STATE of TEXAS HOUSE of REPRESENTATIVES

GARNET F. COLEMAN STATE REPRESENTATIVE DISTRICT 147

May 26, 2011 The Honorable Susan Combs Comptroller Post Office Box 13528 Austin, TX 78711 Dear Comptroller Combs: A balanced budget is one of the tenets of state government, and I question whether or not the proposed budget written by the Texas House of Representatives and Texas Senate meets that constitutional requirement. I bring this to your attention because Article 3, Section 49a(b) of the Texas Constitution requires the Comptroller of the State of Texas to certify that for all appropriations bills passed by the Texas Legislature, “the amount appropriated is within the amount estimated to be available in the affected funds.” Governor Rick Perry, Lieutenant Governor David Dewhurst, and Speaker of the House Joe Straus have released statements announcing a budget deal. Yet, reports on the ongoing budget negotiations suggest that as much as $4.8 billion in Medicaid expenses could go unfunded by the Legislature. As we begin our final week of session, I am requesting any guidance your office can provide on how you will determine whether the state budget is balanced or not. Specifically, I seek responses to the following questions: 1. Will you evaluate the combined revenue and expenses of all major pieces of legislation regarding the state’s fiscal matters, not just the primary budget bill (House Bill 1), in determining whether or not Texas has passed a balanced budget? The Legislature is deliberating numerous “fiscal matters” bills that have consequences on our state’s finances for FY 2012-13. In 2003, the last time Texas faced a massive budget shortfall, Comptroller Carol Keeton Strayhorn determined that the budget was a “’patchwork’ piece of legislation that depends on several other bills to determine some of the spending” for the FY 2004-2005 budget. (Source: Associated Press, “Strayhorn criticizes lawmakers for 'smoke and mirrors' budget,” June 5, 2003). P.O. BOX 2910 - AUSTIN, TEXAS 78762-2910 - (512) 463-0524

Which, if any, bills other than House Bill 1 do you anticipate your office evaluating in order to determine whether or not you will certify the Texas budget? 2. Will you certify $4.8 billion in Medicaid expenses if they are not paid for with revenue Texas can identify in its budget? Wayne Pulver, an assistant director at the Legislative Budget Board, stated before the Texas House Committee on Appropriations on Monday, May 16 that, “it is our estimate that with these funding decisions, the bill is short $4.8 billion in general revenue.” (Source: Associated Press, “Texas budget plan kicks Medicaid funding problem down the road,” May 21, 2011.) It is your intention to certify the Texas budget as balanced, even if we are budgeting to pay for something we do not have the money to pay for? 3. If you cannot certify the $4.8 billion in Medicaid expenses, will you send the budget back to the House in which it originated to ensure Texas passes a balanced budget? In 2003, Comptroller Carol Keeton Strayhorn refused to certify the state’s budget because it spent $186.9 million more in the FY 2004-2005 biennium than the state could count as available revenue. Governor Rick Perry, under a special provision inserted by budget writers, was able to use line-item veto authority to cut expenditures in the budget by $186.9 million. Comptroller Strayhorn was then able to certify the budget. However, the current $4.8 billion shortfall in Medicaid expenses is over twenty-five times the size of the 2003 budget shortfall Comptroller Strayhorn originally did not certify. It is my request that, provided you do not certify the $4.8 billion in Medicaid expenses that remain unaccounted for in any legislation being considered by the Texas Legislature, you do not send the budget to the Governor to balance the budget. It is our duty, as legislators, to pass a balanced budget. Should you determine that the budget is not balanced, I would request that you send it back to the House in which the budget originated, as prescribed by Article 3, Section 49a(b) of the Texas Constitution: When the Comptroller finds an appropriation bill exceeds the estimated revenue he shall endorse such finding thereon and return to the House in which same originated. With only days remaining until the end of the Regular Session of the 82nd Texas Legislature, I remain gravely concerned about the smoke-and-mirrors accounting being used by Governor Rick Perry, Lieutenant Governor David Dewhurst, Speaker of the House Joe Straus, and other key budget negotiators. In addition to the $4.8 billion in unaccounted Medicaid expenses outlined above, the current budget proposal relies on $700 million in waivers the state is not likely to receive. The proposed budget defers payment on $2.2 billion for the Foundation School Program, and does not put a single dollar towards enrollment growth in our public schools.

P.O. BOX 2910 - AUSTIN, TEXAS 78762-2910 - (512) 463-0524

Relying on debt, deferrals, and delays to solve our state’s budget process is irresponsible. Passing a balanced budget is the only requirement of the Texas Legislature. I respectfully appreciate your response to these questions, in order to help my colleagues and I determine whether the budget we will likely be asked to vote on in the final week is balanced, or – as I and others are starting to fear – if the unbalanced budget is in violation of our state’s constitution. Sincerely,

State Representative Garnet F. Coleman District 147

P.O. BOX 2910 - AUSTIN, TEXAS 78762-2910 - (512) 463-0524