By JAY ROOT
STAR-TELEGRAM AUSTIN BUREAU
AUSTIN -- Thanks in part to fans of Texas bluebonnets and horned
toads, the income from specialty license plates appears headed for a
fiscal lockbox.
Although hundreds of millions of dollars in other
supposedly dedicated accounts face almost certain raids by the
Legislature, budget bills under consideration in the House and Senate
don't lay a diverting finger on any of the $9 million in revenue from
the nontraditional plates.
It's still early in the process, so
nothing is final. But Gov. Rick Perry, who is pushing for the return of
billions of dollars to dedicated accounts throughout the state budget,
sees the preliminary decision to keep all the license plate money for
its intended purpose as "an encouraging sign," Perry spokesman Robert
Black said. Black said lawmakers should do the same with other
dedicated revenue sources.
"With a record surplus, there will
never be a better time to stop these accounting gimmicks and to get
some real truth in budgeting," Black said. "[Perry] is still committed
to working with the Legislature so we can all get right with the Texas
taxpayers."
For years, Texas lawmakers have used fees in accounts
dedicated for one purpose to prop up spending elsewhere. But what began
as a shift of a few hundred million dollars a decade or so ago has
mushroomed into real money. Perry estimates that it would take more
than $5 billion to restore the diverted funds.
Ratepayers fund
One
of the top targets of the Legislature: the so-called "system benefit
fund," into which fees from a surcharge on utility bills are deposited.
For most residential ratepayers, including those in the TXU service
area, the fee amounts to about 85 cents a month.
The account was
set up to help the poor and elderly pay their electric bills, but the
Legislature fell on rough fiscal times a few years ago and decided to
use that money for more pressing needs. The fee on ratepayers never
went away, even after state finances improved dramatically.
Now
there's an estimated $408.7 million balance in that account, and $329
million more is expected to come in over the next two fiscal years,
state figures show.
Some now want to eliminate the fee or refund
the money to taxpayers, but top leaders are making plans to spend most
or all of it on various budgetary items. Sen. Steve Ogden, R-Bryan,
said the Legislature needs the flexibility to shift around money in the
various accounts to fund top priorities, including billions of dollars
in reserves that are being set aside for promised property tax relief.
Without
referring to Perry by name, Ogden suggested that he and other critics
are simply trying to score a few cheap points with voters by
criticizing the longtime practice.
"The only way to fix it
honestly is to overhaul the entire tax code. You can't do it piecemeal,
and you can't do it by taking political potshots," Ogden said. "I'm
doing what I have to do to balance the budget and reduce property taxes
in Texas by $14 billion."
Revenue diversion occurs throughout the
state budget. For example, appropriators have diverted nearly $200
million from fees on heavy-duty equipment, supposedly dedicated to
clean-air programs, according to the governor's office.
Emergency fees
This
year, lawmakers are also planning to hold back $101 million raised from
911 emergency service fees on wireless and local telephones to help
balance the budget, figures show.
Rep. Warren Chisum, R-Pampa,
author of the House budget legislation, said there's nothing wrong with
using available spending authority arising from dedicated accounts as
long as the agency or program being funded has plenty of money already.
"There's
no reason to spend it just because we've got it," Chisum said. He also
said the money remains associated with the dedicated fund. It's
basically entered in the accounting books as an IOU from one account to
another.
As long as legislators remember how much they essentially borrowed, they can always give it back some day, he said.
"We don't turn around and steal the money," Chisum said.
Parks funds
Of
course, lawmakers could simply change the law that dedicated the fees
and accounts in the first place, as some legislators have proposed to
do with various funds. More typically, they just keep kicking the
accounting entries into the future and watch the hypothetical reserve
balances get ever larger. Technically, the official state revenue
estimates show dedicated money in dedicated accounts. But when
lawmakers choose not to spend the money for the intended purpose, it
goes into a pool of cash that can be spent anywhere.
Case in
point: fees generated when nature-loving Texans cough up an extra $30
to buy a specialty "conservation" license plate, such as those honoring
the horned lizard (commonly known as the horned toad). The profit from
the sales of those plates was supposed to fund parks programs. But in
recent years the Legislature has only given the parks a fraction of the
money raised.
The raids have come at a time when the Texas Parks
and Wildlife Department, struggling with chronic funding shortages and
crumbling infrastructure, needs cash more than ever. When the Star-Telegram reported on the diversion last year, it sparked indignation from park enthusiasts.
"People
were trying to do the right thing by paying a little extra," said Luke
Metzger, director of Environment Texas, which advocates a massive
financial rescue of the parks system. "To have that money shifted away
to other purposes was outrageous."
Looking ahead
Now,
if current budgetary trends hold, part of the new infusion of cash for
the parks this year will include the full amount of the parks-dedicated
license plate fee money -- from past and future years. According to
calculations in the House spending proposal, the fee money from four
parks-dedicated plates -- horned lizard, bluebonnet, white-tailed deer
and largemouth bass -- will put $3.4 million into the parks system over
the next two years.
Gene McCarty, deputy executive director of
administration at Parks and Wildlife, said the department is waiting to
make sure the ink is dry on the budget before making plans to spend it.
Texas smoke and mirrors
For
years, state lawmakers have used fees in accounts dedicated for one
purpose to prop up spending elsewhere. A look at the numbers:
$150 billion -- Projected state budget for fiscal 2008-09
$5.4 billion -- Amount the governor wants to undo past budgetary diversions
$1.2 billion -- Amount of highway funding governor says has been diverted
$738.1 million -- Amount lawmakers could divert from fees paid by electric customers
$101 million -- Amount of diversion of phone fees assessed for 911 service
SOURCES: Governor's office, state comptroller's office, House Bill 1, Senate Bill 1
