AUSTIN, Texas — As the first week of bill filing for the 84th Legislative Session kicks off, State Senator Charles Perry has authored a package of fiscal responsibility bills that he described as “good old Republican red meat” issues in an exclusive interview with Breitbart Texas.
Perry announced the bills on his website, writing that the conservative sweep of last week’s elections were Texans sending a “clear message at the ballot box” that they “want government to live within its means and stay out of our pocketbooks.” Perry, a certified public accountant, felt that fiscal responsibility issues were so critical to the future of the state, he wanted that to be the focus of the first bills he filed.
Reform of the Texas Franchise Tax is a popular subject with Republican legislators, and as Breitbart Texas reported, Senator Craig Estes (R-Wichita Falls) has also filed a bill, Senate Bill 105, that eliminates the tax outright. Perry’s approach, in SB 138, is to phase out the tax over four years, to allow time to find an alternate funding source. The franchise tax brought in about $4.6 billion in revenue in 2013, the most recent fiscal year for which we have complete data, but as Perry pointed out, compliance with the tax is “complicated” and “arduous,” and actually can result in businesses being required to pay the tax even when they are showing losses. “This is one of those taxes that don’t make sense,” he said, “It’s a hodgepodge of special interests and carve-outs,” and has been a problem for both the state to enforce it and business to comply with it.
Perry noted that the time was ripe to eliminate this tax while Texas is showing budget surpluses. He was specifically focused on the franchise tax because it was one of the least transparent taxes in the state. Property owners receive detailed and written property tax bills, and everyone sees the impact of sales taxes on receipts when they buy goods and services, he noted, but the franchise tax was far more opaque, including in how it was passed on to consumers.
Another bill filed by Perry was SB 136, which would impose what is commonly referred to as “zero-based budgeting,” where a state agency’s budget under review starts at zero, instead of using the previous budget as a baseline. “I’ve learned that the first question normally asked during appropriations — what did we spend last year? — is incorrect,” said Perry. “The question should be, does the program still make sense? Is this program still relevant, is it something that’s working, is it delivering the expected outcomes, can it be done better?” Basing budget appropriations on old budgets prevents lawmakers from determining if the program is being run efficiently or meeting its mission expectations, according to Perry.
Zero-based budgeting dovetails very well with the work of the Texas Sunset Review Commission, added Perry. As Breitbart Texas reported, the Sunset Commission started their public hearings this week, and is tasked with reviewing about 130 agencies on a regular basis and making recommendations to the full Legislature about which agencies should be considered for possible elimination or consolidation. Perry described the synergy between the two thusly: the Sunset review process looks at objectives and asks if a program is working, whereas once it has been decided that a program will continue, zero-based budgeting asks what level of funding is appropriate and efficient. Perry acknowledged that it would not be practical to fully submit the budgets of all Texas agencies to a zero-based budgeting process at once, but instead thought it would make sense to implement it on a gradual basis and incorporate it into the Sunset process.
Perry tackled the complicated issue of transportation funding with SJR 12 and SB 139, which would create an amendment to the Texas Constitution that would end the current diversions from the state highway fund to the Texas Department of Public Safety (DPS). According to Perry, DPS takes about $400 million from the state highway fund for their budget. The DMV can almost carry its own weight with driver’s license fees, but other DPS activities are what Perry described as “core state functions” that “need to be funded as a priority, as a single line item in the budget from general revenue.” Perry told Breitbart Texas that making this change would increase transparency — “people don’t expect gas taxes to go to something besides roads and bridges” — and would “make DPS stand out as the priority it should be” in the Texas budget.
Perry also filed SJR 11 & SB 137, which would create a Constitutional Amendment to place “a common sense cap” on state government spending that ties budget growth to population growth plus inflation, and SB 140, which addresses agricultural sales-tax exemptions. Currently, farmers can purchase tractors and other farm equipment and get an exemption from sales taxes. This exemption applies to specialized GPS devices that help guide their tractors on their fields, but not to the data services purchased to upload and update the maps and guidance systems. Perry’s bill would add the GPS data services to the list of exemptions.
“It’s just not common sense,” said Perry, to have this “gotcha law that gives the state the power to come in for an audit for ticky-tack reasons,” adding that the enforcement costs for the state and the He said that he had farmers in his district come to him and say that this tax was “driving them nuts,” and they could not understand how a “$500 million tractor is exempt, and the GPS device is exempt, but the GPS data is not.”
Overall, Perry was optimistic about the upcoming session and the newly elected Republicans who would be leading the state’s government. “Obviously, the voters felt that the message we have as conservatives is the right one,” said Perry. While he acknowledged that there were “some personal growth opportunities for all of us” to manage the new personalities and new roles, Perry was confident that the session would be a success. “We’ll have a good conservative Senate and House, and I’m looking forward to the new energy, the new blood.”
Perry had a lot of praise for his former colleague in the State Senate, Dan Patrick, who had just been elected Lieutenant Governor. “Senator Patrick’s going to do really well [as LG],” he said, commenting that he respected how Patrick has already reached out to legislators to ask for their input for his agenda for the upcoming session. Perry was also looking forward to seeing how Greg Abbott’s leadership style and experience as Attorney General would shape his administration as Governor, called Sid Miller “the epitome of what an Agriculture Commissioner should look like,” and said that he was “excited” to see Glenn Hegar “take [the Comptroller’s Office] to new heights.”
“It’s going to be fun to see all this evolve,” concluded Perry. “We’ve got so much good going on here, I wouldn’t want to be anywhere else” besides Texas.
Perry told Breitbart Texas that he is working on a package of education reform bills, and expects that will be the next ones that he files.
If you are a member of the Texas Legislature, or a legislative staffer who can speak on the record, and you would like to talk to Breitbart Texas about any of the bills being filed for consideration during the 84th Legislative Session, please contact Sarah Rumpf at sarahbbtx@gmail.com.
Follow Sarah Rumpf on Twitter at @rumpfshaker.
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