Floor Pass

Tom Craddick
Tom Craddick

It’s becoming a perennial pastime at the Texas Capitol. Former speaker of the House Rep. Tom Craddick (R-Midland) files a simple one-page bill that would close a loophole that allows payday and auto-title lenders in Texas to avoid the state’s anti-usury laws and charge unlimited rates; everyone listens politely; and then the bill gets leapfrogged by much more convoluted payday reform legislation.

Yesterday, Craddick plugged this session’s version, House Bill 2019, at the House Committee on Investments and Financial Services.

“What [the bill] does is level the playing field in the payday and auto title loan industry. It does not create any new regulation, it’s just making sure that all lenders … operate under the same standards. The bill would ensure all consumer lenders are subject to the same rates and fees,” Craddick explained. Right now, payday and title lenders operate as “credit service organizations,” a part of the Texas Finance Code originally intended for businesses that repair consumers’ credit. Craddick’s approach would make the payday lenders subject to the same regulations as other consumer lenders.

“The fees are the biggest problem,” said Craddick. Payday and auto title lenders often charge rates of more than 600 percent APR, plunging borrowers into a cycle of debt they are unable to climb out of.

The bill drew support from various members of faith organizations. Advocates for reforming payday loans clearly prefer closing the loophole over legislation moving in the Senate.

Bishop Joe Vasquez, of the Texas Catholic Conference, spoke to the moral obligation of legislators to pass Craddick’s bill.

“Mr. Chairman and members, you face a choice in this committee to endorse predatory lending practices of payday and auto title lenders in Texas or to stand up for poor and vulnerable families in our state,” said Bishop Vasquez.

He was clear that, while the bill does not suggest doing away with fees associated with payday lending, setting a cap on these fees would be much better than the current unregulated system.

Ann Baddour, Senior Policy Analyst for Texas Appleseed, also testified on behalf of the bill.

“I think you have so many churches here and non-profits here concerned about this because people aren’t necessarily complaining to the state,” said Baddour. “Think of yourself, you’re a working family, you barely have enough money to make ends meet. What do you do with your time? Do you complain to someone who can’t help you or do you go to someone who can help you?”

Gail Rowland, a woman from Houston with a full time job, found herself in need of fast money to help pay for medical expenses. She turned to a local payday lender, and, since taking the loan, has paid more than twice her original loan back.

“Am I responsible for the decision I made? Absolutely. Do I owe the money? Yes, I do, and I want to repay that,” said Rowland. “We make bad decisions. The payday lenders help us make bad decisions. They make it extremely easy, they make it extremely fast … And I think when we have a financial need, we are looking for that. We’re desperate.”

She continued: “There’s been a lot of talk about people continuing on that path. I can assure you, this will be my last [loan] … I don’t plan to be in a situation, but these have been hard times for Texans.”

As Rowland quietly took her seat, committee members and those sitting in the room together applauded her.

Texas State Capitol in Austin, Tex.

The Lead:

It took a mere 98 days, but Gov. Rick Perry finally unveiled his proposal for a $1.6 billion business tax cut at a news conference at the Austin Chamber of Commerce yesterday.

The timing is curious. The announcement comes well after both the House and the Senate budgets have been decided, after the bill-filing deadline and with less than six weeks remaining in the session. Perry urged lawmakers to pass a tax cut back in January, but this is his first stab at a specific proposal. The timing has many criticizing the initiative as political pandering.

Whether serious proposal or political stunt, the plan would need a minor miracle to pass this late in the session.

Weekend Headlines:

1. Legislators took a stab at payday lending reform yesterday in the House Investments and Financial Services Committee. It won’t be an easy journey for those who oppose the industry,as the Dallas Morning News reports.

2. House members debating the sunset bill for the Texas Ethics Commission in committee yesterday. The bill, which emerged from the sunset review of the agency, calls for greater transparency in campaign finances. Open government advocates praised parts of the bill but argued it doesn’t go far enough to empower the now-toothless Ethics Commission to oversee campaign fund-raising and spending. The AP has more.

3. Tea partiers met at the Capitol to criticize Gov. Perry’s proposals to expand spending for transportation. There’s just no pleasing some people.

Line of the Day:

“The state of Texas gets an ‘F’ on the environmental comprehensive issues, but what that really means is, it gets an F in healthcare.” —Rep. Lon Burnam speaking on Texas’ rankings on environmental issues in the recently released “Texas on the Brink” study.

What We’re Watching Today:

1. HB 5, which would reduce the number of standardized tests high school kids must pass to graduate, is up in the Senate Education Committee this morning.

2. The sporting goods sales tax debate is up again in House Appropriations subcommittee on Budget Transparency and Reform, as are two bills that consider Medicaid expansion.

3. House members will hear a slew of environmental bills up in the Natural Resources and Environmental Regulation committees. That includes Rep. Cindy Burkett’s HB 3117, which would allow the attorney general to undercut local governments. The AG could settle lawsuits brought by local governments against polluters without the locals’ consent.

4. Legislators will hear Rep. Eric Johnson’s bill in the House Criminal Jurisprudence Committee that would reduce felony charges for prostitution.

The Texas Legislative Study Group released its 2013 “Texas on the Brink” report at the end of last week. The report is an annual study to determine Texas’ rankings among the 50 states and the District of Columbia on health care, education, and the environment.

How’s Texas doing? Not so great: The state ranks 50th in high school graduation rate, first in amount of carbon emissions, first in hazardous waste produced, last in voter turnout, first in percentage of people without health insurance, and second in percentage of uninsured kids.

“Too many of our children do not have access to health insurance,” said Rep. Garnet Coleman (D-Houston), who led the 2013 study group effort and introduced the report with fellow Democrats in a Capitol press conference on Monday morning.

The report made clear that while legislators are—through restrictions on abortion and cuts to family planning—doing well to ensure that babies are actually being born, representatives at the press conference said too little is being done to ensure that Texas children and their mothers are cared for. Texas ranks third in the nation for overall birth rate, but it also ranks fourth highest for teenage birth rate.

The specifics are worse. Texas ranks the lowest in the nation for women with health insurance, and is the second lowest in the nation for percent of pregnant women receiving prenatal care in the first trimester. Texas also ranks the fourth highest in the nation for percentage of women living in poverty.

According to the report, Texas ranks 44th in graduation rates (contrary to what Gov. Perry has said, the number more accurately reflects Texas’ increasing problem with dropout rates—according to the LSG, Texas has previously boasted high graduation rates because studies often to not take dropout numbers into account) and 47th in SAT scores.

Rep. Abel Herrero (D-Robstown) elaborated on the dismal state of education in Texas. “Texas’ investment per student is 27 percent less than the national average. … Yet, as we’ve seen on the House floor, there are still roadblocks to this state, in getting our children the resources they need to succeed.”

The numbers are worse for higher education. In Texas, only 51% of students earn a bachelor’s degree within six years, meaning that only 17% of Texans will earn a bachelor’s degree, said Rep. Mary Gonzales (D-Clint).

Rep. Lon Burnam (D-Fort Worth) spoke on Texas’ environmental rankings, which weren’t particularly good. “The state of Texas gets an ‘F’ on the environmental comprehensive issues, but what that really means is, it gets an F in healthcare. Not just because we don’t insure our kids, but because we create an environment that is unhealthy for our kids and every other person who breathes in this state. It’s a crisis,” Burnam said. “Across the board, Texas fails its children, in particular, and the general public on environmental and healthcare issues.”

Don’t be too alarmed. It’s not all gloom and doom, Coleman pointed out. Texas currently ranks 46th for credit card debt, and 6th highest for affordability of homes. But, he stressed, it’s not enough.

“This is undoubtedly a difficult time for Texas families and a difficult time for our state,” Coleman said. “Texas on the Brink is designed not to shame Texas, but rather to inspire us to do better. … Moving forward we must be mindful as we set our priorities and solve problems based the information that is available to us today. Texas can do better.”

Texas State Capitol in Austin, Tex.
Patrick Michels

State Rep. Bill Callegari (R-Houston) filed a bill last month that would effectively reduce abortion access for minors—especially minors with abusive parents or without parents entirely.

Under current Texas law, women under age 18 must obtain their parent’s permission to have an abortion. Minors who can’t get parental permission—because of abuse, fear or negligence—can ask a court for a bypass.

That may sound sensible, but it’s not enough for Callegari. His HB 3243 would make this process more difficult. It would require a longer wait time and add a burden of proof—minors would have to provide evidence that telling their parents would result in their physical or emotional harm.

“The intent of HB 3243 is to increase parental rights,” Callegari said in a statement. “The [Texas] Supreme Court’s judicial bypass law was originally implemented to protect the small number of cases of minors who would be subject to abuse when seeking parental consent. This bill will help close the loopholes and reinstate parental involvement in their daughters’ health care.”

That may be, but there are a number of problems with this bill. It would allow judges to force minors requesting a bypass to receive “mental health counseling” from a provider of their choice. Tina Hester, executive director at Jane’s Due Process, a non-profit that provides free legal services to minors seeking abortions, said that judges can—and do—assign religious figures to do this counseling. For example, evangelical ministers have been assigned as guardian ad litem to a minor. Often, Hester said, the religious figures assigned by the court will try to dissuade the teen from getting an abortion.

The bill also changes the burden of proof. Currently, “the minor has to convince the judge to grant a judicial bypass on one of three grounds: that she is mature and well informed and understands her options, that it wouldn’t be in her best interest for her parents to be notified, or third, that telling her parents would result in physical, sexual or emotional abuse,” Hester said.

But the text of the bill clarifies that she must also provide “clear and convincing evidence” that notifying a parent or guardian would be detrimental.  Hester said, “she might say ‘they beat my older sister up and kicked her out when she got pregnant,’ but she can’t prove it” to the judge, so the court could deny her request.

Under the new legislation, girls would also have to provide justification for the abortion, if the judge requests it. According to the bill, “In determining whether the abortion is in the best interest of the minor, the court may inquire as to the minor’s reasons for seeking an abortion.” If the judge decides her reasoning is not adequate, he or she can deny the request.

In response to Callegari’s “parental rights” defense, Hester said, “the minors who are able to talk to their parents—they talk to them. Only a fraction of minors pursue a judicial bypass. … Forcing a minor to tell an abusive parent is not helping parental communication,” she said.

Callegari may be trying to protect parental rights, but in practice, his bill would grant courts tremendous power over vulnerable teens’ most personal decisions.

Texas State Capitol in Austin, Tex.
Patrick Michels

The Lead

The top campaign donor in Texas, Bob Perry, passed away late Saturday night at his Nassau Bay home near Houston. The Houston Chronicle has a story about his significant impact on Texas politics. Perry, a wealthy homebuilder, gave tens of millions mostly to Republicans, and bent public policy in Texas toward his conservative worldview. He donated heavily to Governors George W. Bush and Rick Perry, as well as millions to PACs and other Republican candidates across the country. He famously bankrolled the Swift Boat Veterans for Truth campaign that damaged John Kerry’s 2004 presidential bid. In 2003, he prodded the Legislature to create his own state agency—the Texas Residential Construction Commission—that served the interests of the homebuilding industry, until public backlash forced lawmakers to abolish it.  That was the kind of influence Bob Perry had. He was 80 years old.

Meanwhile, at the Capitol, the session is speeding up with just over a month until the finale. The budget is headed to conference committee where lawmakers will iron out differences between the House and Senate versions. Rep. Jim Pitts, chair of the House Appropriations Committee, said a supplemental education spending bill is on the way.

Weekend Headlines:

1. Gov. Rick Perry proposed dedicating growth in motor-vehicle sale revenue to improving roads. This would be on top of using the rainy day fund, halting diversions from the dedicated transportation fund and utilizing low interest rates to make financing easier, as the Quorum Report writes.

2. The Senate has passed a bill to help South Texas hospitals get hundreds of millions of dollars in federal funds for indigent healthcare, the Rio Grande Guardian reports.

Line of the Day:

“They have the audacity to act as though they’re underpaid. They’re enriching themselves by having their living expenses paid for ad infinitum,” —Dave Palmer, a California based campaign finance watchdog, told the Texas Tribune about Texas legislators.

What We’re Watching Today:

1.  The Senate State Affairs Committee will hear a constitutional amendment, SJR 4, by Sen. Donna Campbell (R-New Braunfels) on religious liberty. The amendment would bar government from infringing on a person or group acting (or not acting) out of religious faith. Seems harmless, but it could impact all kinds of policy, including this.

2. The Texas Legislative Study Group will release Texas on the Brink, a report that ranks Texas compared to other states. A sampling: Texas ranks first for the highest percentage of uninsured people and 50th in the percentage of students graduating from high school. Yikes.

3. If you’re in Austin, the whole Texas Observer bunch will be talking politics at tonight’s Mid-Session Review at MonkeyWrench Books.

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