Floor Pass

The Lead:

Yesterday, the Senate passed the Texas Railroad Commission sunset bill, SB 212, which would rename the agency the “Texas Energy Resource Commission.” Sen. Robert Nichols (R-Jacksonville) carried the bill and, after a brief debate over whether the change would confuse the public—or whether to call it the “Texas Department of Oil and Gas” and, delightfully, TDOG for short—the bill passed without opposition. Other major changes to the agency include more restrictions on the Railroad Commissioners ‘ campaign fundraising.

Yesterday’s Headlines:

1. The House also passed an elementary school testing reform bill—its second of the week—which would let high-scoring kids skip state tests in certain grades. Implementing the measure, though, would require a waiver from federal law.

2. House Speaker Joe Straus (R-San Antonio) said Thursday that SJR 1—asking voters to approve spending from the Rainy Day Fund on water, transportation and schools—is a “no go” in the House. SJR 1 passed unanimously in the Senate last week.

Line of the Day:

“We weren’t sent here to govern like California,” said House Speaker Joe Straus (R-San Antonio) in the interview with the San Antonio Express News’ Peggy Fikac.

What We’re Watching Today:

1. The House schedule is full of bills worth watching today, including HB 1926 which would expand the state’s virtual course network and open it further to private online schools.

Texas State Capitol in Austin, Tex.
Patrick Michels
Texas State Capitol in Austin

The Lead:

The House Committee on Homeland Security and Public Safety met yesterday to begin legislative investigation  into the West fertilizer plant disaster. Lawmakers took no action yesterday, but speculated on emergency management procedures that took place and how they might have been improved. Many state agency officials testified that, in safety management of the plant before the explosion, they had been doing exactly what the law requires them to do.

“Everything changes from here on out, period,” committee chair Joe Pickett (D-El Paso) told reporters, according to the Texas Tribune. “I don’t think it’s a law that’s necessary, it’s an attitude.”

Yesterday’s Headlines:

1. Five members of GetEqual Texas, a pro-LGBT rights group, were arrested yesterday at the Capitol as they protested the holdup of SB 237, banning job discrimination based on sexual orientation or gender identity, which hasn’t been given a committee vote. Their offense? Overstaying their welcome in conservative legislators’ offices. The members have been charged with criminal trespassing.

2. The House passed a measure capping the use of dedicated funds to certify the budget at $4 billion, part of a movement to ensure money collected for specific purposes gets spent properly. In the past, the Legislature usually devotes about $5 billion from dedicated to balance the budget.

Line of the Day:

“The NRA doesn’t do pep rallies. … We’re engaged in a long battle that will take years. We know it’s not over.” —Andrew Arulan­andam, NRA Director of Public Affairs. The National Rifle Association holds a national convention this weekend in Houston that is expected to draw 700,000 of the nation’s most gung-ho gun owners.

What We’re Watching Today:

1. Rep. Ruth Jones McClendon’s HB 3238 syringe exchange pilot program bill is up on the House floor. The bill is supported by such groups as Mothers Against Teen Violence, and could help ensure safe needle use to prevent the spread of disease.

2. The Senate could hear HB 5, which relates to high school graduation requirements. Check out the Observer‘s coverage of the bill’s passage in the House and in Senate committee.

The Lead:

Payday loans in Texas tend to have astronomical interest rates and send poor families deep into debt. Lawmakers have made several efforts this session to curtail such practices and impose some restrictions on an influential industry.

But, after a wild committee hearing that lasted well into Monday night, payday reform this session may be dead, as the Observer’s Forrest Wilder reports. Industry insiders milled about the meeting late Monday night, and it appeared that only one member of the House Investments and Financial Services Committee—Rep. Mike Villarreal, author of the reform bill—was in favor of cracking down on payday establishment. With the rest of the committee apparently siding with industry, the reform bill’s prospects look bleak.

Yesterday’s Headlines:

1. The House passed a bill aimed at reining in the power given to Pearson, the English company that supplies many of the materials in Texas schools, as the Texas Tribune reports.

2. A multitude of gun rights bills were filed this session following the many mass shootings. However, only a few have any chance of seeing the light of day, the Austin American-Statesman writes.

Line of the Day:

“It is folly to kid ourselves into believing that if a person works hard enough, they’re going to make it. My mom works 60 to 70 hours a week. … She should be able to afford amazing things in life. Yet, she can’t even afford health care.” —Luis Veloz told lawmakers about Medicaid expansion.

What We’re Watching Today:

1. The House Homeland Security and Public Safety Committee will hear invited testimony about the tragedy in West.

2. The House is scheduled to debate the biennial anti-salvia bill. It would add salvia—which can have similar effects as marijuana—to the list of banned substances.

3. And if you’re more interested in the real thing, Rep. Elliott Naishtat’s medical marijuana bill will be heard in the House Public Health Committee today.

State Rep. Mike Villarreal
State Rep. Mike Villarreal (D-San Antonio)

Late into the night on Monday, the payday loan industry strutted its stuff before a very friendly House committee. The hearing came just a week after the Senate passed a surprisingly tough bill that the industry insists would shut down most of Texas’ 3,400 payday and auto-title storefronts. Even though the legislation aired last night is a faint shadow of the Senate bill, it got a rough treatment from six of the seven committee members.

Only the chairman and author of the bill, Rep. Mike Villarreal (D-San Antonio) evidenced any interest in cracking down on the industry.

“I think the tone of the committee was that clearly there was no support for what Villarreal put out there, at least right now,” said Ann Baddour of Texas Appleseed.

What happens next is anyone’s guess but it is possible that payday reform is dead for the session.

The industry was apparently spooked after the Senate made its move last week.

The original version of the Senate bill “was a bill that required sacrifices for all parties but we were willing to make those sacrifices for the benefit of Texas,” said C. Dan Adams, CEO of South Carolina-based The Capital Corporation.

The lenders are now openly working to kill anything and everything except perhaps legislation that would pre-empt city ordinances regulating payday loans.

At last night’s hearing, Rep. Mike Villarreal, the Democratic chair of House Investments and Financial Services, tried to frame payday loan reform as a balancing act. “It is not just an issue that is about markets but, based on all the testimony we have heard from our constituents, is also an issue about morality,” he said.

Villarreal’s bill is considered by consumer groups to be a minimalist reform effort. The Senate version would close a loophole that allows payday and title lenders to get around Texas’ anti-usury laws and charge unlimited rates. Instead it would impose a strict 36 percent APR cap on loans, effectively scuttling the business model in Texas. The Villarreal proposal, which focuses on limiting the number of “rollovers” and imposes modest limits on the size of loans based on borrower income, has only received tepid support from consumer groups.

The committee consists of two Democrats and five Republicans, including some of the House members most hostile to regulation. Collectively, the seven have accepted almost $115,000 from payday loan interests since 2009, according to Texans for Public Justice. Committee vice-chair Dan Flynn (R-Van) has received the third most payday cash ($50,500) of any House member. Speaker Joe Straus, who makes committee appointments, has by far received the most payday donations of any official in the state, about $312,000 since 2009.

Many of those donors, and their lobbyists, were out in force last night. Former state Reps. Vicki Truitt (R-Southlake) and Burt Solomons (R-Carrollton) were spotted in the hearing room. Bill Hammond, the powerful head of the Texas Association of Business, testified against Villarreal’s bill. So did Bill Peacock of the corporate-funded think tank Texas Public Policy Foundation; Peacock testified that the only thing TPPF is in favor of is striking down city ordinances regulating payday and title lending.

Also testifying: many CEOs, owners and employees of payday and title loan companies. Lorri Davis, who is affiliated with Power Finance, a company owned by Rep. Gary Elkins (R-Houston) testified. So did Robert Reich, the CEO of Community Loans of America, a large title-loan company doing business in Texas as LoanStar Title Loan.

The industry reps must have felt like they were among friends.

“I don’t believe in loan sharks, but on the other hand I’m a little offended when someone wants to assign a morality to an issue of a business,” said Rep. Dan Flynn (R-Van).

“You don’t have to do this. You really don’t have to go get a loan if you don’t want one. … It’s a marketplace. If this industry goes away who services this market?”

Rep. Doc Anderson (R-Waco) also worried that freedom could be harmed by any regulation.

“That’s one of the good points of this product, this market,” he said. “It allows individuals to exercise their freedom.”

What happens next is impossible to predict but billions in revenues hang in the balance.

Daniel Freehan, the CEO of Cash America International, acknowledged as much on a conference call with analysts last week.

“Dozens of different scenarios could unfold at this point that run the gamut of this bill never getting out of the House committee, to a bill that passes the House in identical form of Senate Bill 1247. In between these two extremes are multiple permutations that could develop, and it’s impossible to predict how this may unfold with any reasonable degree of confidence.”

A worst-case scenario from the point of view of the reformers is legislation that would strike down city ordinances but not add any new statewide regulations. One such pre-emption only bill, House Bill 2953 by Rep. Ryan Guillen (D-Rio Grande City), is already headed to the House floor.

Last night, Rob Norcross of the Consumer Services Alliance of Texas, a group that represents 80 percent of all the payday and title storefronts in Texas, tried to play down the pre-emption issue, saying that he believed the industry would prevail in its court. But there’s no doubt that ordinances passed in Austin, Dallas, San Antonio, El Paso and Denton are cutting into profits. In January, Mark Kuchenrithe, the CFO of Austin-based EZCorp, told analysts that the company’s “profitability… was negatively impacted by over $1 million” during the last quarter of 2012as a result of ordinances enacted in Dallas and Austin.”

Texas State Capitol in Austin, Tex.
Patrick Michels

The Lead:

You know the session has gotten serious when the first major bill dies in the House on a point of order.

That’s what happened yesterday, when a major water bill that would have directed $2 billion from the rainy day fund to pay for water infrastructure projects was stopped on point of order, or procedural error, after hours of debate. As the Observer’s Forrest Wilder reports, House Democrats banded together to kill House Bill 11 with a point of order, “only because their demands to put more into Texas’ schools, and fully undo the cuts from 2011, were going unheeded.”

Last session saw $5.4 billion in cuts to public education, and Democrats saw this as their last point of leverage as a way to push for more funds for public education.

On the other side of the water debate, according to the Quorum Report (subscribers only), Gov. Rick Perry went against the Texas Public Policy Foundation—a conservative think-tank and Perry’s traditional ally—in a press conference earlier in the day to advocate using the rainy day fund to pay for the water plan.

How the House will get the water plan funded is somewhat hazy now, but the bill has a small chance to pass on to the Senate if it reaches a vote before the upcoming deadline for the House to pass House bills.

Yesterday’s Headlines:

1. The House Judiciary and Civil Jurisprudence Committee heard a bill, dubbed the “Michael Morton Act,” that would require Texas prosecutors to provide evidence to defense lawyers in criminal cases and could prevent wrongful convictions, The Texas Tribune reports. Morton spent almost 25 years behind bars after being falsely convicted of his wife’s murder in the 1980s.

2. The Austin American-Statesman reports that the House approved a bill Monday that would eliminate standardized writing tests for  fourth and seventh grades and would trim down testing in all grades. It was a voice vote, and there was no opposition.

Line of the Day:

“Here was their argument. They said: ‘Listen, before you did this, the politics of it were great. The Democrats were the bad guys. The Republicans were the good guys. Now we all look like a bunch of squishes.’ Well, there is an alternative. You could just not be a bunch of squishes.” —U.S. Sen. Ted Cruz in a video calling out Republican colleagues for joining Democrats to filibuster gun-control legislation in the U.S. Senate.

What We’re Watching Today:

1. The House will hear a sunset bill that will reinstate, for 12 more years, the Texas Commission on the Arts. The commission manages grants to Texas nonprofit arts and cultural organizations, designates cultural areas and promotes tourism.

2. The Senate Education Committee will hear a bill that would create a pilot program in the Dallas Independent School District that graduates students in three years straight into a career-preparatory program, part of a larger K-12 movement to eliminate the “four by four”—four mandated years of math and science courses—and allow for more students to filter directly into the workforce instead of taking the college path.

3. Senate Education Committee will also hear a bill that would—in light of the school finance lawsuits against the state’s unfair public ed funding system—create a report to evaluate the current funding system and how the Texas Education Agency weights each student’s needs.

UTB-TSC TowerSM
Beth Cortez-Neavel
A water tower in Brownsville sports the UTB TSC logo.

Susan Mills, an English professor at the University of Texas at Brownsville/Texas Southmost College, filed a federal lawsuit last week against the university officials who fired her.

Mills claims that UTB President Juliet Garcia, Provost Alan Artibise and a former dean of the school’s College of Liberal Arts wrongfully terminated her employment as part of the university’s massive downsizing.

The two South Texas schools, UTB and TSC, are in the midst of a five-year divorce ending a partnership that began more than 20 years ago. Both schools are preparing to enroll students separately next semester, and UTB has been scaling back to prepare for fewer students. Mills is one of nearly 90 faculty members notified last spring that they would lose their jobs in May 2013.

Mills claims her tenure gives her property rights to her employment, and that the termination of her job is an unconstitutional violation of her due process rights. The Brownsville Herald first reported the suit last week. It’s apparently the first lawsuit to come out of the schools’ messy split that’s cost the jobs of almost 300 faculty and staff members.

UTB formed departmental review committees to recommend which faculty members should be laid off, based on their credentials and years of employment with the school. The lawsuit says the recommendation to lay off Mills was based upon “false assumptions” and “factual misstatements” made by Charles Dameron, a member of the English department’s review committee.

Mills appealed her termination notice to another committee, which determined in November of 2012 that Artibise’s decision to fire Mills was “arbitrary and unreasonable.” The complaint says President Garcia rejected the hearing committee’s findings, and sent Mills a final termination notice instead.

The complaint says the university’s need to make layoffs “is undercut by the reality that UT-B subsequently began hiring instructors for the English and other departments at the very same time” that it was firing Mills and other faculty. “This case illustrates the tension between faculty and top members of the UT-B administration with respect to tenure rights,” the suit says.

“Downsizing is a myth,” the complaint goes on. “If the downsizing of UT-B were a reality, UT-B would not be hiring faculty at the same time it is releasing nearly ninety faithful educators. In other words, the ‘downsizing’ excuse for honoring its tenure commitments to its professors is a ruse. The real reason is financial exigency rather than downsizing.”

Mills requested a temporary restraining order to prevent UTB from dismissing her at the end of the semester, according to the Herald, but Federal District Judge Andrew Hanen  denied Mills’ request. A pretrial hearing is set for July 23.

The Lead:

Payday loans have become one of the session’s hottest topics. Some lawmakers and consumer advocates have said this session is the time to impose some restrictions on the payday and auto-title lenders—which charge up 600 percent interest—before the industry becomes too rich and powerful to rein in.

The Senate passed John Carona’s  SB 1247 last Monday. It was an odd debate, which included Carona accusing some of his colleagues of “shilling” for the industry. In the end, the Senate strengthened what had been a watered-down compromise bill. The measure, as passed by the Senate, would place a hard cap on the amount of interest lenders could charge. Some advocates—and Carona too—feared the beefed-up bill now has no chance to pass.

We’ll begin to find that out today when the House Investments and Financial Services Committee is scheduled to hear the payday loan bill.

Weekend Headlines:

1. Last Friday, the House passed HB 1025, an $875 million supplemental spending bill to provide funds for public schools and wildfire relief during the 2013 fiscal year, the Observer’s Liz Farmer reports. In addition to the original bill, an amendment passed that would reserve recovery funds for West, Texas.

2. According to the Quorum Report, the House has set a calendar for next Saturday, May 4. The first working weekend will hear a sunset bill for the Texas Department of Criminal Justice.

3. The Austin American-Statesman writes that lawmakers aren’t buying into Gov. Rick Perry’s $1.6 billion tax cut proposal.

Line of the Day:

“I still don’t believe he has done anything,” —Rep. Phil Stephenson about former U.S. House Majority Leader Tom DeLay’s money laundering conviction, as quoted by the San Angelo Standard-Times.

What We’re Watching Today:

1. The House Investments and Financial Services Committee will hear Sen. Carona’s payday loan bill that caused so much stir in the Senate.

2. A major water bill will reach the House floor today. It would instruct the comptroller to allocate money from the rainy day fund to water infrastructure projects. Some Democrats and tea partiers are rumored to oppose it.

3. The Senate Finance Subcommittee on Fiscal Matters is going to be discussing franchise tax exemptions today.

After a few tiffs, the House approved an $875 million supplemental spending bill to provide funds for public schools and wildfire relief during the 2013 fiscal year.

House Bill 1025 allocates $500 million for public schools and $161 million for wildlife relief. An amendment also passed that would reserve recovery funds for West, Texas. The amendment is a placeholder until lawmakers better know how much recovery from the fertilizer plant explosion will cost.

The House overwhelmingly turned down an attempt to put $60 million toward volunteer firefighters. Most of the 15 people who died in the West catastrophe were first responders. However, representatives could only move funds around—they couldn’t add or subtract money from the bill. Rep. David Simpson (R-Longview) wanted to fund the volunteer firefighters because he said the funds were supposed to go to them all along and hadn’t, but Democrats said Simpson’s amendment would take funds away from the free and reduced lunch program for school kids.

Rep. Helen Giddings (D-DeSoto) pressed Simpson to explain his reasoning. “Would you agree that no child in this state should go to bed hungry while we can do something about it?” Giddings asked.

Rep. Gene Wu (D-Houston) said the change would be detrimental. “This is not a problem for a few kids,” Wu said. “This is a problem for half the kids in my community.” After Rep. Naomi Gonzalez teared up while describing the nights growing up when she went to sleep hungry, Wu tweeted “I think a lot of House members don’t know what it means to be poor.”

Texas State Capitol in Austin, Tex.
Patrick Michels
Texas State Capitol

The Lead:

The continuing battle against discrimination in the workplace spread to the House floor on Thursday. House members grew emotional  discussing Rep. Senfronia Thompson’s bill that would align Texas lawsuit practices with the federal Lilly Ledbetter Fair Pay Act. The talk shifted from a calm discussion on the bill to an impassioned debate on equal rights for women. Women reps from both parties banded together in support of the proposal, which eventually passed on a vote of 79 to 50.

The Senate is gone for the weekend. But the House will meet today and will vote on a $875 million supplemental spending bill that will augment state programs through August of this year. The bill, HB 1025, includes $500 million in public school funds.

Yesterday’s Headlines:

1. The House will soon hear a rapidly moving bill aimed at limiting political influence over state funding for technology projects. Good for transparency, not so good for Gov. Perry, whose Emerging Technology Fund has had an affinity for distributing grants to campaign contributors and friends of the governor.

2. The Austin American-Statesman reports that a bill to finance water infrastructure projects, one of the session’s major proposals, may not pass the House on Monday. The bill would steer $2 billion to finance the state water plan.

3. The Senate voted in favor of a bill that would require University of Texas regents to promptly respond to open records requests.

Line of the Day:

“We’ve had enough Bushes … It’s not just four families, or whatever.” —Former First Lady Barbara Bush, speaking from Dallas on the “Today” show on Thursday, responding to a question on whether her son and former Florida Gov. Jeb Bush would run for president in 2016.

What We’re Watching Today:

1. The House vote on a $875 million state spending bill today. The bill includes $500 million to be allotted for public schools.

The Lead:

A House committee approved a campaign finance reform bill yesterday that would require certain nonprofits to disclose their political fund-raising. It’s the same bill the Senate passed, then tried to recall last week by asking the House to, in a highly unusual move, give the bill back (the House said no).

The bill, SB 346  by Sen. Kel Seliger (R-Amarillo), would require groups like Texans for Fiscal Responsibility, and its tea party enforcer Michael Quinn Sullivan (no friend of Speaker Joe Straus), to disclose the people donating to their political operations. Texans for Fiscal Responsibility has been a major player in campaigns the past several elections, challenging Straus’ leadership team for being, in its view, insufficiently conservative. The group doesn’t have to disclose much of the money it spends on Texas politics. The bill would bring that secret action into the light, requiring groups that spend more than $25,000 on an election cycle to report donors to the Texas Ethics Commission.

As Quorum Report writes, the House State Affairs Committee passed the bill with no amendments. It now goes to the House floor. If the full House passes the bill without any changes, the measure would go straight to the governor—no conference committee.  You’d think the bill likely faces a veto. But if it does pass, it would remove much of the secret money in Texas politics.

Yesterday’s Headlines:

1. Juvenile facility workers put kids into solitary confinement for a myriad of reasons, but a bill by Sen. Leticia Van de Putte could change that practice. The Observer’s Patrick Michels writes that not everyone agrees on the proposed change to limit solitary confinement for kids.

2. The UT soap opera continues. A House committee heard  a Senate bill to limit the UT Regents power, as the Observer’s Beth Cortez-Neavel reports.

3. Another repeat episode is Sen. Brian Birdwell’s attempt to revive legislation that’d allow people to carry weapons onto college campuses if they had a concealed handgun license, as the Texas Tribune reports.

Line of the Day:

“It should not matter that as diverse as I am—being gay, disabled, Latino and a veteran—I am a person of this great state. Anyone, regardless of race, color, culture, age, religion, ethnicity, sex, disability, orientation, gender identity or expression—each person deserves the same equal opportunity as each of you representing this great state, no matter who we are.” –Retired Marine Staff Sgt. Erica Alva told a hearing on prohibiting discrimination against LGBTQ workers.

What We’re Watching Today:

1. The Senate Finance Subcommittee on Fiscal Matters will hear two bills that would provide exemptions on the franchise tax, which already doesn’t bring in enough money. The plan is, of course, acclaimed by Gov. Rick Perry. His plan would cost about $1.6 billion over the next two years and he said the “money does more good in the hands of taxpayers than it does in the hands of government,” reported The Dallas Morning News. The committee will also hear Sen. Chuy Hinojosa’s bill to impose a fee on cigarettes.

2. Rep. Bill Callegari’s bill in the House Homeland Security and Public Safety Committee would allow people to drive 10 mph over the speed limit without getting fined. That may be the most sensible bill the Lege has considered all session.

3. The Homeland Security Committee will also hear Rep. Yvonne Davis’ bill that would require drug tests for people applying for a Concealed Handgun License. If it’s good enough for welfare applicants….

4. Texas is the land of high stakes testing, and apparently it happens as early as kindergarten and pre-K. The Senate Education Committee will hear Sen. Leticia Van de Putte’s bill to curtail such testing.

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