The Latest Legislative Nightmare: Senate Bill 18

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Recently we dove into why spending caps are horrible ideas if you want to keep local services running (think fire departments, police departments, electric utilities, etc.) while also being able to adapt to population growth and change, especially in a state like Texas. The need for these services varies from community to community – what McAllen residents might need may look very different compared to what Lubbock residents might need. These needs can also vary over time as new technologies, public health issues, and security threats emerge.

Despite all of this, and despite Texas’ long history of extremely low per-resident spending and taxation, lawmakers often propose spending caps. The latest example is Senate Bill 18, which Senator Estes filed (coauthored by Senator Donna Campbell, Senator Don Huffines, Senator Bryan Hughes, and Senator Charles Schwertner) this week for the special session we currently and begrudgingly find ourselves in:

Despite continued population growth in Texas, and more than 130 cities’ and counties’ populations growing at least twice as much as the state average, state lawmakers are looking once again to pass “one size fits none” spending caps that would tie local lawmakers’ hands. Essentially, state lawmakers want to tell local communities that they can only spend according to the state’s average population growth, regardless of whether or not that community is growing faster than the state average.

What’s worse? Senate Bill 18 goes beyond limiting property tax revenue (for more on the other awful cap that focuses on property tax revenue, head here):

Here’s why passing a spending cap that’s based only on the state’s growth is a terrible idea:

  • Between 2015 and 2016, Williamson and Fort Bend County populations grew by an estimated 4%.
  • The city of Conroe’s population grew by almost 8% in one year; Frisco and McKinney grew by 6% in one year.

    Lawmakers are constantly floating the talking point that Texans are being ‘forced out of their homes’ due to increased property taxes, but the reality is that home ownership has remained relatively stable in recent years (American Community Survey, U.S. Census Bureau).
  • The annual growth of the state’s population as a whole? 1.6%.

Budgets for local cities and counties vary widely across our growing state. It would be nearly impossible to pass a “one-size-fits-all” spending cap at the state level that allows these cities to continue to thrive and respond to the local needs in their own communities. City and county officials’ ability to raise revenue depending on their constituents’ needs – especially in those cities that have their own electric and water utilities – has always been an important factor in giving Texans a choice about what kind of communities they want to live in.

Want to voice your opposition to SB 18? It’s scheduled for a hearing on July 22 (Saturday) in the Senate Select Committee on Government Reform.

Read more about the dangers of spending caps here.

Eva DeLuna Castro joined the Center in 1998 and focuses on state budget issues. Before coming to the Center, she was an Analyst for the Texas Comptroller of Public Accounts, researching various policy issues related to state revenue and spending. She earned a Bachelor of Arts in History and Literature, cum laude, from Harvard University in 1988 and a Master of Public Affairs from the LBJ School of Public Affairs at The University of Texas at Austin in 1997.

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