On Thursday, the Texas House will debate and vote on its proposed state budget for the next two years as well as a proposed “supplemental budget” for the last few months of the current fiscal year.
The budget – which is considered the most important bill the Legislature works on each session – will then go to a House-Senate conference committee to work out the differences between the two chambers’ proposals.
The budget is tighter than usual this year in large part because of past decisions by the Legislature to cut the business tax and to automatically set aside revenue to pay for highways.
The Senate already passed its budget proposal, and we’ve noted some of our concerns as well as the progress made by Senate budget-writers.
Much of the media attention on the budget has focused on the clash between the House and the Senate over their funding methods. The House proposal uses $2.5 billion from the Rainy Day Fund, which is on track to reach $12 billion during the next budget cycle. We applaud that decision. The Senate, on the other hand, has come up with the same amount of money by delaying a transportation funding transfer to the following two-year budget cycle.
Those are important debates, but we also want to provide readers with an update on how the House budget handles a few key priorities for Texas children:
We appreciate that the House has increased funding for child protection by $513.8 million in All Funds ($433.3 in General Revenue), improving foster care reimbursement rates and maintaining the CPS staff pay raises and hiring plan that are necessary to stabilize the workforce and keep kids safe. However, if state leaders are committed to prioritizing child protection this session, they should provide the full $1.1 billion increase that DFPS says is necessary to do its job right.
Besides the standard funding for half-day pre-k in the school funding formulas, the House budget provides $147 million for “enhanced pre-k capacity.” We appreciate that the House continues to work on pre-k funding, but we have two concerns. First, the funding will be more effective if the Legislature delivers it through the high-quality pre-k grant program established in 2015 through HB 4. (The program currently reaches districts serving 86 percent of all pre-k students.) Second, to maintain the annual level of funding provided to school districts this year through the program, the Legislature should appropriate $236 million. Fortunately, the House has included $235 million for the grant program in the Article XI “wish list” of the budget, a welcome signal that House members are open to working on it when the bill goes to the Conference Committee.
Therapies for kids with disabilities
We appreciate that the House’s proposed two-year budget bill and supplemental budget bill together take a significant step forward to reverse the controversial Medicaid reimbursement rate cuts for therapies for children with disabilities. The cuts were passed by the Legislature in 2015 and implemented in late 2016 after litigation and significant criticism from parents, legislators, and others. We urge the House to make the issue a top priority in conference committee discussions with the Senate. (The Senate budget proposal takes no steps to address the issue.)
The issue is likely to come up during Thursday's budget debate, especially when the House considers an amendment filed by Representative Sergio Munoz to go further in restoring those reimbursement rates.
Early Childhood Intervention (ECI)
ECI is the state program that contracts with nonprofit organizations, such as Easter Seals and Any Baby Can, to provide therapies to children under age three with autism, speech delays, Down syndrome, and other disabilities and developmental delays. As we documented in our recent report, ECI has taken a hit from the Medicaid therapy rate cuts mentioned above. But that’s not all; the direct appropriation for ECI in the state budget has also been inadequate in recent years. The House (and Senate) budget fail to provide the $19 million that HHSC requested to get closer to funding the expected number of babies and toddlers in the program over the next two years.
We appreciate that Rep. Munoz has filed an amendment to add the $19 million to the budget.
Potential for more Medicaid cuts
Rider 186 in the health and human services section of the House budget assumes a $2.4 billion reduction in Medicaid ($1 billion in state funds and the remainder in federal funds) achieved through negotiations with the Trump Administration regarding loosening protections in the Texas Medicaid program. We have significant concerns about the Rider and the potential for such negotiations after the legislative session. Children, pregnant women, seniors, and people with disabilities account for 96 percent of Texans served by Medicaid, so they are the ones who would directly suffer under these cuts. We sincerely appreciate the sentiments expressed by Appropriations Chair John Zerwas, who has been a strong leader on health care issues, but the threat to children and others remains.
On the other hand, Representative Greg Bonnen has filed a budget amendment that would reduce the number of pregnant women who can receive prenatal care. It is not clear that there is significant support for the amendment or that Medicaid eligibility can be altered through the budget, but the amendment signals a worrisome desire to cut basic health care.
Department of State Health Services (DSHS)
DSHS is the state’s main public health agency. It responds to disasters and disease outbreaks like Zika virus and implements community-based programs to prevent obesity and chronic diseases. It also operates primary care clinics and runs state laboratories and newborn screenings so all Texas infants are screened for more than 50 conditions right after birth. These programs save lives and enable Texas kids to be healthy.
The DSHS budget looks very different from last session mainly because the Sunset Transformation transferred many programs (almost 9,000 full-time employees) to HHSC. However, for the programs remaining at DSHS, the House budget includes decrease of $309 million in All Funds ($79 million in General Revenue). This is a drastic decrease, and the agency has noted throughout budget hearings that this type of cut would significantly hurt the agency’s ability to continue its basic functions.
On Thursday, much of the debate will revolve around the 400 amendments pre-filed by House members, including the ones cited above; a welcome amendment by Representative Chris Turner to draw down available federal health care funding; an amendment by Representative Ina Minjarez for a much-needed state strategic plan on postpartum depression; harmful amendments by Representatives Matt Shaheen and Briscoe Cain to gut the state office that seeks to eliminate racial disparities; and many other positive and negative amendments. Links to all the amendments are available here.