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Perry likens legislative session to “The Good, The Bad and The Ugly”

Legislature makes key investments in border security, healthcare and education while failing to pass taxpayer protections

From the Office of Gov. Rick Perry

June 11, 2007

Government - Gov. Perry picture AUSTIN–Gov. Rick Perry May 29 commented on legislative action taken during the 80th Legislative Session. The governor highlighted several achievements from the past 140 days, while also addressing disappointment in the resistance of the legislature to advance certain issues.

"We can say as a result of this session that the border will be more secure, healthcare will be better funded, college will be more accessible and school property tax rates will continue to decrease," said Gov. Perry. "However, like the old Clint Eastwood movie, this was a session of The Good, The Bad and The Ugly. Much work was left undone, and I hope legislators will fix their eyes on the unfinished business of the people instead of the political squabbles when they return to Austin."

In February, Gov. Perry proposed a budget that established a new, higher standard for fiscal responsibility and truth-in-budgeting, while meeting key priorities for Texas. The result would be slowed government growth, $15 billion in property tax relief, and an end to accounting gimmicks with the use of a one-time $5.4 billion payment. Additionally, $4.3 billion balance in the Economic Stabilization Fund would be left untouched.

Yesterday, Lawmakers effectively passed a $153 billion budget financing the record school property tax cut of 2006, creating a cancer research fund, funding a health opportunity pool that will help more Texans buy private health insurance, largely increasing college financial aid, creating a new incentive program to meet higher education goals, and dedicating $100 million to border security.

The legislature's budget included many of the governor's priorities presented in his State of the State Address. Though there were some issues left unfinished, such as property tax relief, true budget and spending reform, and appraisal relief, Gov. Perry commended legislators' for their service and looked optimistically toward the future.

"My quarrel is not with where the dollars flow, but the lack of transparency, accountability and budgetary honesty involved in how they are allocated," said Gov. Perry. "That being said, important investments have been made that legislators can proudly proclaim. Lawmakers came here with high hopes and have laid firm tracks that will continue Texas' stride as a prosperous state."

Please see below legislative scorecard highlighting the outcome of Gov. Perry's 2007 priorities.

Gov. Rick Perry's Priorities : 80th Legislative Session Scorecard

The Good, The Bad and The Ugly

In February 2007, Gov. Rick Perry proposed an ambitious agenda for the 80th Texas Legislature. During the 140 day session, lawmakers acted on the vast majority of the governor's agenda and advanced the ball in numerous key policy areas. While lawmakers left some work unfinished and some of the governor's agenda untouched - most notably budget and appraisal reforms - significant progress was made on the majority of the governor's key policy priorities.

The Good:


Healthier Texas
" One of the greatest obstacles to individual prosperity is the rising cost of healthcare... Today I am proposing a new initiative called 'Healthier Texas' which will open the door to more affordable insurance options for two million working Texans."(Governor's State of the State Address. Feb. 06, 2007)

The good: SB 10 and a rider in HB 1 give the Health and Human Services Commission (HHSC) the authority to establish a premium assistance program to provide insurance to uninsured Texans. The state is eligible to receive up to $1 billion annually in federal funds that can be used to help individuals purchase private insurance. Preliminary indications estimate funds will be available to cover at least 200,000 adults annually.
Medicaid Reform
" We must take innovative measures, with the help of Washington, to reform Medicaid. There is no reason for healthy children and pregnant women to have the exact same benefit plan as Medicaid recipients with long-term healthcare needs. Washington's 'one size fits all' approach to Medicaid will bankrupt the states."(Governor's State of the State Address. Feb. 06, 2007)

The good: Texas passed one of the most aggressive, comprehensive Medicaid reforms in the country. SB 10 includes provisions for healthy lifestyle incentives for Medicaid recipients, hospital financing reforms, establishment of a premium assistance program for the uninsured, customized benefit packages, and co-payments for emergency room use for non-emergency conditions. The bill received widespread support from health care advocates and will help Texas control Medicaid spending while improving outcomes for clients and moving more Texans to private insurance coverage.

Raising Medicaid Reimbursement Rates
" Ensuring patients have the best care possible requires more than the lawsuit reforms we passed in 2003 - it requires better Medicaid reimbursements."(Governor's State of the State Address. Feb. 06, 2007)

The good: The legislature agreed with the governor's proposal to restore Medicaid provider rates. That restoration became an essential part of the negotiations that resulted in a settlement to the Frew v. Hawkins lawsuit, which contended that Medicaid provider rates were so low they presented a barrier to children receiving medical care and needed checkups. The following amounts include increases for all applicable Health and Human Services agencies and Frew amounts:
Rate restoration to 2003 levels ($122.8 M General Revenue; $310.1 M All Funds)
Additional rate increase ($866 M GR; $2,185.5 M AF)
Hospital rebasing in FY 2009 ($150 M GR; $377.8 M AF)

Electronic Medical Records
" Healthcare is one of the last sectors of the economy yet to embrace the information technology revolution, including electronic medical records. Electronic records are critical to reducing medical errors and stopping healthcare fraud."(Governor's State of the State Address. Feb. 06, 2007)

The good: HB 1066 passed, creating the Texas Health Services Authority, a non-profit, public-private collaborative that will receive private sector donations and federal funds to develop health information technology policies and foster regional collaboration. HB 921 passed, directing state agencies to develop data standards and a system for sharing client data between agencies that provide health/social services to improve the quality and efficiency of services provided. SB 10 (Medicaid reform) passed, which includes a new pilot program to promote the adoption of electronic medical records through the Texas Medicaid program.

Cancer Research
" I don't know when the day will come that we find a cure for cancer, but I do know it is my dream to accelerate its arrival with a multi-billion dollar cancer research initiative that can save lives and provide millions renewed hope."(Governor's State of the State Address. Feb. 06, 2007)

The good: The legislature passed HB 14 and HCR 90, establishing the Cancer Prevention and Research Institute of Texas. In November, Texans will vote on the authorization of $3 billion in general obligation bonds to provide $300 million in grants annually to fund cancer research.

HPV vaccine
" For the first time ever we have a vaccine that can prevent a cancer - a vaccine that prevents the spread of HPV, the leading cause of cervical cancer in women.…While others may focus on the cause of this cancer, I will stay focused on the cure."(Governor's State of the State Address. Feb. 06, 2007)

The good: Plans are underway at HHSC and the Department of State Health Services to develop and implement an educational campaign on HPV, and to allow parents to submit requests for the immunization exemption affidavit via the Internet. National awareness of the ability to save lives has been raised.


Excellence in the Classroom
" Starting this fall Texas will have the largest performance pay program in the nation to reward teaching excellence, and I will do everything in my power to see that it stays that way."(Governor's State of the State Address. Feb. 06, 2007)

The good: For the biennium, Texas will spend nearly $343 million on teacher incentive programs. Of that, $195 million will reward teachers through the Governor's Educator Excellence Awards and Awards for Students Achievement programs, which apply to campuses with high populations of economically disadvantaged students. Another $148 million rewards teachers in all campuses beginning in the 2nd year of the biennium in order to finance an additional teacher pay raise.

" Early Start" Pre-K
"We still have achievement gaps, and the best place to rectify those gaps is during the earliest learning years. We should invest an additional $80 million to expand the "Early Start" pre-K program, which uses pioneering techniques will improve learning among our youngest at-risk students." (Governor's State of the State Address. Feb. 06, 2007)

The good: The legislature appropriated $20 million to the Texas Workforce Commission for the purpose of increasing childcare reimbursement rates for certain childcare providers that participate in a school readiness integration project. Each year, $1 million will be transferred to the Texas Education Agency (TEA) to fund the management of early childhood education partnership projects. The legislature also passed legislation authorizing TEA to collect reading assessment data for first graders, which will allow the agency to properly evaluate whether early education programs are having an impact on student achievement.

Amachi Program
" Perhaps no student population is at greater risk than the children of prisoners. Seventy percent are destined to follow a parent's path behind bars if no one intervenes. We must break up the generational cycle of incarceration."(Governor's State of the State Address. Feb. 06, 2007)

The good: $5 million was appropriated to fund the Amachi program. Amachi is a statewide program that provides one-on-one mentors to the children of incarcerated, or paroled, men and women through Big Brothers Big Sisters.
High School Completion and Success Initiative
The good: The legislature authorized more than $100 million for grant programs to support high school reform, dropout prevention and college readiness. Outside experts will be consulted to draft a strategic plan to ensure that grants are awarded for projects that will inform statewide decisions to implement meaningful reforms in high school.


Performance Incentive Funding
" Today I am proposing major reforms to higher education that will reward colleges and universities for every student that earns a degree, lead to more degrees awarded in critical fields like computer science and nursing and increase financial aid by $360 million... the ultimate result will be a higher education system that is more affordable, more accountable and more focused on meeting the needs of tomorrow's global marketplace."(Gov. Perry Calls for Higher Education Reforms. Feb. 01, 2007)

The good: For the first time, a portion of funding for higher education institutions will be based on achievement rather than just enrollment. This is a fundamental and appropriate shift in the way taxpayers' funds are appropriated to universities and colleges that will bring about greater accountability. $100 million for incentive funding for the general academic institutions will help the state meet workforce needs by targeting an increased number of graduates, especially in critical fields, and improving the quality of education.

Financial Aid for Higher Education
" When it comes to education, we must recognize its value in an interdependent world. Today, knowledge is more valuable than raw labor, and those nations that prosper by pushing the envelope of innovation are those that invest in vibrant colleges and universities….I am also advocating that we set aside $40 million for a new Texas Technology Grant program. Texas produces 5,500 graduates a year in electrical engineering, engineering technology and computer science while our economy produces 11,000 annual job openings in those fields. We must invest in technology scholarships so that Texans are on the forefront of technology innovation."(Governor's State of the State Address. Feb. 06, 2007)

The good: An increase of $145.5 million will help more students afford college. This includes an increase of $96.2 million for Texas Grants, $39.4 million for B-on-Time, $5 million for Texas College Work Study, and $5 million for Texas Educational Opportunity Grant. Together, this will help 16,000 more students afford college.
Nursing Initiative
" There is another industry shortage we must address because lives are at stake - and that is in our state's nursing profession. I am proposing a $50 million nursing initiative that addresses this shortage n two ways: first, it provides new incentives for recruiting more students and faculty; second, it allows aspiring nurses to become licensed through a pilot program at our hospitals."(Governor's State of the State Address. Feb. 06, 2007)

The good: The budget appropriates $14.7 million for the Professional Nursing Shortage Reduction Program to recruit and retain nursing faculty, a $9 million increase over FY 2006-07. The budget also appropriates $4 million in proceeds from the tobacco lawsuit settlement to support innovative nursing education programs.

Transparency in Budgeting
" I am also asking members of the Legislature to join me in making higher education budgets more transparent by breaking out spending into more detailed line-items instead of the current practice of listing entire university budgets in one lump-sum."(Governor's State of the State Address. Feb. 06, 2007)

The good: Thirty-six special items totaling $123 million are appropriated in line-items in a manner that can be evaluated using gubernatorial veto authority. The interim study recommended by the Governor's Business Council to create a Texas Compact for higher education could be a vehicle to discuss changing the formula system and appropriations patterns.


Transparency in State Budgets
" I believe every agency ought to publish its spending on line. Government that is open and honest will always be able to withstand the light of day."(Governor's State of the State Address. Feb. 06, 2007)

The good: Today, at least 22 state agencies, including the Governor's Office, voluntarily publish their spending on line.
More good: The legislature required that a database of state expenditures be established and posted on the Internet in an electronically searchable format, making it easier for the public to track spending.

" Honest budgeting also requires us to end the practice of raising a fee for one purpose and diverting the funds to another purpose. Trauma funds, utility discount dollars and clean air funds have all been diverted to other purposes, often to balance the budget."(Governor's State of the State Address. Feb. 06, 2007)

The good: The governor proposed eliminating the Telecommunications Infrastructure Fund assessment, saving ratepayers $421 million. HB 735 ends the assessment as of September 2008, one year later than proposed, saving ratepayers an estimated $176 million. Additionally, HB 1 appropriates specialty license plate revenues and balances to the specific causes for which the money was raised.

Tax appraisals
" I believe local governments should be able to raise all the revenue they need, just do it with a vote and not through the appraiser's note."(Governor's State of the State Address. Feb. 06, 2007)

The good: HB 438 limits the amount that a homestead's appraised value can increase to no more than 10 percent in a single year, regardless of when the property was last appraised. Currently, a homestead's appraised value can increase 10 percent for each year since the property was last appraised.

Appraisal Process Reform
" I believe Texans deserve more than property tax relief - they deserve appraisal relief."(Governor's State of the State Address. Feb. 06, 2007)

The good: HB 3496 increases taxpayer rights and extends taxpayer deadlines. The bill creates staggered appraisal notices for different types of property owners and allows a taxpayer to protest after the official protest deadline, but before approval of the appraisal records by the appraisal review board. HB 3024 requires the appraisal district to establish by clear and convincing evidence the property's value in certain taxpayer protest hearings. If a taxpayer provides a written appraisal to the chief appraiser within 14 days of the hearing then the appraisal review board has the burden to establish the value of the property.

Film Incentives
The good: HB 1634 authorizes the film incentives program to encourage film production in Texas. HB 1 provides $22 million for film incentives, which is $2 million more than requested.
Transfer Procurement Functions to the Office of the Comptroller
The good: HB 3560 transfers procurement functions to the comptroller.


Texas Homeland Security Plan
" There can be no safe haven for drug traffickers and human smugglers anywhere in Texas. I propose a border security package that will allow us to take back our streets, neighborhoods and private ranches from the criminal scourge that currently jeopardizes them."(Gov. Perry Emphasizes Need for Additional Border Security. Jan. 24, 2007)

The good: $110 million was added to expand existing successful surge operations coordinated by the Governor's Office of Homeland Security. The legislature added four helicopters to the Department of Public Safety and expands the agency's ability to help homeland security efforts. Additional funds will provide in-car computers and expand the Texas Rangers.
Continuing Sexual Assault Against a Child (Jessica's Law)
" I agree with our Lieutenant Governor that sexual offenders who harm our children must face tougher penalties."(Governor's State of the State Address/ Feb. 06, 2007)

The good: As recommended by the Governor's Criminal Justice Advisory Council, HB 8 makes repeated sexual abuse of a child or children during at least a thirty day period an offense. It also sets a twenty five year minimum sentence without the offender having prior convictions. Additionally, the bill allows young children witnesses to reference abuse within a 30 day period, rather than a single date for a child to remember.
Rehabilitation of Prisoners
" There are thousands of non-violent offenders in the system whose future we cannot ignore. Let's focus more resources on rehabilitating those offenders so we can ultimately spend less money locking them up again."(Governor's State of the State Address. Feb. 06, 2007)

The good: The budget provides nearly $240 million for rehabilitation and parole beds for offenders.


Disaster Contingency Fund
" There is no question that Texas is prepared to step up to the plate and meet a disaster head-on. But we need assurance that, when a disaster strikes, we will be able to continue coordinating our emergency response efforts and protect our communities without being financially penalized."(Gov. Perry Proposes $50 Million Disaster Contingency Fund. Jan. 30, 2007)

The good: The governor requested $50 million for disaster relief to help state and local governments coordinate when disaster strikes. The legislature appropriated $15.8 million.


Water Reservoirs
" I support legislation that establishes more than 20 reservoir sites in statute because securing viable water supplies is vital to the future of this state." (Governor's State of the State Address. Feb. 06, 2007)

The good: The Texas Water Development Board identified 19 reservoir sites in the 2007 State Water Plan, which SB 3 designates to keep local government from interfering with their use as reservoirs.
Texas Emissions Reduction Plan
" Let's continue to invest in clean air by increasing our funding for the Texas Emissions Reduction Program by $180 million. Mobile sources contribute the majority of pollution in Texas. This program cleans up dirty engines and reduces emissions by one ton for every $5,000 invested."(Governor's State of the State Address. Feb. 06, 2007)

The good: The governor proposed increasing Texas Emissions Reduction Plan (TERP) funding by $183 million to $440 million; HB 1 provides for an $80 million increase in funding, or a total of $338 for the biennium. However, HB 1 also appropriates an additional $92 million for the Low Income Vehicle Repair Assistance program from the Clean Air Account to repair, retrofit and replace older, higher emission vehicles.


" The example we set in Texas can have international ramifications. I join Railroad Commissioner Michael Williams and a bipartisan group of legislators in protesting the ethnic genocide occurring in Darfur by calling on the state of Texas to divest of companies doing business in Sudan."(Governor's State of the State Address. Feb. 06, 2007)

The good: SB 247, the Sudan Divestment bill, requires the state Employees Retirement System and the Teacher Retirement System to divest in companies doing business in Sudan.


Senior Tax Freeze
" I want to see a constitutional amendment on the May ballot so that seniors get the maximum amount of tax relief on this year's tax bill the same as other homeowners. Just because senior citizens have their tax rates frozen doesn't mean they should be left out in the cold when it comes to additional rate relief."(Governor designates emergency legislation. Jan. 12, 2007)

The good: On May 12, 2007, Texans voted to extend property tax relief to senior citizens and disabled individuals whose property tax amounts are frozen. Because the constitutional amendment, SJR 13 (and its enabling legislation HB 5), passed, seniors and the disabled will receive property tax relief in 2008-09.
Enterprise Fund, Emerging Technology Fund and Workforce Investment
" At home, we must continue to invest in jobs by expanding workforce training through the skills development fund, by continuing to fund job creation through the Enterprise Fund, and by increasing funding for the Emerging Technology Fund, which will help us attract the new growth industries of this new century."(Governor's State of the State Address. Feb. 06, 2007)

Emerging Technology Fund: HB 1 includes $75 million in new general revenue which along with previous balances and interest results in an estimated $180 million being available for the 2008-09 biennium. Additionally, HB 1188 authorizes the governor to make awards in the form of loans and to charge and receive reasonable interest for the loans. It also provides authority to take an equity position in the form of stock or other security when making an award and to sell the security for the benefit of the fund. HB 1 provides $1.2 million for the biennium to administer the fund.
Enterprise Fund: HB 1 also appropriates an estimated $200 million, including unexpended balances and anticipated interest earnings.
Skills Development Fund: HB 1 appropriates $51 million to the Skills Development Fund, an increase of $11 million to provide customized job training to an additional 8,000 workers.


Toll Roads
The good: SB 792 permits Texas' innovative toll road program to continue forward in a cooperative fashion with TxDOT and local toll authorities using a variety of tools to build the roads our growing state needs. Members passed a two year moratorium on privately financed roads but exempted every road that would conceivably be built using private financing during the next two years.

Rail Relocation Fund
The good: HB 160 makes railroad relocation projects that reduce engine idling and air pollution eligible to apply for TERP grants.


Adoption Incentive Program
The good: HB 2702 provides a monthly health insurance subsidy of $150 through age 18 to parents who adopt foster children who do not qualify for Medicaid.

Recruit foster families
The good: The legislature retained an existing rider in the Department of Family and Protective Services budget of $1.2 million for faith-based foster family recruitment and training.

Expansion of Gubernatorial Powers over Boards and Commissions During Emergency
The good: The Texas Youth Commission (TYC) reform bill changed the oversight structure from an Executive Director with the oversight of a citizen appointed board to an Executive Commissioner appointed by the governor and confirmed by the Senate. An Office of Inspector General is created to investigate crimes committed at TYC owned or contracted facilities and crimes by TYC employees. The Chief Inspector General is selected by the Executive Commissioner. The legislature also created an independent Office of Ombudsman with the Chief Ombudsman appointed by the governor and confirmed by the senate.
More good: HB 15 contains a rider that requires Texas Southern University to establish and implement a rehabilitation plan with an accountability system. The Board of Regents must formulate a plan addressing finance and accounting, human resources, management information systems, planning and communications, student financial aid, contract and grant management and other elements determined appropriate by the Governor and Legislative Audit Committee.

The Bad and The Ugly:

HPV vaccine
The bad: The legislature superseded Executive Order RP65 by passing HB 1098. As a result, only 25 percent of the applicable population will likely be vaccinated against the most widespread sexually transmitted disease, as opposed to 95 percent if the vaccine was mandated. HB 1098 also prohibits the Executive Commissioner of HHSC from exercising existing authority until 2011 to add the HPV vaccine to the list of required vaccinations for school entry.
The ugly: The legislature not only overturned Executive Order RP65, but it included a rider in the budget to restrict the use of state funds to purchase or administer a mandatory HPV vaccine program. While the rider was rendered moot upon the passage of HB 1098, the legislature sent a statement by including it in the budget anyway, and refused to acknowledge that it will restrict low-income women from obtaining the vaccine.
Performance Incentive Funding
The ugly: The governor's incentive proposal received less funding than special-item earmarks, the higher education pork proposals that were never debated but added to the budget, in many cases, in the final week of the session.

Financial Aid for Higher Education
The bad: This amount appropriated is less than half the total requested by the governor, and will reach an estimated 71,000 fewer Texas students in FY 2009. Additionally, no progress was made in consolidating the numerous financial aid programs and increasing student accountability.

Transparency in Budgeting
The bad: Legislative leaders did not engage in any meaningful debate about the need for a more open and transparent state budget.
More bad: HB 2560 would have required disclosure of school district books on the Internet where parents and taxpayers could view school expenditures. The bill died in the Senate.
The ugly: Despite repeated efforts from the Governor's Office and others with interest in accountability, the legislature refused to engage in any meaningful debate about the need for more accessible higher education budgets. In fact, HB 3795, which repeals statutory requirement for higher education lump-sum funding, died in subcommittee without a hearing.

The bad: The governor proposed replacing the use of $1.2 billion in Fund 006 used to finance non-transportation state agency operations and using those funds to maintain and expand the state highway system. The legislature did not adopt this funding strategy. Additionally, the governor proposed using $115 million from balances in the Trauma and Emergency Medical Services account to provide $226 million for grants to trauma facilities and EMS. HB 1 appropriates only $103.4 million.
The ugly: The governor's proposed budget included more than $2 billion for truth-in-budgeting; the legislature's budget accomplishes a mere $554 million in truth-in-budgeting. Additionally, budgetary shell games continue, including legislative budget charts that mask more than $2 billion in education spending as property tax relief. This phony number inflates the cost of keeping our property tax promise, and made more difficult the passage of additional property tax relief.
More ugly: The legislature also passed a funds consolidation bill, HB 3107, which allows the comptroller to sweep various dedicated accounts into the general revenue account for one day in order to certify the budget. This budgetary gimmick flies in the face of honest budgeting.

Tax Appraisals
The bad: The current 10 percent appraisal cap was maintained. Several bills that would have reduced the appraisal cap to an amount less than 10 percent failed to pass.
The ugly: Despite yearly public outcries for appraisal reform, the legislature again refused to have a meaningful, open debate on this issue. Bills that would have instituted an appraisal cap or revenue cap were left to die in House and Senate committees.

Appraisal Process Reform
The bad: Several House and Senate bills, filed at the recommendations of the Task Force on Appraisal Reform, did not receive legislative consideration. The bills would have provided taxpayer protections and improved the fairness of the appraisal process.

Spending Cap
" In a time of record revenues, there is a temptation to spend more than we can sustain in the years to come. That's why I propose a stricter spending cap that is tied to the average inflation and population growth of the last six years."(Governor's State of the State Address. Feb. 06, 2007)

The bad: The governor's proposed revisions to the spending limit, which would have limited spending to population growth and inflation as calculated during the previous six years, were never debated on the floor of either house.
More bad: Additionally, SB 1638, which included new property in the calculation of the effective tax rate, failed to pass the Senate. Under current law, new property is excluded from the tax rate calculation which results in tax revenue that the district receives not being counted as a revenue source, thereby allowing the district to gain more than 8 percent without having to go to the voters for approval.

Rehabilitation of Prisoners
The ugly: While rehabilitation of non-violent offenders is important, so too are the mental health needs of law-abiding Texans. Funding for substance abuse at the Department of State Health Services decreased by $20.9 million. In effect, the budget dedicates $205 million providing treatment to 150,000 prisoners, while cutting treatment funding for 22 million law-abiding citizens.

Windstorm Insurance Fund
" We must also put aside regional differences in order to be prepared for a hurricane of historic proportions. Our windstorm insurance system is out of date, and had Rita made landfall in the Houston ship channel, it would have done great damage to the entire Texas economy, as well as the state budget."(Governor's State of the State Address. Feb. 06, 2007)

The bad: TWIA is not adequately funded; therefore, we must determine what actions can be taken in the interim.
" With current technologies allowing coal to burn at least twice as clean as all of the old natural gas plants we are trying to replace in Texas today, we can meet our power needs while reducing total emissions."(Governor's State of the State Address. Feb. 06, 2007)

The bad: The governor recommended a $20 million appropriation pending the selection of a Texas site for the FutureGen project. The funds were to be used to implement the near-zero emission coal fired power plant project. HB 1 did not include any such appropriation.

Additional Tax Relief
" Today I have proposed a budget that…expands upon the record property tax cut of last year by setting aside an additional two and a half billion dollars for tax relief. One way to provide tax relief is in the form of a rebate. The appeal of a one-time rebate is that future legislatures don't have to find the money to sustain it. However, the will of the legislature may be to provide rate relief instead. Either way is better than the alternative; which is having the money spent on more government."(Governor's State of the State Address. Feb. 06, 2007)

The bad: The legislature had an opportunity to provide an additional $2.5 billion in property tax relief. HB 2785 would have reduced the property tax rate by an additional 6 percent, beyond the property tax relief provided in the 79th 3rd Called Session.

Rail Relocation Fund
The bad: Despite the governor's proposal to appropriate $100 million to capitalize the Railroad Relocation and Improvement Fund, a record budget surplus, and voters approving the Railroad Relocation and Improvement Fund in November of 2005, the legislature failed to appropriate money to the fund to move freight rail lines out of our dense urban areas.

Lease of the Lottery
" Conservative estimates tell us that the state lottery could be sold to the private sector for $14 billion. Using these resources, we could create a $2.7 billion endowment for the uninsured that generates close to a quarter billion dollars in interest payments every year. We could also create a $3 billion cancer research trust fund that would annually generate more than a quarter billion dollars each year to the fight against cancer. And the rest of the money - more than $8 billion - could be dedicated to a public education endowment that would provide about $800 million a year for public education."(Governor's State of the State Address. Feb. 06, 2007)

The bad: HB 3973, clarifying the state's authority to enter into a lottery operation agreement, was filed but never made it out of committee. The legislature missed an unprecedented opportunity to create anywhere from $14 billion to $20 billion in endowments, benefiting the state in perpetuity. Since the Lottery is currently run by a private operator the legal structure changes in the operating agreement would have been transparent and the agreement could have further clarified no expansion of gambling was permissible.

Expansion of Gubernatorial Powers over Boards and Commissions During Emergency
The bad: Despite the governor's request that the Legislative Audit Committee meet to determine if TSU had suffered gross fiscal mismanagement, it has yet to meet. The governor worked with the legislature to craft SB 2039, an option to placing TSU into conservatorship. The compromise language proposed in SB 2039 would have allowed the governor an additional tool to deal with any agency, including universities, suffering from a condition of financial or administrative exigency that created a continuing and pervasive instability in operations and management; or resulted in the failure to properly perform all or part of the agencies' primary functions. The failure to pass SB 2039 will mean greater difficulty for the Board of Regents to make swift and decisive management and administrative changes to correct the institution's systemic problems.


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