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April 19th, 2013:

Friday random ten: The city never sleeps, part 2

More cities, more songs.

1. Asheville/Crashville – Austin Lounge Lizards
2. Beaumont Boys – Ezra Charles
3. Boston – Augustana
4. Chattanooga Choo Choo – Glenn Miller
5. Chinatown – Joe Jackson
6. Cold Chicago – Humming House
7. Darlington County – Bruce Springsteen
8. Debbie Does Montreal – team9 vs Stereogum
9. Detroit – Black Gold
10. Detroit City – Alice Cooper

I complied these lists and drafted these posts a couple of weeks ago, so it’s a complete coincidence that I had a song called “Boston” on the list for today. Fate’s a funny thing. I was going to comment on a couple of the other tunes on this list, but now I think I’ll just let it stand with that.

What Obamacare will do for Texas

Even without Medicaid expansion, the Affordable Care Act will help millions of Texans get access to health care.

It’s constitutional – deal with it

Nearly 2.6 million Texans could qualify for tax credits to purchase health insurance in 2014, according to a report released Thursday by Families USA, a nonprofit that advocates for health care consumers.

The tax credits will be offered through the health insurance exchange — an Orbitz-style online marketplace for health insurance — that the federal government plans to launch as part of the Affordable Care Act in October. Beginning in January, families with an income of up to 400 percent of the federal poverty line, between $47,100 and $94,200 for a family of four, will be eligible for a tax credit subsidy to purchase insurance through the exchange. The tax credits will be offered on a sliding scale, so that lower-income families will receive larger credits.

“These are typically the families where folks are working, sometimes more than one job,” U.S. Rep. Pete Gallego, D-Alpine, said of the report. “Regardless of where you are on the political spectrum, I think that’s something we can all support.”

Nearly 5.8 million Texans — nearly a quarter of the state’s population — are uninsured. The Health and Human Services commission estimates the tax credits offered through the health insurance exchange and other provisions in the Affordable Care Act will lower that rate to 16 percent. If Texas also expanded Medicaid — an unlikely scenario given Gov. Rick Perry’s opposition — the uninsured rate could be lowered to 12 percent.

“Given the large number of people in Texas that are uninsured, many of whom are poor, this is an extraordinary opportunity,” said Ron Pollock, executive director of Families USA. He said it was “short-sighted” for the state’s leadership to oppose Medicaid expansion, as it would bring billions of federal dollars to the state, and increase job opportunities.

You can see the report for Texas here, and for other states here. That still leaves about a million people who would be able to get Medicaid if the state agrees to expand it, but we know how little Rick Perry cares about these people. Trail Blazers has more on the Families USA report.

Elsewhere on the Medicaid front, HHSC Commissioner Kyle Janek has been given the go-ahead to negotiate with the U.S. Centers for Medicare & Medicaid Services. At the time, he wasn’t given any direction about what to negotiate for or toward, but perhaps now that the Zerwas bill has been discussed in committee there’s something tangible for him to talk about. We’re unlikely to hear much about his effort and any progress he may make since apparently talking about it in public spooks people, the way saying the name “Voldemort” does in the Harry Potter books. Lord only knows what might happen, but hey, at least they’re talking. EoW has more.

Division over the payday loan bill

Quite a heated little fight in the Senate yesterday.

An ugly scene erupted in the Texas Senate today, with Sen. John Carona (R-Dallas) suggesting that some of his Republican colleagues were “shills” for the payday loan industry and worrying that the GOP would be seen as “the party that is backed and bankrolled by payday lenders.”

After intense negotiations this week, Carona told lawmakers he had struck a deal to pass legislation to reform payday and auto-title lending in Texas. Most of the consumer groups, the cities, Senate Democrats and even the payday loan industry were on board with the “hard-fought compromise,” he said.

“There have been great concessions on both sides,” Carona said. “We can leave this chamber at the end of May and honestly say we made a significant incremental step forward on protecting consumers.”

However, as Carona moved toward a suspension of the rule to bring the bill up for debate, which requires two-thirds of the Senate, he complained that payday-loan lobbyists were calling senators on the Senate floor and asking them to change their votes. He even hinted that two GOP senators were acting as agents for the industry.

“If we don’t do it this time, you won’t be able to regulate this industry two years from now,” he said. “This industry will be so much wealthier, so much more politically powerful that you won’t be able to say no and you won’t be able to draw the line. I know the lobbyists are just in a frenzy right now to try to stir up some action on the floor and get one or two of my colleagues who seem to be working the floor to change their vote.”

Sen. Carona wound up pulling the bill down. The Trib adds some details.

Carona, who said the bill had been “negotiated literally through the night,” brought with him to the floor six amendments that were intended to address the concerns of some consumer advocates who said the bill didn’t go far enough in limiting the abilities of short-term lenders.

Ultimately, the bill was pulled before debate on the amendments began, but Carona said they mostly contained ways to strengthen consumer protections, including limiting the types of loans that short-term lenders could offer, mandating that lenders accept partial payments, and limiting the maximum duration of multiple-payment loans — a major sticking point for consumer advocates.

“There are only two or three amendments that the industry really finds objectionable,” he said, “and in that case, all we’re asking the chamber to do is do what’s right for consumers.”

Early in the debate, state Sen. Kirk Watson, D-Austin, said many senators’ support for the measure would depend on the inclusion of those six amendments in the final bill.

“I think that there will be an effort to stop 16 people from voting for any conference committee report that strips those out,” he said, referring to the version of the bill that could emerge from a future House vote.

But some senators, who had previously expressed their intent to vote for the bill that emerged from committee, balked at the proposed changes. In an argument about process that turned personal, critics of the bill took issue with the way Carona brought his amendments to the floor.

Leading the criticism was state Sen. Troy Fraser, R-Horseshoe Bay, who charged that Carona hadn’t given the chamber enough time to review the proposed changes. While calling payday lending reform a “difficult issue,” he asked Carona if he had sent the amendments around 24 hours in advance. Carona’s reply was sharp.

“No, sir,” he said. “And, frankly, I haven’t seen you do that with your bills.”

[…]

Fraser was joined in his criticism by Sen. John Whitmire, D-Houston, who also argued that the legislative process should be slowed down to give senators time to consider prospective amendments, adding that he had concerns about Houston’s ability to regulate payday lending under the bill.

“What’s the rush?” Whitmire asked Carona.

Because “the industry has hired damn near every lobbyist in town to kill this bill,” Carona replied.

When Carona replied that he had been in constant contact with the city of Houston to determine its position on the bill, Whitmire erupted, telling Carona that he would represent his own constituents. He again criticized Corona for rushing the process.

“When you were negotiating this most recent agreement, I was chairing [Senate] Criminal Justice for four hours,” Whitmire said. “I think this has gotten totally out of control.”

The bill in question is SB 1247. Before this kerfuffle, the main divisions had been among consumer advocates.

Some progressive groups, including the Center for Public Policy Priorities and Texas Impact, have thrown their support behind the bill, arguing that it’s better than the status quo.

“For us, doing nothing is not an option this time around,” said Don Baylor, senior policy analyst at the Center for Public Policy Priorities. He points to estimates that limiting the number of times borrowers can “roll over” loans would save consumers at least $132 million.

“You get to a point where you ask yourself the question, Is there any more money [for consumers] left on the table? The folks that have decided to support it have decided there isn’t any more money on the table.”

Bee Moorhead, director of interfaith group Texas Impact, said that it’s important that legislators show the increasingly aggressive and powerful industry who’s boss.

“The thing that’s hard is that first step,” Moorhead said, “saying the state gets to decide under what terms you do business.”

Opposing the bill, however, are most Senate Democrats, the Texas Catholic Conference, Baptist organizations, Texas Appleseed and AARP.

They say that Carona’s approach falls short of meaningful reform and sanctions harmful new loan products.

“Our opposition is that this bill doesn’t do what it purports to do,” said Ann Baddour, with Austin-based group Texas Appleseed.

The pre-emption of local ordinances is the sticking point for many, myself included. It should be noted that there is a decent argument for proceeding anyway, as articulated in the Chron.

The bill has split the community of nonprofits that lobby legislation affecting the poor. Favoring it are the Center for Public Policy Priorities, Goodwill Industries and Texas Impact, whose leaders believe it provides a pragmatic system of statewide regulation.

While it pre-empts the stronger city ordinances, they believe lenders simply are directing borrowers to suburban locations outside the reach of city enforcement.

The industry has launched legal challenges to those ordinances that probably will be resolved by the conservative Texas Supreme Court, said Scott McCown, executive director of the public policy center. “Do we really think that if the ordinances are challenged, the Texas Supreme Court is going to say they are valid and enforceable?” he asked.

McCown also said most cities do not have the “economic wherewithal” to enforce the ordinances. While he would like the bill to be stronger, McCown said, “our assessment is that this was the best we could do.”

[…]

Carona’s bill would limit the number of times lenders could “roll over” a loan and charge new fees. That provision would save Texas consumers at least $132 million a year, according to an analysis by the Texas Consumer Credit Commission.

[Rob] Norcross said [the payday lending group Consumer Service Alliance of Texas] agreed to it in response to the plethora of city ordinances and the burden that dealing with so many different laws creates for business. “If anybody thinks anybody (in the industry) is happy, they are wrong,” he said. “This is a high price to pay.”

I’m a half-a-loaf guy and I get where McCown and Moorhead are coming from. I’m still reluctant to support this thing, though perhaps I’d feel better once I knew what the amendments that never got to be debated are about. The Observer indicated that Carona may bring the bill back on Monday, though the Trib suggested it could be longer than that. I don’t know what to think at this point, other than to marvel once again at how sleazy the payday lending industry is. Trail Blazers has more.

Protecting polluters

Ridiculous.

Ship Channel circa 1973

It’s never been easy fighting powerful polluters in Texas. A bill approved by a Senate committee today would make it even harder. With a big push from the Texas Chemical Council and the Texas Association of Business, the Senate Natural Resources Committee voted 6-3 today for legislation “streamlining” (read: weakening) the process that communities and environmental groups can use to challenge permits to pollute. (Democrats Rodney Ellis and Carlos Uresti as well as Republican Robert Duncan were the ‘no’ votes.)

“We are very disappointed by the committee’s vote today,” said Environment Texas Director Luke Metzger. “The deck is already stacked against residents when a powerful polluter applies for a permit to discharge chemicals in to our air, water and land.”

Senate Bill 957 by Sen. Troy Fraser (R-Horseshoe Bay) would put limits on contested case hearings, mini-trials in which each administrative law judges hear testimony and evidence from each side. Environmental groups already complain that the process is flawed: The judges can only offer recommendations to the Texas Commission on Environmental Quality. That agency, run by corporate-friendly Rick Perry appointees, often ignores or downplays the judge’s proposals.

However, SB 957 would weaken it even further. Fraser’s proposal would shift the burden of proof from the company seeking the permit—often some of the most lucrative and powerful corporations in the world—to the protestant, often a hastily-formed grassroots group or an environmental organization. The bill would also strictly limit how long the contested case hearing could last; limit who could participate; narrow the scope of the hearing; and eliminate discovery.

Here’s SB957. It’s not the only polluter-friendly bill out there.

Some county governments have found that when it comes to suing corporations over polluted property, hiring a private law firm on a contingency fee basis is the way to go.

But against the backdrop of a multi-billion dollar dioxin case in Harris County, there’s an effort to outlaw those arrangements in pollution lawsuits. The House Committee on Environmental Regulation has scheduled a hearing today on a bill that would ban counties from using private firms, HB 3119.

The bill has the support of the Texas Conservative Coalition Research Institute that compiled a report on what it calls the “dubious practice of employing private lawyers on a contingency basis.”

“The arrangement creates a variety of perverse incentives. A county faces no risk in bringing a suit and the outside, contingency-based counsel has no incentive to settle the suit,” said Brent Connett, communications director for the group.

The group argues that instead, contingency fee deals encourage private firms to enrich themselves at the expense of adequately funding the cleanup of toxic sites.

Harris County, which was the focus of the conservative group’s report, says contingency fee arranagements are vital to its efforts to litigate pollution cases.

“We don’t have money to go out and hire lawyers. You’re talking about, at a minimum, hundreds of thousands of dollars that we would have to spend up front just to go to court. With the contingency fee, we don’t have to do that. We only pay if we win,” said Terrence O’Rourke, special assistant to the Office of the Harris County Attorney.

[…]

[Harris County] points out that the big corporations fighting the suits often use very experienced, highly-paid attorneys.

“They’re spending millions on their lawyers and Harris County can’t afford that. We’ve got contingent fee lawyers,” says O’Rourke, the county’s special assistant.

The point of taking cases on contingency is that it only pays to take cases you think can win. Otherwise, it’s a lot of hours down the drain for nothing. One could argue that it’s the attorneys for the polluters that have no real incentive to settle, since they get paid by the hour. But maybe as a compromise, we could set up a public defender system for the businesses that find themselves plagued by these suits, to represent them free of charge. Think the polluters would go for that? Yeah, me neither.

Here’s the Chron on these two bills:

“It surprises me a little bit because there is no history of us settling cases in opposition to the attorney general or against the wishes of the attorney general,” said Rock Owens, who heads the environmental division in the Harris County Attorney’s office, which historically has filed the most civil environmental lawsuits in the state.

Owens said the legislation would diminish an authority local governments have had for decades to punish environmental offenders, and also make for an uneven playing field as governments cannot afford to pay private attorneys on an hourly basis like the companies they sue.

While the county has been filing environmental cases for a long time, it only recently began recruiting outside counsel. Six cases have been relegated to private firms.

[…]

Harris County Judge Ed Emmett said the county has not taken an official position on hiring outside lawyers on a contingency fee basis, but that all counties “ought to be able to make those decisions on their own.”

Once again I note the irony of people who rant and rage about the federal government telling Texas what it can and can’t do but who are lining up to tell various local governments, often in localities far from their own home districts (Rep. Cindy Burkett, author of HB 3119, is from the suburbs of Dallas), what they can and can’t do. The good news is that SB957 likely won’t get past the Senate’s two-thirds rule, while HB3119 hasn’t yet been voted on in committee. If we’re lucky, it won’t have enough time to make it through, or it too will die from insufficient Senate support. But until they both do die, they’re menaces to be watched.

Bad ideas never die

And so we find ourselves once again talking about tax breaks for yacht buyers.

Just think how much you would save on this baby

From capping the sales tax on yachts to phasing out the state business levy, some lawmakers are pushing for tax breaks even as others say the system is already riddled with too many special-interest exemptions.

The breaks are most often cast as a driver for economic development, and a Monday hearing on the yacht tax break was no exception.

Senate Bill 862 “is not about giving tax breaks to the rich. It is all about jobs and protecting our Texas economy,” said Sen. Larry Taylor, R-Friendswood, who pitched it before the Senate subcommittee on fiscal matters as necessary for the state to compete for boat business.

The subcommittee, which left the bill pending, is trying to have hearings on at least a representative sampling of the tax breaks that have been proposed, said its chairman, Sen. Glenn Hegar, R-Katy. “Obviously, the question always becomes do they, at the end of the day, provide a benefit to the taxpayers overall?” said Hegar.

[…]

A similar measure sank two years ago. Backers emphasized then, as they are now, a decision by Florida to cap its sales and use tax at $18,000. They said that has prompted buyers to purchase and keep their boats in Florida.

As filed, the legislation would cap the amount of boat tax at $15,625 per retail sale, the amount typically paid for a $250,000 yacht. Taylor has a substitute to change that to $25,000.

The subcommittee left the bill pending while it awaits a new fiscal note on the change.

As noted, a similar bill was introduced last session, but it did not pass. The fiscal note for SB862 says it would cost $2,893,000 for the upcoming biennium, which is slightly more than the fiscal note of the previous bill. Perhaps the Legislative Budget Board is forecasting more yacht purchases for this biennium, or maybe it’s just that yachts are more expensive these days. In either case, I doubt that Taylor’s substitute bill will make that much difference in this department.

I expended all the snark I have on this two years ago. There’s only so much time available in a legislative session, and it really says something about John Davis and Larry Taylor that they think this particular issue, which would greatly benefit a very small number of people at the expense of the general revenue fund, is worth their limited time and energy. I haven’t even seen a bogus “economic benefit” report on behalf of the yachters, making the usual dubious claims about how much more money this would actually mean for Texas despite the fiscal note, which is telling in itself. As Rodney Ellis says in the story, our tax code is already an unmanageable jumble of bizarre, obscure, and often needless tax breaks that cost billions for no clear reason. We don’t need to add to that.