House budget writers on Thursday finished drafting a two-year state budget that has three very big differences from Senate GOP leaders’ emerging budget package.
The House Appropriations Committee’s plan would spend more on public schools; about the same on roads, though only in the short run; and less on border security.
There are probably hundreds of other differences. But these are the biggest:
Public schools – House Appropriations has left $2.2 billion more on the table for school districts to spend than the Senate’s starting point budget did.
Lt. Gov. Dan Patrick and GOP senators are more focused on cutting local school property taxes.
Speaker Joe Straus, R-San Antonio, and his bipartisan governing coalition want to increase state aid beyond the legally required minimum. House leaders have decided on a figure — $2.2 billion — for the increase. But they haven’t determined how the money would be delivered — probably through the basic allotment for state school aid, according to sources, though that is still to be determined.
This year’s school funding discussions are a bit mind-numbing. For state budget writers, the news is good. For people running schools, it’s mixed.
In 2011, lawmakers cut about $5.4 billion from public schools. Many blamed the recession but most were adamantly against raising taxes. GOP leaders have argued that last session, the Legislature undid the cuts. According to them, basic state aid per student is up about $200 per student since 2011. According to the state’s largest teachers group, though, districts are spending about $600 less per student than they did six years ago — mostly because of inflation and state cuts. If House leaders prevail this session, the additional $2.2 billion won’t end the dispute but will bolster state leaders’ arguments.
By all rights, it’s money that lawmakers could take away. That’s because the state’s obligation to financially support schools declines as school districts raise more from their property taxes. Property values are soaring in many urban areas. That means districts can raise more money locally, causing state support to drop — unless school-finance laws are changed. That is unlikely, at least until a lawsuit that districts have brought against the state is decided by the Texas Supreme Court.
Property values are expected to increase so significantly that the state actually could reduce its aid to schools by $4.5 billion in the next cycle. In their starting point budgets, both chambers used some of that savings to cover the $2.3 billion cost of surging enrollment in schools. In Texas, enrollment will increase next year by an estimated 83,000; and in the following year, by 85,000 students.
Basically, the House wants to leave all of the state’s windfall with the schools, while the Senate would cover enrollment growth but use the rest for tax cuts.
Clear as mud? Just wait and see what happens when we add a little asphalt.
Transportation – GOP leaders in both chambers are getting closer and closer to increasing state funding of highways to the bare minimum experts say is needed to maintain what for many Texas commuters is an unacceptable status quo. Hey, in a world in which tax increases are politically unpalatable, that’s how many folks define success.
In bold brush strokes, here is the emerging portrait: The Texas Department of Transportation says $5 billion more a year is needed just to maintain the current condition of the state’s roads and keep congestion from getting worse. On Tuesday, Appropriations Committee Chairman John Otto, R-Dayton, said House budget writers have cobbled together some $9.1 billion of the $10 billion needed for the 2016-2017 budget cycle.
He was fudging a bit — by counting last November’s transfer into the highway fund of $1.7 billion of energy-severance tax money, which voters had just approved by passing Proposition 1. The money otherwise would have remained parked in the state’s rainy day fund, which is politically untouchable and expected by August 2017 to increase to $11.1 billion — a sum unimaginable to the fund’s creators, back in the oil bust of the late 1980s.
Even discounting for Otto’s maneuver, House budget writers have moved about three-quarters of the way to the goal of giving TxDOT $10 billion more for the next budget cycle. So has the Senate. The key difference in their approaches is that the House moves $1.5 million of general-purpose tax money into the highway fund, while the Senate makes a one-time transfer to the fund of $1.2 billion of sales tax collected on cars and pickups.
Senate leaders want to expand that “raid” on the motor vehicle sales tax — but only in future years, beyond the next budget cycle. They have proposed placing a constitutional amendment before voters next year that, barring a recession, would shift at least $2.5 billion a year of vehicle sales tax into transportation, starting in fiscal 2018.
Border security — In last year’s Republican primary battles, no issue generated more talk than immigration and border security. In a crowded, four-way race, Patrick made it his centerpiece. Not surprisingly, the Senate’s initial budget would spend $815 million on law enforcement efforts along the Texas-Mexico border — a 74 percent increase. Last month, Patrick said that the Senate would appropriate additional money to keep the National Guard deployed into the next budget cycle.
Currently, the state is spending $468 million for state police overtime, state equipment purchases, local law enforcement grants and other costs of its surge in border enforcement.
In January, the House’s initial budget assumed the Guard soldiers would stand down this spring. So House leaders trimmed overall border security spending for 2016-2017 to $397 million. Since then, however, they have increased their proposed spending to about $520 million.
House leaders make other boasts about their budget: It would shore up the underfunded pension fund for active and retired state employees. It adds money for trauma care by reducing the hoarding of special-purpose fees and taxes. It spends $460 million to keep primary care doctors from dropping out of Medicaid, after the expiration of federal money for temporary increases in their reimbursements.
Senate leaders will have their chance to brag soon enough.
On Thursday, Otto’s panel tentatively approved the House’s version of the budget. It will take a week to print. Leaders said the Appropriations Committee probably will vote out the bill next Thursday.
The Senate’s isn’t even that close to being printed on paper. Work groups of the Senate Finance Committee are still meeting to hash out details of that chamber’s budget.