Taxpayers Did Well This Legislative Session

Texas is in the black, state budget passes with low spending growth

The first business of any legislative session is to pass a budget. In these though economic times, Texas is one of only a few states able to balance their budget, Texas is in the black, and the state budget stabilization fund is intact. This is a major victory for Texas taxpayers and good news for the Texas economy.

Americans for Prosperity has long proposed budget growth to be limited to the increase in population and inflation with taxpayer approval required for higher spending. We are pleased to report that the 2010-11 biennial budget of $182 billion represents a 7.4 percent increase over the 2008-09 biennial budget. This is an increase of just 3.7 percent per year.

The budget did not touch the almost $9 million rainy day/budget stabilization funds. The federal stimulus dollars were primarily directed for one-time uses. The legislature passed no major tax increases.

Feds didn’t prevail in attempt to broaden eligibility for UI

AFP and other fiscal conservative groups didn’t want the federal stimulus dollars to force the state to expand programs or grow government. In the big battle over whether or not to take the unemployment insurance (UI) stimulus funds with the strings attached (requiring Texas to expand the UI program), we prevailed and that stimulus money was rejected.

Legislature studies spending limitation

The legislature also required the Legislative Budget Board to undertake a study to evaluate the effect of creating a constitutional and statutory spending limit based on the sum of the rate of population growth and the rate of monetary inflation. The budget left a surplus of approximately $250 million. For more budget highlights, click here. Also, HB 464 by Rep. Ken Paxton requires the LBB to develop a dynamic fiscal note for all tax bills that have a static fiscal note of $100,000,000 or more. The dynamic fiscal note will incorporate a model that will show the estimated fiscal impact of tax legislation for five years into the future. This will help future legislatures to determine the impact of any proposed taxes and tax cuts.

Local option gas tax defeated

Taxpayers prevailed in a hard-fought battle to deny local taxing entities with a new taxing authority, the so-called local option gas tax. Thanks to thousands of calls going into legislators’ offices, legislators got the message. The votes were not there to pass this measure, though it was lobbied heavily by DFW local officials and their multi-million dollar lobby teams. Read our perspective on this taxpayer win.

Smoking Ban defeated

Big-brother do-gooders are often pushing liberty-limiting laws like smoking bans. Sen. Rodney Ellis and Rep. Myra Crownover proposed legislation this session to make smoking in all public places unlawful. Problem is, these legislators assumed private business establishments to be public places. They are not, and a smoking ban would violate the private property rights of these business owners. The legislative battle was hard-fought and the smoking ban advocates included associations which receive public funding. However, constitutional property rights protections prevailed. Neither bill made it to the floor of their respective house. This represented a major victory for property rights advocates, consumer choice and individual liberty. Read the AFP perspective here.

Eminent domain legislation passes

Last legislative session, Rep. Frank Corte (R-San Antonio) was unable to get his legislation to “fix” the Kelo decision and prohibit government from taking private property and providing it to developers who could generate more sales tax revenue. This session, HJR 14 by Corte passed and Texas property owners have the protections they deserve.

Business tax relief provided

The legislature tripled the margins tax exemption threshold, providing a tax cut for about 40,000 small businesses.

Some property tax protections pass

Rep. John Otto (R-Dayton) headed The Property Tax Relief and Appraisal Reform Select Committee this interim and worked hard this session to get some significant property tax appraisal reform legislation passed. He filed a large bill with many reforms, and was successful in breaking the bill down and passing some of those measures, and other protections were also passed. Here are the highlights of the property tax reforms which were passed.

More government-run health care was rejected

Proposals to increase the eligibility for the Children’s Health Insurance Program (CHIP) to 300% of the poverty level were defeated. Current eligibility is 200% of poverty level. Putting more people on a government-run health care plan simply distorts the marketplace. The thought that parents making 3 times the poverty level would have opportunity to get government-subsidized health care for their children is a bad policy cloaked in its being "for the children". I wonder how many of those households put a priority in buying a TV, cable access or satellite TV or other luxuries. Many parents are providing coverage for their children and paying higher taxes for these programs. To act as if federal dollars are free is also foolish and fool hardy.

What didn’t pass

We regret that we were unable to get more taxpayer protections passed which would empower taxpayers to determine just how much government we want and are willing to pay for. We were also unable to end the practice of taxpayer-funded lobbying. It is clear more work needs to be done before we can assure hard-working Texas taxpayers that their tax dollars will not be used to oppose taxpayer protections