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April 11th, 2019:

Yes, they really are now pushing a sales tax for property tax swap

Some bad ideas never die.

Texas’ top three political leaders — Gov. Greg Abbott, Lt. Gov. Dan Patrick and House Speaker Dennis Bonnen — threw their support Wednesday behind a proposal to increase the sales tax by one percentage point in order to lower property taxes across the state.

But that’s only if lawmakers agree to limit future local property tax increases.

The proposal would raise the state’s sales tax from 6.25% to 7.25%, generating billions of additional dollars annually for property tax relief, if voters approve a constitutional amendment. But the idea will be a hard sell to Democrats, since the sales tax is considered regressive, meaning lower-income Texans end up paying a larger percentage of their paychecks than higher-income Texans.

“Today we are introducing a sales tax proposal to buy down property tax rates for all Texas homeowners and businesses, once Senate Bill 2 or House Bill 2 is agreed to and passed by both Chambers. If the one-cent increase in the sales tax passes, it will result in billions of dollars in revenue to help drive down property taxes in the short and long term,” said a joint statement from the three Republicans.

Neither chamber has passed HB 2 or SB 2, which would require voter approval of property tax increases over 2.5%.

The House Ways and Means Committee was scheduled to take public testimony on the House’s sales tax swap proposal this week but delayed hearing the bills. Rep. Dan Huberty, R-Houston, who authored House Joint Resolution 3 and House Bill 4621, is considering changing the legislation to use a fraction of the additional money generated by the sales tax for public schools — in order to get more Democrats on board.

The bills are intended to provide another revenue source to help significantly cut down local school property taxes, which make up more than half of the local property taxes levied in Texas.

If the Legislature approves the resolution, the constitutional amendment would go to voters to approve in November, and if voters sign on the tax rate change would apply in January 2020.

See here for the background and my opinion about this lousy idea. Given that a constitutional amendment is needed for this, it will be easy enough to prevent it from happening. The progressive case against swapping out property taxes, which will disproportionately benefit commercial real estate and wealthy homeowners, for regressive sales taxes, is clear cut, and likely to hold a lot of sway with the current Democratic caucus. There’s also polling evidence to suggest that the public doesn’t care for a sales tax increase. I’m a little skeptical of that, since the question was not asked in conjunction with a potential cut in property taxes, but that’s an argument for the Republicans to make, and given the baked in doubt about anything actually reducing property taxes (for good reason!), I’d take that bet. HB2 is up for debate today, so we’ll see how this goes. The Chron and Texas Monthly have more.

Commissioners Court replaces Judge McLeod

Unfortunate, but understandable.

Judge William McLeod

A divided Harris County Commissioners Court declined to give County Court At Law Judge Bill McLeod a reprieve Tuesday after he inadvertently resigned last week, opting instead to appoint a replacement.

Harris County Judge Lina Hidalgo said letting McLeod remain as a holdover judge until a special election for the seat in 2020 was too risky, since he almost would certainly have to recuse himself from cases to which the county was a party, as Commissioners Court would have the power to remove him at any time.

Instead, the court voted 3 to 2 to appoint Houston lawyer Lesley Briones to hold the seat through next year, on the recommendation of Precinct 2 Commissioner Adrian Garcia.

“I think voters deserve a judge who can be absolutely independent, as he was elected to be,” Hidalgo said. “This would put us in the untenable position that he would no longer be an unbiased person, because he would be beholden to Commissioners Court.”

Precinct 3 Commissioner Steve Radack and Precinct 4’s Jack Cagle voted against the appointment. Cagle told Briones he could not support her since the nomination was made just minutes earlier and he did not have a chance to review her qualifications.

Briones, a Yale Law School graduate and general counsel to the Laura and John Arnold Foundation until December, accepted the appointment on the spot.

“I have deep respect for the law and I respect that you made a hard decision, and I respect the consternation in this room,” Briones said. “But know that I will work extremely hard for everyone.”

See here and here for the background. There were some good legal arguments in favor of retaining Judge McLeod, while Judge Hidalgo’s point is worth taking seriously as well. In the end, I didn’t have a strong opinion one way or the other; I think either decision was defensible. JUst a couple of thoughts to keep in mind as we go forward:

– McLeod’s point that the state constitution is incredibly long and arcane is unquestionably true. It’s also kind of disingenuous coming from a judge. More to the point, this is why potential candidates should talk to a political professional or two before making any public statements about running for office, because there are various weird rules related to candidacy that are easy to stumble over if you don’t know what you’re doing. I can think of a dozen people off the top of my head who could have pointed this out to McLeod before he filed his designation of treasurer. You gotta do your due diligence.

– Not to belabor the point, but there’s a reason why basically nobody had been felled by this problem before. As I said in my first post, nearly every story about then-Sheriff Adrian Garcia’s rumored candidacy for Mayor was accompanied by a discussion of how he couldn’t say anything without triggering the resign-to-run provision. Sheriff isn’t judge, but in this case they’re both county positions. One might well wonder if that provision applied to one job, would it apply to another?

– All that said, let’s not get too high and mighty at Bill McLeod’s expense. Yes, this was a dumb and avoidable mistake, but it’s not like this particular cul-de-sac of our word salad that is the state constitution was a cornerstone of our inviolable values as a state. County court judges have to resign to run for another office, but district court judges and appeals court judges don’t. All five Democrats who ran for statewide judicial positions last year were sitting on a bench while running for something else, and last I checked our state didn’t collapse. The fact that Bill McLeod had to resign is a quirk and not a principle, and it’s at least as dumb as McLeod’s unfortunate action. I’m sorry this happened to him. I’m sure we’ll all take the lesson to check and doublecheck whether “resign to run” applies to whatever office one holds before stating an intention to seek another, but maybe we should also take the lesson that these same rules are arbitrary and ought to be reviewed to see if they still make sense. Campos has more.

Time for another Texas Central legislative update

I keep thinking that Texas Central has reached a point where there’s not much that can be done in the Lege to stop them, and events continue to prove otherwise.

Dallas-Houston bullet train developer Texas Central Partners LLC said its project could be delayed by a provision added to the Texas Senate’s proposed 2020-21 budget Wednesday, even though the company is not planning on using state funds to build the high-speed rail line. The company said language added to the upper chamber’s spending plan would encourage lawsuits and “is not beneficial for good coordination and planning.” Meanwhile, project opponents cheered the provision.

The measure, authored by Sen. Brian Birdwell, R-Granbury, continues to bar state funds from subsidizing high-speed passenger rail projects but would go further than current law. It would prevent the Texas Department of Transportation from helping coordinate access to rights-of-way on state highways for the high-speed rail project until there is a final, unappealable court ruling on the project’s eminent domain authority. Debate over whether Texas Central has the right to condemn land and buy it from unwilling owners has fueled opposition to the project and led to court battles across the state. The new language was added in what’s called a rider to the proposed budget.

[…]

“Working with TXDOT is critical to the project,” the company said in a statement late Wednesday. “This rider would impose arbitrary and discriminatory restrictions for a single project and sets a bad precedent.”

Texas law allows railroads to use eminent domain to take land for projects, and Texas Central says it is one. But opponents argue that the company doesn’t count as a railroad because it’s not operating any trains — and a Leon County Court upheld that viewpoint in February.

Texas Central disagreed with the ruling, citing a previous Harris County ruling in its favor, and said it plans to appeal the judge’s decision. But as the decision stands, the company can’t condemn land in the counties under the court’s jurisdiction, according to an attorney who represented the landowner in that case.

Patrick McShan, an attorney for the group Texans Against High-Speed Rail and more than 100 landowners along the train’s route, said there may be a lengthy court battle to settle the disagreement over whether the company can use eminent domain. And that, he said, could stall the project.

“At least two years, could be four years. Whatever it is, it’s several years,” he said. “It would be a significant obstacle to the project being constructed. … I do not envision a scenario where they can obtain these necessary approvals and these necessary court rulings to prove to the state that it is justifiable and necessary for the state to expend its resources on this project.”

See here for more on that court case, and here for where things stood at the end of the 2017 session. I fondly remember thinking that if Texas Central survived that session with nothing bad happening they were probably in good shape going forward. Those were the days, I tell you. The Senate budget still has to be approved by the full chamber and then reconciled with the House budget, so there will be opportunities for this rider to get ditched. And then I can make the same foolish prediction at the end of this session and get proven wrong again in 2021. It’s the circle of life, almost.

Texas blog roundup for the week of April 8

The Texas Progressive Alliance did not listen to Paul Ryan’s advice in putting together this week’s roundup.

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