A Legislative Update from the Texas Public Policy Foundation

Dear Friend,

Yesterday’s Tea Parties provided a stark visual of taxpayers’ frustration with runaway government spending. While many in the media were joined by big-government advocates in denouncing the activities as fringe, I saw with my own eyes that those in attendance cut a swath across all demographics, from soccer moms with their children, to veterans and average working Joes. The hundreds of thousands of people who gathered in communities large and small all across America had a message that was delivered loud and clear – that government has grown too big.

It’s easy to look at Washington as the symbol of tax and spend excess – with its trillions spent on bailout and stimulus packages that reward bad behavior and punish financial responsibility. But taxpayers also need to pay close attention to the work underway in our own state’s Capitol for examples of misplaced priorities that could result in even greater tax burdens.

At several Tea Party events, speakers shared their frustration about a bill that appears headed for passage – Senate Bill 855 – that could result in billions of dollars in new taxes to build light rail, hike & bike trails, and roads. At the state Capitol, the crowd of thousands burst into chants of “no new taxes” after hearing about this bill.

This legislation is a prime example of the type of legislative activity that has played a role in taxpayers’ frustration boiling over into public protest. For years, the legislature has diverted billions of transportation taxes to non-transportation purposes – taking gas tax revenues and giving it to the Arts Commission, the Historical Commission, and the Department of Public Safety, to name a few. Now legislators are surprised they’re running out of transportation money, and within a week of adopting a budget that continues to divert more than $1.3 billion of transportation taxes, they adopt a new tax scheme for even more transportation revenue.

Even worse, this bill includes a provision so that only high-income earners pay several of the proposed fee increases. That sounds awfully similar to an income tax.

Unfortunately, if you spend enough time in Austin, you’ll hear all sorts of excuses to raise taxes rather than fix a broken system – in this case, ending transportation funding diversions. Supporters of this bill criticize our stance on the bill, simply because the bill requires voter approval. That’s nonsense. A tax bill should be the most difficult type of bill to pass, and taxpayers assume that legislators are asking the tough questions before ballot measures are put in front of them.

It’s time for our elected officials – especially those in Washington, D.C., and Austin, Texas – to heed the strong and united voice of their taxpayers: Don’t raise taxes on businesses and hard-working families when we can least afford it.

The pace of the 81st Texas Legislature has quickened since the last “Voice of Liberty,” and as you can see below, our policy analysts are involved not just in the debate over taxes but also many of our state’s most critical issues. We invite you to follow these efforts through these emails, and by visiting our website where you can visit our blog, request a speaker, and sign up to receive information about recently released publications and upcoming events via our e-newsletter, TPPN.

Yours in liberty,Justin KeenerVice President of Policy and Communications

House to Debate Budget

On Friday, the House is scheduled to debate its version of the state budget. It currently sits at $178.4 billion and is $4 billion less than what was adopted by the Senate. More than 400 amendments have been pre-filed for consideration. Amendments to the amendment, which do not require pre-filing, could easily double that number, which will mean an extremely long day on the floor. By calendar rule, adopted by the House, any amendment that costs money must find money elsewhere in the budget to pay for it. If the debate goes as usual, there will be numerous attempts to redirect the Texas Enterprise funds from the governor’s office to a variety of uses. Expect significant debate over the use of stimulus funds, and whether or not incentive and merit pay for teachers should be replaced with smaller, across-the-board pay raises for everyone regardless of performance.

Teacher Pay

There are several amendments to the budget that will be debated tomorrow on teacher pay. One amendment gives all teachers, nurses, librarians, and counselors an across-the-board pay raise of $1,000. Research clearly states that across-the-board pay raises do not lead to higher teacher quality. In fact, across-the-board pay raises give all teachers a pay raises regardless of their effectiveness in the classroom and actually encourage ineffective teachers to continue teaching. We urge Texas lawmakers to put the needs of students first and vote to keep incentive pay funding that has already led to higher academic gains in school districts.

Texas and the Federal Stimulus Funds

Last week, the Foundation was joined by several legislators in releasing our research that examined the national and statewide economic effect of the recently passed federal stimulus package. Our research demonstrated that the growth in government will crowd out private sector growth, resulting in more than 130,000 jobs lost in Texas and 1.7 million lost nationwide.

Unnecessary Regulations Preventing Access to Health Care

On Tuesday, the House Public Health Committee heard Rep. Wayne Christian’s House Bill 1107 that would allow licensed advanced practice registered nurses to diagnose patients and prescribe medications, within their education and training. The Foundation provided testimony on a viable solution to the lack of physicians in regions across the state, by allowing health care providers other than physicians to meet the basic health needs of residents in these regions, as done throughout the nation in other states. Repealing the restrictions on APN prescriptive authority will provide Texans with more affordable options.

Windstorm Insurance

It wasn’t that long ago during the mold crisis when homeowners were hard-pressed to find insurance coverage at any price. Reforms have greatly increased the availability of homeowners insurance and brought down prices, but the future of those reforms is at stake in legislation currently being considered by the Texas Legislature. The proposed sunset legislation on the Texas Department of Insurance – heard in the House Insurance Committee on Tuesday and awaiting floor action in the Senate – would further enhance those reforms, but attempts are being made to roll back the clock to the days of high prices and scarce availability. Legislators have a choice to make: let market competition fully unfold and flourish, or revert to heavy regulation and subsidies.