The House Ways and Means Committee reported out the first two bills of the special session this evening. Both are thought of as part of the Perry-Sharp tax plan.
HB 1 uses the surplus to "buy down" 17 cents of school maintenance property taxes. Once a school district exceeds a maintenance and operations tax rate of $1.36 per $100 of valuation (14 cents under the $1.50 cap), it must hold an election. It can go above $1.36 with voter approval at a rate of no more than five cents a biennium. The bill also allows Chapter 41 districts (property wealthy) to keep all the proceeds of local taxes above $1.33. (In other words, there would be no recapture above $1.33.) Districts below $1.36 tax rate are subject to the normal rollback law, which allows six cents of increase without an election. Chapter 42 districts (which receive money from the state) would be equalized (receive a state match) at the current yield for tax effort above $27.14.
The original version of HB 1 would have required an election to go above $1.33. It also would have required a two-thirds vote to go above the five cents per biennium. The school groups complained loudly about these provisions, accusing them of violating the Texas Constitution. Specifically, school lobbyists told committee members that requiring voter approval as a prerequisite to any increase in spending was tanamount to a state property tax. The two-thirds provision was removed, and the maximum rate that districts could charge without an election increased from $1.33 to $1.36.
HB 1 left committee 8-1, with Rep. Mike Villarreal (D-San Antonio) voting no. Villarreal tried unsuccessfully to amend the bill to increase the guaranteed yield (money per penny) on tax effort above $1.33. He argued the feature of the bill that does not recapture tax effort above $1.33 would hurt equity and increase the gap between school districts. Proponents of HB 1 noted that the Texas Supreme Court has expressly authorized some unequalized local enrichment in its decisions. The Villarreal amendment would have increased the cost to the bill by about $350 million per year, committee members were told. Because of the concern some house members have about equity, bill author Warren Chisum (R-Pampa) told LSR he is working with other house members on those provisions of the bill.
House Bill 2 by Rep. Jim Pitts (R-Waxahachie) would dedicate certain state revenues to property tax relief. Basically, any extra revenue generated by a revised franchise tax, the repeal of the "liar's affidavit" on used cars, and the tax increase on cigarettes would go to buy down additional property taxes. The bill cleared committee 7-2 with Villarreal and Rep. Vilma Luna (D-Corpus Christi) voting no.
Even the New York Times noticed today. Seven months after two powerful hurricanes blew through the Gulf Coast, elected officials, law enforcement agencies and many residents say Texas is nearing the end of its ability to play good neighbor without compensation.
Houston is straining along its municipal seams from the 150,000 new residents from New Orleans, officials say. Crime was already on the rise there before the hurricane, but the Houston police say that evacuees were victims or suspects in two-thirds of the 30 percent increase in murders since September. The schools are also struggling to educate thousands of new children.
"Personally I am sick of hearing about Katrina," said Ronda Authement, standing outside her trailer in Sabine Pass, where she will live until she can get the money and the workers to put her three-bedroom house back on its foundation. "I would like to throw up, frankly, hearing about Katrina."
Mother Nature seems to have it in for North Texas. Two days ago, it was the heat taxing electric generators which prompted rolling blackouts. This morning, about 80,000 Dallas-Fort Worth area households are without power, owing to the spate of thunderstorms that moved in after midnight throughout the wee hours.
Trees and power lines are down, and lightning has knocked out electric transformers. Another round of storms is expected later today as another storm system moves across the region.
Officially, it was Clippers 85, Mavericks 71 on Wednesday night. A meaningless goof-off game except for airline tickets for the fans and playing time for P-Pod? Not to coach Avery Johnson, who, exhibition-game substitutions aside, coached this thing as if it was Game 7, Earth People Vs. Martians, Loser Gets Nuked. Some thoughts in the 'School of Fish':
According to the Austin American-Statesman, the State Third Court of Appeals handed U.S. Rep. Tom DeLay a victory this morning, affirming a trial judge's decision to throw out one of two felony indictments against him.
The Sugar Land Republican, who has announced he plans to retire from Congress, still faces money-laundering charges. But the appellate court said Judge Pat Priest was correct to dismiss an indictment accusing DeLay and two associates of conspiring to violate the state election laws.
Priest ruled last year that the state's conspiracy statute did not apply to the election code until Sept. 1, 2005 — long after DeLay was accused of laundering corporate money into political donations for the 2002 legislative elections.
State law generally forbids corporate and union money from being spent in connection with campaigns.
DeLay's lawyer Dick DeGuerin said he expected prosecutors would appeal.
Excluding food and energy, the CPI-U advanced at a 2.8 percent SAAR in the first quarter, following a 2.2 percent rise in all of 2005. While most categories advanced at a faster rate in the first quarter of 2006 than in all of 2005, about two-thirds of the acceleration was accounted for by a larger increase in the index for shelter – up at a 3.6 percent SAAR in the first quarter after increasing 2.6 percent in all of 2005. An upturn in the index for apparel and a larger increase in the index for education and communication also contributed to the acceleration in the first quarter of 2006.
Joshua Bolten, President Bush's new White House Chief of Staff, has moved quickly to put his own stamp on the White House staff operation by removing Scott McClellan as White House Press Secretary and taking away the policy portfolio from longtime Bush political advisor, Karl Rove. No successor has been named yet for McClellan, a Texas Bush loyalist and son of Texas Comptroller Carole Strayhorn. Joel Kaplan, who worked for Bolten in the Budget office, is expected to take Karl Rove's job as deputy chief of staff for policy. Rove will continue to oversee political operations for the President. There also have been strong rumors that Bolten wants a new Secretary at the Treasury Department. Today's developments do nothing to dampen speculation on that front.
The Texas Medical Association and Gov. Rick Perry have reached a compromise on the governor's tax plan that has won the doctor's endorsement. Perry agreed that individual medical practitioners such as doctors could exclude government paid income for Medicare, workers comp and military insurance. They would also get a 150% deduction for payment provided by Medicaid and the Children's Health Insurance Program. Doctors and other health practitioners had claimed that these rates were usually far below reimbursements from private health care companies. Hospitals and other institutions would get half the benefit accruing to individual doctors. The endorsement of several medical associations removes what many had viewed as potentially a major stumbling block for the plan's passage.