LEGISLATIVE UPDATE January 20, 2017

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1 LEGISLATIVE UPDATE January 20, 2017 STATEWIDE: Texas Ethics Commission On January 17 th, the Texas Ethics Commission announced the appointment of Seana Willing as its new executive director. Ms. Willing will assume the office on February 13, 2017, following the retirement of Natalia Luna Ashley as executive director on December 31, For the past 13 years, Ms. Willing has served as executive director of the State Commission on Judicial Conduct, and previously served the agency as general counsel and commission counsel. Ms. Willing has also served the State Bar of Texas as assistant disciplinary counsel. Ms. Willing is an attorney. She received a juris doctor from St. Mary s University School of Law, and a bachelor s degree in economics from the College of the Holy Cross in Worcester, Massachusetts. Ethics Commission Chair Chase Untermeyer said, As much as we regret losing the superb services and deep knowledge of Natalia Ashley, the Commission welcomes Seana Willing as our new executive director with every confidence in her leadership. Texas Ballot Integrity Act On January 17 th, Senator Paul Bettencourt (R-Houston) and Senator Eddie Lucio Jr. (D-Brownsville) filed SB 488, the Texas Ballot Integrity Act. Senator Bettencourt said, It s intent is to prevent local governments from misleading voters at the polls with deceptive ballot language, spending taxpayer money to ignore lawfully collected petition signatures, and suppressing petitions signed by those they are sworn to represent. SB 488 would: Require clear ballot language that accurately defines the proposition being placed before voters; Allow a court to rewrite ballot language if the court finds that the language is inaccurate; Create a standard form for use by residents for referendum or recall petitions; Clarify restrictions on who may collect signatures; Create a "rocket docket" for expedited court review of ballot language to prevent the delay of local initiatives; and Allow prevailing parties to have access to legal fees. Senator Bettencourt added, This bill will get city officials to follow the law. In the past, city officials have openly ignored their duties in regards to lawfully collected petitions... After hearing testimony from multiple citizens in multiple cities on multiple problems leading to multiple Supreme Court rulings, it became apparent that we needed to file this bill. Senator Eddie Lucio, Chair of the Senate Intergovernmental Relations Committee added, SB 488 will set a uniform process for local ordinance elections that will protect the integrity of citizen-driven petitions and referendums by providing home-rule municipalities a specific process to propose charter amendments, local initiatives or bond obligations.

2 Child Protective Services On January 17 th, Representative Kevin Roberts (R-Houston) filed HB s 871 and 872, which are intended to incentivize local faith-based groups and non-profit organizations to promote prevention and early intervention programs through increasing access to services for families in crisis like counseling and parenting classes. HB 872 would allow local organizations to accept volunteer custody of the child during the Child Protective Services (CPS) review process as opposed to the child being sent to foster care. Both pieces of legislation are designed to help create more options when it comes to voluntary guardianship and keeping children out of group homes, while giving families the tools they need to prevent abuse and neglect. Representative Roberts said, It is unacceptable that the children of Texas are being kept in such poor conditions, that a judge has told us rape, abuse, psychotropic medication and instability are the norm in the system. It is time for Texans to rally around our kids and show them that they are valued, that they are important, and that they loved. This is a time when all options need to be on the table, and I am confident that the faith-based community will rise up to the challenge that our state faces and be a part of the solution. Both bills are based on recentlypassed legislation in Indiana, which has been shown to improve outcomes for both children and families. GOVERNOR: Texas Racing Commission On January 13 th, Governor Greg Abbott named John Steen, III presiding officer of the Texas Racing Commission. The commission oversees pari-mutuel wagering on horse and greyhound racing. John Steen, III of Houston is vice president of business development for Sage Midstream. He is a chartered financial analyst and a past gubernatorial appointee on the State Board of Dental Examiners. Steen received a Bachelor of Arts in economics from Vanderbilt University, a Master of Business Administration from the Wharton School of Business at the University of Pennsylvania and a Master of Arts in international studies from the University of Pennsylvania. Network of Nurture Initiative On January 13 th, Texas First Lady Cecilia Abbott and Department of Family and Protective Services (DFPS) Commissioner Hank Whitman sent a letter to faith partners across Texas asking them to join with them help provide support to youth and families through the Network of Nurture Initiative, which was established by the First Lady and DFPS to help to find loving homes, educate parents, and provide support for the youth in foster care by promoting a partnership between DFPS and faith partners in Texas communities. The joint letter to pastors and faith partners said, The new year brings new hope for health, happiness and prosperity, and resolutions to spend more time enjoying friends and most importantly, family. While not everyone feels called to foster or adopt a child in need, we are all called to do something for this vulnerable population. As you start planning your programs for the new year, please consider becoming a part of a network of nurture that provides support to youth and families in the child welfare system. The letter suggested ways that faith partners and their members can help including: Survey your members to see how many foster and adoptive families are a part of your congregation that may need support. Encourage members to provide support services to foster and adoptive parents, such as babysitting or providing meals. Mentor an older youth transitioning out of the foster care system through ministries such as The Open Table, a faith-based model that congregations use to create community and

3 transformation. Donate diapers, clothing, school supplies, car seats, cribs and beds, or volunteer to help sort items at a CPS Rainbow Room. Consider joining the CarePortal or Orphan Care Solutions, online portals that allow congregants to fulfill requests for goods and services requested by a CPS caseworker or family member. Participate in Blue Sunday, a national day of prayer for abused and neglected children that is typically held on the last Sunday in April. BILL COUNT: Nearly 1,200 House Bills and Joint Resolutions have been filed, and over 500 Senate Bills and Resolutions. The bill filing deadline is March 10, SENATE: This was a short week for the Texas Senate due to the Martin Luther King, Jr. state holiday on Monday and Senate leadership travelling to Washington DC for the Presidential inauguration festivities starting on Wednesday. The Senate met briefly on Tuesday and Wednesday to conduct routine business. As President Pro Tempore, Senator Kel Seliger presided over the Senate on Wednesday. Just one week after being sworn in as the President Pro Tempore of the Senate, Seliger became acting governor because both Governor Greg Abbott and Lt. Governor Dan Patrick are out of the state. Senate Committees Lt. Governor Dan Patrick announced Senate Committee assignments on Wednesday. About the assignments, Patrick said, These committee assignments reflect the proven leadership, commitment, expertise and solid work ethic of the thirty-one senators who have been elected by the people of Texas to represent them. The appointments call on all senators, including freshmen, in both political parties to play a significant role. Moving forward from today, we know that the hours are long and the work is difficult, but I am confident we have the committee leadership in place to get the job done for the people in Texas. Senate Committee chairs and new members include: Administration Chair-Lois Kolkhorst (R-Brenham). New members include not only the Chair, but also the Vice Chair, Konni Burton and new members Bryan Hughes, Robert Nichols and Judith Zaffirini. Agriculture, Water and Rural Affairs Chair-Charles Perry (R-Lubbock). Senator Jose Rodriguez, a previous committee member, moved up to Vice Chair. The only new member is Borris Miles. Business and Commerce Chair-Kelly Hancock (R-North Richland Hills). There are four new members Donna Campbell, Craig Estes, Robert Nichols, and Judith Zaffirini. Criminal Justice Chair-John Whitmire (D-Houston). The committee has three new members Brian Birdwell, Sylvia Garcia, and Bryan Hughes. Education Chair-Larry Taylor (R-Friendswood). There are three new members Bob Hall, Bryan Hughes, and Carlos Uresti. Finance Chair-Jane Nelson (R-Flower Mound). Brian Birdwell is the only new member of the Senate Finance Committee. Health and Human Services Chair-Charles Schwertner (R-Georgetown). Carlos Uresti moved up to Vice Chair. There are four new members Dawn Buckingham, Konni Burton, Borris Miles, and Kirk Watson.

4 Higher Education Chair-Kel Seliger (R-Amarillo). There are two new members Dawn Buckingham and Larry Taylor. Intergovernmental Relations Chair-Eddie Lucio, Jr. (D-Brownsville). The two new members are Don Huffines and Van Taylor. Natural Resources and Economic Development Chair-Craig Estes (R-Wichita Falls). Judith Zaffirini moved up to Vice Chair. Six of the eleven committee members are new to the committee Konni Burton, Sylvia Garcia, Don Huffines, Borris Miles, Jose Rodriguez, and Van Taylor. Nominations Chair-Brian Birdwell (R-Granbury). Kirk Watson moved up to Vice Chair. Four of the seven members are new Dawn Buckingham, Jose Menendez, Borris Miles, and Van Taylor. State Affairs Chair-Joan Huffman (R-Houston). There are two new members Bryan Hughes (Vice Chair) and Eddie Lucio. Transportation Chair-Robert Nichols (R-Jacksonville). Bob Hall moved up to Vice Chair. There are four new members Brandon Creighton, Juan Chuy Hinojosa, Charles Perry, and Jose Rodriguez. Veteran Affairs and Military Installations Chair-Donna Campbell (R-San Antonio). There are three new members Don Huffines (Vice Chair), Dawn Buckingham, and Carlos Uresti. Facts About Senate Committees: Number of Committees The number of Senate committees remains 14. The one standing subcommittee, the Veteran Affairs and Military Installations Committee s Subcommittee on Border Security, was eliminated. Republican Committee Chairs In 2015, and again for 2017, Republicans chair(ed) 12 of the Senate s 14 committees. Democratic Committee Chairs In 2015, Democrats chaired two of the Senate s 14 committees Eddie Lucio, Jr. (Intergovernmental Relations) and John Whitmire (Criminal Justice). Those chairs remained the same. Carry-over Committee Chairs During the interim, Lt. Governor Dan Patrick appointed Senator Kelly Hancock as Chairman of the Senate Business and Commerce Committee, replacing Senator Kevin Eltife, who did not seek re-election. Also during the interim, Senator Craig Estes was appointed to replace Senator Troy Fraser as chair of the Natural Resources & Economic Development Committee. All of the previous committee chairs, including the interim appointments of Senators Hancock and Estes were carried forward as chairs for the 85 th Session. The only new appointment was Senator Lois Kolkhorst (R-Brenham) as the Senate Administration Committee Chair. Protective Vests for Police On January 12 th, Senator Royce West (D-Dallas) filed SB 12 providing protective vests for police officers. SB 12 is an announced priority for Lt. Governor Dan Patrick who said, "Last year, Texas had more law enforcement officers die in the line of duty than any other state in America. Families were shattered by senseless tragedies - some of which could have been prevented if these law enforcement officers had been outfitted with protective vests capable of stopping high-caliber bullets. I have made it a priority this legislative session to give all Texas officers on patrol bulletproof vests that can withstand rifle rounds. I commend Senator West for filing this important bill to help protect our brave men and women in law enforcement who risk their lives every day to protect us. The least we can do for the families of our police officers is to make sure that when they leave home to protect our communities they have the best protection possible."

5 HOUSE: The House was in session briefly on Tuesday, and Wednesday this week conducting routine business. House Republican Caucus On Tuesday, Representative Tan Parker of Flower Mound was reelected by his Republican colleagues to serve as the Chairman of the Texas House Republican Caucus for the two-year duration of the 85th Legislature. Chairman Parker said, Over the past two years I have been humbled and honored to serve the Republican majority in the Texas House during the critical 84th Legislative Session. We accomplished many remarkable conservative victories. Looking ahead, I am confident the caucus will further conservative policies that cultivate our Texas values of limited government, fiscal responsibility, and personal liberty. Other caucus officers include Representatives Cindy Burkett of Sunnyvale, Vice Chair; John Raney of College Station, Secretary; and Dan Huberty of Humble, Treasurer. BUDGET: Senate Budget On Tuesday, Senator Jane Nelson, R-Flower Mound, filed SB 1, the Senate's base budget, establishing the Senate's funding priorities for the next two years. (Note: On Wednesday, Senator Nelson was re-appointed chair of the Senate Finance Committee.) Senator Nelson said, "This base budget is a starting point, and I look forward to working with my colleagues to develop a balanced budget that addresses our needs and strengthens our economy. While we will need to prioritize and make efficient use of our resources, I am confident we can meet the challenges ahead. Last week, the Texas Comptroller issued his Biennial Revenue Estimate, indicating that the Legislature will have $104.9 billion available for the FY budget. SB 1 allocates $103.6 billion, including additional resources for transportation, Child Protective Services and other priorities. Senator Nelson provided a summary of SB 1 indicating that it: Continues the current funding formulas for both public education and higher education; Adds $2.65 billion to cover student enrollment growth, which is projected to be more than 80,000 per year over the next two years; Increases the education instructional materials allotment by $29.6 million; Provides an additional $32 million for high quality pre-kindergarten; Continues funding at current levels for Communities in Schools; Includes $5 million for Pathways in Technology Early College High School (P-TECH), a new program designed to help students pursue careers in technology; Provides $10 million to support Education Commissioner initiatives; Maintains current funding levels for Texas major financial aid programs for public institutions of higher education, including TEXAS Grant; Adds $44.1 million for Graduate Medical Education with the goal of ensuring that residency slots are available for Texas medical school graduates; Dedicates approximately $5 billion for transportation in accordance with Proposition 7; Adds $260 million to address the critical needs of Child Protective Services; Provides a $1 billion commitment to improve the state hospital system and address other state facility needs; Includes $63 million to eliminate waitlists for community mental health services; Keeps funding for women s health programs at current levels; Maintains veterans' services and the Texas Veterans + Family Alliance, a $20 million grant program to assist veterans struggling with post-traumatic stress and other mental health issues;

6 Fully funds the Cancer Prevention & Research Institute; Maintains the additional $800 million for border security approved last session; Includes $25 million for high caliber bullet-proof vests to protect Texas peace officers; Directs the Department of Information Resources to study the state s vulnerability to cyberattacks. Eliminates one-time expenditures from the previous budget. Includes many agency recommendations for 4% savings. Reduces funding for non-educational higher education initiatives. Calls for a 1.5% across-the-board budget reduction, exempting the Foundation School Program. Senator Nelson discussed challenges the Senate will face due to declining oil revenue and growing needs including: Structuring our school finance system to better meet the needs of students; Skyrocketing health care costs in Medicaid, the Teacher Retirement System, the Employee Retirement System and correctional managed care; and Addressing mental health needs of the state, including infrastructure and capacity challenges within the mental health state hospital system. Senator Nelson concluded, We have difficult decisions to make this session, and we will work tirelessly to address the needs of the state in a responsible manner. About her re-appointment as Senate Finance Committee Chair on Wednesday, Nelson said, "Just as any household or business, state government must live within its means. We will craft a responsible, compassionate budget that addresses our priority needs and keeps the economy growing. I am honored to serve the Texas taxpayers in this capacity and ready to work." Lt. Governor Dan Patrick commented on SB 1 saying, This budget is well within the available revenue and upholds our commitment to continue to live within our means and not spend more than the growth of our population times inflation. SB 1 fully funds the estimated 80,000 students per year in population growth and leaves aside money for emergency appropriations including the Department of Family and Protective Services (DFPS). It maintains $800 million for border security, which will allow for an additional 250 troopers by the end of the biennium and the $5 billion increase in transportation funding authorized last session by Proposition 7. SB 1 also improves the transparency of state government by providing more program-level information. I know I speak for the people of Texas in thanking Chairman Nelson for her hard work in drafting this budget and the continued efforts she and the Senate Finance Committee will put forward as we begin the budget process. House Budget On Tuesday, House Speaker Joe Straus announced the House budget, which will be HB 1 but has not yet been officially filed. It will be filed by the Chair of the House Appropriations Committee after committee assignments are announced in the House. Speaker Straus said, The House budget puts additional resources into public education, child protection and mental health while increasing state spending by less than 1 percent. We keep overall spending low while making investments in children and our future. We put an emphasis on public education, child protection and better mental health care. The Members of the House, beginning with the Appropriations Committee, will now have the chance to shape this budget and decide how best to allocate resources during an economic slowdown. This is the first step toward

7 producing a balanced budget that reflects the priorities of the Texas House and does not raise taxes. The Speaker presented highlights of the initial House budget, which includes: Public Education - The budget provides funding to pay for expected enrollment growth of about 165,000 students over the next two years. It also includes an additional $1.5 billion for public education that is contingent upon the passage of legislation that reduces recapture and improves equity in the school finance system. Child Protection - In December, the leaders of the House and Senate joined with Governor Greg Abbott to approve new caseworkers and investigators at Child Protective Services, as well as pay raises aimed at reducing employee turnover. Overall, the House budget provides $268 million to bring additional stability to the CPS workforce. Mental Health - The House budget increases funding for behavioral health by $162 million. The increase would allow the Legislature to eliminate wait lists for mental health services and implement recommendations of the House Select Committee on Mental Health, including early identification efforts, jail diversion programs and local collaborations to expand capacity of mental health treatment facilities. The increase also provides funding for the treatment of Post Traumatic Stress Disorder among Veterans. General Revenue - The initial House plan appropriates $108.9 billion in General Revenue. It reduces funding for administrative costs and discretionary programs across state agencies. It also eliminates one-time funding provided by the last Legislature, such as completed capital and information technology projects. It also includes cost-containment efforts to reduce spending in Medicaid by $100 million. Speaker Straus concluded, The House will have a productive debate about where to go from here. I m confident that the end product will put more dollars in the classroom, protect children and keep this state on sound fiscal footing. Representative John Zerwas, who is a member of the Legislative Budget Board, commented on the House budget proposal saying, "The House budget reflects the priorities of this state, including addressing the mental health crisis and continued financial support of the foster care system and public education. This bill is a starting point that requires the Legislature to have real discussions about the tough policy choices that face the state of Texas. Texas deserves a budget that reflects its needs and priorities, but that also respects the use of taxpayer dollars. I am confident that under House leadership, a conservative budget that addresses the needs of our state will be achieved. Budget Comparison Based on Legislative Budget Board summaries, the Senate and House budget proposals reflect different priorities but also have several recommendations that are the same. Below is a comparison by major funding area. Foundation School Program The Senate budget includes $34.1 billion in General Revenue Funds (GR) and $42.4 billion in All Funds. That compares to the House s $35.6 billion in GR and $43.9 billion in All Funds. Both bills provide a $1.5 billion (3.5 percent) increase in Other Funds, attributable to projected increases in revenue from the Property Tax Relief Fund and from recapture payments and a corresponding decrease in GR. The House bill provides an increase of $1.5 billion in funding for the Foundation School Program (FSP) over the amount estimated to be required to fund the current law FSP entitlement, contingent on the passage of legislation to

8 reform the school finance system in a manner that improves equity, reduces recapture, and increases the state share of the FSP. Medicaid The Senate bill provides $61.2 billion in All Funds, including $24.9 billion in GR. The House bill includes $65.1 billion in All Funds, $26.8 billion of which is GR. Both bills have $0.2 billion in General Revenue-Dedicated Funds (GR-Dedicated). The Senate version is a reduction of $0.8 billion in All Funds, which includes a reduction of less than $0.1 billion in GR. The House bill provides an increase of $0.9 billion in All Funds, including a $0.7 billion increase in GR. That amount assumes supplemental funding to complete fiscal year 2017 expenditures. The Senate budget does not assume supplemental funding for fiscal year Transportation Senate and House bills provide the same amount of funding for transportation, which is $28.2 billion in All Funds, including $5 billion from anticipated state sales tax deposits to the State Highway Fund (SHF), which was approved by the voters in 2015 as Proposition 7, $2.2 billion in funding from oil and natural gas tax-related transfers to the SHF, and all available SHF from traditional transportation tax and fee revenue sources (estimated to be $8.6 billion). Both bills include $24.7 billion in All Funds for highway planning and design, right-of-way acquisition, construction and maintenance; and $2.3 billion in All Funds for debt service and other financing costs. Behavioral Health The Senate bill includes $3.4 billion in All Funds including $2.7 billion in GR/GR-Dedicated for non-medicaid behavioral health services. The House bill includes $3.5 billion in All Funds including $2.8 billion in GR/GR-Dedicated for non-medicaid behavioral health services. Both bills include $95.6 million in All Funds, $62.6 billion of which are GR to address current and projected waitlists for community mental health services for adults and children. Child Protective Services Both bills provide $3.2 billion in All Funds, including $1.9 billion in GR for Child Protective Services functions at the Department of Family and Protective Services, an increase of $260.1 million in All Funds and $310.6 million in GR over the base. Higher Education Both bills provide higher education formula support of $7.2 billion in GR and $1.5 billion in statutory tuition in GR-Dedicated. The Senate bill represents a decrease of $74.1 million in GR and an increase of $144.4 million in GR-Dedicated (statutory tuition). The House bill represents a decrease of $33.5 million in GR and an increase of $145.7 million in GR-Dedicated Funds (statutory tuition). The House bill maintains current formula funding and adds funding for two new medical schools. The Senate bill maintains current formula funding for all formulas except the Graduate Medical Education formula. The House bill contains funding for infrastructure support at two new Texas State Technical Colleges created by the 84 th Legislature (Texas State Technical College North Texas and Texas State Technical College Fort Bend County). The Senate bill decreases special items funding by $800 million but provides $20 million for two behavioral health special items at The University of Texas Health Science Centers at Houston and Tyler. Adult Incarceration The Senate bill provides $6.7 billion in All Funds, including $6.6 billion in GR/GR-Dedicated for the incarceration, probation and parole of adult offenders in the Texas Department of Criminal Justice, a decrease of $89.7 million including a $60 million decrease for deferred maintenance, a $10 million decrease for video surveillance cameras, and a $13.1 million decrease for the closure of an Intermediate Sanction Facility. The House bill provides $6.8 billion

9 in All Funds, including $6.6 billion in GR/GR-Dedicated, a decrease of $49.7 million including a $20 million decrease for deferred maintenance. It also includes the same decreases as the Senate for video surveillance cameras and a Intermediate Sanction Facility. Border Security The Senate bill provides $800 million in state funds for border security including $732.6 million to the Department of Public Safety (DPS), $490.4 million of which is for the Secure Texas line item. The House bill provides $663.2 million in state funds for border security including $595.8 million, $353.7 million of which is for the Secure Texas line item. Both bills provide $242.2 million to fund other border security functions in the DPS budget. Teacher Retirement and Health Benefits Both bills provide $1 billion in All Funds for the state contribution to retirement benefits of the Teacher Retirement System. The funding reflects a state contribution rate of 6.8 percent of employee payroll in each year of the biennium. It assumes an annual payroll growth rate of 3.5 percent for public education and 2.9 percent for higher education in each fiscal year. Retiree health insurance funding includes $747.6 million in GR, which provides a statutorily required state contribution to TRS-Care of 1 percent of public education payroll. Neither bill addresses the $1.3 billion shortfall in TRS-Care. State Employee Retirement Benefits The Senate bill has $1.3 billion in All Funds including $980.2 million in GR/GR-Dedicated for the state contribution to the Employees Retirement System retirement program. That reflects an increase of $30.5 million in All Funds, $32.2 million in GR/GR-Dedicated. The House bill provides $1.3 billion in All Funds including $976.7 million in GR/GR-Dedicated, which reflects an increase of $27 million in All Funds and $28.8 million in GR/GR-Dedicated. Both bills provide for a 9.5 percent state contribution rate. Debt Service Both bills fully fund debt service for a total of $4.3 billion in All Funds, a decrease of $280.1 million or 6.1 percent from the current biennium. Across-The-Board Reduction The Senate bill contains a 1.5 percent across-the-board reduction in all GR appropriations with the exception of the Foundation School Program. There is no equivalent provision in the House Bill. Economic Stabilization Fund Neither bill includes an appropriation from the Economic Stabilization Fund, which is estimated to be $11.9 billion at the end of the 2019 fiscal year. All Funds The Senate bill contains $ billion in All Funds and $103.6 billion in GR/GR- Dedicated Funds, a $3.25 billion (3 percent) decrease from the current biennium. The House bill contains $ billion in all funds and $ in GR/GR-Dedicated, a $822.1 million (0.8 percent) increase over the current biennium. Last week Comptroller Glenn Hegar estimated the state will have $104.9 billion in available GR/GR-Dedicated funds available for spending in the upcoming biennium. The Senate bill is $1.3 billion below the Comptroller s biennial revenue estimate (BRE), while the House bill is almost $4 billion above the BRE. Professional Licensing Fees On Tuesday, Representative Cindy Burkett (R-Sunnyvale) filed HB 1055, which would prohibit state agencies from increasing professional licensing fees and returns this authority to the Texas Legislature. Representative Burkett said, "It is impossible to conduct business without having to pay mandatory licensing fees if you are a barber, athletic trainer, dietician, realtor, or any of the other professions that are regulated by the state. In some

10 cases there is little to no stability in these rates, and Texans are left with no recourse. Not only do these mandatory fees present a barrier to employment, but they are arbitrarily set by unelected bureaucrats who are not accountable to the people being forced to pay the fee. HB 1055 adds transparency and accountability to professional licensing fees by providing citizens a voice through their elected representatives. In order to increase a fee, an agency would have to request permission from the Texas Legislature and defend any proposed increased. Next Week: The Senate Finance Committee has posted meetings for Monday-Friday next week. On Monday, January 23, 2017, they will meet at 11:00 a.m. in the Senate Finance Committee Room (E1.036) for an organizational meeting. They will meet on Tuesday, January 24 th, Wednesday, January 25 th, and Thursday, January 16 th at 9:00 a.m. in the Senate Finance Committee Room to take up institutions in Article III (Education). If necessary to complete pending business, the committee will also meet on Friday, January 27 th at 9:00 a.m. ENVIRONMENT: Texas Emissions Reduction Plan On Wednesday, Senator Craig Estes (R-Wichita Falls), Chairman of the Senate Natural Resources and Economic Development Committee, filed SB 26, which would renew and expand the Texas Emissions Reduction Plan (TERP). TERP is the State's program for lowering tropospheric ozone emissions to bring Texas into compliance with the national ambient air quality standards issued by the EPA under the federal Clean Air Act. Chairman Estes said, "I believe this bill will mitigate the damage being done to Texas businesses by overreaching EPA regulations. Texas has significantly improved air quality over the last thirty years, and this bill will continue that progress without damaging our economy." TERP is comprised of fourteen different programs: eight offer incentives to convert or replace dirty engines with cleaner ones, three promote energy efficiency, and three fund air quality research and monitoring. Five of the incentive grant programs are designed to encourage the use of vehicles fueled by alternative fuels that generally have fewer tailpipe emissions than gasoline and diesel. These alternative fuel programs are set to expire in 2017 and 2018 if they are not renewed this session. The remainder of TERP will expire in 2019 if not extended. Estes concluded, "I appreciate Lt. Governor Patrick prioritizing SB 26. We, as legislators, have a duty to ensure that our children, grandchildren, and future generations have both clean air and a strong economy. This bill keeps Texas on track to have both." Lt. Governor Dan Patrick commented on the filing of SB 26 saying, "SB 26 will give state agencies, local governments, and school districts the opportunity to dramatically reduce fuel costs while reducing mobile emissions. I commend Senator Estes for filing SB 26 and for his commitment to the effective use of natural resources across the state." HEALTH: Balance Billing On Tuesday, Senator Kelly Hancock (R-North Richland Hills) filed SB 507 to give more Texans recourse when they receive unexpected medical bills. Senator Hancock, who chairs the Senate Business and Commerce Committee said, "No Texan looks forward to visiting a surgical center or emergency room, but when that happens, hidden charges and surprise bills should be the last thing on their mind. Balance billing is common practice in the healthcare system. It occurs when patients are directly billed by a provider for the portion of medical expenses not covered by their insurance. Often times these bills are a shock to the patient. For instance, patients admitted to an in-network facility may unknowingly receive treatment from an

11 out-of-network doctor and wind up with a hefty bill. In 2009, I passed legislation establishing a Texas Department of Insurance (TDI) mediation system for consumers caught in this type of balance billing situation. Mediation is working for consumers when it is available. Specifically, SB 507 would: Expand mediation protections to consumers that have a PPO plan to address balance billing through mediation to all emergency providers and to all out-of-network providers working at a network facility. Allow mediation of balance bills from all types of out of-network providers treating patients at in-network hospitals and other facilities, including free-standing emergency departments. (Current law applies only to the six listed types of facility-based physicians: radiologists, anesthesiologists, pathologists, ER physicians, neonatologists and assistant surgeons). Allow mediation of balance bills for emergency care from any provider or facility of emergency care services, including freestanding emergency departments. Expand disclosure requirements regarding network status and balance billing by insurers, facilities and other health care providers including the requirement that the following statement be included on balance bills: This is a balance bill that may be eligible for mediation. Expand mediation protections to the Teachers Retirement System (Already applies to the Employee Retirement System). Texas Association of Health Plans, the statewide trade association representing commercial and public health plans operating in Texas, expressed support for SB 507. Jamie Dudensing, CEO of TAHP said, Home to the majority of the nation s freestanding ERs, Texas has become ground zero for the explosive growth of emergency care costs and rates of surprise medical billing. TAHP applauds Senator Hancock s efforts to better protect consumers against this growing trend, to require greater protections for consumers against surprise billing by freestanding ERs and other emergency care providers, and to ensure consumers have more options to challenge exorbitant, surprise medical bills often waiting for them in the mailbox after they ve been treated in an emergency situation. HIGHER EDUCATION: Tuition On Thursday, Senator Kel Seliger (R-Amarillo), Chairman of the Senate Higher Education Committee, filed two bills that he said would address the rising cost of tuition that outpaces what many Texas families can afford. SB 18 would eliminate the requirement for institutions of higher education to set aside a portion of tuition payments to be used for tuition assistance for qualified students. Chairman Seliger said, "The set aside discussion is just a small portion of the bigger discussion around the cost of higher education. The focus should be on how to make higher education more accessible and affordable, rather than how to get the state, and students, to pay more." SB 19 would freeze tuition and fees statewide at Texas public higher education institutions for the next four years. Chairman Seliger also filed SB 543. It would implement Performance Based Tuition, which requires institutions to meet certain performance metrics prior to increasing tuition. Chairman Seliger added, "Tuition relief and predictability is necessary for Texas students and families. SB 19 provides much needed stability for those planning to attend or attending college. Together with SB 543, we will have the opportunity to implement a long-term tuition reform solution which holds institutions accountable and ensures they remain accessible and affordable."

12 Lt. Governor Dan Patrick commented on the filing of SB s 18 and 19 saying, Senate bills 18 and 19 are critical to ensure higher education tuition and fees do not continue to outpace what hardworking Texans earn. Making college more affordable for all Texans continues to be one of my top priorities this Legislative Session. I commend Senator Seliger for filing these two bills that will help bring economic relief to students who pursue higher education. HUMAN RESOURCES/EMPLOYMENT: Minimum Wage On January 13 th, Representative Chris Turner (D-Grand Prairie) joined House and Senate colleagues and representatives from the Texas AFL-CIO to announce legislation aimed at increasing the minimum wage. Turner filed HB 924 and the accompanying HJR 56, which would give Texas voters the right to decide whether or not to raise the state's minimum wage to $10.10 an hour. Representative Turner said, "This is a good first step in the right direction to help Texas families make ends meet, but this is just a first step. Our current minimum wage of $7.25 an hour is nowhere near where it should be, and we need to do more to ensure Texans make a living wage so they can pay their bills and support their families." HB 924 and HJR 56 would let voters decide if Texas should join 29 other states and the District of Columbia in raising the minimum wage above $7.25. The Texas AFL-CIO presented research from the Texas Politics Project at the University of Texas, which indicated that most Texans would support raising the wage. Sixty-two percent of Texans favor an increase, and only 27 percent oppose it. Representative Turner concluded, "This legislation simply gives the voters a chance to have their voices heard. No legislator in the Capitol should be afraid to let the people decide if Texas families should be earning a living wage. Senator Jose Menendez (D-San Antonio) has filed the companion bills SB 229/SJR 22. Also on January 13 th, Representative Justin Rodriguez filed HB 954, which would allow counties and municipalities to establish a local minimum wage greater than the current federal minimum of $7.25. Representative Justin Rodriguez said, With the cost of living on the rise, a wage of $7.25 per hour impedes Texans' ability to prosper economically and stymies their purchasing power. Under current wage laws, many hardworking Texans are forced to take on more than one job to make ends meet and support their families. HB 954 would repeal the minimum wage preemption law passed in 2003, and restore localities ability to adopt higher wages. Additionally, it would require any private entity that enters into a contract or agreement with the county or municipality, to pay the respective minimum wage to its employees. Increasing the minimum wage should be a priority for everyone. It is common sense and long overdue. The people of Texas deserve better." Senator Jose Rodriguez has filed SB 427, the companion to HB 954. PRIVACY: Right of Access Act On January 18 th, Senator Van Taylor filed SB 515, the Right of Access Act, which is designed to ensure that elected or appointed officers of a state governmental body, county, city, or special district the right to access all information and property relating to the governmental body they serve. Senator Taylor indicated he filed SB 515 after conversations he had with local officials who expressed concern with bureaucracies preventing access to records the officials needed to effectively perform their duties and represent the people s interest. He said, "A government of the people cannot work unless elected officials have unfettered access to information within their jurisdiction. Elected officials should not be stonewalled or asked to jump through bureaucratic hoops to access information critical to their oversight and decision-making responsibilities. This transparency bill aims to protect the taxpayers and empower elected officials to do the job voters expect." The bill specifies that confidential information disclosed to an officer will remain

13 confidential, and that the governmental body may require that the requesting officer sign a confidentiality agreement including certain terms and conditions. PROCUREMENT: State Contracting and Cybersecurity On Thursday, Senator Jane Nelson (R-Flower Mound) filed two bills aimed at building on work from last session relating to state contracting and promoting cybersecurity within state agencies. Senator Nelson said, "SB 532 will help us better secure the sensitive data stored by our agencies and protect against cyber-attacks. SB 533 builds upon our contracting reforms from last session, bringing additional government functions under the enhanced oversight and strengthening oversight of information technology contracts." Cybersecurity - SB 532 would direct the Department of Information Resources (DIR) to assess each state agency's Information Technology (IT) security when making a major IT purchase. It would also require agencies not using Data Center Services (DCS) to consider cloud storage or a DCS for their data storage needs. And, it would require DIR to produce a report on state agency use of commercial cloud services along with the cost savings. State Contracting Oversight SB 533 would strengthen oversight of state contracting to ensure that state business with the private sector remains transparent, accountable and competitive by giving legislative leaders more oversight of major information. Specifically, SB 533 would: Give the Governor, Lt. Governor, and Speaker more oversight of major information resources projects; Add the Comptroller to the Quality Assurance Team (QAT); Require agencies to submit to the QAT a technical architectural assessment for major IT projects and contracts; Require agency project delivery frameworks to be recognized as a best practice for major information resources projects and contracts; Increase the cap on cooperative IT contracts from $1m to $5m; Clarify that agencies may communicate with the private sector; Lower the threshold for Contract Oversight Team review from $10 to $5m; and Bring contract oversight to Regional Education Service Centers. PROPERTY: Americans with Disabilities Act Compliance On Thursday, Representative Drew Springer filed the remainder of his bills in support of the Americans with Disabilities Act (ADA). He said, These measures do not create any new rules or regulations but rather help owners, architects, and builders to follow current ADA laws through the use of education and prior notifications for projects that qualify for ADA compliance. People with disabilities are the one minority that anyone can become a part of in the blink of an eye. By educating and ensuring buildings are up to standards before construction or remodeling, we can ensure that buildings are more accessible to all. No one's intent is to single out people with disabilities, and therefore streamlining government to make ADA requirements easier to follow ultimately makes current laws more efficient and effective without creating any burdensome regulations." Representative Springer's ADA bills include:

14 HB 284 would allow residents in assisted living centers to have the right to request seatbelts for their wheelchairs. HB 1120 would give advance notification of projects that require ADA compliance and then ensure those plans are ADA compliant before receiving a certificate of occupancy. HB 1121 would require public universities to teach ADA building codes to any student seeking an architectural undergraduate or graduate degree. HB 1123 would require ADA compliance in the continuing education of architects. PUBLIC EDUCATION: Individual Graduation Committees On January 13 th, Senator Kel Seliger (R-Amarillo) filed SB 463, which allows for the continued use of Individual Graduation Committees. SB 463 gives students who fail one or two STAAR exams, but otherwise meet all other graduation requirements, a path to graduation. Senator Seliger said, "I am proud to author SB 463 to remove the Sunset date that was included in SB 149 last session. This bill ensures that deserving students who have passed all of their courses and demonstrated that they are prepared for college or the workforce will graduate from high school. We have seen that schools use this provision judiciously, and we have heard real life examples of students whose futures were ensured because they had the option of consideration by a graduation committee. Many of these students have gone on to universities, community and technical colleges and entered the workforce with great success. I emphatically maintain that a single test cannot determine a person's ability to effectively pursue postsecondary ambitions." Charter School Funding Also on January 13 th, Senator Donna Campbell filed SB 457 which she said will close the systemic funding gap that currently exists between public charter school students and their peers at traditional public schools. Senator Campbell said, On average, public charter school students receive $1400 less in public funding than traditional public school students. SB 457 would cut that gap in half. Charter school students in Texas are treated as public school students in every regard except for their funding. With 141,000 students on charter school waiting lists, it is high time we address this critical funding gap. Unlike traditional public school students, charter school students receive no state funding for facilities (I&S) and are forced to shift limited dollars toward the cost of facilities. The current funding gap is truly a burden on families who want to choose the best public school to meet the individual needs of their child. SB 457 is a sure-fire way to increase access for every student in Texas to receive the best education. Broadband Connectivity On Tuesday, EducationSuperHighway issued its second annual State of the States report on broadband connectivity. It indicated that 83 percent of Texas school districts now meet federal minimum connectivity goals, up from 67 percent in Since launching the Texas Classroom Connectivity Initiative, Texas has made significant progress in its ongoing effort to expand access to high-speed Internet in public schools statewide. EducationSuperHighway is a national non-profit focused on upgrading the Internet access in every public school classroom in America. This year s report indicates that: 83 percent of Texas school districts meet the minimum connectivity goal of 100 kbps per student, a significant jump from 67 percent in million Texas students gained access to more bandwidth in their classrooms. 382 Texas school districts upgraded their networks in 2016.

15 Governor Greg Abbott said, Last year, in partnership with EducationSuperHighway, I joined with Texas Education Commissioner Mike Morath to announce the Texas Classroom Connectivity Initiative to expand the reach of high-speed Internet in Texas schools and connect our students to the opportunities of the modern educational world. Today s report is a testament to the progress we have made and highlights that - in less than a year - this initiative has provided an additional 1.6 million Texas students with access to more bandwidth and Internet connectivity. However, there is more work to be done. I look forward to building on the success of this past year and expanding this initiative in an effort to connect all of our students to the broadband Internet access they need to succeed and the educational opportunities they deserve. Governor Abbott and Commissioner Morath are requesting $25 million in the Texas Education Agency s legislative appropriations request (LAR) for a state matching fund that will leverage $225 million in federal dollars to allow for the construction of fiber to some of the hardest-to-reach schools. Teaching Best Practices On Wednesday, Commissioner of Education Mike Morath announced the official launch of #IAmTXEd, a new social media campaign intended to share the ongoing success stories of Texas teachers in the classroom. The #IAmTXEd campaign collects and shares the stories of Texas educators whose work is leading to greater student outcomes and achievements. The social media posts are shared statewide each week via Texas Education Agency (TEA) Facebook, Twitter and Instagram. Commissioner Morath said, There is no shortage of great work taking place in classrooms all across our state every school day. Each week, this social media campaign allows everyone to see just how rigorous the teaching profession can be and how our educators are working hard to secure the future of Texas. Stories from the campaign will feature; teachers providing rigorous and rewarding academic experiences; highlight the critical role that educators play in students lives; and showcase teachers driving student achievement, a love of learning and personal growth and/or exhibit instances in which educators go above and beyond to provide meaningful learning experiences inside and outside the classroom. The first #IAmTXEd stories have highlighted the work of educators in the Presidio, Duncanville, Lubbock and Northwest independent school districts. Their stories reached approximately 40,000 people via social media. TEA is soliciting submissions to the #IAmTXEd campaign directly from school districts and charters and plans to publish stories from every region of the state. TAX: Re-Attachment of Detached School District Property On Tuesday, Representative Jim Murphy filed HB 1059, relating to the reattachment of property detached from a school district by the Texas Commissioner of Education. Chapter 41 of the Texas Education Code (also known as the "Robin Hood" plan) requires wealthy school districts to send funds to school districts that are property poor. These payments, known as "recapture" are being paid by increasingly more school districts (ISDs). Currently, Texas school districts choose to either pay the scheduled recapture funds or have the Texas Education Agency "detach" property (and its associated tax revenue). There is no statute for "reattaching" property that has been detached. HB 1059 would establish a mirror-image process for reattachment of previously detached property when circumstances dictate. Representative Murphy said, "If property can be detached from an ISD, certainly the reversal of those circumstances should cause the reattachment of the property to make an ISD whole. The remedy here is to balance the detachment process so that the TEA has the guidance to manage the changing environment of school finance." On November 8, 2016, voters in Houston ISD rejected a proposal to send its recapture money to the state for redistribution to poor