Senators tend budget gap with rainy day reserves

April 22, 2011

A $176.5 billion budget that patches some deep cuts to state services easily cleared a Texas Senate panel Thursday after lawmakers agreed to dip into the state’s reserve fund.

Senate Finance Committee Chairman Steve Ogden, R-Bryan, had told his colleagues late Wednesday that $3 billion would be needed from the state’s rainy day fund to balance their proposed 2012-13 budget. The budget is $12 billion larger than the version of House Bill 1 already approved by the lower chamber.

No further discussion was needed Thursday morning when the senators agreed to use some of the $9.4 billion reserve fund for public education. They then approved their version of HB 1 on a vote of 11-4.

“It doesn’t generously meet the essential needs of Texas, but I think it is adequate, and I think in these circumstances, adequate is a pretty big deal,” Ogden said.

But it is generous in contrast with the bill approved by the House a few weeks ago that reduced spending by $23 billion below the current budget. The Senate’s budget comes in $11 billion short of current spending.

The House did not use the rainy day fund for the 2012-13 budget, and The Associated Press quoted House Appropriations Chairman Jim Pitts as saying it is “kind of off-limits” in his chamber.

Gov. Rick Perry has said he will not sign a 2012-13 budget that accesses the rainy day fund, but Ogden points out that he has not threatened to veto such a budget, either.

Michael Quinn Sullivan of Texans for Fiscal Responsibility said the committee “took the easy way out in crafting a budget that exceeds taxpayers’ means.”

Ogden said he could defend every bit of spending in the budget.

“The burden on people who criticize this budget is to show us why that spending is unnecessary or excessive. I don’t believe it is,” Ogden said.

He added that the rainy day fund was “pretty critical” to getting necessary votes to pass the bill out of committee.

And the draw from the rainy day fund might not be necessary if revenue collections exceed projections.

“The $3 billion is a backstop,” Ogden said.

Among the committee members, Sen. Dan Patrick, R-Houston, registered the only objection to using the rainy day fund. He later voted against HB 1 along with three Democrats.

Patrick’s objection has introduced a new variable to the political calculation of passing the bill through the full Senate.

Senate rules require that 21 senators — two-thirds of present members — give their consent in order to debate a bill. If Patrick or other Republicans defect, Ogden would need to win over more Democrats.

“I still believe I need their support, and I’m going to work as hard as I can to get it,” Ogden said of the Democrats.

The bill could come up late next week.

Sen. Juan “Chuy” Hinojosa, D-McAllen, said he and his fellow Democrats might not like the bill, but “under the circumstances, that is the best that we can do.”

Sen. Kirk Watson, D-Austin, said he is unwilling to accept a bad budget, even if the alternative is worse.

“Unfortunately, this bill’s main selling point seems to be that it’s better than another, even less acceptable plan — that it’s good simply by being less bad,” Watson said in a statement. “The Senate plan remains unworthy of this state and its people.”

Patrick said he has not decided whether to vote for bringing up HB 1.

He said he likes the final product, particularly the additional spending for schools. Before he lends his support, however, he said he would first like Senate leaders to explore other potential savings and address problems with the state’s business tax as well as other long-term budget issues.

“I’m going to have to have a reason to vote on the floor to move it forward,” Patrick said.