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Watson to call for budget reforms

Tuesday, February 10, 2009
by Jason Embry
Austin American-Statesman

Sen. Kirk Watson, D-Austin, plans to file today six bills that he says are “designed to make the Texas budget more sensible, open and honest.”

Watson wants to return Texas Performance Reviews to the state comptroller’s office. The Legislature moved the reviews, which evaluate state programs and suggest various ways that the state could save money, to the Legislative Budget Board in 2003 at the height of its animosity with then -Comptroller Carole Keeton Strayhorn. Having the reviews at the LBB, which is chaired by the lieutenant governor and speaker, allows the Legislature to “grade its own papers,” Watson says.

He also wants a Constitutional amendment requiring the Legislature to fully fund the Children’s Health Insurance Program. And over five years, the program would move to cover children from families who make up to 300 percent of the federal poverty level ($66,000/family of four). Right now the state covers children from families who make up to 200 percent of the poverty level ($44,000/family of four).

Another bill would stop the process of “funds consolidation,” which essentially allows unspent balances in dedicated accounts to be counted as general revenue to help balance the rest of the state budget.

Like Gov. Rick Perry, Watson wants to raise the small-business exemption in the state’s new margins tax. Businesses with $300,000 in total revenue are now fully exempt from the tax, and Watson wants to raise that level to $1 million. Watson also wants a reduced tax rate for businesses making up to $1.5 million. He says he wants to pay for these changes by making it more difficult for large corporations to avoid the tax. This legislation would not affect the budget that lawmakers are now crafting; it would kick in for the 2012-2013 budget.

Watson also wants the state to work with the LBJ School to put clearer, and more, budget information online in a timely manner, and he wants state agencies to review their functions and determine if they should or could be paid by fees instead of general revenue. It would not apply to higher education.

Watson is not on the Finance Committee, but he’s a star in the Democratic Caucus and has received much acclaim during his short time in the Legislature. So it will be interesting to see where this goes. There is more information about his proposals on his Web site.