Last Week in the Legislature

By Kenneth Besserman
Director of Government Affairs and Special Counsel

March 5, 2021 | Issue No. 7

The End of the Beginning

Week 8 of the Texas Legislature began in the aftermath of marathon House and Senate committee hearings investigating the state power grid failures during the February winter storm. House and Senate committees held hearings well into the evening of February 25 and the morning of February 26.

Representatives and senators asked pointed and tough questions of ERCOT, the PUC, power generating companies and many others in an attempt to discover what caused the power grid failures, why the regulators and the state were unprepared for the storm, exorbitant consumer pricing during the storm, and what solutions the legislature should consider to address the situation that Governor Greg Abbott has set forth as an emergency item. (House Committee hearings can be found here and the Senate Committee hearing can be found here.)

Both ERCOT and the PUC pushed back on taking full responsibility for the power grid failures – both blaming each other and both stating that the system worked as designed to prevent a full power grid failure that might have resulted in a complete power blackout for weeks or months. Much of the discussion centered on what power generating sources (gas, coal, nuclear, wind and solar) failed to operate at a sufficient level. The consensus among the witnesses was the gas-powered plants and the gas systems powering the generating plants froze up to a higher degree than other sources. Because Texas relies on natural gas as its biggest power source, the failure of the gas generating plants likely caused a higher percentage of the grid failure.

The committees also heard testimony about weatherization of generating plants and gas lines. The governor has recently made weatherization of the Texas power grid a priority item and the committees were interested in hearing about why full weatherization was not implemented after the 2011 winter storms and after both federal and state reports recommended weatherization. The governor has pledged to push for weatherization and has even gone the extra step to tell the legislature that they will be back for a special session to address the issue if it cannot be resolved in the regular session.

The end of Week 8 saw both the PUC Chairman, DeAnn Walker, and the ERCOT CEO, Bill Magness, resign their positions after enormous political and public pressure to do so. Additionally, one power generating entity, Brazos Electric Power Cooperative, has filed for bankruptcy, putting further stress on the Texas power grid. Significant structural reform of ERCOT will continue to be a focus of the legislature – Lt. Governor Dan Patrick has even made the item one of his 30 priorities for the session. Hearings will continue as the legislature attempts to find out what happened and look for solutions.

Both the House and Senate convened for just two days this week and adjourned until Tuesday, March 9. Week 9 should see a number of committees begin having regular committee meetings and begin taking testimony on bills. Legislation is beginning to be referred to House and Senate committees, albeit at a slower rate than in previous sessions. As previously mentioned, the COVID-19 pandemic has thrown out the legislative playbook when it comes to process, routines and the regular course of business. While the pandemic is taking up a lot of the legislature’s time and energy, what capacity remained for the legislature to tackle other matters has been diminished by the winter storm and power grid failures and how the legislature should address those matters. Beyond the budget, power grid reform and COVID-related legislation, there may not be a lot of time, energy and desire to take on many other matters.

This week, one of TXCPA’s legislative priorities, SB 297 – CPA fingerprinting deadline extension, was referred to the Senate Committee on Natural Resources and Economic Development. The companion bill, HB 2023, was also introduced in the House by Rep. Angie Chen Button. We hope to have a hearing on this legislation soon. TXCPA has been working closely with the Texas State Board of Public Accountancy, the Sunset Commission and members of the legislature on this proposal. During our Virtual Advocacy Day in late January, TXCPA received very favorable comments from the legislature on this proposal. Stay tuned for more updates on this legislation.

Week 8 also saw Governor Abbott rescind the state’s mask mandate effective March 10. Businesses, consumers and the general public are beginning to determine how they will operate under a no mask policy. The state capitol, legislature, individual members of the legislature and their offices, will also begin the process of how they will navigate in this new environment. We expect there to be some changes in Capitol, House and Senate protocols regarding building and office access, committee hearing access, and other operations matters.

If nothing else, the pandemic has taught us all that we need to expect changes, rapid changes, and new rules and regulations to be imposed quickly. The legislature is no different. We will provide updates on session operations changes as they become available.

The bill filing deadline is March 12. That is generally considered the End of the Beginning of the legislature and the time when the pace begins to pick up considerably. The pace of the session will undoubtedly be quicker in the coming weeks and uncertainty about how the session will unfold will continue to abound.

Put on your seatbelts for a tumultuous next few weeks..

Only 86 days remain in the session.