The 83rd Texas Legislature opens Tuesday, and the contrast between this session and the last one could not be more clear.
A contentious redistricting battle, spawned by the 2010 census, is history. No one expects a repeat of the severe budget cuts that forced legislators to slash funding for education and other state agencies. With the state’s economy on the upswing, the outlook is much stronger than it was two years ago.
Veteran legislator Phil King, who represents Wise and Parker counties, acknowledges all that, but says the state still needs to be cautious because of what is going on – or not going on – in Washington, D.C.
“The greatest issue Texas has right now is the federal government,” King said this week. “They can’t continue to borrow $4 billion a day. If they do, they’re going to drive us into a recession. Then at some point they are going to reduce spending – they’ll have to – and that’s going to come back on the states. It’s very, very concerning.
“Texas needs to be very, very cautious, fiscally, to prepare for that.”
King, a Weatherford attorney who is beginning his seventh term in the Texas House, said he was disappointed in the stop-gap tax measure Congress approved as it faced the “fiscal cliff” on New Year’s Eve.
“The deal Congress passed had no spending cuts,” he said. “They just dealt with revenue, and it sounds like that’s the President’s focus – revenue.”
King’s take is that the federal government intends to continue to expand Medicaid.
“It’s 25 percent of our state budget now, and it could easily be 35 percent in a few years,” he said. “That’s money you can’t put in roads, lakes or things you really need to be doing. That rivals education.”
King’s office just announced this week that he has pre-filed a bill to create a constitutional amendment that would limit state spending for welfare and entitlement programs. Under House Joint Resolution 52, spending in those programs could not exceed the corresponding rate of growth in total state spending.
Without a cap, Texas’ general revenue spending for Medicaid alone is likely to increase from $16.3 billion in 2012-13 to $38.3 billion by 2020-21.
“Texas must limit the growth of welfare spending, or it will quickly overcome public education and transportation as the single largest item in the budget, and become unsustainable,” the news release said.
Indeed, the state already owes Medicaid $4.7 billion as soon as legislators walk in the door – spending deferred from last time in an accounting maneuver designed to balance that budget.
King said another $600 million will need to be appropriated right away to cover expenses from wildfires that devastated parts of Texas last year.
“Compared to the $27 billion shortfall we walked into last time, right now they’re projecting an $8 billion revenue surplus,” he said. “But that spends down pretty quickly. It’s not a huge surplus – not if you really understand how the budget works. It’s not anywhere near what people think it is.
“The good news is that the economic projections are very favorable,” he said. “Last time, it was doom and gloom. Things are much more favorable now, and we have an opportunity to do some things we need to do.”
EDUCATION ON HOLD
King said everyone is watching the court case in which more than 600 school districts have sued the state, claiming that budget cuts in the 82nd Legislative session may violate the constitution’s mandate that the state provide “adequate” funding for public schools.
The trial before District Judge John Dietz in Austin, picks up again Jan. 7 after a holiday recess, and will likely continue through the end of January.
Meanwhile, legislators will probably deal with other matters as they await a ruling.
“With the exception of one new element, it’s essentially the same lawsuits that have been brought in previous decades,” King said. “The big concern for us is we can’t really do much on education funding until we know what the ground rules are.”
But King has concerns about education that go beyond the funding system.
“The state’s effort to micromanage education at the local level has done nothing but add to school districts’ operating costs,” he said. “We’ve got to quit constantly adding to their cost of doing business.
“Everyone gets upset with them for adding all these administrative and non-teaching personnel, but it was government that put all those requirements on them that forced them to go hire somebody to do that,” he said. “We have got, got, got to return to local control in education.”
Asked about vouchers to allow students to attend private school and take some state funding with them, King said he’s “not a big fan.”
“In my district, which includes 18 school districts, people in those communities are by and large happy with their schools,” he said. “Vouchers are to allow people an alternative, to pull their kids out of poor-performing schools, usually in inner cities. We have the kind of schools people are wanting to get their kids into, not out of.”
But he also noted that in other states, vouchers come with strings attached.
“There’s no way that money can come without bringing some level of state regulation over how private schools spend those dollars,” he said. “That’s a very great concern to me.”
King does not expect any kind of battle over the re-election of Speaker Joe Straus.
“There’s not going to be a Speaker’s race,” he said. “The Speaker has had more than enough votes to continue in that office since early last year.”
One thing that will change is that the age and experience of House members will continue to drop.
“Right at half of the members of the House are freshmen and sophomores now,” Kind said. “That’s good and bad. We get a lot of new energy, new ideas and new approaches – but at the same time we’ve lost a lot of institutional knowledge on issues.”
He cited the lack of members in agriculture and oil and gas-related businesses – sectors which still make up a significant portion of the state’s economy.
“It takes a little while to replace those people,” he said. “Experience brings knowledge.”
The conservative Republican said he expects the House to be even more conservative than it was in the last session.
“The majority of the new members are Republicans, and they’re going to be very conservative, both fiscally and on social issues,” he predicted.
DOING BIG THINGS
King said with the budget crisis of last session in the rear-view mirror, he would like to see the state legislature start thinking long-term again – planning and dreaming for a future that still holds great promise.
“I really want Texas to get back to doing big things,” he said. “I think we’ve been coasting and not tackling the big issues.”
One of those big issues is water. King would like to see the state finally fund a water plan it approved several years ago. A key component of that is a trust fund that would underwrite notes for local entities to rebuild their water infrastructure and enable them to better withstand drought.
That trust fund would need to generate $400 to $500 million a year, King said, dedicated within the state budget to help local entities.
“It’s going to take $50 billion over the next 50 years to meet our needs,” he said. “The plan is in place – we just need to fund it.
“We need access for the small communities to leverage their dollars to build infrastructure, and also funding for the large water projects – and those are very, very expensive.”
King said the long-term nature of water projects makes it too easy for the legislature to put them on the back burner.
“It’s easy to kick this one down the road, because the money you spend today will benefit us 25 or 30 years down the road,” he said. “But we could still be at the front end of a long-term drought.
“The good news is that the Speaker has made this one of his priorities.”
Certainly all 150 members of the Texas House will walk in the doors next Tuesday with their own priorities, and the perception of a budget surplus means plenty of interest groups will be lining up to lobby for their piece of the pie.
One thing is certain: Even with the Longhorns’ football season over, things aren’t likely to be dull around Austin for the next several months.