to the department. With the state’s mental health program under severe attack in federal court, it’s time to put the $29 million to better use.
Target: Office of Public Utility Counsel
Recommendation: Pull the plug
Back in 1968, a Dallas lawyer named Eugene Locke ran for governor. His campaign is memorable chiefly for producing both the silliest jingle in modem Texas politics (“Yew-gene Locke should be guv-nur of Texas/ The guv-nur of Texas should be Yew-gene
Locke”) and the silliest idea. To counter accusations that he was the darling of the business lobby, Locke proposed to create a “people’s lobbyist.” The poor fellow never caught on that the governor is supposed to be the people’s lobbyist. He finished fifth.
If Eugene Locke were alive today, he would love the public utility counsel. The counsel’s job is to represent consumers in rate cases before the Public Utility Commission. The theory is that the commission hears only one side of the story—the utility company’s. The public utility counsel is supposed to balance the scale.
Nonsense. The utility commission was created to represent the public interest. If the public doesn‘t like the way the commission is doing its job, the answer is to get new commissioners, not to get a new guardian to guard the old guardians. Indeed, the system worked perfectly in the 1982 elections, when Mark White used criticism of the commission to unseat Bill Clements as governor. This textbook lesson in political science notwithstanding, the Legislature created the counsel’s job the following spring.
Target: Mass transit
Savings: $21.5 million
Do you know what makes mass transit so popular? People think, “If enough other people use it. I can drive my car on the freeway.” Here’s what‘s wrong with mass transit. It costs too much to build. It costs too much to operate. It costs too much to maintain. It encourages white flight. Texas cities are too sparsely populated to support it. The road networks between transit corridors aren’t good enough to get people to the transit lines. People would rather drive.
Even if you don’t agree, there’s no reason why tax dollars from Dumas should help buy a rail line for Houston. State mass transit money is just an urban raid on the state treasury.
Target: Office of State-Federal Relations
Savings: $1.5 million
Does the State of Texas really need 23 people to handle its Washington lobbying? Exxon has only 7, and it’s doing all right.
MONEY IN THE KITTY SO FAR: $666,355,335
V. Loose Change
The budget bulges with fat, waste, and mismanagement. These cuts add up to more than $200 million—and they only scratch the surface.
Target: License plates
Recommendation: One per vehicle
Savings: $4.8 million
Louisiana saves money this way. Then they throw it away on a world’s fair.
Target: Inspection of inspection stations
Recommendation: Reduce DPS supervision
Savings: $4 million
Of all the things that the State of Texas inspects, nothing gets scrutinized so closely as automobile inspection stations. Sixteen times a year they are visited by DPS troopers. Pennsylvania, in contrast, checks out its inspection stations once a year. By cutting back to six visits a year, Texas could save $4 million and still supervise inspection stations more closely than most other states do. The DPS will protest that laxity will cause the highways to be clogged with unsafe cars, but in fact the DPS’s intense supervision does little good. Two thirds of the violations uncovered by troopers result from consumer complaints rather than from inspection visits.
Target: Prison system mineral fund
Recommendation: Spring it
Savings: $6 million
Investigators have discovered 27 slush funds maintained by the Texas Department of Corrections. The TDC uses the money for its own purpose, while the Legislature scrambles for find tax dollars for the agency’s ever-growing budget. Fewer tax dollars would be needed if the slush funds were wrenched from TDC control and incorporated into the prison system’s budget. The royalties from oil and gas leases on prison land are a good place to start.
Target: Mental Health and Mental Retardation computer
Recommendation: Output three fourths of the money
Savings: $10.6 million
The agency’s computer is a standing joke in state officialdom. For a half million dollars a month it generates paper for no purpose; one MHMR administrator recently confided to a colleague in another agency that in ten years with the department, he’d never heard of the computer’s influencing a single decision.
Target: All health programs
Recommendation: Use generic drugs
Savings: $8 million
Last fall, word circulated through the Capitol complex the Comptroller bob Bullock was preparing his own ideas on how to balance the budget. This news set off fear and trembling in the bureaucracy because Bullock knows where everybody is buried. They needn’t have worried. Bullock’s report left all skeletons interred, focusing instead on a couple of worthwhile ideas, like using generic drugs, and a bunch of loser on the order of “Require use of the Postal Service’s nine-digit ZIP code.”
Target: State personnel costs
Recommendation: Hiring freeze
Savings: $78 million
Bullock’s other good idea. Assuming the current annual turnover rate of 18.3 per cent, the state could save $78 million by leaving one of every four vacancies unfilled. To make up for the lost productivity, the Legislature could always cut back on the fourteen state holidays, three more than the national average.
Target: Commissions serving the blind and deaf
Recommendation: Combine with the Rehabilitations Commission
Savings: $3.7 million
All three agencies do exactly the same thing—job training for the disabled—except that Rehab does it for the fewest bucks. The blind and deaf commissions are separate because each constituency wants its commission. That’s not a good enough reason to inflate spending by 25 per cent more.
Target: A&M agricultural publications
Recommendation: Charge a fee
Savings: $3 million
The Aggies employ 88 people to produce agricultural reports. In 1984 the Agricultural Extension Service distributed more than three million publications, almost all of them for free. They are mailed to libraries around the world with no pruning; what will the Moscow library do with “Look Your Professional Best”? Cutting the publications budget by $3 million will force the Extension Service to make it self-supporting, as it should have been all along.
Target: Medical school slush funds
Recommendation: Bypass surgery
Savings: $25.5 million
Medical schools have been looting the treasury for years. Here are three ways: (1) They estimate how much they will collect in patient fees, and then the state fills out the budget with tax dollars. By underestimating fees, the schools have caused the state to pump in $6 million more than is necessary. (2) Some nursing and medical technical programs are funded on the basis of estimated enrollment. Guess what? The same folks who underestimated patient fees (to their advantage) overestimated nursing and technician enrollment (also to their advantage). Funding the programs according to formulas would recoup $10 million. (3) Most faculty members at medical schools maintain clinical practices on the side. Their billings go into a pool used by the schools to supplement doctors’ salaries. So far, so good—except that retirement benefits are not deducted from the pool. Instead, the state has been picking up the tab to the tune of $9.5 million. Every other state employee has to pay retirement from his salary; why not docs?
Target: Uncollected debts owed the state
Recommendation: Dun Jim Mattox
Savings: $44 million
Over the years the attorney general’s office has been notoriously lax in collecting judgments owed the state. But Jim Mattox’s tenure hasn’t improved a thing. Maybe the Legislature should put Mattox’s budget on a contingent fee basis, giving him a piece of everything he collects until he brings in the entire $44 million.
Target: Governor’s Office of Budget and Planning
Recommendation: Cut budget, keep planning
Savings: $3.4 million
No Legislature in memory has paid the slightest attention to any governor’s proposed budget, so why pay for it?
Target: Mental Health and Mental Retardation construction
Recommendation: No more bricks
Savings: $31.5 million
Hasn’t MHMR gotten the news? The way to treat people these days is in the community, not in institutions. In the last two years MHMR received $31.5 million for construction—not a penny of it for community centers.
MONEY IN THE KITTY SO FAR: $888,855,335
VI. Tough Cuts
I’ve done what I said I’d do: cut the fat before looking at higher education. But instead of hurting all schools, which is what legislative budget writers elected to do, I’m going to concentrate our resources on healthy schools and close those that are not.
Target: University of Texas-Permian Basin
Recommendation: For sale by owner
Savings: $14.3 million
Permian Basin was an essential part of late regent Frank Erwin’s master plan to locate UT campuses in so many senatorial districts that UT’s oil money would be forever safe from political attack. But while most of the new schools are flourishing, UTPB enrollment is still struggling to get above the two thousand mark. Students do not want to go to school there. Let’s quit asking them to.
Target: East Texas State University
Recommendation: East Texas Junior College
Savings: $14.3 million
This is another case of the market’s having spoken, ETSU’s enrollment peaked in 1975 at 9981; it has declined for nine consecutive years and now rests around 7000. The culprits: UT-Dallas and UT-Tyler, which have grown at the expense of ETSU, and junior colleges that proliferate in the area. ETSU should pack up, move to its Texarkana campus, and absorb Texarkana junior college.
Target: Texas Women’s University
Recommendation: Join North Texas State
Savings: $15 million
Why should we have two separate universities in Denton? Why should we have a separate state-funded university for women anywhere? If there ever was a clear-cut case for consolidation, this is it.
Target: Lamar University System
Recommendation: Undo the system
The system mania is one reason why the state is in such financial trouble. Every time a university starts teaching course away from its main campus, it wants to make the new location a separate university. Thus we have the University of Houston and the University of Houston-Downtown, a ten-minute ride away. And we have Lamar University-Beaumont, Lamar University-Port Arthur, and Lamar University-Orange. Making these satellite campuses full universities costs the state a lot of money. Lamar is an outrage. More than half of the students in Orange and Port Arthur are vocational rather than academic, yet Lamar administrators are stalking the halls of the Capitol, seeking full academic-formula funding. Cutting $300,000 now will save the state millions in the future.
Target: One-of-a-kind programs
Recommendation: Cut funding in half
Savings: $43 million
This really is a tough cut. Nearly all universities have special programs that get extra funding in the budget. They range from the well-known Bureau of Business Research at UT-Austin to the obscure Chihuahuan Desert Research Institute at Sul Ross in Alpine. Most of them do first-rate work. But they are frills that aren’t central to the schools’ educational function; in a true budget crunch they have to go.
But don’t feel too sorry for them. Most of them are established as consulting centers. They get grants and outside contracts that include money from overhead. Indeed, the Legislature funds them with the understanding that they are capable of being self-supporting some day. That day has arrived.
MONEY IN THE KITTY SO FAR: $985,655,335
Target: A&M at Galveston
Recommendation: Sell to Holiday Inn
Savings: $14.8 million plus the sale price
Oops. You mean we’re still short of $1 billion? Well, I know I said Galveston was untouchable, but now there’s just no other way to get there. The truth is, we’re all going to have to give up something. Besides, A&M is a little hard to justify when U of H-Downtown spends $23 million for seven thousand students and A&M-Galveston spends $14.8 million for fewer than six hundred most of whom are learning how to pilot ships.
FINAL TALLY: $1,000,455,335