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Senate Finance Committee passes its budget

The fight over the Rainy Day Fund is now officially on.

A $176.5 billion budget for the 2012-13 biennium — 5.9 percent smaller than the current budget but almost $12 billion larger than the version passed earlier by the House — won approval from the Senate Finance Committee Thursday morning and will come to a full Senate vote after the Easter break.

And, unlike the House version, the Senate would use up to $3.1 billion from the Rainy Day Fund for the .

The vote was 11-4, with Sens. Eddie Lucio Jr. of Brownsville, Dan Patrick of Houston, John Whitmire of Houston and Judith Zaffirini of Laredo voting against it. All but Patrick are Democrats. Two Democrats — Juan “Chuy” Hinojosa of McAllen and Royce West of Dallas — voted for the bill.

The chairman of the committee, Sen. Steve Ogden, R-Bryan, said the Senate version spends more money on nursing homes, on public education and on Medicaid. “It doesn’t generously meet the needs of Texans, but I think it’s adequate,” Ogden said. He said he wasn’t spending more to set up a compromise in coming negotiations with the House. “I’m going to fight for this bill,” he said.

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The House version would spend a total of $164.5 billion. Senate Finance’s version totals $176.5 billion. The current budget totals $187.5 billion. Spending from state sources — general revenue — comes to $80.7 billion in the Senate plan, as against $77.6 billion in the House plan and $82.1 billion in the current budget.

The Senate’s biggest cuts, compared with current spending, come in health and human services, which would get $7.8 billion less. Ogden said the budget leaves Medicaid spending about $3 billion short of what current law requires. But with changes afoot in Washington on health care and Medicaid, he said current law could change before the money is needed. If it doesn’t, the state will have the money. “That’s why we need to leave some money in the Rainy Day Fund,” he said.

According to an analysis prepared by the Senate, the upper chamber’s version makes smaller cuts in Medicaid reimbursement rates than the House, provides $200 million more for mental health services, and restores proposed cuts to foster care programs. It puts $4.3 billion more into public schools, $400 million more for textbooks and makes smaller cuts to teacher retirement and health plans than the House. Almost $200 million more would go to TEXAS Grants. The Department of Public Safety would get $249 million more than in the House version, and prisons would get $358 million more — enough, according to the analysis, to maintain current probation and capacity needs in prisons.

Let’s be clear on this: The Senate budget still sucks. It’s better than the House budget, by a lot, but that’s like saying that it’s better to be smothered in your sleep than to be eaten alive by piranhas. The end result is still the same, which in this case is a budget that does not meet the needs of the state. Don’t get me wrong, I’m glad the Senate has done what it has to make the truly wretched House budget better, and I’m glad that Sen. Ogden intends to fight for his version. That’s a fight that can only end with one or both sides giving in, now or after some number of special sessions, so if he really means that, it’s saying something. It’s just too bad that even in the case of a clear win for Sen. Ogden, the victory will be extremely hollow.

Sen. Kirk Watson sums it up well:

For weeks, politicians and pundits have focused on a genuinely horrendous plan approved by the Texas House of Representatives to hack away at schools, nursing homes and so many other priorities that Texans hold dear – even knowing that such a devastating proposal would never be approved by the Senate.

So compared to that gore-fest, the milder horror show of the Senate budget must look pretty good, right?

But compared to anything else – Texans’ priorities, Texas’ history, even the status quo – the Senate plan that’s now on the table remains unworthy of this state and its people.

And make no mistake: had we been told back in, say, September that the state was about to take about $4 billion from Texas schools and billions more from universities and the uninsured – all the while using the same debt, diversions and deception that have been a staple of the state’s budget-balancing practices for years – I suspect most of you wouldn’t have called that a “best-case scenario.”

I doubt you’d conclude it was an acceptable solution simply because “it could have been worse.”

Meanwhile, the Rainy Day Fund that Rick Perry and the band of radicals in the House are fighting to preserve is doing just fine on its own, thank you very much. Thanks to robust oil and gas prices, the fund may increase by another $3 billion or so in the next two years, far more than the current Comptroller projection. Given that sales tax revenues are ticking up as well, one might wonder why we plan to sit on a huge pile of cash when teachers are getting fired and nursing homes are closing. That’s a question that needs to be at the forefront of the 2012 elections. In somewhat related news, the House adjourned for the weekend without taking action on a bill that would allow for greater class sizes and give school districts some more flexibility in dealing with cuts by getting rid of the minimum salary schedule for most employees. This is similar to but not the same as the Senate bill that would allow for furloughs, among other things. For the more wonkish among us (you know who you are), here are three documents of interest sent to me from the office of Rep. Mike Villarreal: The Legislative Budget Board summary of CSSB 1; the LBB summary of CSHB 1; and a comparison of HB1 and CSHB 1. Robert Miller, Abby Rapoport, and EoW have more.

UPDATE: The Statesman story from today notes that the class size provisions in Sen. Shapiro’s SB12 have been removed by Sen. Dan Patrick, who was their main booster. “I didn’t want to do anything to make it any more difficult to pass,” Patrick said. “There are too many good things in the bill to have the whole thing go down on one area where we don’t agree.” For more on Rep. Eissler’s HB400, the bill that was postponed until next week, see here, here, and here. Finally, RG Ratcliff writes on BurkaBlog “If you think of the two-year budget passed by the Texas House as a bankruptcy filing for the State of Texas, then the budget approved by the Senate Finance Committee yesterday is a reorganization plan that requires a substantial liquidation of assets.” Good way to look at it.

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