The Texas Report 5/31

The Texas Report 5/31

What’s Happening:

• Special Session #1

• Paxton impeachment update

• Looking at the Texas Regular Session

• DeSantis plans big Texas fundraising trip (More here)

We’ve reached the end of the 88th Texas legislative session, and the Governor has already called legislators back for the first special session to address property taxes and border security.

The Governor esentially endorsed the House’s property tax plans, setting up a battle between the three most powerful Texas politicians (Speaker & Governor vs. the Lieutenant Governor). Additionally, DeSantis is making plans for a major Texas fundraising trip with well known conservative billionaires.

Special Session #1

Despite the efforts of many top negotiators in both chambers, several major priority bills for Republican leadership across the state didn't make it across the finish line. During the last day of the Texas 88th Regular session, the Speaker and Lieutenant Governor made it clear to their members that a special session was on the horizon and it wouldn't be a good idea to pack their bags.

Following adjournment, a couple hours later, Governor Greg Abbott announced the first special session and issued a proclamation that "Special Session #1 agenda items include:"

• PROPERTY TAXES: Legislation to cut property-tax rates solely by reducing the school district's maximum compressed tax rate in order to provide lasting property-tax relief for Texas taxpayers.

• BORDER SECURITY: Legislation solely for the purpose of increasing or enhancing the penalties for certain criminal conduct involving the smuggling of persons or the operation of a stash house.

This proclamation was significant for various reasons; one, it confirms that there will be multiple extra legislative sessions to address the policy priorities of the Governor's office. And two, it was the first time since the start of the 88th Regular Session that the Governor took a specific stance on property taxes. Choosing to make the agenda solely focused on "reducing the school district maximum compressed tax rate" aligned the House plan with the Governor and contrasted what Lt. Governor Patrick and the Senate had been pushing.

This is significant for several reasons. Namely, it's one of the first times in recent memory that the Speaker and Governor have so openly aligned against the Lt. Governor. And it's on one of last year's most important policy discussions.

• The Texas House and Senate met yesterday and then passed their priority property tax bills. The House adjourned "sine die" for this special, signaling they're done after passing their bill. This is another tactic to put pressure on the Lt. Governor & Senate by adjourning and leaving the ball in their court.

• Abbott released a statement following the House passage of the bill doubling down on his support. He said, "The Texas House is the only chamber that passed a property tax cut bill that is germane to the special session that I called to provide Texans with property tax cut relief."

The Lt. Governor responded to Abbott's statement, saying, "Governor Abbott has finally shown his cards. He chooses to give homeowners 50% less of a tax cut, nearly $700 a year, to give corporations more. This is not what homeowners expected when they voted for him." Patrick added that "the Senate plan dedicates nearly $6 billion for homestead exemptions. That gives homeowners nearly $700 more than the Abbott plan. I'm shocked Governor Abbott is advocating for taking that additional $700 savings from homeowners and giving it to businesses." (Lt. Gov response)

This fully positions the Speaker and Governor together against the Lt. Governor, but for Texans to receive relief, there will have to be some compromise as it takes both chambers to pass a bill.

Paxton Impeachment Update

The Impeachment Trial of Texas Attorney General Ken Paxton took additional steps forward over the last several days as the Texas House appointed its impeachment managers who presented the articles of impeachment to the Senate and were given similar authority as the committee on general investigating. Board members can meet and conduct business without having to adhere to open meeting or posting requirements.

Here are the impeachment managers appointed by the House - Andrew Murr, chair; Ann Johnson, vice chair; Charlie Geren; Joe Moody; Terry Canales; Jeff Leach, Oscar Longoria; Morgan Meyer, Briscoe Cain; Cody Vasut; David Spiller, and Erin Gamez.

The Lt. Governor also announced that the Texas Senate would convene on June 20 to consider rules for the Paxton trial and that trial is to start no later than August 28.

The appointed Senate committee to consider rules for the trial: Brian Birdwell, Chuy Hinojosa, Brandon Creighton, Pete Flores, Joan Huffman, Phil King, and Royce West.

Six leadership members within the Texas Attorney General's office took a leave of absence to help defend the Attorney General in his upcoming impeachment trial. The Daily Wire first reported the news, and the employees are solicitor general Judd Stone, the agency's top appellate lawyer; assistant solicitors general Joseph N. Mazzara and Kateland Jackson; Chris Hilton, chief of the general litigation division; senior attorney Allison Collins; and executive assistant Jordan Eskew.

There are several legitimate rumors that packets containing hundreds of pages of defense for the Attorney General were left at the desk of every Senator in the last several days. Ann Johnson said this essentially amounts to attempting to interfere with the trial. She added, "We expect that this committee has been fully engaged in the process with the highest level of integrity that the individuals on the other side would realize dropping a binder on your potential jurors could be considered tampering or attempting to interfere with a lawful process.

Several senators and Lt. Governor Patrick said they understood their duties in this process and would take their role as jurors seriously.

In his comments in the closing minutes of the 88th regular session, House Speaker Dade Phelan (R-Beaumont) called the impeachment necessary and just. The Speaker has come under significant fire from conservative voices nationwide, including former President Donald Trump, who lamented Governor Greg Abbott's lack of a comment. (More here)

Looking at the Legislative Session

As we wrap up the session, we'll look at some of the various priority bills that passed and then some of what didn't.

Bills on interest that passed:

• Senate Bill (S.B.) 14 by Senator Donna Campbell (R-San Antonio) was the major Republican priority bill to prevent gender reassignment treatment for minors. This legislation, if signed by the Governor, will prevent surgeons from performing castration and vasectomy and prescribing puberty blockers to anyone under eighteen. There is an exception in the bill for prescription drug treatments that began before June 1, 2023.

• House Bill (H.B.) 6 by Representative Goldman (R-Arlington) increases the criminal penalties for controlled substances, including fentanyl, and makes fentanyl poisoning, whether intentional or not, a state jail felony offense for the person that delivers the controlled substance.

• S.B. 18 by Senator Brandon Creighton (R-Conroe). As it passed the Senate, this bill would have gotten rid of university tenure. The House changed the bill to allow tenure, but it must be given by the institutions governing board on the recommendation of the institution's chief executive officer. The Senate agreed to these House changes.

• S.B. 1933 by Senator Paul Bettencourt (R-Houston) establishes new oversight and administrative authority for the Secretary of State's office for elections in Harris County. The state can now add oversight and fire county elections officials if the state believes there is a recurring pattern of problems with election administration or voter registration.

Some of the major Republican priorities that didn't pass this session:

• Any major overhaul of Texas border law. During the early parts of the 88th session, Texas Republican leadership advertised significant legislation to change the narrative around the border. The House had multiple border security omnibus bills, and the Senate created an entire committee to focus on border issues, but the two chambers could not agree on any significant border legislation.

  • However, they did agree to further increase state funding for border security, now at $5.1 billion for Operation Lone Star,

• S.B. 147 by Senator Lois Kolkhorst (R-Brenham) was intended to prevent citizens, governments, and business entities from Russia, North Korea, China, and Iran from buying property in Texas. The bill underwent various changes throughout the process to try and clarify that the prohibitions don't apply to U.S. citizens or lawful permanent residents. It made it out of the Senate but never received a hearing in the House.

• H.B. 4843 by Representative Justin Holland (R-Rockwall) would have increased the minimum term of imprisonment and changed the eligibility for community super version and parole for certain felony offenses involving a firearm. The bill received significant bi-partisan support but was killed via parliamentary procedure.

We will continue analyzing some of the major bills that passed this session over the coming weeks. If there is a specific policy area you're interested in, please let us know.

Ron DeSantis plans major fundraising trip in Texas next week

DeSantis is making major fundraising moves is his first trip to Texas as an (official) presidential candidate. (More here)

The Florida governor is set to visit Texas from June 7-9 for a six-city fundraising tour, according to a schedule obtained by The Texas Tribune. He will be in Midland on June 7; Fort Worth, Dallas, and Houston on June 8; and The Woodlands and Austin on June 9.

It will be DeSantis' first visit to the state since he officially launched his White House bid last week, stepping forward as the Republican challenger to former President Donald Trump.

According to the Texas Tribune, in Midland, the hosts include S. Javaid Anwar. Who has been the largest donor to Governor Greg Abbott across his political career? He's given over $6.3 million to Abbott since 2008 and donated well over one million in the last election cycle.

In Dallas, the hosts include other major billionaires, even the brother to former state senator Don Huffines who challenged Abbott in the 2022 primary.

For the Houston trip, DeSantis will be in part hosted by two major commercial real estate developers. Who also happen to be leaders for Texans for Lawsuit Reform, which is the most influential tort reform organization in the state and a powerful business association that routinely gives millions to candidates across the state.

It's interesting because many of these are major Abbott donors, and some are significant former Trump supporters. Abbott has still yet to rule out a potential 2024 run, and Trump has already begun building significant support among Texas congressmen, with few so far endorsing DeSantis.

The battle for the Texas billionaires will likely continue to play out until primary election day and will have significant financial implications for many campaigns.