Political Intelligence



When it comes to federal pork–for road construction, fighter planes, and the like–few states bring home the bacon like Texas. How ironic, then, that Texas may soon be sending $449 million back to the federal government. And the money was anything but pork: it was originally given to the state to insure low-income children under the new Children’s Health Insurance Program. Because the state was so slow to implement the program, under federal rules they must forfeit the unspent portion of the money.

What went wrong? An excess of concern, according to Governor Bush. “I want to make sure that the most needy children are taken care of first,” he told reporters, explaining why his administration has made it so difficult for eligible Texans to enroll in the program. The children enrolled thus far are indeed the poorest of the uninsured, but what about the rest of them? The approximately 100,000 new low-income enrollments–recently described by the governor as a victory in Texas’ efforts to enroll uninsured kids–amount to fewer than 10 percent of all uninsured children in the state, and only a fraction of those who actually meet the eligibility requirements.

The joint state-federal Children’s Health Insurance Program–CHIP for short–required an initial investment from the state of about one-fourth of the total cost of the program. Some states, like Louisiana, have claimed that providing the full state contribution was too much of a stretch for their budgets. Unlike Louisiana, Texas had no trouble coming up with the cash. It ponied up the money from tobacco settlement payments and soon found itself the recipient of full federal matching funds. Yet by the time the first installment became available in October, 1997, the Texas Legislature had already ended its biennial session. Faced with a choice between calling a special session or starting the program rolling on his own, Bush did neither. Instead, he sat on it.

In one sense, there may have been a silver lining to the Governor’s inaction. It was widely expected that, left to his own devices, the governor would have severely restricted eligibility for the program, excluding those applicants who earned above 133% of the federal poverty level. This would have excluded a big chunk of the target population: working families who don’t qualify for Medicaid, but whose low-wage employers provide no health benefits. Bush’s stinginess (with federal money, even) was unmatched by other Republican governors, such as New Jersey Governor Christine Todd Whitman (who proudly set a generous 300 percent eligibility level), and even his own brother, Florida governor Jeb Bush (who set his program at 200 percent).

The 1999 Legislature eventually settled on an eligibility level of 150 percent for CHIP, despite the governor’s opposition. After launching the session with a push for an “emergency” $45 million tax break for oil-and-gas producers, Bush fought hard (in the name of “fiscal responsibility”) against Austin Democrat Glen Maxey’s effort to expand CHIP coverage. In real numbers, Maxey’s victory over the governor meant an estimated 500,000 kids–rather than the governor’s proposed 300,000–would qualify for the program. (In the end, only two states set their eligibility standards stricter than Texas’s.) As it happened, both numbers were pie in the sky. Texas’ CHIP program, which began in April of 2000, nearly three years after program funds became available, was able to insure only about 17 percent of its goal of 428,000 children.

In fairness, Texas is not the only state to drop the ball. Forty states have failed to live up to their obligations under federal rules and face the prospect of turning over funds to those states with successful programs. (At press time, a bill by Houston Democrat Ken Bentsen to allow Texas to keep a portion of its allowance was pending before Congress.) The states gave a laundry list of excuses, according to reports in The New York Times. In all, about 45 percent of the first CHIP installment of $4.2 billion will be sent back. With 29 percent of the US’s approximately 11 million uninsured kids living in Texas and California, these two states account for over half the returning funds. In a statement to The New York Times, Bush campaign spokesman Dan Bartlett laid the blame for the number of uninsured kids squarely with Clinton and Gore, pointing out Census Bureau reports showing the number of children without coverage increased by about 1.1 million since 1993.

Texas has at least one more lingering problem, though. There is precious little staff to make use of all that federal largess. Not a single full-time employee is funded to run the program, Ann Dunkleberg of the Texas Center for Public Policy Priorities told the Austin Chronicle in June. She added that Bush’s welfare reform program eliminated 675 Department of Human Services employees that might have come in handy in administering the program. Instead, according to the Chronicle report, the state resorted to telethons, cobbled together by the contractor hired to boost enrollment.


They’re getting closer. Just in time for the upcoming legislative session, the San Antonio-based Texas Public Policy Foundation, has opened an office in Austin, one block from the state capitol. The conservative think-tank is a project of James Leininger, the right-wing millionaire who famously boosted Rick Perry’s Lieutenant Governor campaign with a last-minute, million dollar loan. Leininger must be feeling fat again, having rented a suite in the lobbyist-infested Texas Association of Broadcaster’s Building. The Austin office will be headed by Lee Adams, currently chief of staff for Mesquite Republican State Rep. Elvira Reyna.

Like Dr. Leininger, who helped underwrite the tort reform campaign after the fortune he made in adjustable medical beds was temporarily threatened by product liability suits (some people got squashed), the Foundation is dedicated to the “principles of limited government, free enterprise, private property rights, and individual responsibility.” If you spent any time in the capitol last session, you’d think TPPF had already taken up residence: their ubiquitous press releases and special reports littered the halls. (The budget of the self-described “research institute” has to be at least fifty percent marketing and public relations.) “This expansion is part of our long-range plan to add additional infrastructure to support free market reforms of state government,” TPPF president Jeff Judson said in a press release. Time to unplug the fax machine, in other words.


As lobbyists and legislators begin their biennial pas de deux in the skyboxes of Royal Memorial stadium, 350 leaders of the twelve organizations of the Texas Industrial Areas Foundation (IAF) Network met in Austin in mid-September to hammer out their agenda for the upcoming legislative session. They were joined by a number of state senators and representatives who met with the IAF organizations in preparation for January’s legislative session. And they weren’t just there to meet. As the IAF leaders announced the components of their legislative agenda for 2001, the legislators were asked to pledge support for that agenda. It was time for accountability. “Invest in our communities,” Austin Interfaith leader Oralia Garza de Cortes told the legislators. “We want a piece of the New Economy pie.”

And these “real people” had real issues based on their real experiences for the legislators to support. They included proposals on health care, public education, higher education and job training. The proposals were presented to the legislators by IAF leaders telling stories drawn from these experiences.

Texas is one of five states that has kept three barriers to Medicaid enrollment in place. As a consequence, 600,000 Medicaid eligible children in Texas are not enrolled. The Texas IAF delegations asked legislators to follow the lead of other states by removing the assets test, eliminating the face-to-face interview and lengthening the enrollment period to twelve-months instead of the current six. They also proposed extending Medicaid and CHIP benefits to low-income adults as 15 other states do. The federal government would reimburse Texas between 60 cents and 72 cents for every dollar spent on covering adults.

To these proposals, State Rep. Garnet Coleman (D-Houston) pledged that this year “we are fighting for all kids, including those kids in Medicaid.” Austin State Rep. Elliott Naishtat said he and others were already “in the process of getting bills drafted to eliminate the assets test, eliminate the face-to-face interview, and to create 12 months’ eligibility for Medicaid.” He added, “Providing coverage for parents will be just as big a fight, but we need to do it.”

Alicia Alvarez, a Valley Interfaith leader and social studies teacher at Pharr-San Juan-Alamo High School, told the legislators about the value of the state’s Investment Capital Fund for her school. The fund was created by then Texas Education Commissioner Skip Meno and the legislature in 1993 in response to pressure from the Texas IAF to create extra state funding to support parent and community engagement in schools and special school programs. The fund has grown from $2 million in 1993 to $14 million in 1999. It has supported enrichment programs, extension of the school year, after-school programs, and training for parents, teachers and principals to build community support for public schools. Ms. Alvarez told how it funded an after-school folklorico program for 10th graders having difficulties in school. This was integrated with research and writing projects and math. All the children in the program passed their TAAS exit exams in English and stopped having truancy problems. The Texas IAF leaders are proposing increasing the fund to $20 million in the next legislative session to serve more schools and to provide the possibility of larger grants.

In agreeing to support the entire IAF agenda, State Sen. Eliot Shapleigh of El Paso said, “A compassionate governor ought to start with kids first. I’m from a part of the state where we figured out what ‘compassionate conservatism’ really means. He came to visit us 14 times, and so we had time to figure it out. It means besos y buena suerte [kisses and good luck].”

The IAF organizations also called on the legislators to amend the Local

Government Code to allow cities to dedicate economic development funds to support educational and job training programs–human development as well as economic development. Last spring, COPS and Metro Alliance–San Antonio IAF organizations–were successful in getting language on that city’s ballot to use a portion of the city sales tax for a Human Development Fund to support job training, after-school programs, college scholarship programs, and early childhood strategies. The initiative was pulled, however, when it was discovered that state law prohibits using sales tax revenues for such purposes. The IAF organizations are proposing legislation to rectify that situation. They’ve convinced the City of San Antonio and that city’s legislative delegation to help lead the charge.

The IAF organizations are also calling for more than quadrupling the current Texas Grant Fund to $214 million to ensure a scholarship for any Texas student with financial need who is entering college. Houston State Sen. Rodney Ellis responded, “California put $1 billion a year into a comparable program. Georgia put $170 million, and it’s got one-fifth the students. We should be embarrassed we’re so tight as $50 million.”