Government
Affairs Committee
Steve Ahlenius
Vice-Chair Govt. Affairs
McAllen
Eddie Brown
Sherman 
John Darby
Hutto 
Tony Felker
Frisco
Mary Frazior
Hurst-Euless-
Bedford
Jim Johnson 
Lufkin 
Jamee Jolly
Plano 
Eddie McBride
Lubbock
Wayne Mitchell
Nacogdoches
Jason Mock
San Marcos
Tony Moline
Cedar Park
Mitch Thames
Bay City







WEEK 12 UPDATE

Call For Information
Does your chamber also operate the EDC, CVB, or have other contractual arrangements with your city/county?  Or does your chamber receive funding from your city/county government in other ways outside of membership?  If so, please let us know.  Email Aaron Cox at acox@txbiz.org. Thank you for your assistance.  
Following are highlights and items of interest from the legislature.

There are several bills being debated on the issue of guns ranging from constitutional carry to business/employer liability.  Included in the discussion will be: 
HB 375 by Jonathan Stickland (R-Bedford) and HB 1911 by James White (R-Woodville) each of these would allow for unlicensed carry of a handgun.

HB 477 by Cecil Bell (R-Magnolia) and HB 556 by Mark Keough (R-The Woodlands) each of these would increase the liability of businesses that disallow carrying of a handgun on their property.

The Senate passed SB 2 by Paul Bettencourt (R-Houston), which would lower the ad valorem tax rollback rate from 8 percent to 5 percent and schedule an automatic election if a taxing jurisdiction exceeds that rate.
 
Senator Bettencourt said, "Texas taxpayers know the truth. Property taxes are rising too fast. As appraisal values rise, tax rates do not come down enough to provide property tax relief. SB 2 will save future money for hard-pressed homeowners and business owners. Throughout Texas, in hearing after hearing, the Select Committee heard 50 hours of public testimony from frustrated Texas taxpayers who overwhelmingly called for property tax relief. The Texas Senate heard them. SB 2's passage says, the plight of homeowners and business owners is recognized."
 
Texas Municipal League Executive Director Bennett Sandlin commented on SB 2 saying, "The method the Senate has chosen for providing property tax relief guarantees that homeowners who qualify for the over 65 or the disabled exemption on their homes will get practically no tax cut. Anyone who calls this tax relief is really committing tax fraud. The 5 percent cap on city property tax increases restricts the ability of cities to fund police and fire protection, road construction, and economic development incentives. If legislators are serious about reducing property taxes for homeowners, they will throw this bill out and start addressing the real cause of high property tax which is the state's system of financing public education."
 
Senate Democratic Caucus Chair Jose Rodriguez said, "Local officials are elected to make tough decisions in the best interest of their community. Scores of them, from small Texas counties to large Texas cities, as well as their public safety leaders and financial officers, clearly told legislators that capping local discretion would hurt their ability to determine and serve community needs. Small communities cannot predict emergencies and should not be hamstrung by a legislative mandate. Further, SB 2 does nothing to address the true driver of property taxes - schools, which make up more than half of property owners' tax bills. Relief for property taxpayers will only come when the state finally fulfills its constitutional obligation to finance a public school system that meets the needs of Texas children."
 
Last Tuesday, the Senate also passed SB 17 by Jane Nelson (R-Flower Mound), which would phase out the franchise tax in increments in each biennium the estimated general revenue growth exceeds five percent. The committee substitute was adopted and it passed by a vote of 23 - 7.
 
Senator Nelson said, "There is widespread support to eliminate the franchise tax, which hinders the ability of Texas businesses to grow and prosper. As a business person who paid this tax, I know how complicated and burdensome it can be - especially on small businesses. This legislation responsibly phases out the franchise tax while ensuring we retain the revenue necessary to meet the needs of our state. Our economy is healthier when businesses have fewer burdens and are free to grow."

Lt. Governor Dan Patrick commended Senator Nelson and the Senate after the passage of SB 17 saying, "During the 2015 Legislative Session we reduced the franchise tax by 25% - a major cut, saving Texas businesses nearly $2.5 billion dollars. This year, despite a tighter budget, our goal is to continue to chip away at the franchise tax until it is eventually eliminated completely. That's why today, I'm proud to announce that SB 17 passed the Senate. That's good news for business and it's good news for Texas. This important bill will help us keep the Texas economy vibrant and competitive."
 
Center for Public Policy Priorities Senior Fiscal Analyst Dick Lavine also commented on Senate passage of SB 17, "This short-sighted proposal would automatically lock in future revenue cuts, without regard to budget needs. The proposal would cut the rate of the franchise tax if the comptroller's biennial revenue estimate showed that general revenue related funds (available for certifying the budget) would grow by more than five percent in the next biennium. SB 17 would guarantee tight state budgets into the future, starting with a $1.1 billion reduction in franchise tax receipts for the 2020-2021 budget."
 
BUDGET:
On Wednesday, The Senate Finance Committee discussed and then unanimously voted out a committee substitute for SB 1, the general appropriations bill. The committee substitute appropriates $106.3 billion in general revenue, up from the $103.6 billion in the filed bill.
 
The difference is made up from delaying the $2.5 billion transfer of sales tax revenue to the state highway fund from August 2019 to September 2019 (into the next biennium). Chairman Jane Nelson said, "This budget remains a work in progress, but we will continue our work to make the most of every dollar, meet our priority needs and keep Texas moving in the right direction. This committee left no stone unturned looking for savings, examining our budget drivers and looking for ways to make smarter use of our limited resources. CSSB 1 establishes a $106.3 billion budget for fiscal years 2018-2019, which is well within the state's population growth times inflation and the spending limit."
 
Lt. Governor Dan Patrick said, "I commend Chairman Jane Nelson and the members of the Senate Finance Committee which passed out CSSB 1 this morning with a 15-0 bi-partisan vote. This budget fully funds K-12 education and actually increases spending on health care, including Child Protective Services - our two top budget drivers - without raising taxes or using the Rainy Day Fund. The Finance Committee has worked many long days and nights for several weeks to ensure that we have a budget that maximizes our resources in these lean times and reflects our conservative principles. I know I speak for the people of Texas in thanking them for their commitment and their good work on this critical issue."
 
Comptroller Glenn Hegar - Last Monday, Comptroller Hegar sent a letter to Chairman Nelson in response to her question regarding deferral of the transfer. The letter said, "If the estimated $2.2 billion in sales tax collections in fiscal 2018 for the highway fund were transferred in September 2018 and the $2.5 billion in fiscal 2019 sales taxes were transferred in September 2019, then there would be a gain to certification of $2.5 billion for the 2018-19 biennium."
 
Speaker Joe Straus - In response to the Senate budget, House Speaker Joe Straus said, "I want to be clear that counting money twice in order to balance the budget is not a good idea. I'm not interested in cooking the books just to avoid a vote on the Rainy Day Fund. I don't want to put our comptroller in the position of having to do some ridiculous maneuver in order to make this budget work. Gimmickry is not going to get us out of here this time. This is the Texas Legislature. We are not Enron."
 
Here are some key provisions of CSSB 1:
Education Highlights:
  • Continues the current funding formulas for public education;
  • Adds $2.65 billion to cover student enrollment growth, which is projected to be more than 80,000 per year over the next two years;
  • Provides $65 million for a new public-private partnership to ensure high quality pre-kindergarten throughout the state; 
  • Includes $25 million for E-Rate, a program to bring broadband infrastructure to Texas schools lacking those services; 
  • Includes $5 million for Pathways in Technology Early College High School (P-TECH), a new program designed to help students pursue careers in technology;
  • Adds $316 million to fund SB 788 by Senator Huffman to mitigate the Teacher Retirement System shortfall;
  • Increases financial aid for public institutions of higher education, including an additional $45 million for TEXAS Grant funding;
  • Replaces special items with $700 million in additional formula funding, which ensures that at least 90 percent of each higher education institution's FY 16-17 formula and special items are funded; and
  • Increases Graduate Medical Education funding by $44.1 million with the goal of ensuring that residency slots are available for Texas medical school graduates.
Health & Human Services Highlights:
  • Provides $3.4 billion for Child Protective Services, an increase of $430 million over FY 16-17 levels, including: $180 million increase to continue pay raises and the 828 additional caseworkers and support staff approved over the interim; $116 million to strengthen foster care capacity by increasing rates and expanding community-based foster care to four additional regions; and $55 million to hire 386 new conservatorship caseworkers to reduce caseloads;
  • Provides an additional $15 million in child abuse prevention funding to maintain programs and services;
  • Allows the Department of Family and Protective Services to allocate $3 million to address youth homelessness and human trafficking;
  • Provides a $780 million commitment for new construction and significant repairs to the state hospital system, plus $145 million for other critical life and safety capital needs at state hospitals and state supported living centers;
  • Adds $244 million for mental health services in Article II, including: $63 million to eliminate waitlists for community mental health services; $44 million to maintain indigent behavioral health services to former clients of the NorthSTAR program; $10 million to maintain level funding for current purchased psychiatric hospital beds; and $35 million to maintain state hospital service levels and increase maximum security capacity;
  • Provides $20 million for the Texas Veterans + Family Alliance, a grant program to assist veterans struggling with post-traumatic stress and other mental health issues;
  • Adds $18.2 million for an additional 276 Home and Community-based Services waiver slots for foster children aging out of the system;
  • Increases funding for Medicaid to provide caseload growth at FY 18 levels and assumes over $400 million in cost containment initiatives; and
  • Maintains funding for women's health programs at current appropriated levels, a $31 million increase over current spending levels, and requires additional program reporting requirements.
Other Provisions:
  • Dedicates approximately $5 billion for transportation in accordance with Proposition 7;
  • Adds $44.9 million to the Railroad Commission to maintain current operational stability and increase pipeline safety;
  • Provides $46.2 million to fund preservation and updates to the Alamo;
  • Includes $40 million to support infrastructure projects at Texas ports;
  • Maintains veterans' services at current levels;
  • Increases funding for the Commission on Jail Standards to improve the safety of local jails;
  • Provides additional resources to the Department of Public Safety to prevent crimes against children;
  • Fully funds the Cancer Prevention & Research Institute;
  • Maintains the $800 million for border security approved last session;
  • Includes $25 million for high caliber bullet-proof vests to protect Texas peace officers;
  • Increases Crimestoppers funding by $4 million;
  • Adds $6.3 million to strengthen oversight of guardianship;
  • Directs the Department of Information Resources to study the state's vulnerability to cyberattacks;
  • Fully funds behavioral health peer assistance programs at the dental, pharmacy, nursing and veterinary boards; and
  • Fully funds the prescription monitoring program at the Board of Pharmacy.
SB 543 by Kel Seliger (R-Amarillo) would implement Performance Based Tuition, which would require institutions of higher education to meet performance metrics prior to increasing tuition. It requires the Texas Higher Education Coordinating Board through negotiated rulemaking define the following performance measures:
  1. The total number of undergraduate degrees awarded by the institution;
  2. The total number of undergraduate degrees awarded adjusted by the institution's six-year graduation rate;
  3. The total number of undergraduate degrees awarded per 100 undergraduate full-time student equivalents;
  4. The total number of undergraduate degrees awarded to at-risk students;
  5. The total number of undergraduate students having successfully completed at least 25 percent of the student's degree requirements or having earned at least 30 credit hours toward a 120-credit-hour degree;
  6. The total number of undergraduate students having successfully completed at least 50 percent of the student's degree requirements or having earned at least 60 credit hours toward a 120-credit-hour degree;
  7. The total number of undergraduate students having successfully completed at least 75 percent of the student's degree requirements or having earned at least 90 credit hours toward a 120-credit-hour degree;
  8. The average length of a student's enrollment, by number of semesters, for undergraduate degree completion;
  9. The four-year graduate rate of first-time, full-time, bachelor's degree-seeking students who enrolled in at least 12 semester credit hours in the student's first fall semester at the institution and who graduated from the institution or from any other institution of higher education or private or independent institution of higher education;
  10. The six-year graduate rate of first-time, full-time, bachelor's degree-seeking students who enrolled in at least 12 semester credit hours in the student's first fall semester at the institution and who graduated from the institution or from any other institution of higher education or private or independent institution of higher education; and
  11. The institutions administrative costs.
In support were representatives of Texas Association of Business and Texas Business Leadership Council. The chancellors also testified "ON" this bill as did Higher Education Commissioner Raymund Paredes. It was left pending.
 
Total number of bills reported out of Senate Committees this week: 68
Total number of bills passed by the Senate this week: 34
 
HB 577 by Paul Workman (R-Austin) would prohibit a political subdivision from adopting an ordinance that prohibits, limits or regulates a private employer's ability to request, consider or take employment action based on the criminal history record information of an applicant or employee.
 
In laying out the bill, Representative Workman said, "HB 577 would prohibit local governments from adopting 'ban the box' or 'fair chance hiring' ordinances. Ban the box ordinances prohibit an employer from including questions regarding criminal history on an employment application. Fair chance ordinances, among other mandates, prohibit an employer from running a criminal background check until after a conditional offer of employment has been made. In addition to prohibiting local governments from adopting ban the box or fair chance hiring ordinances, the bill would void any such existing local regulations. The bill does not prevent local governments or private businesses from creating self-imposed versions of these policies for their own hiring practices.
 
There is a large number of supporters of this legislation who have been leading the way in promoting sound re-entry policies to reduce recidivism rates in our state. I have supported such efforts. As experts in this field, they know that fair chance ordinances do nothing to promote re-entry and can harm the very people these ordinances are supposed to be helping. Local control is meant to protect individual liberties, not dismantle them. Local governments should not be involving themselves in the hiring decisions of private businesses, no matter how well intentioned." It was left pending .

HB1774 by Dr.  Greg Bonnen (R-Friendswood) regarding Hailstorm Litigation Reform will be heard today in House Insurance.  The companion bill SB10 by Kelly Hancock (R-North Richland Hills) is currently pending in Senate Business and Commerce.

Have a great week!

See what's happening on our social sites