Texas agencies use flair to keep funds
Officials tread narrow path when talking about budgets with politicians.
Studying state budget documents is usually a reliable way to promote a deep and restorative sleep. Unless you’re scanning the latest appropriations request from the Texas Department of Public Safety, which is more likely to produce night sweats.
The document outlines the agency’s proposed spending for the fiscal years 2018 and 2019, a period Director Steven McCraw warned could be particularly perilous for Texans. During that time, 900 “high-risk criminals” would go unarrested by DPS. Troopers would let 98 potential traffic scofflaws pass unmolested — every day.
Building security provided by the agency would become more porous, placing government
employees and elected officials at risk for their safety. Citizens seeking handgun licenses will suffer possibly dangerous delays.
The reason for the anticipated mayhem? Four months ago, state leaders instructed agencies to cut their budgets by 4 percent for 2018 and 2019. (Public education, border security and child protection were among a handful of services excluded from the mandate.)
The Department of Public Safety, whose trim would come to about $50 million, isn’t the only state agency foreseeing calamity in the downsizing. The Texas Lottery Commission has predicted a nearly $1 billion plummet in lottery sales if forced to reduce its spending. Responses in recent weeks from other departments juggling their figures have ranged
from belligerence to stoic acceptance.
Talking spending with politicians requires treading a narrow path. Directed to cut, agency bosses must not appear too compliant for fear of leaving the impression they were overfunded to begin with. Lawmakers also don’t like being assured in the fall that an agency is doing perfectly well with the money it has, only to learn later in spring hearings that a cash shortage has rendered it incapable of performing its work.
“Sometimes, managers will get yelled at for not being frank enough,” said Eva DeLuna Castro, a budget analyst for the Center for Public Policy Priorities.
Yet push back too hard by predicting a falling sky, and elected officials can come down just as hard. “It’s like, ‘Come on, guys; give me a break,’ ” Talmadge Heflin, a former state representative from Houston who chaired the House Committee on Appropriations, recalled thinking more than once. “‘What’s the real picture here?’ ”
For aficionados, the between-the-lines information contained in so-called legislative appropriations requests can make for intriguing and occasionally revealing reading. “Budgets are very political documents,” said Dale Craymer, president of the Texas Taxpayers and Research Association.
They may, for example, reveal which agency leaders feel secure — or temporary — enough to publicly stare down legislative leaders. By the end of his 14-year tenure as governor, Rick Perry had appointed the heads of virtually every state agency, and they were likely to respond agreeably to his spending directives.
Perry named Mike Geeslin commissioner of the Texas Department of Insurance in 2003. Asked to anticipate a 10 percent cut ahead of the 2011 legislative session, however, Geeslin was surprisingly colorful in his appropriations request.
“If you want to cut weight from a car, and you remove two of the tires and half the transmission, it ceases to work like a car,” he noted. Geeslin announced his retirement several months later as the lawmaking got under way, though he said there was no connection. “I always was candid with the Legislature,” he said. “You have to be.”
A calculated reaction
In one sense, the entire process of how the government decides to spend money is theater of the nerd, a public stage on which elected and appointed government leaders act out their roles.
“There is a lot of posturing,” said Heflin, now an analyst for the Texas Public Policy Foundation. “Most people know that. Whether they admit it or not.”
In addition to a spending assessment, budget documents can be read as a statement of direction and purpose to stakeholders — voters, but also state contractors, regulated entities, licensees. That includes the recent austerity directive itself.
In this year’s version, sent out June 30 under the signatures of Gov. Greg Abbott, Lt. Gov. Dan Patrick and House Speaker Joe Straus, analysts say the 4 percent cut was presumed to anticipate less petroleum revenue and account for a new law diverting money formerly included as general revenue to highway spending.
Yet the letter also contained a very-much-for-public-consumption statement of conservative principle that had little to do with the on-the-ground budgeting: “With your help, we can restrain the size and scope of government to ensure that employers are empowered to create more jobs that benefit hardworking Texans.”
Analysts expressed skepticism that the mandate will survive the upcoming session. Still, state agencies this summer dutifully assembled their 2018-19 appropriations requests to submit to the Legislative Budget Board, the agency that helps the Legislature prepare its spending plans. In recent weeks, managers have been answering questions from the board in public hearings.
The requests so far — some will be revised — have displayed a wide range of calculated reactions to the 4 percent haircut. The governor’s office, perhaps intending to set an example, briskly summarized its process. After “a thorough review of each program and the value of each dollar spent by the agency,” Abbott’s staff reported the “office strategically reduced four percent of the base appropriation levels of all programs equally.”
Other agencies favored a straight-ahead, you-askedfor-it approach. The Board of Professional Geoscientists, which regulates the occupation, reported that it could accommodate the 4 percent cut; its work simply would be done 10 percent slower.
The Texas Alcoholic Beverage Commission navigated a middle path — a low warning shot muffled with a silencer of conservative solidarity. The 4 percent cut means the agency “will not be able to absorb unexpected expenses without drastic consequences,” Chairman Jose Cuevas Jr. wrote, quickly adding: “However, the dedicated employees of the Texas Alcoholic Beverage Commission are committed to being fiscally responsible and accountable.”
Tensions between an agency and the Legislature can, like a black hole, tug and shape an appropriations request. “There are definitely things you can intuit,” said Sherri Greenberg, a former state representative now teaching at the Lyndon B. Johnson School of Public Affairs.
Just months past a contentious standoff with anti-gaming legislators over historic racing, the Texas Racing Commission’s spending plan noted that if its budget came up short, it was legally empowered to recoup its regulatory costs by charging more to politically active racetrack owners. “If no alternative funding is enacted ... the agency will exercise its authority to raise the funds necessary to cover the requested appropriations.”
Washington Monument gambit
Perhaps mindful of its own recent high-profile clashes with lawmakers — and its underachieving football team — the University of Texas’ appropriations request barely references the 4 percent reduction mandate. The No. 8-ranked Aggies were bolder, touting the school’s fiscal discipline and declaring that the “reduction would have significant negative consequences at Texas A&M University.”
Inciting anxiety is a time-honored tactic to deflect cuts — part of a larger passive-aggressive strategy known as the “Washington Monument gambit” or “firemen-first principle.” The idea, explained Greenberg, who keeps a list of such methods for her classes, is to intentionally identify a beloved or seemingly essential service as an austerity victim, with the goal of generating enough public pressure to persuade politicians to restore the money. Some claims might be truer than others.
In its request, the Texas Commission on Law Enforcement, which oversees licensing and education for police, subtly wondered about the connection between a budget reduction and the protests that have rocked communities after police shootings.
“The cuts come at a time when law enforcement is under great scrutiny, and quality training is more important than ever,” Executive Director Kim Vickers wrote. “We are concerned for the potential that more licensees will have a harder time completing their continuing education, or worse, for insufficient training to lead to interactions with the public that better training could have improved.”
The Texas Department of Criminal Justice, which manages the state’s sprawling prison system, said lopping 4 percent off its spending would force it to mothball a lockup and cut 2,000 employees. That “will likely increase recidivism, cause significant growth in the prison population” and imperil “both supervision in the community and security within our institutions,” Executive Director Bryan Collier predicted.
Street violence might be frightening. But little is scarier to politicians than a threat of having to produce more money. The Texas Lottery Commission, which enjoyed a record-breaking $5 billion in sales last year, said one of the places from which it had to trim the 4 percent from its budget was its contract with the company that prints scratch-off tickets, the main source of its revenue — meaning fewer of them to sell.
The agency’s prediction: $900 million in lost lottery sales — a nearly $200 million hit to Texas schools, which get most of the proceeds. The obvious way to remedy such a financial disaster, the agency suggested: Quickly restore the money.