The Austin Chronicle

Budget Uses Stimulus to Hide Flaws

By Richard Whittaker, April 17, 2009, News

State reps are preparing for a long weekend in the chamber as Senate Bill 1 – the state budget for the 2010-11 biennium – comes to the floor amid increased costs, falling tax revenue, and controversy over whether it relies too much on federal stimulus money to paper over the cracks in state funding.

The Senate passed its version of the budget on April 1, and technically that's what the House will be debating. In reality, and as is standard, the House has thrown all the Senate recommendations out and substituted its own priorities, leaving the difference between the two to be hammered out later in conference committee. Both versions propose increases over the state's $169 billion budget for 2008-09. The House will be debating a 5.1% increase to $178 billion, while the Senate approved a 7.3% hike to $182 billion. Neither version touches the state's Rainy Day Fund, instead allocating $5.5 billion in federal stimulus money. The one big-ticket item the fund would have paid for – House Bill 6, Rep. Craig Eiland's hurricane reconstruction bill – has been shuffled into general revenue expenditure as part of HB 4586, the supplemental appropriations bill. But with unemployment rates skyrocketing, lawmakers are divided over how rainy it has to be to spend the fund. House Appropriations Chair Jim Pitts, R-Waxahachie, said, "We're going to have some discussion on that."

The Senate version was controversial, passing 26-5 instead of the traditional unanimous vote – not because of the numbers but because of where the cash goes. Sen. Kirk Watson, D-Austin, was one of the "nay" votes, in part because of a rider from Senate Finance Chair Steve Ogden, R-Bryan, barring state funds paying for embryonic stem cell research. But that wasn't his only reason. "If you look at the various articles, there are probably two good, logical reasons in each one to vote against them," he said. He argues that neither budget covers the state's real needs, while both use stimulus money to cover up a structural deficit that will become obvious in 2011, when that federal cash disappears. "The truth is, they're borrowing from Obama," he said.

Pitts admits that it's not a perfect budget and that it will reveal a deficit "next time." But while he expects some "no" votes in the House, he's getting positive feedback from members about quick passage. "We'll get this over with Friday night, so everyone can go home for a nice weekend," he added optimistically.

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