Taxes Won’t Increase, but Many Fees Will

AUSTIN–Putting an exclamation point on a legislative session

that opened with lawmakers facing a $9.9 billion shortfall, the

all-Republican leadership team gave itself a pat on the back for

not raising taxes.

“State leaders showed the kind of budgetary discipline families

must show: We set priorities, separated wants from needs and

stretched every dollar,” Gov. Rick Perry said a day after lawmakers

finished their business. “We protected the pocketbooks of Texas

taxpayers while protecting vital programs, increasing funding for

public education and health care.”

But where Perry and others see discipline, Capitol critics see

dodged responsibility.

“Let’s just say that some pocketbooks got protected more than

others,” said Richard Kouri, spokesman for the Texas State Teachers

Association. “Every school employee in the state lost $500 for

insurance, and we also saw a doubling of the amount active

employees pay into the health insurance system for retired


And school employees aren’t the only ones who are going to see a

bigger bite taken out of their paychecks after the 140-day

legislative session that ended Monday.

Following the agenda set by state leaders, lawmakers also pared

back the rolls for human services programs, dramatically jacked up

the fines for traffic violations and opened the door to higher

tuition at the state’s premier universities.

To comply with federal clean-air mandates, lawmakers also

increased from $13 to $33 the vehicle-transfer fee paid by car

buyers in high-pollution areas such as Fort Worth-Dallas. Under the

same measure, car buyers in less polluted areas will now pay $28.

Also, the fines for many traffic offenses will be raised by $30,

with the bulk of the money going to fund trauma centers.

In addition, Texas will adopt a point system to punish drivers

who receive multiple traffic tickets. For example, a typical

speeding ticket would be worth two points, and causing an accident

would be three points.

Motorists who rack up six points over 36 months will have to pay

a $100 surcharge to keep their licenses. Additional fines will be

assessed at $25 per point.

The state will also assess a $1,000 surcharge for first

convictions for driving while intoxicated. Those who drove without

a license or with a suspended license will be fined an additional


State university boards of regents can now set tuition rates.

The new policy, which ends the long-standing practice of uniform

tuition set by the Legislature, will not take effect until the

spring 2004 semester, so it remains unclear which universities will

increase rates.

To help offset any increase brought about by the deregulation of

tuition, the Legislature increased need-based grants for college

students from $280 million to $324 million. However, that still

falls $89 million short of what the Higher Education Coordinating

Board sought for all eligible students expected to apply. As a

result, eligibility requirements may be tightened.

Fees for hunting and fishing licenses will rise starting Aug.

15, but not because of an act of the Legislature. Last month, the

Texas Parks and Wildlife Commission voted to increase the price of

both from $19 to $23. A combination license will cost $42 instead

of $32.

Advocates for reduced government spending give the lawmakers and

the governor high marks for putting the concerns of taxpayers


An effort to raise the cigarette tax by $1 a pack failed without

so much as a hearing in committee. The same was true for a proposal

to allow voters to decide whether Texas should levy a personal

income tax.

“I think this was a very good session for taxpayers, no question

about it,” said Peggy Venable, who heads the conservative watchdog

group Texas Citizens for a Sound Economy. “I think the governor and

the leadership team deserves high marks for saying they weren’t

going to raise taxes and sticking to it.”

Anne Dunkelberg, an analyst for the liberal-leaning Center for

Public Policy Priorities, pointed out that the rolls for the

state-backed Children’s Health Insurance Program will be cut by

about 170,000 and that the hours will be curtailed for the

Medicaid-funded home health aides who help the disabled.

“All they [lawmakers] did was shift the costs down to the local

governments, and that will mean higher taxes at the city and county

level,” Dunkelberg said. “They are the ones who will have to take

up the slack.”

Bill Allaway, president of the nonpartisan Texas Taxpayers

Research Organization, said it’s too soon to calculate the full

impact of the budget. But he said he doubts that local governments

will institute huge tax increases or slash services.

“There’s a little bit of truth to both of those, but in reality,

nobody really knows yet,” Allaway said. “Personally, I don’t think

there is going to be as big a hue and cry as some might imply. But

it remains an incomplete picture right now.”

Early indications are that Tarrant County was spared many of the

ill effects expected from state cutbacks.

Tom Roy, the Tarrant County Hospital District’s government

affairs liaison, said that when the ominous talk of steep budget

reductions was initiated by top state officials, it appeared that

the cost to the district would reach as high as $28.5 million.

That number is now estimated at $4.5 million and could drop to

about $515,000 if Tarrant County receives its share of a $1.28

billion federal grant announced last month.

“The best way to put it from our point of view is that we dodged

a great big bullet,” Roy said.

Staff Writers Gordon Dickson, Jim Fuquay, Mark Horvit, Jan Jarvis,

Patrick Mcgee, Mitch Mitchell, Diane Smith, Neil Strassman and Anna

M. Tinsley Contributed to This Report.