Saturday, July 02, 2011

Recapping the 82nd Session of the Texas Legislature

As part of a traveling primer series, a recap of the 82nd legislative session was offered by Texas Public Policy Foundation in Houston Wednesday. During the luncheon held at Houston City Club, Foundation supporters heard from four speakers:
The Honorable Arlene Wohlgemuth, TPPF Executive Director and Director, Center for Health Care Policy; The Honorable Talmadge Heflin, Director, Center for Fiscal Policy; Kathleen Hartnett White, Distinguished Senior Fellow in Residence and Director, Armstrong Center for Energy and the Environment; and Mario Loyola, Director, Center for Tenth Amendment Studies.

Here are some of the highlighted conclusions I found interesting:

The 2012-2013 State Budget:
The state's All Funds budget for 2012-13 represents the first budget in 50 years that appropriates an amount less than the previous biennium. All Funds appropriations for Article II: Health and Human Services decreased by $5.4 billion, or 9.1% from the 2010-11 General Appropriations Act (GAA). All Funds appropriations for Article III: Agencies of Education - which includes funding for both public education and higher education - increased by $0.2 billion or 0.2%.

That's right - even in truly difficult economic times, the Texas state budget increases school funding. Despite what the critics say, the children of Texas will have schools to go to and teachers to teach in those schools. And, the taxpayers who pay for it all will not be presented with a bigger bill.

General Revenue (GR) appropriations in the state's 2012-13 budget decreased by approximately $170 million or 0.2% as compared to the 2010-11 GAA. As compared to the amount expended in the 2010-11 biennium, GR appropriations for fiscal 2012-13 decreased by $1.6 billion or 2%.

The new budget provides for approximately 3,300 fewer full-time positions in both fiscal years 2012 and 2013.

Primary reasons for the funding decrease include: a sharp decline in state revenues; expiration of $12 billion in federal stimulus funds; underfunding Medicaid caseload growth; and a $2.3 billion Foundation School Program deferral.

Only one major agency consolidation took place during the 82nd Session of the Texas legislature (regular session) - the Texas Youth commission and the Texas Juvenile Probation Commission. The consolidation of these two agencies is expected to yield an estimated $150 million in savings in the coming biennium.

The Economic Stabilization Fund (Rainy Day Fund)
During the regular session, the Legislature elected to appropriate $3.2 billion from the $9.7 billion ESF to apply towards the deficit for the 2010-11 biennium. This was accomplished through the passage of HB 275. The remaining balance of $6.5 billion was left untouched.

But, while the ESF was left intact during the regular session, an amendment that appropriates money from the fund in certain circumstances was added to SB 2 during the First Called Special Session (special session). It is estimated that this provision, assuming certain growth patterns, could redirect up to $2 billion out of the ESF and into the Available School Fund.

During the regular session, the Governor vetoed HB 2403, a bill that would have created new legislation to extend the sales and use tax to certain online retailers. Dubbed the "Amazon tax", the measure has been revived as an amendment to SB 1, the reincarnation of SB 1811, during the special session. Currently, it is unclear whether this measure will be removed by the conference committee or whether the Governor will veto SB 1 because of this provision.

Medicaid makes up roughly 1/4 of our state's budget and it continues to grow. Medicaid delivers poor health care, due to low reimbursement rates and it has caused almost 2/3 of the state's doctors to refuse to take Medicaid patients.

The Health Care Compact passed in Special Session and this is a huge victory for our state and its ability to determine how best to spend health care delivery dollars.

Energy and the Environment
A victory for private property rights occurred with he passage of SB 332 which clarifies and re-affirms that "a landowner owns the groundwater below the surface of the landowner's land as real property." Under the 1917 Conservation Amendment to the Texas Constitution and subsequent law, groundwater may be regulated. As a landowner's real private property right, however, the right is protected by the Texas and U.S. Constitutions from regulation that goes too far. With passage of SB 332, the Texas Legislature made a historic choice for private property rights instead of unlimited government control.

Center for Tenth Amendment Studies
The Center was very active in the interstate compacts area, focusing on health care and environmental regulation.

The Center helped develop HB 2545, which would strip EPA of the authority to approve or disapprove State Implementation Plans under the Clean Air Act. Though it didn't come to a vote on final passage, it gained interest through the end of the session and will be a promising avenue in the next Legislature.

Much was accomplished in raising awareness in Texas and in state legislatures across the country of the potential of interstate compacts to address federalism issues and help erect a shield to protect the states' regulatory autonomy. The interstate compact proposals developed at the Foundation triggered a debate in many state legislatures as to why the federal government rather than the states should be regulating in areas such as health care, which are quintessentially matters of local concern. This was the greatest impact of the Foundation's efforts.

The Center filed the Foundation's first ever Amicus Brief in the 11th Circuit Court of Appeals, on behalf of the states in the 26 state challenge to the constitutionality of ObamaCare.

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