Wednesday, December 22, 2010

Texas Grows, but what about the budget?

Some preliminary population numbers are out from the Census Bureau and Texas has grown twice as fast as the rest of the nation.   This is good news if you want to be a Congressman.  Texas will get 4 new congressional districts.  But it also means the Texas budget has to grow to keep up.  Funding sources for the Texas budget have not grown and that's why Texas legislators face a big budget deficit in 2011.  There are two ways to deal with the deficit, raise taxes (ain't gonna happen) or cut spending.  In my next post about the Texas budget I'm going to talk about options for Medicaid, the second largest portion of the Texas budget. 

Friday, December 17, 2010

Will California Lead to Way to Cap and Trade?

California regulators just passed a new plan for a cap and trade market place to give monetary incentives to big polluters to clean up their act.  When I first read the article I was wondering, where are they going to get the money to do this.  Apparently the plan is to get the polluters to pay for it, first by getting permits to pollute and then when some are greener, selling their carbon permits to other companies that pollute more.  The regulators even claim polluters could make money, it would be a carbon emissions stock market. 

Of course it has its detractors, companies who say it will raise electricity prices because some of the biggest polluters are coal plants, and others who are worried the system can be cheated and not really lower pollution at all.  I guess we'll have to see.  It will certainly be a good test case to see if this kind of system can actually work.  Most innovative ideas come from states and if they become popular, then they are adopted by the Federal Government.

Thursday, December 16, 2010

I Wonder What Bexar Met's Bond Rating is Now?

Bexar Met General Manager Victor Mercado has just been indicted in Detroit on Racketeering charges.  I think that A bond rating for the utility may be sinking fast, just when they really need to borrow some money.

Wednesday, December 15, 2010

How does the money get Spent? The Texas Budget: K through 12 Public Education

So what do we spend money on in the State of Texas?  The approved budget for the 2010-2011 biennium was $182 billion.  About 36% of that money comes from the federal government, 47% from general revenue funds (taxes, fees, etc) and about 16% from other sources. By state law the budget has to be balanced, no deficit spending allowed.  The chart below shows that the bulk of the budget is spent on K-12 Education, Health and Human Services, Higher Education, Business and Economic Development, and Public Safety and Criminal Justice.

Based on figures from the Fiscal Size Up done by the Legislative Budget Board (LBB)

By far, the biggest expense in the Texas budget is K-12 Education.   The state will receive $9.077 billion directly from the federal government and another $5.875 billion through the American Recovery and Reinvestment Act to help cover this expense.  The rest of the money ($37.77 billion) comes from the General Revenue Fund and other funds.  An interesting side note to all this is that even though expenditures for All Funds (Federal Funds, General Revenue Funds and Other Funds) has gone up by 24% since the 1996-97 biennium, General Revenue Funds expenditures, where our taxes and fees go, after being adjusted for population increases and inflation, has actually dropped by 1.4%.   Also, according to the Fiscal Size Up (by the LBB) even though spending on Education (Pubic and Higher Ed) has risen from $45 billion in 2000-01 to $75 billion in 2010-11, its share of the revenues has actually dropped 3.2% since 2000-01.

The Texas school population was predicted to rise by 14% by 2008 back in the late 1990s.  But in actuality, between the 1996-97 school year to the 2008-09 school year the number of students in Texas schools rose by 24%, from 3,838,975 in 1996-97 to 4,749,571 in 2008-09. So part of the dramatic rise in school spending is due to population increases.  But, according to the Financial Allocation Study for Texas (FAST) per pupil spending has also increased dramatically. In the 1998-99 school year, Texas spent an average of $7,095 per pupil, by 2008-09 an average of $11,564 was spent per student, a rise in per pupil spending of  63% over 10 years.  Inflation during this period would make $7095 in 1998 dollars be equivalent to $9331 in 2008, so even accounting for inflation school spending went up by over $2,000 per pupil ($1520.57 in 1998 dollars).

There are legislators who believe spending for Public Education needs to be cut.  They point to efficiencies that would lower costs and not hurt education.  Some, like Rep Warren Chisum R-Pampa, who is running to replace House Speaker Joe Strauss R-San Antonio, says that over the years we have doubled money spent on education and gotten poorer results.   But even though spending on public education went up by $15.3 billion between 2006 and 2009 to $75 billion (or 44% of the State budget) Texas still ranks 43rd in the nation in spending per student.  Also, according to the Texas Sunshine Review site, even though schools ranked academically unacceptable went up 4.4% between 2008 and 2009, the number of recognized schools went up by 10.4% and the number of exemplary ranked schools went up by 6%.

In order to evaluate public school spending and academic performance, the Texas Legislature commissioned the Comptroller (through HB 3) to 
identify school districts and campuses that use resource allocation practices that contribute to high academic achievement and cost-effective operations.

The Comptroller Office responded with the Financial Allocation Study for Texas (FAST).  Now of course, not all school districts spend the same amount of money per pupil, so the FAST study looked at each school district individually and scored them based on a three-year average of math and reading scores with a three year average of operating expenditures.  In order to determine the spending index for a school district 
  • Texas districts and campuses operate in a variety of “cost environments” —socioeconomic and geographic characteristics that influence the cost of education and are often beyond a school district’s control.
  • The research team evaluated financial data for each district and campus by comparing them to “fiscal peers” — districts and campuses that operate in similar cost environments, are of similar size and serve similar students.
  • To ensure the validity of financial comparisons, the research team employed a technique called propensity-score matching to identify up to 40 peers for each Texas school district and campus, based on common cost factors such as wages, school district size and geography and student demographics.
  • After a group of fiscal peers is identified for a school district, the district is then assigned a “spending index” based on its spending relative to its fiscal peers.
When spending was compared to academic achievement some school districts fared better than others.  In San Antonio, the highest scoring school district was North Side ISD with four stars for high academic acheivement and average spending.

The FAST study identified several strategies that school districts used to reduce spending.  Some reduced staffing (60% of most school budgets) through attrition and staff consolidations.  The FAST Study identified many efficiencies used by the highest rated school districts from online education classes, to refinancing bond debt, to transportation coops and facility sharing, to architectural prototypes for new schools and energy efficiencies.

Based on these efficiencies and other FAST Study findings, the Comptroller has made the following recommendations to the Texas Legislature and the Texas Education Agency:
  1. Eliminate the 22-student limit for each K-4 classroom and institute an average 22-student class size instead.
  2. Instead of rewarding teachers for years of service or advanced degrees, teacher salary schedules should reward teachers based on performance.
  3. The Legislature should amend state law to facilitate the dismissal of ineffective teachers.
  4. Study patterns in school district administrative staffing. From 1998-99 to 2008-09, the number of teachers in Texas rose from 256,276 to 325,809, a 27.1 percent increase. During the same period, the number of administrators rose from 18,531 to 25,130, a 35.6 percent increase.
  5. Ensure that teacher preparation programs produce high-quality teachers.
  6. Reduce barriers to on-line course work.
  7. Require book publishers to provide textbooks in a format compatible with common electronic reading devices.
  8. Standardize the reporting of campus financial data.
  9. Include questions in the State of Texas Assessments of Academic Readiness (STAAR) that evaluate high-performing students.
  10. Integrate education and work force data into TEA's database.
  11. Allow school districts and other local governments to publish public notices on their websites instead of requiring newspaper advertisements.
  12. Assist school districts in placing their financial records and budgets on their websites to increase transparency.
  13. Continue to update the FAST study data and use it to identify school districts that deliver quality education in a cost effective manor and to target LBB school performance reviews. 
  14. Take advantage of the Comptroller's Purchasing Cooperative so that school districts get the best prices possible.
  15. Encourage shared-service arrangements.
  16. Create an efficient strategy for organizing transportation cooperatives.
  17. Use architectural prototypes in new construction.
  18. Maximize the use of school facilities.
  19. Take advantage of opportunities to manage energy costs more effectively.
Just the savings from going to an average class size, statewide, of 22 could save an estimated $557.5 million annually.

So, can we save money in K-12 Education?  Yes, but remember, Education is one of our most important resources.  If Texas wants to be The financial powerhouse of the 21st Century, it is imperative that we have a well educated workforce.  If the FAST findings are followed in an efficient, careful and unpolitical way, I believe we can achieve this goal and save some money at the same time.

Thursday, December 9, 2010

Bexar County Gov 2.0

Bexar County has joined the 21st Century by launching the YourGOV application on it website. Similar to the City of San Antonio 311 reporting page, the YourGov site allows citizens of the county to report nonemergency  issues.
YourGOV can be used via the Web or your mobile phone.  By using YourGOV, the Citizen will be able to submit an issue and track its progress from submittal to completion via the Web. Issues are brought directly into the County’s Work Management solution where they can be forwarded on to the responsible department. By entering in an address or selecting a location on the map, the Citizen will be able to view where in Bexar County their issue is located. In addition, the Citizen will be able to view issues that have been submitted by other Citizens and track their status.
All you have to do is download the Microsoft Silverlight plug-in to your computer (available free at the YourGOV site) or the YourGov Iphone App to your smartphone.  To track your request, submit your email address and a password.  So if you see something that the county needs to address, such as graffitti, pot holes, missing or damaged signs, animal removal, dumping, etc, try out this new service today!

Wednesday, December 8, 2010

Who Cares if there's a New Speaker of the Texas House?

Back after reconstruction, when Texans were spitting mad at the radical Republicans for taking over their government, as soon as the Democrats had the chance they held a constitutional convention.  The participants wanted to weaken the government as much as possible.  So they split the Governor's powers across five different offices, gave the power of choosing just about all judges to the people through election, and made the legislative session so short it would be hard to pass many bills.  But there are two offices that still remain very powerful because of their power over the two presiding legislative bodies, the Lt. Governor, who presides over the Senate, and the Speaker of the House.

The Speaker of the House is one of the most powerful offices in Texas and it is the only one not directly chosen by the People.   The Speaker is chosen by his/her fellow legislators.

So why is the Speaker So Powerful??
The Speaker of the house chooses all of the committee chairmen for the various house committees.  These committees decide whether, and in what form, a bill makes it to the House floor or whether it dies in committee.  Because the Speaker chooses these chairmen he usually has a fair amount of control over them and can, in some cases, dictate what bills he wants to see on the floor.  Also, if a contentious bill makes it to the floor anyway, the Speaker can decide not to recognize legislators who want to debate the bill, or not even allow it to come up for a vote. 
The current Speaker is Joe Strauss R-San Antonio.  Joe Strauss has only been speaker for one session when he wrested the position from the autocratic Tom Craddick R-Midland.  According to Fred Hill R-Dallas
under Tom Craddick, the system was set up to do what Tom Craddick wanted to do, and he
exercised his power to pass legislation that he was in favor of. If he wasn’t in favor of it, he would kill it.
 Of course Democrats wanted to be rid of Craddick, but there were also Republicans who chafed under his rule, some even contending that he was abusing his power.
... the fight was about Craddick having consolidated power with lobbyists and having used campaign contributions to maintain control in the House: "This is about the convergence of money and power and influence," Cook [R-Corsicana] said.
Tom Craddick at first was able to maintain control by not recognizing Republicans who wanted to oust him.
House Speaker Tom Craddick shut down repeated efforts by House members to remove him from his post during a dramatic midnight coup attempt Friday, refusing to recognize them for a procedural move that would set off a vote to oust him.

In an extraordinary late-night exchange before a packed House gallery, with most House members seated quietly at their desk, Fred Hill, R-Richardson, asked that the chamber be allowed to vote on Mr. Craddick's fate.

It was the climax of discontent that had been building for weeks – but Mr. Craddick, R-Midland, stymied it with carefully worded parliamentary rulings.

"The speaker's power of recognition on any matter can not be appealed," he said.
Craddick managed to maintain his position until the 2009 legislative session when Democrats came close to splitting the chamber with the Republicans (74 Ds to 76 Rs), in part due to voter unhappiness with Craddick.

Now that the Republicans have a strong majority in the House once again, Joe Strauss is in trouble because he won the Speaker position partly due to overwhelming support by the Democrats.  Part of the deal Strauss made with Democrats for their support was the handing out of some committee chairmanships to Dems. But at the time the Republican majority was only by 2 members.  Now that the Republicans have almost a Super Majority in the House, it stands to reason that the chairmanships should change hands, even under Strauss. 

Many Conservatives say Strauss is a Democrat in Republican clothing.  Some Republicans claim Strauss supported Democratic Candidates and that he is Pro-Choice.  But as with most campaign rhetoric, you have to separate the wheat from the chaff.  According to the Texas Ethics Commission, campaign contributions made by Strauss were to fellow Republicans.
Campaign finance reports from January 1 through Election Day show the names Joe Straus, Joe R Straus, Speaker Joe Straus, Joe R Straus III, Joe Strauss, and Joe R. Strauss gave $716,550 to Republican candidates and political groups.
Straus defended his efforts as “completely legal,” helping to “bring about the largest gains in the history of our party.”

It is considered part of the House speaker’s job to support the House members, in both their efforts to effectively represent their districts and in their efforts to be re-elected. It is considered bad form for a speaker to actively campaign against incumbents, even if they are in the opposing party.

In fact, former Speaker Tom Craddick , R-Midland, Straus’ direct predecessor, raised more than $2.5 million in campaign contributions in the election years during his three terms in the post. Some of Craddick’s contributions were through his speaker PAC, Stars Over Texas, which was formed to support House Republicans in their election bids.
Strauss may have raised money for his fellow Republican supporters, but he didn't raise money for any Democrats.

It is hard to say what Strauss' position is on Abortion, because he didn't vote at all on any of the recent Pro-Life legislation (2005, 2007,2009). Joe Strauss isn't even on the NARAL Abortion Issues list.  Neither did he try to obstruct votes on Pro-Life bills.  Votes for 3 Pro-Life bills were held in the House during his tenure.  If he is guilty of anything, it is by being Neutral in this contentious issue.

Two very conservative Republicans are challenging Strauss for the Speaker position, Warren Chisum R-Pampa and Ken Paxton R-McKinney.  They feel the strong Tea Party showing in Texas has given them the mandate to challenge Strauss.  Strauss is an establishment Republican, and as we all know by the recent election, the Tea Party hates the establishment. 

But, no matter who the Speaker of the House is, he will have to deal with a budget shortfall some are estimating at as high as $25 billion, not a job I would want to have!

Tuesday, December 7, 2010

Bexar Met, Financially Strong?

Bexar Met has been touting their "A" Bond rating, saying that Standard and Poors has found them financially fit.  However, Standard and Poors begs to differ.  They say the "A" rating was given along with a negative outlook.  Bexar Met is facing a bill in the legislature this legislative session that would dissolve the utility and eventually move its customers over to other more viable utilities such as SAWS.  Other utilities would be willing to take on Bexar Met debt because the utility has water rights to 90,000 acre feet of water but only uses half of it.

The Bexar Met board was definetely exaggerating its worth by claiming that all rate payers in the district would have to be compensated and it would make them instant millionaires.  But any utility that takes over Bexar Met will have to put in a large capital investment in order to upgrade facilities, some of which are in pretty bad shape.  Also the utility has been bleeding money and has a lot of debt, creditors would have to be paid off first.  More than likely rate payers would rather be guarenteed to have water than to have all the Bexar Met facilities sold off to the highest bidder.  So if you're in Bexar Met, don't expect to see any million dollar payouts.

Monday, December 6, 2010

SA2020--Your Chance to Shape the Future

The next SA2020 Forum, What Does Success Look Like, is this Wedsnesday, December 8, 2010 at St. Mary's Bill Greehey Arena.  Click here to register.  This is the fourth meeting and if you haven't had the chance to participate yet, now's your chance.  Let SA's leaders know what YOU want San Antonio to look like in 2020.

Wednesday, December 1, 2010

Smart Growth Around America

I'm still on jury duty, but I have time for a quick post.  I just added a new blog to the City Planning Blogs called Smart Growth Around America.  The title speaks for itself.  The blog was pointed out to me by an Urban Planner on Quora who pointed out that not only is regional planning for transportation mandated through the federal government through the Metropolitan Planning Organization (MPO) (an organization that exists in every urbanized area with 50,000 or more residents) but is also now being bolstered by a joint effort of Housing and Urban Development (HUD) and the Department of Transportation (DOT).  HUD and DOT have come together to offer $68 million for HUD's Sustainable Communities Challenge Grants and DOT's TIGER II Planning Grants.  According to a post by Smart Growth Around America
HUD’s Sustainable Communities Challenge Grants and DOT’s TIGER II Planning Grants are the latest examples of interagency federal programs that aim to create economically robust and sustainable communities through better transportation, housing and development coordination – helping communities make themselves even stronger through a more thoughtful use of every available dollar for their local economy.

“The partnership between these agencies is good for communities and allows federal funds to achieve multiple goals simultaneously,” said Geoff Anderson, President and CEO of Smart Growth America. “By looking at housing and transportation together, HUD and DOT can help regions move farther and faster to strengthen their local economies and create jobs.”
Over 1,700 communities applied for the grant money, but of course there was only so much to go around.
The city of Dallas and the North Central Texas Council of Governments (Arlington) each received a grant together totaling more than $2.8 million.  I will be keeping an eye on these projects to see how they progress.