April 11, 2007
More on the Senate budget

Here's more detail about the Senate budget that came out of committee yesterday.

The \$152.2 billion, two-year state budget approved 15-0 by the Senate Finance Committee represents a 6.8 percent increase in state and federal spending compared with current levels.

It includes a big boost for Medicaid services to children to settle a court case, a move it would partly fund with an across-the-board state spending cut on other services of more than half of 1 percent.

[...]

Like the House, Senate budget writers would keep \$4.3 billion untouched in the state rainy day fund and leave billions more on the table to be sure they can subsidize local school property tax relief in future years. In addition, budget totals don't include another \$14.2 billion to be spent over the next two years to cut local school property tax rates.

"We tried very hard to pay for what we're supposed to do and what we promised we would do," said Sen. Steve Ogden, R-Bryan, Senate Finance Committee chairman. "It's an honest budget and ... there's between \$2 (billion) and \$3 billion left for property tax relief in the future."

Evidently, we're living on Mars or something, because this is totally out of this world. Out of a \$152 billion state budget, the Senate Finance Committee cuts every agency's budget to come up with \$700 million to pay for the FREW lawsuit settlement.

One key difference between the Senate budget and the House budget is that the Senate kept the teacher merit pay that the House killed, while shuffling the across-the-board pay increase off to the "wish list" ghetto. Vince addressed that point specifically:

The cost for the merit pay program is as follows: \$263,056,920 for the first year of the biennium and \$319,114,000 for the second year. I take these numbers from Amendment 63 to CSHB 1. Unless my calculator is doing some Republican fuzzy math, that's a total of \$582,170,920.

The FREW settlement will cost the state about \$700 million over the biennium. That's about \$118 million difference between the amount for the merit pay scheme (which nobody wants) and what's needed for FREW.

So, since no one wants the merit pay scheme, and we've got to pay for FREW, it would stand to reason that, before budget writers do anything else, they would take that \$582.1 million from the merit pay program and plug it into the FREW settlement, and make up the remaining \$118 million from somewhere else.

You'd think that would have been an appealing as well as straightforward approach, but apparently the Senate Republicans would rather re-fight the merit pay battle. Look for merit pay to get added back in conference committee (remember, Tom Craddick gets to pick the committee members from the House), which will put those breakaway Republicans in the position of having to vote against the whole budget to register their desire for a real pay raise. Ain't gonna happen.

On the other hand, the budget as it now stands may not make it to the floor of the Senate. Wouldn't that be a train wreck?

On a side note, you know that Lt. Gov. David Dewhurst has been making a stink about reverting CHIP to annual enrollments, which is how it was done before the 2003 budget massacre. What you may not know is that Dewhurst, who has been busy saying things like "What's so hard about filling out one number on an application every six months?" has his own difficulties in filling out forms. The Lone Star Project has the gory details (PDF). As Burka says:

Of all the programs in state government to be against, why would Dewhurst single out CHIP? It's not a welfare program; participating families have to pay premiums. It's not an entitlement; when the funds run out, no more families can be served. The federal government picks up much of the tab, and the state's share is a drop in the bucket compared to Medicaid. The only reason to favor six months' eligibility is that you want to cover fewer children--we know from experience that the shorter eligibility period will result in around 100,000 fewer children receiving coverage--but why would you want to? You can make a personal-responsibility argument, but to what end? Is it really worth adding 100,000 kids to the already shameful number of uninsured people in this state? It was one thing to raise the eligibility bar in 2003, when the state faced a \$10 billion shortfall, but it's quite another thing to raise it now, when the treasury is full. I don't get it.

The reason, of course, is that Dewhurst wants to appeal to Republican primary voters for the 2010 governor's race. The real question is why keeping 100,000 kids uninsured is so damn appealing to these voters. Or, to be more charitable, why Dewhurst thinks it's so appealing to those voters. Those questions I can't answer.

Posted by Charles Kuffner on April 11, 2007 to Budget ballyhoo