Which policy issue carries greater weight in Texas – economic development or children’s health care?
If you chose children’s health care, you’re probably not from around here. The correct answer is a no-brainer for the companies that represent the target audience of Gov. Perry’s new TV spots, which started airing this week in Washington, D.C., Detroit, Sacramento, and San Jose. Private donations financed the “Moving to Texas” ad campaign, but taxpayers could end up paying millions if any one of the targeted companies decides to accept Perry’s offer of a handout from the Texas Enterprise Fund. The fund was set up two years ago to serve as a deal-clinching tool in the state’s courtship of companies looking to expand or move their business operations. Lest we forget, the fund has also helped Austin out in a jam. It kept New York-bound Sematech anchored in Austin and, more recently, helped seal Freescale’s decision to stay put instead of moving to Chicago. It’s quite possible, though, that both Sematech and Freescale would have stayed in Austin even without enterprise fund money.
A lot of people are still sore over the fact that this $295 million boondoggle was born out of a $10 billion budget shortfall. Perry stuck his own hand out at a time when legislators faced some tough choices during the 2003 budget-making process – choices that forced them to decide, more or less, between servicing the governor’s shiny new piggy bank or funding a bare-bones social services account. In the end, from a dominant GOP majority, Perry got everything he asked for – with no strings attached – and the poor got nothing but more paperwork.
Two years and a thousand cuts later, lawmakers have seen the error of their ways and have moved to restore some, but not all, of the funding they cut from children’s health care and Medicaid programs. They restored vision and dental benefits, and added money to pay for “reforms” – still in development – in Child and Adult Protective Services, but didn’t restore cuts made to funds for hearing aids, eyeglasses, and mental health counseling. They also left in place the added paperwork that acts as a rationing device, requiring families to enroll in CHIP every six months instead of once a year.
We’re No. 1!
At the start of this year’s budget process, Perry requested $300 million for the Enterprise Fund, plus another $300 million to kick-start a new emerging technologies fund. So far, legislators have outfitted the Enterprise Fund with $270.4 million, with nothing for the new fund. But it’s early. The real haggling comes when a conference committee sits down to draw up a final budget based on the spending bills passed out of the Senate last month and the House last week – $139.3 billion and $137.5 billion, respectively. The House also approved a $3.4 billion emergency spending bill to shore up some cash-strapped programs.
Perry, meanwhile, is pleased as all get-out with the enterprise fund, which he says has created nearly 23,000 jobs (make that 23,000 announced jobs). That number contributed to Texas winning the 2004 Governor’s Cup award and ranking No. 1 in the nation for best business climate, in annual plaudits handed out by Site Selection, an industry magazine.
What the governor doesn’t say is that Texas also ranks No. 1 for having the largest percentage of uninsured children. In some cases, economic development itself has contributed to the state’s current tally of 1.4 million uninsured children, because their parents’ employers can’t or won’t provide health insurance. Take, for example, Wal-Mart (and its Sam’s Club subsidiary). Though not a recipient of Enterprise Fund dollars, Wal-Mart holds the state title for the number of employees with children enrolled in the Children’s Health Insurance Program. According to the Center for Public Policy Priorities, more than 4,800 kids of Wal-Mart employees are on the Texas CHIP rolls.
But last week, no amount of grim statistics could convince House members to fully restore CHIP and other programs for the working poor. The nearly 16-hour debate culminated early Thursday morning with bipartisan approval of the budget, 102-41. Of Austin’s House delegates, Democratic Reps. Elliott Naishtat, Eddie Rodriguez, and Mark Strama voted “no”; GOP Reps. Terry Keel and Todd Baxter voted “yes,” and Democratic Rep. Dawnna Dukes said she would have voted with Keel and Baxter had her machine not malfunctioned. The only other Austin-area Democrat casting a favorable vote was Dukes’ deskmate, Rep. Patrick Rose of Dripping Springs.
Bad Karma
In the end, the House fight was much less vitriolic than the bitter battle of 2003. But Democrats, led by Houston’s Garnet Coleman, nonetheless took dead aim at Perry’s corporate slush fund, which to them represents the grimmest reminder of how the budget came to be balanced on the backs of poor people. This time, House Dems tried to shift dollars from Perry’s business fund to beef up CHIP and Medicaid. They lost, of course. Houston Rep. Senfronia Thompson scored a victory with her amendment to siphon $6.4 million a year – not from the Enterprise Fund but from the state lottery’s marketing account – to help poor nursing home residents pay for personal hygiene supplies. Rep. Jessica Farrar, D-Houston, lost an attempt to direct some of the Enterprise Fund’s dollars toward air-quality testing in Houston, which could, she reasoned, go a long way toward improving the city’s economic outlook; and Rep. Trey Martinez Fischer, D-San Antonio, tried unsuccessfully to earmark 20% of the fund to pay for small business grants.
But most of the debate was centered on efforts to move $140 million from Perry’s fund to CHIP, which, when matched with federal funds, would open additional slots for 175,000 eligible children. “If I were a Buddhist,” Coleman mused at one point during the discussion, “I certainly wouldn’t want to come back as a child. I would come back as a corporation.” Rep. Lon Burnam, D-Fort Worth, recalled the Christian right’s claim on “moral values” during the last presidential election and asked, “Don’t you really think it all comes down to moral values? This is probably one of the most important moral votes that we will have the opportunity to make in the Legislature this year.” 
This article appears in April 15 • 2005.
