ustxtxb_obs_1969_05_23_50_00010-00000_000.pdf

Thompson carried, and at that only narrowly, the prosperous section of the city \(they never realized how small it was horseshoe of precincts around it. To their credit, a large number of the blacks stayed home, but of those who voted the majority went for Stroud, this country’s self-styled ambassador to Southern Rhodesia. Worst is best for these times, some people are saying. ITHE LEGISLATURE Now, in the wake of his big success at the polls, the people of Amarillo can expect to hear invoked the word “mandate” on behalf of a lot of Bircher arguments before the city commission. And, with Stroud and the commission sure to disagree on key issues, one can envision a series of De Gaullist referendums over the next two years. It will be a tedious and costly process of legislation, but it is likely that Stroud’s position, if not Stroud, will lose the majority of the referendums, as in the vote on the water issue. In the aftermath of the election you hear a lot of talk here about Stroud running for Congress or governor or something. There are bound to be a couple of guys standing around talking about what a fine president he would make. Lobby Pushes One-Year Bill Austin The movement lately towards a oneyear, instead of two-year, appropriations bill is traceable, largely, to the business lobby’s desire to avoid the imposition of taxes on the state’s industrial and commercial interests. If a one-year bill is passed, as now appears likely, it probably would provide no new taxes if enough trimming can be done from existing state obligations to provide for a teachers’ pay raise. The lobby is evidently of the opinion that if a two-year bill were passed this month it inevitably would mean taxation of an unusually considerable scope imposed on Texas business and industry. By passage of a one-year bill, for which no new taxes would be necessary, the political realities in 1970, when a special session of the Legislature could consider the second year’s spending and taxing bills, might mean that Texas business could avoid a tax bite of the size that would appear to be necessary, politically, this year. Texas taxpayers, individual people, have grown restive about three tax increases put on them in the past 20 months by the Legislature. House Speaker Gus Mutscher noted this in announcing his support of the one-year spending plan. “I don’t think the public is in the mood for more taxes,” he said. If business were exempted once again from shouldering very much of the load, probably the electorate would become even more restive than at present. So lobby people and many legislators believe. Reinforcing the belief that individual citizens will not at present tolerate letting business and industry off the hook if it were necessary this spring to raise taxes were recent proposals that such novelties, in Texas, as a corporate gains tax \(to gross receipts tax on the chemical industry \(about $45 million, being pushed by Gov. Preston Smith because of the Texas Chemical Council’s support last year of Eugene increased taxes on natural gas production. At one point it was being proposed that perhaps as much as 40% of any new taxes for this legislative session be imposed on Texas business. This is almost unheard of 10 The Texas Observer for the state’s Legislature, which long has preferred to tax individuals rather than fly in the face of the influential and powerful business lobby. THE TEACHERS’ pay raise was the key problem facing legislators as this Observer was being closed. Most legislators and state leaders are committed to a substantial increase for the teachers. Its cost for the coming fiscal year, which begins in September, would amount to nearly $70 million. Estimates vary, but there appears enough money without new taxes for perhaps two-thirds of this raise in fiscal 1970. So about $25 or $30 million will have to be cut from other portions of the state budget, or the teachers will have to take a lower increase than they had sought, through their lobby, the powerful Texas State Teachers Association. Lt. Gov. Ben Barnes and Speaker Mutscher both favor a one-year spending bill. Their position, which is disputed by others, is that in this way the tax increase necessary through fiscal 1972 will be less, as a more clear picture of the state’s financial standing will be known next year when a special legislative session could enact a spending bill for the second year of the coming biennium. However, Gov. Preston Smith and some legislators believe that in the long run it costs the state more to budget for one year instead of two. Smith says that when Gov. John Connally came up with the one-year procedure in 1967 it cost the state $40 million. Rep. Bill Archer, Houston Republican, notes that a special legislative session costs about $500,000; moreover, he goes on, legislators were told in 1967 that the, scheme would save $50 million but “instead of saving $50 million, we spent $44 million more, resulting in a one-cent increase in the sales tax.” The state’s tax needs could have been met with only a half-cent increase in the sales tax, Archer believes, if a two-year spending bill had been passed in 1967. Smith is standing in the way of Barnes’ and Mutscher’s plans. As a conservative” Smith believes the State Constitution must be followed; he holds that the Constitution is clear in its provision for two-year spending bills. He resists this year, as he did two years ago, as lieutenant governor, the idea that the state should budget for one year at a time. He has, in private, told several persons he definitely would veto a one-year spending bill, and would convene a special legislative session, probably in August. But the governor has seemed at pains lately to take a public stance that would leave open to him the option of not vetoing a one-year appropriations bill. Nonetheless, it appears clear he prefers, evidently because of personal conviction, that a one-year bill not be put on his desk by the Legislature. Smith has proposed, as an alternative, that a two-year spending bill be enacted along with a tax bill that would not take effect until the second year of the 1969-71 biennium. But, again, the political timing of such a move makes this alternative appear unacceptable to the Legislature. This would require the Legislature to act before the passage of another 12 months could ease the sting of another tax increase on individuals. AS THIS issue went to press, the best guess as to the immediate outcome of the fiscal dilemma was that a one-year spending bill will be passed, providing no new taxes, and that Smith probably will veto that bill and reconvene the Legislature early in August. The state fiscal year begins on Sept. 1, so that would give lawmakers about a month to come up with a bill for the biennium. Smith, it is said, would convene the Legislature on Aug. 6, the day after Texas voters decide several amendments to the Constitution, among them a proposal for annual legislative sessions. Were that amendment approved Smith might then be willing to go along with a one-year spending bill in August. Otherwise, it is said, he’d probably hold out for a two-year plan. Before Mutscher came out in favor of a one-year plan most House members favored a two-year spending bill, polls of the membership indicated. But, as a practical matter, the members, most of them, will go along with whatever the leadership puts before them as the final days of the session draw near. The question, then, is: will the governor vetothe impending one-year bill? G.O.