Texas Senate passes $195.5B two-year budget plan

AUSTIN, Texas (AP) -- A new state budget cleared its first major vote in the Texas Legislature on Wednesday when the Senate approved a $195.5 billion spending plan that will test a relatively civil political climate as Democrats ratchet up pressure for more state spending.

The spending bill passed 29-2 and proposes a 7.7 percent increase in general revenue spending over the current budget, which lawmakers cut to the bone in 2011 to erase a massive shortfall borne by the Great Recession.

Senate Republican leaders lauded the proposed 2014-15 budget as making the best of sunnier economic fortunes this time around. Public schools gutted of $5.4 billion two years ago would win back about one-fourth of those historic cuts, mental health funding would increase by $240 million and financially shaky state parks would be spared from closure.

Democrats raised skepticism during a three-hour Senate floor session about whether the spending kept pace with population growth. They also urged majority Republicans — yet again — to dig deep into the state's Rainy Day Fund, which is projected to reach nearly $12 billion in cash reserves.

Only two Democrats, Sens. Wendy Davis and Sylvia Garcia, who was sworn in just last week, voted against the bill.

"We've come a long way, baby, since last session," said Republican Sen. Tommy Williams, the Senate's chief budget writer.

The bill now goes to the House.

Williams said room remains to deliver tax relief, which Gov. Rick Perry wanted lawmakers to prioritize going into the session. Williams said the most likely options include refunding $900 million in the System Benefit Fund, which was created to help low-income residents pay utility bills.

He introduced the Senate spending bill by railing against the growing chunk of the budget chewed up by Medicaid — Texas remains one of the few states to reject expanding health care for the poor under the federal Affordable Care Act. He also described securing new highway money for a rapidly expanding Texas population as the state's own "fiscal cliff."

Davis' eleventh-hour filibuster during the 2011 session to temporarily postpone the classroom spending cuts elevated her star power among Democrats — and she was again the loudest voice of dissent in the chamber on Wednesday.

"The budget product was artificially strained from the start," Davis said. "I can't ignore the alternatives that were available to us."

Yet aside from Davis' floor speech, the Senate budget bill passed with little drama. Retired teachers in red shirts packed the gallery when the Senate began but stuck around only long enough for a resolution honoring their members. They filed out before the chamber began considering the budget bill in which public education funding remains the most divisive issue.

Other Democrats conveyed optimism that more money would eventually be spent but did not launch into any pointed attacks. With the 140-day session now more than halfway finished, Democrats instead praised the openness of budget negotiations so far, unlike the acrimony and tense exchanges that often shadowed spending discussions two years ago.

The Senate budget uses $94.1 billion in general revenue and carries a total price tag of the $195.5 billion over two years. General revenue is mostly stockpiled through state sales taxes, and is the pot of money that lawmakers wield most control over how to spend when writing the budget.

A rejuvenated Texas economy handed lawmakers a record $101.1 billion in revenue to potentially spend when the Legislature convened in January. About $6.6 billion of that was already spent earlier this month in an emergency bill to cover a Medicaid shortfall, and there is $269 million in other estimated expenses in the current budget that lawmakers must also set aside.

That leaves about $410 million remaining, and Williams said that number is likely to increase after the comptroller revises revenue projections next month.

Including federal dollars, the budget passed by the Senate is $8.6 billion more than the base draft released in January.

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