Monday Funding Monday

Monday is the day the Texas House begins debate on five bills on school funding. Rep. Scott Hochberg, Democrat, District 137 (southwest Houston), discusses these bills below. Of particular interest is his explanation of the rule change that Speaker Craddick pushed through that limits amendments to several of the bills. This rule change, however, does not affect amendments to the main tax bill which may have had as many as 125 amendments submitted by the deadline. This rule change is what will limit the ability of the House to debate and consider funding things such as increased teacher pay, teacher health insurance, improved school facilities, etc.

The email from Rep. Hochberg:

We came to Austin knowing that Governor Perry's tax plan provided no money for the schools right now. But its saving grace was supposed to be that it would put our state's tax system more in line with the economy, so that as the economy grew, there would be funds available so that schools could keep up with growth, inflation, and higher expectations without relying on increases in local property taxes.

That promise evaporated in the House this week, with the introduction of a bill, fast-tracked by Speaker Craddick, that would dedicate all growth from the new taxes forever to property tax reductions. In other words, no new money for schools, now or later.

Meanwhile, a bill to increase taxes on tobacco products, long supported by the American Lung Association and American Cancer Society among others, lost the support of those groups when it was rewritten at the urging of the tobacco industry. Health advocates have argued that substantial increases in the cost of cigarettes are very effective in discouraging teenagers from smoking.

The new tobacco tax bill, also on the fast track, would phase in the tax increase so slowly that health advocates believe that any anti-smoking benefits would be lost. Industry lobbyists argued much the same, saying that by postponing the tax increases, their sales would not be hurt. To make up the revenue lost from phasing the tax in, the state would borrow money by selling bonds to be repaid by future tax revenues. So, in a time when there are billions in the treasury, we will be voting on a proposal to borrow additional money to provide tax reductions.

Tomorrow the House will see 5 bills, in the following order:

1.) A revised version of the Perry tax plan, with some changes for
particular industries since the Sharp Commission issued its recommendations;

2.) A bill dedicating all increased revenues from each of the new taxes
entirely to property tax relief, now and in the future, prohibiting any of
the new "school funding" from actually being used for funding the schools.

3) A bill that spends some of the money in the treasury on property tax reductions in the coming year, but which also gives taxpayers in rich school districts an additional reduction in taxes now and in the future. The bill also "unreserves" the $1.8 billion that the Legislature had previously voted to put aside for teacher pay raises and other school improvements.

4) A bill dealing with the sale of used cars that says that you will be taxed on at least 80% of the "blue book" value of the car, even if you actually paid less for the car, unless you can prove through an appraisal that the car was worth what you paid for it. You pay for the appraisal. The bill is estimated to raise about $50 million each year, which would go to property tax reductions.

5.) The tobacco tax bill, discussed above.

Normally, we would discuss and debate these bills by offering amendments to change various parts of the bills. But in a move that is unprecedented in my years in the Legislature, the Speaker pushed through rules that prevent significant amendments on the property tax reduction bills (the second and third bills listed above) from being offered.

Our rules already prohibit offering amendments to a bill that are outside the subject of the bill. Unlike Washington, we already are prohibited from "tacking on" amendments that are unrelated to the bill before us. So that's not the purpose of these new rules.

The rules mean, for example, that the House will not be allowed to debate using some of the revenues from the Perry tax bill to increase teacher pay. By approving a rule that prohibits such amendments from being offered, House members avoid the accountability of having to explain votes on such amendments to their constituents. It also means there will be less debate on the bills, since most debate occurs when amendments are offered.

Voting on rules instead of on actual amendments is how Congress in Washington operates under the current Congressional leadership, but, as I said, is new to Texas. The vote on these rules was essentially along party lines, with all but a few Democrats voting against the rules and most Republicans voting as the Speaker wished.

The tax bill, however, is not subject to these new rules, as various industries still want the chance to fight for their special exemptions. I have been told unofficially that most of the roughly 125 amendments submitted by yesterday's 5 pm deadline pertain to the Perry tax bill since it had no new rule restricting amendments that could be offered.

His inside information on the tobacco bill is interesting as well as the tidbit that the amendments to the tax bill are going to be all about special interests fighting for exemptions. It's not surprising, is it, that in a Perry controlled universe special interests rule the day?

Thanks to blogger John Cobarruvias of Bay Area Houston Blog for forwarding Hochberg's email to me. Off the Kuff discusses other aspects of the school funding issue and links to Aaron Pena's, Democrat, District 40 (Austin), thoughts on the five bills before the House.

Want to know more about the history of school funding in Texas? Look no further than Capitol Annex! Wow. Vince gives you links, links and then still more links to great resources on this topic.