Last Week in the Legislature

April 5, 2019 | Issue #12

By John Sharbaugh, CAE
Managing Director of Government Affairs

Texas House Passes CPA Sunset Bill

There was good news this week as the Sunset bill (HB 1520 updated) was passed in the Texas House on Wednesday by a vote of 147-0. HB 1520 will continue the Texas State Board of Public Accountancy (TSBPA) and the Texas Public Accountancy Act (TPAA) for another 12 years until the next Sunset Review in 2031.

HB 1520 also includes CPA firm mobility provisions and some other changes to the TPAA that TXCPA supports.

HB 1520 will now go to the Texas Senate where TXCPA will work to have the House bill accepted and passed.

We will ask for Key Person assistance on the legislation in the Senate when it is needed. Hopefully, our efforts in the Senate will progress smoothly and we will see the legislation enacted before the legislative session ends on May 27.

Senate Budget Bill Advances

Another significant action on Wednesday was the Senate Finance Committee’s advancement of the Texas Senate’s two-year, $248 billion spending plan (SB 1) that includes a boost for public schools and a cut to Medicaid, setting the stage for negotiations with the House.

The House passed its budget last week. Both chambers have agreed to pump an additional $9 billion in state revenue into the public education portion of the budget, but lawmakers must now reconcile their differences over how to spend the money.

The Senate bill favors a $4 billion proposal for a $5,000 across-the-board pay raise for public school teachers and librarians and another $2.3 billion for school districts. The House, meanwhile, would provide $6.3 billion to school districts, which could make their own decisions about targeted pay raises or hiring additional staff although on Wednesday, the House also voted to provide a smaller increase in pay for school employees.

Before the budget’s passage, the Finance Committee voted narrowly to keep a controversial provision targeting a proposed high-speed rail line between Houston and Dallas (see more below). The spending plan also contains a provision directing the Texas Health and Human Services Commission to cut costs by $900 million.

Wednesday’s version of SB 1 is $4.8 billion larger than the initial proposal unveiled back in January. The bill now heads to the full Senate for approval, where it is expected to pass easily.

High-Speed Rail Affected by Finance Committee Action

During the debate on the budget in the Senate Finance Committee this week, a rider was offered that affects the high-speed rail project to connect Dallas and Houston. The measure, authored by Senator Brian Birdwell (R-Granbury), continues to bar state funds from subsidizing high-speed passenger rail projects, but would go further than current law. It would prevent the Texas Department of Transportation from helping coordinate access to rights-of-way on state highways for the high-speed rail project until there is a final, unappealable court ruling on the project's eminent domain authority. Debate over whether Texas Central (the company behind the project) has the right to condemn land and buy it from unwilling owners has fueled opposition to the project and led to court battles across the state. It is anticipated that it may take years for these issues to receive final resolution in the courts.

"This project has many issues and one could easily see the potential outcome that could befall Texas by looking at the catastrophic failure occurring in the California high-speed rail project," Birdwell said in a statement Wednesday.This rider seeks to solely protect state resources, including state rights-of-way, should [the company] begin construction before receiving a definitive answer on their condemnation authority." 

The budget rider didn't advance smoothly through the Finance Committee. Senator Royce West (D-Dallas) moved to strike down the amendment and remove it from the budget, but his motion failed in a 7-8 vote. The budget plan now heads to the full Senate for approval. There is no similar provision with respect to the high-speed rail project in the budget plan adopted by the House.

House Approves Pay Raises for Teachers and Other School Employees

In the process of debating and passing a bill on school finance (HB 3) on Wednesday, the House approved an amendment that would require school districts to give all school employees pay raises of roughly $1,850, using some of the extra money districts would receive under the House bill. The provision appears to be an attempt to compromise on an issue that quickly became a major difference between the House and Senate on how to spend money on schools. Until Wednesday, House Speaker Dennis Bonnen has said he would prefer to give school districts flexibility on how to use additional funding and that he does not favor a key Senate proposal for $5,000 teacher pay raises.

The amendment in the House was proposed by Rep. Chris Turner (D-Grand Prairie). "This is a sustainable way of providing increased compensation to our teachers and other employees," Turner said Wednesday afternoon, explaining his amendment to his peers in the House. "It establishes a floor, but it requires every school district to spend at least 25 percent of its basic allotment increase on pay raises. They can go beyond that if they wish to."

The bill, which included the amendment by Rep. Turner, was passed by the House by a vote of 148-1. Only Rep. Jonathan Stickland (R-Bedford) voted against the measure. Based on the numbers in HB 3 and in the two-year state budget bill approved by the House, the Turner amendment would guarantee that $2.4 billion will go toward pay raises for every full-time teacher and support staff in the state. Of that, 75 percent must be offered equally to all employees in the school district. The remaining 25 percent can then be used at the discretion of the district, provided it is for employee pay.

Lt. Governor Dan Patrick has prioritized a $5,000 across-the-board teacher pay raise over other measures to improve school finance. That $4 billion piece of legislation, Senate Bill 3, passed unanimously out of the Senate last month. The Senate's proposed raises would only be for teachers and librarians, though, and would not extend to all school employees.

The differences between the House (HB 3) and Senate (SB 3) bills must now be resolved.

Bill to Require Monitoring Software Scheduled for Hearing Next Week

I reported a few weeks ago on HB 1352, sponsored by Rep. Giovanni Capriglione (R-Southlake), which would require vendors who provide professional services or technical information technology services to governmental entities (including state and local governmental entities) in Texas to install software on their computers that would track their key strokes and require that screen shots be captured once every three minutes and be maintained for seven years. This type of legislation has been popping up in a number of states around the country and is being promoted by a software developer who just happens to sell that kind of software.

There will be a hearing on HB 1352 on Monday in the House State Affairs Committee. Many groups, including TXCPA, are opposed to the bill and plan to testify against the measure at the hearing. Major concerns revolve around privacy and data security issues, as well as the cost of compliance and liability worries.

There is no counterpart bill in the Senate and it is our hope that we can kill this bill in the House. We will report back next week on how the hearing goes.

Senate Bill on Religious Liberty for Occupational License Holders Advances

I reported last week on SB 17, sponsored by Senator Charles Perry, CPA (R-Lubbock). SB 17 was voted out of the Senate State Affairs Committee last week; this week, it cleared a final vote in the full Senate and has been sent to the House. There is a companion bill in the House sponsored by Rep. Phil King (R- Weatherford).

Read the version of SB 17 passed by the Senate.

SB 17 is a bill that would provide protections to occupational license holders for their “sincerely held religious beliefs” when their licenses are at risk due to professional behavior or speech. It would also prevent licensing boards from enacting regulations that burden “an applicant’s or license holder’s free exercise of religion.” The bill does not protect police officers, first responders or doctors who refuse to provide life-saving care. The legislation is opposed by business groups and LGBTQ advocates who say the legislation is discriminatory and will have a negative effect on business and tourism in the state.

After a heated debate in the Senate, the measure passed on a 19-12  vote, with one Democrat, Senator Eddie Lucio (D-Brownsville), voting for it and one Republican, Senator Kel Seliger (R-Amarillo), voting against.

Senate Declares Border Emergency

Also this week, the Senate passed a resolution declaring a crisis at the Texas-Mexico border and requesting that Congress fully fund "all means necessary" to secure it. The resolution sparked ire from Senate Democrats, who said the first time they saw the measure was on the Senate floor. Senate Resolution 535 passed in a party line vote, 19 to 12, late Tuesday afternoon.

The resolution doesn’t prescribe a specific border security solution, but asks Congress to deploy agents, implement technology and “erect barriers where needed.” It also states that the “Texas Senate supports the President in his efforts to move forward with emergency action” – a line that angered multiple Democratic senators.

Senator Paul Bettencourt (R-Houston), who authored the resolution along with the other Senate Republicans, said the measure will be entered into the congressional record after passage.

Daylight Savings Resolution Has a Hearing in the House

A resolution calling for a constitutional amendment authorizing a statewide referendum allowing voters to indicate a preference for exempting Texas from daylight savings time or observing daylight savings time year-round was heard in the House State Affairs Committee this week. HJR 117, sponsored by Rep. Lyle Larson (R-San Antonio), would put it to the voters to decide whether Texas should stay on daylight savings time all year round or eliminate it altogether. Either way, Texans would not have to adjust their clocks if this proposal is passed by the legislature and approved by the voters.

The State Affairs Committee did not vote on the measure this week, but left the resolution pending. There is no counterpart resolution in the Senate, but there are several bills in both chambers to eliminate daylight savings time in Texas. These types of bills have been introduced in earlier sessions and have never gone anywhere.

To get this issue on the ballot in November, both the House and Senate would have to adopt similar resolutions and they would have to be approved by two-thirds of each chamber. If it makes it on the ballot in November, it can be approved by a simple majority of the voters.