Tuesday, July 16, 2013

Texas 2nd Special's Remaining Issue

In a move that sparked much controversy, Governor Rick Perry called a second special session of Texas's 83rd Legislature. The controversy revolved around one of the three issues the congress was to address.

The recall was propagated as though it were called solely to debate and consider the abortion regulation reform that a mob prevented from being enrolled, though passed, before the final seconds ticked to the deadline of the first special session.

However, the media tends to ignore the other two issues up for consideration. The first of these issues passed quietly. It changed mandatory sentencing regulations regarding minors (citizens under 18 years of age) found guilty of capital crimes.

That legislation was necessary in order to get the state of Texas in line with a US Supreme Court ruling concerning death sentences and life without parole sentences for minors. Minors can still be "tried as adults" in capital cases. However, they are to be given a chance for parole in sentencing.

No "social justice" activists received any media attention of note regarding the important legislation. Yet Governor Perry and conservatives in the Texas congress were vilified for calling a special session "unfairly" because they couldn't get an abortion reform bill passed.

Both the abortion reform law and the change in the sentencing of minors law have passed, been enrolled, and are awaiting the Governor's review and signature.

The Texas Senate will reconvene on July 17th and the House will return on the 18th.

One issue remains.

The legislature was also called to consider transferring tax revenue from certain funds to the highway fund. The highway fund is a potential job creator. It would allow for needed repairs and maintenance. It will allow for new road construction. It may lead to P3 (private-public-partnership) contracts that would make newer and better toll roads that would be, in part, maintained by private companies.

P3 toll roads are not a new idea. They are not that revolutionary. They are, however, a common sense boost to the state's economy. Indiana, under Mitch Daniels, enacted such a program. The state's highways improved greatly. People went to work. Tax money was saved, reallocated to much needed areas. The state balanced its budget. A private company made money (and hired people). Everybody (except extreme socialists) won.

In order to transfer any public funds, the Texas Constitution may need to be amended.

HJR 2 proposes such an amendment. It allows the transfer of funds. It restructures the fuel-taxes in an effort to achieve a better "bang for the bucks".

The joint resolution passed the house on July 15th, with a single amendment. The amendment will allow up to 25% of fuel-tax revenues to be transferred into the state education fund.


       (c)  Not later than the 90th day of each fiscal year, the comptroller of public accounts shall transfer from general revenue to the economic stabilization fund and to the available school fund the amounts prescribed by Subsections (d) and (e) of this section. However, if necessary, the comptroller shall reduce proportionately the amounts to be transferred to the economic stabilization fund to prevent the amount in the fund from exceeding the limit in effect for that biennium under Subsection (g) of this section.
       (d)  If in the preceding year the state received from oil production taxes a net amount greater than the net amount of oil production taxes received by the state in the fiscal year ending August 31, 1987, the comptroller shall retain [transfer to the economic stabilization fund] an amount equal to 25 [75] percent of the difference between those amounts as general revenue. The comptroller shall transfer the remaining 75 percent of the difference between those amounts to the economic stabilization fund and the available school fund, as allocated in accordance with Subsection (e-1) of this section [retain the remaining 25 percent of the difference as general revenue]. In computing the net amount of oil production taxes received, the comptroller may not consider refunds paid as a result of oil overcharge litigation. [Read the full resolution here.]


HB 16 is the enabling bill that accompanies the resolution. It is, essentially, the first law that will use the amendment, should it pass the Senate and be ratified. The bill creates legislation to start the transfer of funds from the general fund and economic stability fund to other needed areas. 75% of the fuel-tax revenues will then go towards the highway fund. The remaining 25% will be allocated to other funds.

 Sec. 162.503.  ALLOCATION OF GASOLINE TAX.  (a)  On or before the fifth workday after the end of each month, the comptroller, after making all deductions for refund purposes and for the amounts allocated under Sections 162.502 and 162.5025, shall allocate the net remainder of the taxes collected under Subchapter B as follows:
             (1)  three-fourths [one-fourth of the tax shall be deposited to the credit of the available school fund;  [(2) one-half] of the tax shall be deposited to the credit of the state highway fund [for the struction and maintenance of the state road system under existing law]; 
[Full Bill Text Available Here]

Counter-Point

The bill, resolution, an amendments appear rather complicated. Some may claim they appear as a complex "robbing Peter to pay Paul" situation. It may even appear so complex it more resembles a different scenario. It robs Peter to repay Mary 75% of what was borrowed to pay Paul who will use 50% of that payment to loan George enough to pay 25% of what he owes to Peter.

It is hard to decipher the bills to determine if they are common sense legislation or good ideas. It is rather complicated. for the common layman to understand. The problem with such bills is that the more complex they tend to seem, the worse they tend to be when enacted. The federal Patient Protection and Affordable Care Act as well as other federal tax codes are prime examples. 

The media and protest circus over the abortion reform bill may have been, in part, inflamed in order to obfuscate this particular issue. When dealing with taxing fuel, citizens need to understand the implications on food costs, retail costs, farming costs, public transportation costs, school busing costs, and increased costs in commuting to the workplace. This issue is one that just may have much greater effects on all citizens than the much debated abortion regulation reform law, which directly affected a much smaller segment of the population.