Rainy Day Fund OK for Water, Roads & Tax Cuts, But Not Kids & Seniors?

"Priorities" Road Sign with dramatic clouds and sky.

As you know, last session the $23 billion budget crisis was the biggest challenge to deal with.  To fix that fiscal mess, those in power decided on a “cut first, ask questions later” agenda, slashing funds for Texas schools, health care and seniors.  Some of us disagreed with their approach and offered alternatives to protect Texas schoolchildren and seniors.  Unfortunately, we were ignored at every turn.

The budget lowlights included:

  • cut over $5 billion from Texas schools;
  • shifted another $2 billion in payments to Texas schools into the 2014-15 budget cycle;
  • cut $4.7 billion in Medicaid and cut nursing home reimbursement rates by 3 percent;
  • counted more than $1 billion from unlikely federal waivers and other rosy scenarios;
  • slashed higher education $1.5 billion, a 10 percent cut from current levels and $2 billion below what was needed to maintain than current services;
  • eliminated financial aid for over 43,000 students, including 29,000 students who lost their TEXAS Grant, the state’s largest financial aid program.

Those in power chose to irresponsibly cut vital services for Texas families to the bone.  They chose to sacrifice our children’s educational opportunities and eliminate or reduce vital services for those in need, while continuing multi-million dollar corporate giveaways.

Some of us fought to reduce those draconian cuts.  We said we faced an emergency and should use some the state’s then $10 billion Rainy Day Fund to protect families.  At every turn, those in charge blocked it, saying the fund could only be tapped in the case of some massive natural disaster.  We had to sock money away for an even rainier day.  They set a precedent: the Rainy Day Fund is untouchable, even under the direst fiscal circumstances.  We were told we had to ignore an immediate, obvious crisis just in case another, bigger crisis comes down the road.

That was then, this is now.

In just the last two weeks, those in charge have now called for spending billions from the Rainy Day Fund.  Senate Joint Resolution 1 takes $6 billion from the Rainy Day Fund and spends $2.5billion for water projects and $3.5 billion for transportation projects.  And Governor Perry has called for using $1.6 billion from the fund for tax cuts for businesses.

So the message is the Rainy Day Fund can be used, but only for those priorities important to those in charge of Texas government.  Restore funds to our kids’ schools? Not a priority.  Provide billions of dollars for water infrastructure?  Please proceed!  Provide health care for 1.5 million Texans?  Sorry. Invest billions in roads? You betcha!  Fund tens of thousands of new college scholarships?  Maybe next time.  Give businesses more tax breaks?  But of course!

Rainy Day Fund for Our Schools Should Be Priority #1

Restoring the cuts to our children’s schools must be the top priority for any money coming from the Rainy Day Fund.  As seen in the chart below, the inflation-adjusted budget levels proposed in the budget do not make up for the cuts imposed last session.

For instance, after $594 in cuts per pupil last session, this budget only adds about $20 per pupil to Houston ISD, and per student funding in is lower in FY 2014 ($9,381/$3,921) than it was in FY 2012 ($9,676/$4,132), the first year of the budget cuts.

We need to use the Rainy Day Fund to invest more in our children’s schools.

education funding

(Adjusted to 2013 dollars)

Use Rainy Day Fund to Invest in Health Care

Texas has the highest uninsured rate in the nation, and 6.1 million Texans lack real access to health care.  We have one of the chintziest Medicaid programs in the nation, with hundreds of thousands of truly needy Texans left without insurance.

We have a historic opportunity to finally do something about these dismal numbers, but, instead, some choose to stand in the doorway and say ‘no.’

For an investment of $15 billion, we could draw down as much as $100 billion in federal funds and expand health care coverage to 1.5 million low-income Texans over 10 years.  The feds will cover 100 percent of the costs for expansion for the first three years, and then gradually reduce to 90 percent thereafter.

Texas has long had the highest uninsured rate in the nation, and our Medicaid program currently spends less than the national average per enrollee and also reimburses doctors, hospitals and other providers less than the national average.

This is not to diminish the need for investments in water and roads.  I know that Texas faces a severe water shortage as we move deeper in the 21st century, and we have to begin to address this problem.  And I have served on the Senate Transportation Committee for six years, so I fully understand the crisis we have in transportation and support investing more resources to get Texas moving again.  However, considering that just two years ago we were lectured by those in charge that using any of the Rainy Day Fund for just about anything was simply impossible, to now be told that we are going to take $6 billion and not invest it in our children’s educational future is simply beyond reason. 

The bottom line is if we are now allowed to use the Rainy Day Fund as intended, we need to put our kids on an equal footing with our cars and our creeks.  My solution: let’s do both. Let’s truly invest in Texas’ future and save our natural resources and our most precious resources.  Let’s restore the cuts to our children’s schools and fulfill our promise to our kids.

We have the money; we just need the will to do it.

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