Last Week in the Legislature

Spending the Surplus – Budget Week(s) Ahead 

By Kenneth Besserman
Director of Government Affairs and Special Counsel

April 7, 2023 | Issue 9

AUSTIN - This week, the Texas House begins debate on its version of the state budget. The debate began in the House on Thursday morning and lasted well into the evening. At the outset of the debate, well over 350 amendments were pre-filed. The amendments addressed all aspects of state finance from property tax funding to school finance to limiting or allowing state agencies to spend state funds to issues of importance to individual members. The House budget debate (the multi-hour debate can be found here) is often entertaining viewing highlighting serious debate on profound policy decisions and oftentimes focusing on picayune matters of interest to only a very few members or citizens.

Just as debate began on Thursday morning, the House pulled down many amendments and moved hundreds more to Article XI. (Article XI is a catch-all section of the budget where many wish list items are held until the budget goes to a conference committee.) This unprecedented move by the House means that the House floor debate is going to be shortened by many hours this session. (Look for more information in this column next week about what made it into the budget and what failed.)

Interestingly, while the House was debating a perennial budget amendment to restrict the use of state funds for school vouchers, the Texas Senate was poised to begin debate on its own school voucher (Education Savings Accounts) legislation. Much of this legislative jockeying on school vouchers usually happens late in the session when legislative temperatures have risen and the legislative finish line is in sight. If the Senate passes its vouchers bills, then the House will face enormous pressure on the issue.

Property Taxes

Yesterday’s House budget discussion focused heavily on the amount of state funds that the House wanted to provide to school districts to buy down property taxes. Both the House and the Senate budgets have set aside $5.3 billion to help buy down school property taxes. The Senate budget – which will likely be on the Senate floor the first week after Easter – adds an additional $5.4 billion to help buy down property taxes and adds an additional $1.5 billion to help businesses with property taxes.

The House budget and property tax reform focuses on lowering property tax appraisals from a 10% to 5% increase every year. The Senate plan focuses on increasing the homestead exemption to $70,000 (from the current $40,000). While there is still considerable debate, negotiations and compromise to come with the property tax debate, the budget that passed last night is a big step forward in lowering property taxes.

The House budget debate also included conversations about placing limits on the use of state funds for gender affirming or gender transition procedures, increases in funding for mental health initiatives, policy discussions about drug intervention programs and support, higher education programs, increased border security funding, and numerous other issues. As has been the tradition in the House for many years, some amendments get added to the budget with the expectation that they will get removed in the budget conference committee, other amendments get added or defeated on the merits, and members sometimes withdraw their amendments because they know the issue will not receive a favorable reception, and finally, some amendments get added to move the debate along as the evening gets late.

It's a Gamble

Along with budget week, there were some interesting developments on the gambling front. This week, the House State Affairs Committee passed both casino gambling and sports betting legislation and sent the proposals to the House floor. While there is general agreement that there are the votes to get the bills out of the House, Lt Governor Dan Patrick has indicated that there is not enough support for the measures in the Senate, making Senate passage difficult in this session. Gambling has continued to make progress the last several sessions, but the issue remains stalled, most often in the Senate.

Other issues that garnered some attention in the Senate this week include legislation that seeks to rein in district attorneys who decline to pursue certain classes of cases – targeting election fraud cases, violations of abortion restrictions, types of lower-level crimes. Charges of official misconduct could attach to a district attorney who does not prosecute certain classes of crimes or the Attorney General could intervene in those types of cases. The Senate also debated minors attending drag shows in public places and public funding of libraries that permit drag queen reading times. All three of these issues passed the Senate and may well be debated in the House in the coming weeks.

Moving Forward

TXCPA is set to have another big week on its legislative priorities. House Bill 2504 – the legislation to expand the State Board’s fifth-year scholarship program to any accounting student with at least 15 upper-level accounting hours – is set to be heard by the House Higher Education Committee on Monday, April 10 at 10 a.m. in Austin.

This bill will help with TXCPA’s pipeline initiatives by allowing more students access to scholarship funds to enable them to complete their accounting education and move towards CPA licensure. Please reach out to committee members and let them know how important this bill is for the profession and for the state. You can find some more information about the legislation here. We will have more to report on the progress of this bill next week and on social media.

Only 51 days left in the session!




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