INSIDE THIS ISSUE • 83rd Legislative Update • Legislative Articles of Interest • 83rd Legislature Dates of Interest • Helpful Links • TAB Legislative and Government Affairs Staff • Rally Day was a Success! • Thank you to our 2013 Rally Day Sponsors!

83rd Legislative Update First Bill Passed out of House

Two TAB Priority Bills Filed

TAB Executive Director testifies on HB 4 A TAB priority on funding the State Water Plan.

HB 5 Left Pending in Committee Comprehensive Education Reform Bill, includes TAB priority language on curriculum for workforce needs.

On Friday, February 15, Rep. Lois Kolkhorst (R) filed HB 1377, a TAB priority bill relating to the ownership and local regulation of trees and timber. HB 1377 would:

 Codify case law and common law, which holds that a tree belongs to the property owner, and states that a tree may be removed by the property owner.  Specifically state that a city may continue to assess tree mitigation fees and replacement regulations, as long as the fees and regulations are reasonable and proportional.  Prohibit a city from enforcing mitigation fees and replacement regulations in the city’s extraterritorial jurisdiction, unless the extraterritorial jurisdiction touches an active federal military base.

On Tuesday, February 19, Rep. John Kuempel (R) filed HB 1503, a TAB priority bill relating to the appointment of building contractors to certain trade advisory boards of the Department of Licensing and Regulation. HB 1503 would:

 Add two building members to the Electrical Safety and Licensing Advisory Board (increasing its membership from nine to 11 members) and two members to the Air Conditioning and Refrigeration Contractors Advisory Board (increasing its membership from seven voting members to nine voting members). Doing so will not result in a builder majority on either board.  Follow the practice of the Texas State Board of Plumbing Examiners, which currently has two builder members on its nine member board.

GOVERNOR – On February 15, Governor Rick Perry announced that Tenaris will be extending its U.S. investments by building a new steel pipe manufacturing facility in Matagorda County, creating 600 jobs and $1.3 billion in capital investment. The state is providing $6 million through the Texas Enterprise Fund (TEF) to close the deal. Governor Perry said, "This announcement is only possible thanks to the hard work of state and local officials, as well as, the area business

community, which always plays a major role in decisions like this. The most profound statement about our favorable economic climate comes when companies like Tenaris make an investment of this size in our state. That says that not only is Texas the best place to grow your business now, but they're confident that we'll remain that way moving forward." Tenaris is a global manufacturer of steel pipe products used for drilling in the energy industry. The 1 million sq. foot Matagorda County facility will include a state-of-the-art seamless pipe mill, heat treatment and premium threading facilities. Once complete, the mill is expected to produce 600,000 tons of pipe annually.

On Thursday, February 21, Governor Perry announced that National Instruments will expand its research and development capacity in Austin, creating 1,000 jobs and making an $80 million capital investment. The state is providing $4.4 million through the Texas Enterprise Fund (TEF). Execution of the state's agreement is contingent upon finalization of a local incentive package. Governor Perry said, "Central Texas' flourishing high tech industry is further strengthened by National Instruments' expansion, which will create 1,000 technical and engineering jobs and bolster Austin's status as a hub for research, development and innovation. Texas' continued focus on STEM education is a natural fit, and will ensure the Lone Star State continues to provide the capable workforce necessary for high tech employers like National Instruments to thrive." Chief Operating Officer of National Instruments Alex Davern said, "National Instruments was founded in Austin over 35 years ago and has grown to a global company, supplying tools to scientists and engineers around the world to accelerate productivity, innovation, and discovery. The business friendly climate in Texas, along with our commitment of intense investment in research and development, is helping drive long-term job growth and economic development in Central Texas." Senator Kirk Watson added, "We welcome the 1,000 new jobs this expansion will bring. Austin is a special place, and it continues to attract employers from around the world and opportunities for people who are here. Nevertheless, we're in a competition with other cities and regions for these kinds of jobs. It speaks well of Austin that National Instruments has chosen to stay here and to grow here." Representative Elliott Naishtat concluded, "I am extremely pleased to welcome the expansion of National Instruments in Austin. High tech industries have contributed significantly to Austin's vibrant economy, and this expansion is a recognition of Austin's highly skilled workforce."

SENATE – The Senate was in session on Monday, Tuesday, and Wednesday of last week conducting routine business. Last Monday, February 18 the Senate honored University of Texas President Bill Powers. Ten Senate members extolled the praises of President Powers including Senators , Kirk Watson, Eddie Lucio, Jr., Jane Nelson, Rodney Ellis, Joan Huffman, Royce West, , Robert Duncan, and John Whitmire. In a rare speech, Lt. Governor also expressed support for President Powers saying, “I want to say to Bill Powers, you’re a good man and we are lucky to have you. We all want to make sure that our great institutions of higher learning are accessible, that we control costs and improve our graduation rates. I believe in reform, and I know Bill Powers believes in reform. That’s why I’m particularly troubled when I see UT regents go around this man and his administration. This man deserves better treatment than what he’s getting. I am really upset about this, so tomorrow I will have more to say about this, but ladies and gentlemen, this issue is bigger than just UT Austin and President Powers, though I’m very interested in that. This is about the reputation of the state of Texas. UT Austin is our premier tier-one university nationally and President Powers deserves a great amount of credit for putting us in that position. This is about the reputation of this university, this fine man and this great state.”

The Senate adjourned until 2:00 p.m. on Monday, February 25, 2013. Total number of bills reported out of Senate Committees this week: 12

HOUSE – The House was in session Monday through Thursday of last week conducting routine business. On Thursday, February 21 the House passed its first bill of the session, HB 10, the emergency Medicaid funding bill. Passage required several procedural votes including first suspending the constitutional order of business rule to allow it to be taken up before the 60th day of the session and ultimately the constitutional rule requiring bills to be read on “three several days.” One clarifying amendment was added by Chairman Jim Pitts, the bill’s sponsor, but the other pre-filed amendments were withdrawn. HB 10 passed unanimously with 148 votes. Speaker Joe Straus said, “I thank Chairman Pitts and the Appropriations Committee for their work on HB 10 and I am pleased that the House unanimously passed this important legislation to ensure that our Medicaid obligations are met.”

Total number of bills passed by the House this week: 1 The House adjourned until 2:00 p.m. on Monday, February 25, 2013.

BUDGET – The Senate Finance Committee’s workgroups met Monday, Tuesday and Thursday of last week, and the full Senate Finance Committee met on Thursday to hear updates from the workgroups. The House Appropriations Committee’s subcommittees met every day of last week. The full Appropriations Committee met last Thursday to take up subcommittee recommendations on Article V (Public Safety and Criminal Justice).

On Monday, February 18 the House Government Efficiency and Reform Committee held an organizational meeting and took invited testimony. The committee heard from State Auditor John Keel, and representatives of the Comptroller’s Council on Competitive Government, Department of Information Resources, Texas Department of Licensing and Regulation, Sunset Advisory Commission and Office of the Inspector General. The Legislative Budget Board provided recommendations of the Interagency Required Reports Workgroup which evaluated the usefulness of statutorily required reports that are prepared and submitted by state agencies. They suggested repeal of 50 required reports and modification of another 150 reports. Texas Department of Licensing and Regulation told the committee that the agency has reduced fees resulting in a cumulative savings of $24.7 million since 2004; streamlined penalty matrices resulting in a savings of $853,237 in 2012; and streamlined license issuance using plastic credit-card type licenses with Austin-based Signature Card Inc. handling all production and distribution functions, freeing TDLR staff to focus on the agency’s core competencies.

On Wednesday, February 20 the new House Select Committee on Transparency in State Agency Operations held its first formal meeting. Co-Chair Dan Flynn (R-Van) presided over the meeting and opened it with a discussion about the Committee's goals. Chairman Flynn said, "I am looking forward to working with my colleagues to make Texas more transparent and accountable. Too many times, citizens are unable to access important information about our state. Citizens have a right to know how our state performs, makes decisions, and spends taxpayer money. Until that is a reality, our job is not done. The Committee will be looking into a number of topics, including state compensation practices and purchasing decisions. Texans deserve the right to know how Texas operates and spends their tax money. Our goal is to protect taxpayers and make all Texans better informed about their government." When evaluating transparency, the Committee will be asking three important questions: Is the information open (complete and timely) to the citizens? Is the information understandable (in a common-sense language and technologically compatible)? Does it encourage accountability?

Passed the House: HB 10 by Jim Pitts (R-Waxahachie) is the emergency appropriations bill that would appropriate $4.8 billion in general revenue funds and $313 million in other funds for fiscal 2013 to the Health and Human Services Commission, Department of Aging and Disability Services, and the Texas Education Agency ($3.4 billion for Medicaid, $74.7 million for the Children’s Health Insurance Program, $1 billion for nursing facilities for long-term care services; and $317 million for school districts subject to recapture); and would reduce by $3 million fiscal 2013 appropriations to the Texas Public Finance Authority for debt service on bonds.

This Week: The Senate Finance Committee’s Workgroup on Article I (General Government) will meet in E1.012 of the Capitol Extension: Monday, February 25, 2013 at 9:30 a.m. to take up general government agencies. The Senate Finance Committee’s Workgroup on Public Education will meet in E1.028 of the Capitol Extension: Monday, February 25, 2013 at 2:30 p.m. to take up Article III (Education) agencies. The House Appropriations Committee will meet in E1.030 of the Capitol Extensioin: Monday, February 25, 2013 at 8:30 a.m. to take up Article VIII (Regulatory) agencies. Tuesday, February 26, 2013 at 7:30 a.m. to take up Article VI (Natural Resources) agencies. The House Appropriations Committee’s Subcommittee on Budget Transparency and Reform will meet in E1.030 of the Capitol Extension: Monday, February 25, 2013 upon adjournment of the full committee to take up: HB 1026 by Jim Pitts (R-Waxahachie) would reverse the delayed payment to the foundation school fund enacted by the legislature in 2011. HB 1062 by Jim Pitts (R-Waxahachie) would repeal the expedited collections of taxes enacted in 2011. ECONOMIC DEVELOPMENT – Last Tuesday, the Senate Government Organization Committee took up: SB 328 by John Carona (R-) would authorize state agencies to employ an entrepreneur-in-residence to improve outreach to the private sector, strengthen coordination and interaction between state government and the private sector, facilitate the understanding and use of technological advances to make state government more transparent and interactive; and implement the best private sector practices to make state government programs simpler, easier to access, more efficient, and more responsible to users. It was voted favorably as substituted.

Last Thursday, the House Economic and Small Business Development Committee heard invited testimony on economic development incentive programs. The committee heard from Aaron Demerson, Director of the Governor’s Office of Economic Development and Tourism; Patrick Boswell, Director of the Texas Emerging Technology Fund; Dale Robertson of the Texas Workforce Commission, and Carleton Schwab of Texas Economic Development Council. Chairman John Davis formally appointed the Subcommittee on Manufacturing composed of Representatives Jim Murphy, Chair; Jason Isaac; Mary Ann Perez; Eddie Rodriguez; and Paul Workman.

This Week: The House Economic and Small Business Development Committee will have 2 committee meetings in Room E2.014 of the Capitol Extension: Tuesday, February 26, 2013 at 11:00 a.m. to take invited testimony on the current status of manufacturing in the state. Thursday, February 28, 2013 at 8:00 am to take invited testimony on agencies and workforce issues under the committee’s jurisdiction.

ENERGY – Commissioner Rolando Pablos announced his resignation from the Public Utility Commission of Texas effective on March 1, 2013. Commissioner Pablos said, “It has been a privilege and honor to serve the people of the Great State of Texas. My objective has always been to help strengthen our economy through the application of fair, transparent, and predictable regulation. Because electricity is the heartbeat of our economy, ensuring that Texas has a reliable supply of electricity has been a top priority for me. Ensuring universal access to telecommunication services on a state-wide basis has also been an important component of my work at the PUC.” Pablos was appointed to the PUC by Governor Rick Perry on September 20, 2011.

Last Tuesday, the House Energy Resources Committee and the House Environmental Regulation Committee met jointly to hear invited testimony from state agencies within the committees’ jurisdictions. The committee heard from representatives of the Railroad Commission, Texas Commission on Environmental Quality, the U.S. Department of Energy, and the State Energy Conservation Office.

Last Wednesday, the House State Affairs Committee took up: HB 550 by Sylvester Turner (D-) would cap the fee for the system benefit fund at two cents (rather than 65 cents) per megawatt hour and allow it to be used for regulatory purposes, customer education programs, customer education programs and administrative expenses. It was left pending.

This Week: The House Business and Industry Committee will meet in E2.014 of the Capitol Extension: Tuesday, February 26, 2013 at 10:30 a.m. to take up: HB 1086 by Eddie Rodriguez (D-Austin) would allow recovery of one month’s rent plus $1000 (instead of $500) if a residential landlord interrupts water, wastewater, gas, or electric service unless the interruption results from bona fide repairs, construction, or an emergency.

ENVIRONMENT – Last Tuesday, the House Natural Resources Committee took up: HB 4 by Allan Ritter (R-Nederland) would establish the State Water Implementation Fund to provide financing for projects included in the state water plan or education projects related to the development of water resources, the conservation of existing water resources, or water reuse. The committee heard ten hours of testimony from a broad and diverse range of stakeholders supporting the legislation including associations and individuals representing agriculture, municipalities, real estate, engineering, construction, manufacturing, energy, and the environment all in support of the legislation. Scott Norman, Executive Director of the Texas Association of Builders, testified in support of the bill. "As we are trying to meet the housing needs of Texas moving forward, as our population continues to grow, as our economy continues to grow, water will be vital," said Norman. "Not just directly for our industry for future housing needs but for the economic well-being of the state." About the hearing, Chairman Ritter said, "The message we heard today was clear: in order to ensure we have the clean, affordable supply of water needed to maintain a path of growth in Texas, legislators must take action now to fully implement the State Water Plan. Projections from the Texas Water Development Board and the Legislative Budget Board show that $2 billion could be leveraged to finance $27 billion in state assistance to develop projects included in the State Water Plan. With a one-time capital investment, we could provide adequate, meaningful funding to the plan and achieve the state’s goals of supporting local entities in the implementation of projects.” Testimony was provided from the mayors of Houston, Dallas and San Antonio in support of H.B. 4. Houston Mayor Annise Parker said, "This legislation is as important to the City of Houston as it is to the rest of Texas. Increased availability of water project funding will allow acceleration of efforts to secure resource adequacy for the future." HB 4 was left pending. Also on Tuesday, the Senate Business and Commerce Committee took up: SB 383 by John Carona (R-Dallas) would remove the provision in the occupations code making it an offense for air conditioning and refrigeration contractors to purchase a refrigerant or equipment containing a refrigerant. It was left pending.

Water and Sewer Utilities - On Monday, Senators Robert Nichols (R-Jacksonville) and Kirk Watson (D-Austin) filed SB 567, which would overhaul the state's oversight of investor-owned water and sewer utilities (IOUs). The legislation reflects the work of Senate subcommittees led by Senators Nichols and Watson in 2012. Companion legislation, HB 1307, has been filed by Representative Charlie Geren (R-Fort Worth) in the House. Senator Nichols said, “The many stakeholders working with the subcommittees have helped us to determine that the current regulatory system is broken. The one-size-fits-all treatment of large-, mid- and small-sized utilities does not work." Senator Watson added, "Over the past decade, more and more small, privately owned public water and wastewater utility systems have been acquired by national corporations and investment funds. Texans need to be able to afford basics like water and sewer service. We've found that they also need protection from national or multinational entities that view water as a profitable commodity, not a basic necessity for rural Texans." The legislation would:

 Transfer economic regulation of water and sewer utilities from the Texas Commission on Environmental Quality (TCEQ) to the Public Utility Commission of Texas (PUC);  Establish IOU classifications based on number of connections; and  Give the Office of Public Utility Counsel (OPUC) authority to intervene in water rate cases on behalf of residential and small commercial customers.

Water Districts - Last Tuesday, Representative Eddie Lucio, III (D-Brownsville) filed HB 1214, a comprehensive water districts bill which would allow water districts to operate in a way which will more accuracy reflect current water supply conditions. Provisions in the bill originated from recommendations outlined in the State Auditor's office audit of the Hidalgo County Water Improvement District No. 3. Representative Lucio said, "Water districts across the state are seeing an increase in their municipal demand. We want to ensure that they have the flexibility to service those needs. Water districts included under this piece of legislation are water improvement districts, water control and improvement districts, and irrigation districts. Due to urbanization, districts that previously delivered the majority of their water to irrigation are now delivering a significant amount to municipalities. This shift in revenue source is now taken into account with the proposed legislation. I am committed to streamlining water district requirements to meet current marketplace conditions. This is the first time in a long time water has been the highest priority during Session. We look forward making great strides when it comes to water policy."

This Week: The House Environmental Regulation Committee will meet in E1.026 of the Capitol Extension: Tuesday, February 26, 2013 at 10:30 a.m. to take invited testimony.

This Week: The House Government Efficiency and Reform Committee will meet in E1.026 of the Capitol Extension: Monday, February 25, 2013 at 4:00 p.m. to take up: HB 86 by Bill Callegari (R-Katy) would require the Sunset Advisory Commission, when reviewing occupational licensing agencies, to consider whether the occupational licensing program serves a meaningful, defined public interest and provides the least restrictive form of regulation that will adequately protect the public interest; the extent to which the regulatory objective can be achieved through market forces, private or industry certification and accreditation programs; the extent to which the licensing criteria ensure that applicants have occupational skill sets or competencies that correlate with a public interest; and the impact of the regulation, including the extent to which the program stimulates or restricts competition and affects consumer choice and the cost of services. It would also establish a review process for creating new occupational licenses. HB 87 by Bill Callegari (R-Katy) would specify that an individual can engage in an occupation not prohibited by law without being subject to a state agency rule that is substantially burdensome and unnecessary to fulfill the purpose and intent of the law; and would prohibit a state agency rule from substantially burdening an individual’s right to engage in an occupation unless the agency demonstrates that the rule or policy is necessary to fulfill the purpose and intent of the statute authorizing regulation of the occupation.

This Week: The House Defense and Veteran’s Affairs Committee will meet in E2.012 of the Capitol Extension: Thursday, February 28, 2013 at 8:00 a.m. to take up: HB 171 by Roberto Alonzo (D-Dallas) would require the Texas Veterans Commission to administer a veterans resource center in at least one institution of higher education in each of the state’s 15 higher education regions.

HUMAN RESOURCES/EMPLOYMENT – Last Tuesday, the Senate Business and Commerce Committee took up: SB 473 by John Carona (R-Dallas) would repeal Chapter 92 of the Labor Code to remove Texas Department of Licensing and Regulation’s oversight of temporary common worker employers; and would create a new chapter within the Local Government Code authorizing cities and counties to adopt a licensing program for temporary common worker employers within their jurisdictions. It was left pending.

Last Wednesday, the Senate Economic Development Committee took up: SB 248 by Wendy Davis (D-Fort Worth) would authorize an aggrieved person to obtain up to two years of back pay if the individual prevails in a discriminatory compensation decision. It was left pending.

Worker Bill of Rights - On Wednesday, Senator Kel Seliger (R-Amarillo) filed SB 674 which would require labor union votes to take place by secret ballot. Senator Seliger said, “It's important that workers feel free to make decisions and cast votes free of coercion. This bill is not anti-union, and it has no prohibitions against any right to assemble or organize already allowed in the state. It secures the principles that make Texas such a business friendly state, a state in which businesses and unions work together, as long as every entity’s rights are protected." The announcement also included a new "worker bill of rights" unveiled by Attorney General Greg Abbott. General Abbott said, “This document reaffirms a worker's right to not participate in a labor union. At a time when jobs matter more than anything else, we want all Texas workers to know their rights and we want to protect their rights from abusive labor practices. The document also affirms that dues paid to labor unions are voluntary and cannot be deducted from wages without approval, nor can a worker be denied employment or fired for refusing to join a union.” Representative Charles “Doc” Anderson (R-Waco) filed the companion bill, HB 1524. Texas AFL-CIO President Becky Moeller responded saying, “By seeking to block a well-used path for workers to organize into unions, the Attorney General of Texas and two legislators have essentially come out for lowering workers’ wages in the State of Texas. But the way the bills are written, they do not apply to all labor unions. Federal law governs union elections and supersedes any state attempt to regulate union elections in the private sector. We believe the only workers who could arguably be affected by this legislation are police officers and fire fighters who have collective bargaining agreements with their local governments under state law. We are appalled that Attorney General Abbott is using hard-working Texas fire fighters and police officers, who put their lives on the line every day of their working lives, as props for his political ambitions. We strongly resent Abbott’s insinuation that police and fire fighters might form unions through a process of intimidation against those who do not wish to join. The Texas AFL-CIO vows to stand with first responders in our state to oppose this unwarranted legislation.”

This Week: The House Business and Industry Committee will meet in E2.014 of the Capitol Extension: Tuesday, February 26, 2013 at 10:30 a.m. to take up: HB 298 by Eddie Rodriguez (D-Austin) would prohibit an employer from suspending or terminating or discriminating against an employee who seeks to recover wages owed to the employee through a wage claim hearing conducted by the Texas Workforce Commission. HB 1065 by Ana Hernandez Luna (D-Houston) would require an employer to give an employee who is a victim of a crime or whose child is a victim of a crime to time off to attend court proceedings related to the crime.

INSURANCE – Last Tuesday, the Senate Business and Commerce Committee took up: SB 72 by Rodney Ellis (D-Houston) would prohibit the use of credit scoring in personal insurance policies. In support was a representative of Texas Watch and Mark Kincaid, testifying on behalf of himself. In opposition were representatives of Association of Fire and Casualty Companies of Texas, Property Casualty Insurers Association of America, Texas Association of Business, Coalition for Affordable Insurance Solutions, Reed Elsevier, Inc., Progressive, ACE Group, National Association of Mutual Insurance Companies, and American Insurance Association. It was left pending. SB 74 by Rodney Ellis (D-Houston) would authorize the Commissioner of Insurance to require prior approval of rates if the commissioner believes an insurer’s rates to be excessive, inadequate, or unfairly discriminatory. In support was a representative of Texas Watch and two individuals representing themselves. In opposition were representatives of Texas Coalition for Affordable Insurance Solutions, Association of Fire and Casualty Companies of Texas, Texas Association of Business, ACE Group, National Association of Mutual Insurance Companies, Farmers Insurance Group, and Property Casualty Insurers Association of America. It was left pending.

PRIVACY – Last Tuesday, the House Business and Industry Committee took up: HB 318 by Helen Giddings (D-Dallas) would make it an unlawful employment practice for an employer to require an employee or applicant to disclose a user name, password or other means for accessing his/her personal e-mail account or information on a social networking website through an electronic communication device. In support were representatives of AFL-CIO and American Civil Liberties Union. In opposition were representatives of Texas Mortgage Bankers Association, and Texas Association of Business. Wendy Reilly of TechAmerica testified “on” the bill. It was left pending.

This Week: The Senate Agriculture, Rural Affairs, and Homeland Security Committee will meet in E1.012 of the Capitol Extension: Monday, February 25, 2013 at 2:00 p.m. to take up: SB 166 by Robert Deuell (R-Greenville) would allow health care providers including physicians, nurses, dentists, podiatrists, pharmacists, chiropractors, therapeutic optometrists, ambulatory surgical centers and nursing homes to use electronically readable information from a driver’s license or personal identification certificate.

PROCUREMENT - Last Tuesday, the Senate Government Organization Committee took up: SB 116 by Juan “Chuy” Hinojosa (D-McAllen) would add disabled veterans to the definition of economically disadvantaged for purposes of classifying a business as a historically underutilized business for purposes of state contracting. In support were representatives of Texas Coalition of Veterans Organizations. It was voted out favorably.

Last Wednesday, the House State Affairs Committee took up: HB 535 by Yvonne Davis (D-Dallas) would require the comptroller and state agencies making purchases of goods to promote the purchase of and give preference to goods manufactured by Texas bidders; and it defines “manufactured” as goods assembled, the final assembly, processing, packaging, testing, or other process that adds value, quality or reliability. It was left pending.

This Week: The House Defense and Veteran’s Affairs Committee will meet in E2.012 of the Capitol Extension: Thursday, February 28, 2012 at 8:00 a.m. to take up: HB 194 by Joe Farias (D-San Antonio) would add disabled veterans to the definition of economically disadvantaged for purposes of classifying a business as a historically underutilized business for purposes of state contracting.

PROPERTY – Representative Van Taylor (R-Plano) filed HB 1496, which would amend state law to include a land owner's mineral rights in the definition of private real property. Representative Taylor said, “Current law protects only the property rights of surface owners, this bill expands provisions to any action a municipality may take regarding mineral interests. For too long, municipalities have taken away mineral interests of Texans. HB 1496 requires municipalities to permit the reasonable development of a mineral interest or compensate the owner for the burden/prohibition." Roy Morris, Chairman of Texans for Property Rights added, "We applaud Representative Taylor for filing House Bill 1496. This legislation is true property rights reform that will protect the rights of landowners to develop their mineral interests or compensate them for the denial of access to their property. Representative Taylor is a true defender of property rights."

PUBLIC EDUCATION - Last Monday, the Texas Conservative Coalition Research Institute released its education reform recommendations at its 2013 Technology Summit. TCCRI’s Executive Director John Colyandro said, “If Texas is going to compete long-term in the technology sector, it is imperative that public education be part of any long-term plan. By adopting innovative education methods, Texas can ensure that future generations have the knowledge and skills to carry on and innovate for subsequent generations down the road. Many options exist for promoting technology, math, and science in education.” TCCRI’s education recommendations include:

 Improve and expand the Virtual School Network;  Remove the statutory cap from the charter school program and encourage partnerships with the T-STEM initiative; and  Adopt a tax credit scholarship program.

Charter Schools - Last Monday, Senator (R-Houston) filed SB 2, which would make several changes regarding charter schools. Senator Patrick said, "There is no one answer to transforming schools but adding high quality public charters will give Texas parents, including the nearly 100,000 currently on a charter school waiting list, more choices to find the best education for their child. SB 2 lifts the cap on charter schools, provides facility funding, strengthens the academic and financial accountability over charters, and creates an independent authorizer of charter schools. Under the bill, an authorizing board will be allowed to grant an unlimited number of charters per fiscal year to charter holders located in Texas as well as successful charter holders outside of Texas. It also allows for the replication of highly successful campuses under a charter. SB 2 amends statute related to home-rule school districts so that it is easier for a district to become a home-rule school district. The bill also allows a district to become a home-rule school district if a majority of the board adopts a resolution ordering that a charter commission be appointed.” David Dunn, President of the Texas Charter Schools Association said, “Texas public charter schools are proud to work with Sen. Dan Patrick on legislation that will strengthen the quality of charters, streamline the process to encourage more innovation and make necessary changes so that students are well-served in the school of their choice.”

Opposition to Increasing the Charter Cap - Raise Your Hand Texas CEO Dr. David Anthony responded to the filing of SB 2 saying, “Unlimited expansion of charters as proposed in SB 2 will result in more charters, but not necessarily better ones. With 17.9% of charters rated academically unacceptable under the accountability system in 2011, let’s show that we can effectively oversee the charter schools that we have before authorizing the creation of a bunch of new ones. According to the Texas Sunset Advisory Commission, Texas expended $938 million on charters in 2011-2012 to serve 3% of Texas students. We simply can’t fathom providing facilities funding for charter schools in addition to the funding that they already receive when Texas public schools are still suffering from $5.3 billion in funding cuts.” Texas State Teachers Association President Rita Haecker also expressed opposition to SB 2 saying, “Some growing school districts built new campuses but were not able to open and staff them because of state budget cuts imposed two years ago. Those campuses were built with local property taxes approved by local taxpayers. Now, Senator Patrick wants to let private charter operators, who are not accountable to local taxpayers, ‘rent’ those campuses for $1 per year with no local control. With a state surplus and Rainy Day Fund balance totaling $20 billion, the top priority of the senator and his colleagues should be restoring the $5.4 billion – more than $500 per student – cut from traditional public schools in 2011. Local public schools are where the vast majority of Texas children will continue to be educated, and they should have first call on our education tax dollars.”

Last Tuesday, the House Public Education Committee took up eight bills on curriculum accountability and testing including HB 224, HB 251, HB 399, HB 554, HB 596, HB 640, HB 659, and: HB 5 by Jimmie Don Aycock (R-Killeen) would make several changes to required curriculum, testing and evaluating student performance and school ratings. HB 5 includes TAB priority language on curriculum for workforce needs. The committee took ten hours of public testimony. Most of the witnesses were in support of HB 5 including representatives of Raise Your Hand, Texas Computer Education Association, Texas Association of School Administrators, Texas State Teachers Association, Texas Association of Mid-Size Schools, Texas School Alliance, Texas Association of School Boards, Texas Music Educators Association, Texas Rural Education Association, Texas Industrial Vocational Association, Corpus Christi Chamber of Commerce, Texas American Federation of Teachers, Texas Association of Community Schools, Texas Association of Builders, Texas Chemical Council, Texas School Coalition, South Texas Association of Schools, Texas PTA, and representatives of the Bridgeport, Brownwood, Bullard, Gregory-Portland, Alief, Killeen, Bryan, Dripping Springs, Belton, Manor, Floydada, Keller, and Los Fresnos Independent School Districts. The Texas Association of Business testifed against HB 5. All eight bills were left pending.

Last Thursday, the Senate Education Committee took up: SB 2 by Dan Patrick (R-Houston) would make several changes regarding charter schools. It was left pending. SB 306 by Joan Huffman (R-Houston) would exempt students in residential treatment facilities from a school or district’s performance rating. It was voted out favorably as substituted.

Reported from Senate Committee: SB 3 by Dan Patrick (R-Houston) would provide curriculum flexibility in high school graduation requirements. It was voted out favorably as substituted.

This Week: The House Public Education Committee will meet in E2.036 of the Capitol Extension: Tuesday, February 26, 2013 at 2:00 p.m. to take up: HB 210 by Marisa Marquez (D-El Paso) would authorize the Commissioner of Education to issue subpoenas and to conduct accreditation investigations in response to a complaint submitted to the agency with respect to alleged inaccurate data that is reported through the Public Education Information Management System (PEIMS). HB 234 by Ryan Guillen (D-Rio Grande City) would authorize a school district to apply to the commissioner to provide a flexible school day program for any campus that would benefit from the program. HB 422 by John Davis (R-Houston) would allow one credit in career and technology education to be substituted for the fine arts credit in the recommended high school program. HB 525 by Jimmie Don Aycock (R-Killeen) would require the Texas Education Agency to collect information through the Public Education Information Management System (PEIMS) relating to the enrollment of military-connected students and would prohibit the information to be used in determining a campus or district’s performance rating. HB 580 by Donna Howard (D-Austin) would allow compensatory education allotment funds to be used to provide child-care services or assistance with child- care expenses for students at risk of dropping out of school or to pay the costs of day care or associated transportation provided through a life skills program.

PUBLIC SAFETY – This week: House Culture, Recreation & Tourism will meet in E2.026 of the Capitol Extensioin: Wednesday, February 27, 2013 to take up: HB 597 by Ryan Guillen would amend the Parks & Wildlife Code to require boater education courses to include department-approved methods for cleaning a boat, boat motor, fishing and other equipment and a boat trailer to prevent the spread of exotic harmful or potentially harmful aquatic plants, fish and shellfish.

TAX – Last Monday, the Texas Conservative Coalition Research Institute released its tax reform recommendations at its 2013 Technology Summit. TCCRI’s Executive Director John Colyandro said, “Staying competitive becomes more difficult as other states emulate the Texas model. More and more states are cutting taxes and passing right-to-work laws. Texas must maintain its position as the model, rather than an emulator. Eliminating unnecessary taxes and creating additional incentives to do business in Texas are but a few options.” TCCRI tax recommendations include:

 Eliminate the franchise tax;  Reinstate the research and development franchise tax credit;  Reduce property taxes across the board, and extend relief to commercial property; and  Expand the manufacturing exemption to include research and development equipment.

Last Tuesday, the House Ways and Means Committee heard invited testimony on the biennial revenue estimate from the John Heleman, Chief Revenue Estimator for the Comptroller’s office and on the base budget recommendations from Ursula Parks, Director of the Legislative Budget Board. R&D Coalition - On Wednesday, Texans for Innovation, a coalition working to extend the manufacturing sales tax exemption to materials and equipment used for research and development purposes and to reinstate the R&D franchise tax credit, released a study indicating that Texas could enjoy more than $13 billion in increased economic activity and 97,600 new permanent jobs if the state embraces a more competitive package of research and development (R&D) incentives and tax credits. Tony Bennett, President of Texas Association of Manufacturers said, “We want Texans to appreciate what R&D means to our larger economy and to the creation of new, good-paying jobs for Texans and their families. This economic research shows that strategic incentives aimed at increasing R&D in Texas can be a real game changer. For large and small companies in industries like manufacturing, high-tech, energy, and biotechnology, R&D is the critical ‘first phase’ where questions, ideas, and problems are fleshed out in labs, the field or production facilities to become the products and solutions that power the Texas economy. The R&D process is where it all starts.” The coalition’s study also found that the absence of an R&D franchise tax credit in Texas is detrimental to the economy. According to the report, prepared by Jon Hockenyos, founder and president of TXP, Texas’ share of national business- based R&D increased when the R&D franchise tax credit was implemented in 2001 and then fell when it was repealed in 2006. During 2010, Texas accounted for: 8.1% of the nation’s population; 8.4% of the national economy; 7.3% of national academic R&D spending; and 5.2% of business-based R&D activity. Hockenyos said, “The lack of an R&D franchise tax credit is costing the state more than $3.1 billion in lost economic activity annually and 23,600 jobs. The impact of R&D on the state’s larger economy is significant. Texas’ current tax policy concerning research and development (R&D) puts Texas at a significant competitive disadvantage versus other states across the nation. Currently, Texas is one of only seven states that do not offer some type of tax incentive for R&D.” Dale Craymer, President of Texas Taxpayers and Research Association said, “We need public policy that puts Texas in the driver’s seat in R&D. Otherwise, we run the risk of watching private research and development investment - and jobs that go with it - seek out greener pastures in other states.” Representative Jim Murphy (R-Houston) Chair of the House Interim Committee on Manufacturing and sponsor of the coalition’s bill, HB 800, which would extend the manufacturing sales tax exemption to R&D equipment and reinstate the R&D franchise tax credit first enacted in 1999 and repealed in 2006, added, “Texas should be doing all it can to encourage growth in the manufacturing sector. Broad-based, low-rate taxes and smart incentives that encourage research and development are central to this growth equation.” Texans for Innovation includes the Texas Association of Manufacturers, Texas Association of Business, TechAmerica, TechNet, Texas Healthcare and Bioscience Institute, Texas Taxpayers and Research Association, and the Metroplex Technology Business Council.

This Week: The House Ways and Means Committee will meet in E2.014 of the Capitol Extension: Tuesday, February 25, 2013 at 2:00 p.m. to take up: HB 105/HB 162/HJR 40 by Lyle Larson (R-San Antonio) would repeal the provision of law that restricts the allocation of revenue from sales taxes on sporting goods to the Parks & Wildlife Department to the amount appropriated. HJR 74 by Richard Raymond (D-Laredo) would propose a constitutional amendment prohibiting the legislature from imposing a sales tax on food, drinks, or medicine not subject to the sales tax on January 1, 2013.

The Senate Intergovernmental Relations Committee will meet in E1.028 of the Capitol Extension: Wednesday, February 27, 2013 at 1:30 p.m. to take up: SB 359 by Juan “Chuy” Hinojosa (D-McAllen) would allow the board of trustees of junior college districts to participate in the selection of members of the board of directors of an appraisal district. SB 382 by John Carona (R-Dallas) would clarify that delinquent property taxes are considered debt for purposes of the law prohibiting counties from disbursing funds to a person who owes an outstanding debt to the county until the debt is paid. SB 385 by John Carona (R-Dallas) would be the Property Assessed Clean Energy Act (PACE) to allow local governmental entities to establish a PACE program allowing the entity to issue bonds to enter into a written contract with the owner of commercial or industrial real property to issue bonds, provide long-term loans to property owners, and impose an assessment to repay the owner’s financing of a renewable energy system improvement on the owner’s property. SB 476 by Juan “Chuy” Hinojosa (D-McAllen) would allow a person delinquent in the payment of property taxes on a residence homestead to pay the tax, penalties, and interest in installments if the person has not entered into an installment agreement with the collector for the taxing unit in the preceding 24 months.

The Senate Business & Commerce Committee will meet in E1.016 of the Capitol Extension: Tuesday, February 26, 2013 at 8:00 AM to take up: SB 247 by John Carona would amend Chapter 32 (tax Liens and Personal Liability), Tax Code, and Chapter 351 (Property Tax Lenders), Finance Code, to remove non- judicial foreclosure authority that property tax lenders currently utilize and to forbid the sale, transfer, assignment, or release of rights associated with a property tax lien to a person who is not licensed by CCC. With this change, property tax lenders will have to use the regular judicial foreclosure process in order to foreclose on a property.

TELECOMMUNICATIONS - Last Tuesday, the Senate Business and Commerce Committee took up: SB 259 by John Carona (R-Dallas) would prohibit the Public Utility Commission from requiring a non-dominant carrier to obtain advance approval for a filing with the commission or a posting on the non-dominant carrier’s Internet website that adds, modifies, withdraws, or grandfathers a retail service or the service’s rates, terms, or conditions. In support were representatives of Verizon, Texas Public Policy Foundation, TW Telecom, Sprint Nextel, AT&T, and Texas Cable Association. It was left pending.

This Week: The House Transportation Committee will meet in E2.012 of the Capitol Extension: Tuesday, February 26, 2013 at 8:00 a.m. to take up: HB 27 by Trey Martinez Fischer (D-San Antonio) would prohibit the operator of a passenger bus with a minor passenger from using a wireless communication device to read, write, or send a text message unless the vehicle is stopped. HB 41 by Jose Menendez (D-San Antonio) would prohibit the operation of a motor vehicle while using a wireless communication device unless the vehicle’s transmission is in park, the vehicle’s parking brake is applied, or a hands-free device is used (including calling, texting, or e-mailing). HB 63 by Tom Craddick (R-Midland) would prohibit the use of a wireless communication device to read, write, or send a text-based communication or while operating a motor vehicle unless the vehicle is stopped. HB 347 by Jim Pitts (R-Waxahachie) would prohibit the use of a wireless communication device while operating a motor vehicle on the property of an elementary or middle school unless the vehicle is stopped or is used with a hands-free device.

WORKERS’ COMPENSATION: This Week: The Senate State Affairs Committee will meet in the Senate Chamber: Monday, February 25, 2013 at 9:00 a.m. to take up: SB 381 by Leticia Van de Putte (D-San Antonio) would prohibit the misuse of the name or symbol of the Division of Workers’ Compensation of the Texas Department of Insurance in a deceptive manner on a business document.

WORKFORCE - Governor Rick Perry reappointed Andrew Alcantar of Pflugerville to the Texas Workforce Commission for a new term that will expire on February 1, 2019. Commissioner Alcantar is currently serving as chair of the Texas Workforce Commission and has served as commissioner representing the public since his appointment in August, 2008. He is former deputy director of the Governor’s Office Division of Budget, Planning and Policy.

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Legislative Articles of Interest

Education, Medicaid, Water and Transportation issues flood Capitol Interview with Scott Norman, TAB Executive Director

As water plan moves toward reality, who benefits?

Group calls for immigration reform for construction workers

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83rd Legislature Dates of Interest

Friday, March 8, 2013 (60th Day) Deadline for filing bills and joint resolutions other than local bills, emergency appropriations and bills that have been declared an

emergency by the governor.

Monday, May 27, 2013 (140th Day) Last day of 83rd Regular Session. The Legislature adjourns Sine Die.

Sunday, June 16, 2013 ( 20th Day Following Final Adjournment) Last day governor can sign or veto bills passed during the regular legislative session

Monday, August 26, 2013 (91st Day Following Final Adjournment) Date that bills without specific effective dates (that could not become effective immediately) become law

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Helpful Links  Texas House of Representatives 

 To research bills of interest, visit the Texas Legislature Online.

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TAB Legislative and Government Affairs Staff To receive information on any legislative issue, please contact us at (800) 252-3625 or (512) 476-6346

Scott Norman, Executive Director Ned Muñoz, V.P. of Regulatory Affairs and General Counsel Felicia Wright, Government Affairs Associate

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Rally Day was a Success!

Rally Day was a Success!

On February 20, TAB's Rally Day kicked off on the South Steps of the Capitol with a speech from Senator Troy Fraser. Senator Fraser has filed several bills this session, including SB 4 and SB 22, that aim to help Texas meet future water needs. He highlighted the importance of funding the State Water Plan by borrowing a member’s sign to wave during the speech. Participants were then briefed on TAB's legislative agenda and were given an advocacy update on key issues. Following the Rally, TAB members stormed the Capitol to meet with hometown lawmakers face to face and help educate them on issues that affect our industry. Rally Day ended with a legislative reception at the historic Driskill Hotel in downtown Austin concluding an important and exciting day.

In spite of the rainy weather, more than 800 attendees traveled from across Texas to Austin to advocate on behalf of the housing industry and the Texas Association of Builders. During the course of the day, every Senator and Representative was visited by Rally Day attendees and TAB representatives.

TAB would like to thank everyone who participated in this important event. We also want to thank our sponsors (listed below) for helping to make the event possible. Rally Day proved an effective way for members to get in front of critical issues that could impact the bottom line for Texas home builders. Look for photos from the event in the next issue of Texas Builder magazine.

Watch the KVUE recap of TAB's Rally Day.

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Thank you to our 2013 Rally Day Sponsors!

Rally Day Presenting Sponsors

Rally Day Signature Sponsors

Rally Day Patron Sponsors

Texas Capital Bank

Texas Panhandle Builders Association PAC

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