By now, Texas businesses were supposed to have already filed returns and written checks for the newish business margins tax. They got a one-month reprieve from Comptroller Susan Combs, who decided the level of confusion was high enough to give everyone another month to calculate and pay up.

That probably delays some of the noise the new tax will generate, but not all of it.

The Texas branch of the National Federation of Independent Business is trying to build a business coalition to change the new tax. Their complaint is that the tax is too high, that it puts a hardship on companies with losses or tiny net incomes, that it's not offset by drops in property taxes, and that smaller businesses should get more of a break than they're getting.

To judge from comments from NFIB and from business people who spoke at a protest lunch on the day the tax was supposed to come due, lots of people weren't paying attention when lawmakers approved the tax two years ago.

They complained of being surprised by the tax. Some said their accountants are confused. Some said they thought their property tax relief was supposed to match their tax increase. And others said peculiarities of their operations make the new tax unfair.

Quick refresher (cribbed from our own archives of two years ago): The new tax kills the corporate franchise tax and replaces it with a levy on adjusted gross revenues of corporations and partnerships in the state. Businesses can choose what they deduct — either their cost of goods sold, or (most of) their employee compensation. Most would pay the state one percent of what's left after that calculation; retailers and wholesalers would pay 1/2 of one percent.

NFIB didn't lobby the tax when lawmakers passed it in special session two years ago; they say opposition among their members didn't reach the necessary 70 percent at the time, so they stayed out. Now that the members are seeing the tax bills (and NFIB sees the opportunity for a membership drive), the opposition is louder.

The group was joined by four lesser-know outfits (the Independent Electrical Contractors of Texas, the Air Conditioning Contractors of America Texas Chapter, the Associated Plumbing-Heating-Cooling Contractors of Texas, and the Texas Courier and Logistics Association) at an Austin lunch that drew about 150 people.

They'll push for several changes to the new tax, saying it shouldn't apply when companies are losing money or have only small profits; that the exemption for small businesses should be raised to $1 million in gross receipts from $300,000 now; that businesses with annual gross receipts under $20 million should pay only half the one percent tax rate; that all businesses should be allowed to include contract employees when adding up their deductions for payrolls; that the rate shouldn't be allowed to change unless the change gets approval from two-thirds of the House and of the Senate; and that businesses shouldn't have to pay more than twice what they paid under the old corporate franchise tax.

NFIB is trying to recruit other business groups and officials say they've got some prospects lined up. And members of the four groups that have joined in spoke at the lunch and, after it, with reporters.

"We've all made mistakes," said Gordon Stewart, an electrical contractor from Houston. "I have faith in our legislators... but I also believe they didn't know what they were getting into when they passed this."

He was the first of several speakers who said the tax was onerous. One electrical contractor said his taxes had risen to $50,000 from $3,900, but also said his company had $21 million in sales and $5 million in profits. An air conditioning contractor, Rebecca Maddux of Houston, said her business taxes quadrupled. She said later that it would have helped to know the rules last year, when she could have budgeted and planned for the tax (the comptroller didn't have final rules in place until early this year, and didn't have the form for filing the taxes completed until April 1). Maddux also said her business didn't get any property tax relief, since her father owns the land it's on and got that break.

Combs has started collecting the tax, but it's not due until June 15 and she has said it will be a couple of months — maybe August or September — before she's confident enough to say how much money the new levy has put in state accounts. House Speaker Tom Craddick recently said the state will have $15 billion more than it's currently spending when lawmakers write the next budget. Whether that's right or not, that number has found its way to voters. And Gov. Rick Perry is already talking about tax refunds if that number is correct, while others are saying the state should use any unfettered funds to improve or expand state services.

A lot will hinge on the two numbers coming within the next seven months from the comptroller: How much state revenue the new tax has produced, and how much money she expects the state to collect from other taxes over the next two years.

Those figures will frame the fight over tax cuts and revisions and on state spending in the 2009 legislative session.

Are You Nerd Enough?

This starts with a chart shoved in our faces by an energetic and smart student at the University of Texas. The conversation in a political science class late last year turned to Williamson County, and the reelection chances of Rep. Mike Krusee, R-Round Rock.

Krusee won an unexpectedly close race in 2006. Democrats had him in their targets (he has since decided not to seek reelection) based on that 2006 race.

That's when the anonymous student (he didn't leave his name) pulled up a chart on his laptop computer, showing the difference between Republican and Democratic voting patterns in gubernatorial and presidential years. Everybody knows that more people vote in presidential years. This chart, however, showed that the presidential year balloon in that county was red. The difference on the Democratic side in 2004, a presidential year, and 2006, a gubernatorial election year, was about 15,000 votes. That many more Democrats voted in Williamson County in 2004 than in 2006. But the swing in the number of Republicans was significantly larger — about 26,000 votes. The student's theory was that a candidate like Krusee, who could survive the 2006 election, would probably be okay in a presidential year. More Republicans turning, more buffer for a downballot Republican candidate.

Some counties — Travis, next door to Williamson, is an example — have bigger Democratic margins in presidential years than in gubernatorial years. Some Democratic counties — Hidalgo is one — are more strongly Democratic in gubernatorial years; that is, Democrats beat Republicans, on average, by more votes in gubernatorial years there. And in some — Collin and Denton are in this rank — the presidential year Republican bloat exceeds 70 percent. The average statewide Republican margin of about 57,000 votes in Collin County turns into about 100,000 votes in a presidential year.

It's a look in the rear-view mirror and not a predictor of what's going to happen next. And if you look at county-by-county numbers, you'll find some landmarks. George W. Bush did extraordinarily well in that first presidential election, even in Democratic counties. So that skews the numbers. His home-state advantage in 2004 was smaller, but still apparent. Texas Democrats did much better in 2002, when they ran a strong statewide ticket, than in 2006, when they ran a serious race for governor and weak candidates for most other statewide contests. You can see it in the numbers: a million-vote average difference between statewide Republicans and Democrats in 2006, and half that in 2002.

And the state is becoming more competitive for the minority party — when Democrats field credible, well-financed candidates. That's why, for instance, the Republicans running for statewide judicial positions are nervous this year. Those elections have more to do with party identification than with anything else. Bush, who's still more popular in Texas than he is elsewhere, won't be on the ticket. Republicans are having a rough time nationally. And while the Republican turnout in the primaries grew dramatically this year, the GOP numbers were puny next to the growth in Democratic turnout.

One indication of change: Both sides consider Krusee's open seat in Williamson County a battleground race. It used to be solidly Republican.

Pleading (to) the Fifth

Texas Democrats want the 5th Circuit Court of Appeals to look at a Midland candidate's eligibility, and the candidate himself has filed a friendly lawsuit against his own party.

Midland City Councilman Bill Dingus filed to run against House Speaker Tom Craddick, R-Midland. After some Republican rumblings about his eligibility, the Texas Democratic Party asked a federal judge whether Dingus is eligible, as a city council member, to also run for state rep.

The court didn't rule on that question, instead kicking the case to state courts. But U.S. District Judge Walter Smith wrote that Dingus isn't eligible to run. Dingus responded to that by resigning from the City Council. And now the TDP is going to the New Orleans-based federal appeals court for another crack at the question.

Dingus, meanwhile, filed against the Texas Democratic Party in an attempt to clear up his spot on the ballot. He's asking the state court to declare him eligible. No court date's been set.

• That's not the only election that's gone to the judges. The Texas Supreme Court denied a plea from Rep. Nathan Macias' lawyers to replace the judge hearing his case. And the court recount of his election defeat in HD-73 is set for Monday, May 19.

Macias, a freshman Republican from Bulverde, lost the GOP primary to former New Braunfels Mayor Doug Miller. It was close, though, and Macias thinks alleged hanky-panky in Gillespie County's Box 5 — where the votes came in late, and for a time, Miller's sister-in-law mingled with the counters — might have cost him his reelection. His lawyers wanted the judge removed without stating a reason; the judge — upheld on appeal — said that works in regular cases, but not election contests. The difference between the winner and the loser: 17 votes. Trivia: Two years ago, Macias beat incumbent Rep. Carter Casteel, R-New Braunfels, by just 45 votes.

And Then There Were Nine

The national press might be anointing Barack Obama, but U.S. Rep. Ciro Rodriguez, D-San Antonio, watched the returns from North Carolina and Indiana and put his superdelegate support behind Hillary Clinton. In his announcement, he said the voters in his district favored Clinton, "and I will respect their decision."

That leaves nine Texas superdelegate votes undecided — five of them under the direct or indirect influence of Texas Democratic Party Chairman Boyd Richie. He's got a vote. Betty Richie, his wife and a Democratic National Committee member, has got a vote. And the rules say three delegates will be chosen at the state convention — appointed by the chairman and approved by a Party committee.

Our superdelegate chart, updated, is available in the Files section at TexasWeekly.com.

Political Notes

Texas Republicans have a door-knocking campaign going on this weekend, encouraging their grass-roots folks to get out and gather names of people who might vote with the GOP in November. Their pitch to volunteers is that Democrats are jazzed up this year and the Republicans need to catch up. They've got various officials — U.S. Sen. John Cornyn, Railroad Commissioner Michael Williams — promising to give $250 rewards to people who win drawings after turning in 60 new names.

• Roland Gutierrez, a former San Antonio city councilman, is the newest member of the Texas House after a swearing-in this week. He was unopposed in the contest to finish the term of Rep. Robert Puente, a Democrat who resigned earlier this year (and who was named interim CEO of the San Antonio Water System a week ago). Gutierrez is also the only candidate on the ballot in November.

• Put R. Ted Cruz on your list of potential candidates for attorney general, should an opening occur in that office in the next couple of years. Cruz was until recently the state's solicitor general, working for Attorney General Greg Abbott. He left for private practice a few weeks ago (joining the Morgan Lewis law firm as a partner this week), became a father, and somehow got other Republicans talking about his political future. Abbott hasn't said he's going anywhere, but even the squirrels on the Capitol grounds have heard the rumors that he'd like to run for lieutenant governor or even governor in 2010.

• U.S. Sen. John Cornyn's campaign doesn't trust polls that show Democrat Rick Noriega only four points behind the incumbent. But they're using the scare to try to raise money. Their latest pitch: " The facts are clear, the extreme left is energized and unscrupulous, and our opponent is shamelessly aligned with them and will say and do anything it takes to gain much needed relevance and resources." Two separate polls had Noriega just behind Cornyn; and both, like others we've seen, had Cornyn holding less than 50 percent support.

• One of the nation's biggest pro-choice organizations endorsed Barack Obama, but the Texas affiliate of NARAL isn't joining in. NARAL Pro-Choice Texas issued a statement saying they won't endorse right now in the presidential race, but will "when a pro-choice nominee for president is named." They'll wait for the Democratic convention, in other words. How do they feel about Republican John McCain? They call him an "anti-choice candidate." He won't be getting the nod.

• Former U.S. House Speaker Newt Gingrich of Georgia will speak at the Texas GOP convention in Houston next month. So will Mitt Romney, the former presidential candidate and Governor of Massachusetts. The Republican Party of Texas made Gingrich part of the afternoon lineup on Friday, June 13; Romney will speak at the dinner that night.

• Texas Agriculture Commission Todd Staples is going to Cuba on a trade mission. He says he's the first statewide elected official from here to do that in 45 years. He'll take a couple of dozen people with him; they're trying to expand trade between Texas and the island.

• Pat Dixon, the state chairman of the Libertarian Party, is now an elected official after winning a spot on the Lago Vista City Council. He was on the council before, lost the seat in 2007 and will go back on.

• One of the best campaign finance websites — OpenSecrets.org — has been redesigned. It's faster, searches are better, and one of the truly great resources on the Internet is now even better. In about two seconds, we had our mitts on this: Texas ranks third among the states in total contributions to federal candidates in this election cycle, fourth in money given to Democrats, second in money given to Republicans, and first in soft-money contributions. Texans have contributed $90.6 million to federal candidates so far, with about three-fifths to Republicans and two-fifths to Democrats.

What the *%*$@#!!!???

It appears that voters in Eustace have elected Mark Sanders to their city council.

Sanders, a political consultant and former reporter who's worked in statewide campaigns for Republicans (like Kent Hance), Democrats (Tony Sanchez Jr.) and Independents (Carole Keeton Strayhorn), got 75 percent of the vote, which means he got 69 votes.

He finished second in a field of six candidates, with the top three getting council seats. The top vote-getter pulled in 77 votes; number three got 64 votes.

Eustace is in northeast Texas, near Athens.

Political People and Their Moves

Carl Richie Jr. is closing his solo lobby shop to become vice president for government affairs at TXU Energy (the retail company borne of last year's TXU buyout). He'll start the new gig June 2.

Mindy Carr is joining another TXU spinoff. She'll join Oncor, the distribution company, as government affairs director. Carr was most recently at the Texas Land Title Association.

Paige Cooper is leaving her lobby biz for a spot in the intergovernmental affairs section at the Attorney General's office. She worked in the House for ten years before she started lobbying four years ago.

Dr. Jose Gonzalez is the new medical director for Medicaid and CHIP at the Health and Human Services Commission. He's a pediatric endocrinologist and professor at the University of Texas Medical Branch in Galveston. He'll start next month.

Dr. Hilton Israelson, a Dallas periodontist, is the new president of the Texas Dental Association; the new president-elect is Dr. Matt Roberts, from Crockett.

Gov. Rick Perry made some appointments:

• Jerry Lowry of New Caney and Larry May of Sweetwater to the Texas Commission on Jail Standards. Lowry is an exec with the Greenspoint District (a real estate project), and May is a CPA.

• Nine people to the Judicial Compensation Commission, which sets judge's salaries and, by extension, the retirement benefits of legislators and other state officeholders. The new commissioners are Betsy Whitaker, a Dallas lawyer who'll chair the panel; Ramiro Galindo, chairman of the Galindo Group in Bryan; Tom Harwell of El Paso, an exec with medical device manufacturer Ethicon Endo-Surgery; Harold Jenkins, president of CTJ Maintenance in Irving; Pat Mizell, a Houston attorney with Vinson & Elkins; Wanda Rohm, president of Presto Printing in San Antonio; Linda Russell of Kemah, CEO of the Woman's Hospital of Texas; Austin attorney Mike Slack; and Bill Strawn, also of Austin, founder of an executive search firm called Strawn Arnold Ashpitz Groover.

• Darrel Brownlow, a Floresville exec with Cemex USA, to the Evergreen Underground Water Conservation District Board. That's a reappointment.

Deaths: Alice Finley, the House's Journal Clerk when she retired in 1995. She was 70. And one of her contemporaries, Cynthia Gerhardt, a longtime Capitol staffer whose last job before retirement was chief clerk of the Texas House, after a ten-year fight with cancer. She was also 70.

Quotes of the Week

John Heleman, the state comptroller's chief revenue estimator, quoted by the Associated Press: "We are seeing a gentle cooling of the Texas economy. The last several years have really been growing very robustly... we were calling for an easing of that growth and we're seeing that now."

Daisetta Mayor and Fire Chief Lynn Wells, quoted in The New York Times on the massive sinkhole that appeared in the middle of town: "It's unreal — the earth just wallered up."

Terry Clawson, speaking for the Texas Commission on Environmental Quality in the Houston Chronicle after state auditors said there aren't enough inspectors available to ensure the safety of the state's 7,603 dams: "We know of no dams in Texas that are in imminent danger of collapse."

Rep. Linda Harper-Brown, R-Irving, quoted by the Fort Worth Star-Telegram about the state's transportation agency: "TxDOT used to be a premier agency in America. It's not any more. Other states have better roads."

Rep. Warren Chisum, R-Pampa, quoted in the Houston Chronicle after Attorney General Greg Abbott said it's probably illegal to transport horsemeat across Texas: "Mexico kills horses, whether we like it or not, and people in France eat them. And sometimes the slaughterhouses like to ship the meat out of Corpus [Christi] or Houston."

Barack Obama press secretary Bill Burton, quoted in The New York Times about on-air advice for his campaign from politico-turned-pundit Karl Rove: "Wouldn't taking his advice be a little like getting health tips from a funeral home director?"

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Texas Weekly: Volume 25, Issue 20, 19 May 2008. Ross Ramsey, Editor. Copyright 2008 by Printing Production Systems, Inc. All Rights Reserved. Reproduction in whole or in part without written permission from the publisher is prohibited. One-year online subscription: $250. For information about your subscription, call (512) 302-5703 or email biz@texasweekly.com. For news, email ramsey@texasweekly.com, or call (512) 288-6598.

Tom Craddick is the talk of the blogosphere again this week. Bloggers are also discussing Democrats and writing about Republicans, while a criminal justice blogger gives his two cents on Eldorado. And then there are the usual posts that didn't fit into categories.

* * * * *

There's Something About Tom

State Rep. Lon Burnam, D-Fort Worth, has asked a committee to investigate whether Speaker Craddick has a "ghost worker" of his own in House Parliamentarian Terry Keel, according to PoliTex, the Fort Worth Star-Telegram's blog.

Burnt Orange Report sends out an APB: "Please feel free to send us any pictures you have of Terry Keel or any Craddick staffer not doing their job during the hours of 8 a.m. until 5 p.m. (typical work hours)." Eye on Williamson has a take, too.

On a semi-related note, Gov. Rick Perry is raising money for Keel's sister-in-law Donna Keel, who's running for the House District 47 seat, reports Postcards from the Lege, the Austin American-Statesman's blog. And Chronic, the AustinChronicle's blog, sums up the "legal kerfuffle" surrounding former Midland city council member's Bill Dingus's bid to challenge Craddick in November. (Another, Off the Kuff, also uses the unlikely word "kerfuffle" this week.)

* * * * *

Blue Streak

Democratic state party chair and superdelegate Boyd Richie says he won't commit to a presidential candidate until after the state convention ends June 8, reports Tex Parte Blog. Burnt Orange has been designated Texas' official blog, granting them credentials to the Democratic National Convention in Denver. And Barack Obama's Texas campaign coordinator is taking a job with the Travis County Democratic Party, according to Postcards.

Capitol Annex goes over the challenges to the Democratic county and state conventions. Here are some of the challenges in Adobe Acrobat (.pdf) format, by Texas Politics, the Houston Chronicle's blog.

State Rep. Mark Strama, D-Austin, is holding his third Strama Campaign Academy from June 23 to July 25, says the show’s manager in Burnt Orange. Meanwhile, Texas Blue pens a hagiography of Democrat Wendy Davis, who's challenging Republican Kim Brimer for his Fort Worth state Senate seat.

Election Law Blog has LULAC's complaint against the Texas Democratic Party's primacaucus system, via VoteLaw.com. That earned LULAC one of Kaos's Cheese Tray Awards," presented to the biggest whiners in politics.

Blue interviews Karl-Thomas Musselman, Rick Noriega's online coordinator and also a writer for Burnt Orange. Texas Kaos notifies readers that Noriega was on Blog Talk Radio. And mean rachel attended a party thrown by Travis County Democrats.

* * * * *

Red Dawn

U.S. Rep. John Culberson, R-Houston, got caught on camera sticking his foot in his mouth. Kuff saw it first, and Blue has video.

The pair of polls showing a tight race between incumbent Sen. John Cornyn and Noriega could help Cornyn raise money, says KVUE's Political Junkie. Meanwhile, Half Empty has some fun with a questionnaire mailed to him from the Republican National Committee.

PoliTex reports that Mitt Romney and Newt Gingrich will headline the Texas GOP convention in June. Austin Political Report takes a moment to provide sordid details about Gingrich's personal life.

ABC News has people covering Sens. Kay Bailey Hutchison and Cornyn as potential running mates for John McCain, but nobody for Perry, according to Texas Politics. And here's the view from PoliTex.

* * * * *

True Grits

Grits for Breakfast does not agree with the state's raid of the Yearning For Zion ranch in Eldorado. He says authorities have been using "phony statistics on pregnant teens." He has a post on FLDS members speaking out on the Internets.

Grits says the state ignored evidence showing that the initial call for help was a hoax. "I'm now fairly convinced Texas will never see any successful criminal prosecutions from the Great Eldorado Polygamist Roundup. They've just screwed it up too badly," he says.

* * * * *

Salmagundi

Texas Libertarians have 174 candidates on the November ballot, a new record, says Chronic. And Vaqueros & Wonkeros, the El Paso Times'sblog, brings readers up-to-date on the state House contest between incumbent Dee Margo and Democrat Joe Moody.

BurkaBlog writes about Attorney General Greg Abbott's ruling against the Lege's needle exchange program. "People will die and medical costs will rise as a result." Meanwhile, Junkie's got a photo of Texas Secretary of State Phil Wilson ringing the closing bell at NASDAQ.

To nobody's surprise, Burnt Orange doesn't agree with a recent state Supreme Court ruling in favor of big-spending Republican Bob Perry. And Annex says Texas isn't caring for its dams.

In The Pink Texas's Pink Lady turned 36. Burnt Orange has a tribute post.

Capitol Crowd's "Person of the Week" is Texas Tomorrow Fund II director Kevin Deiters. State Sen. Florence Shapiro, R-Plano, is going to Israel as part of a White House delegation, reports Postcards. And Mike Falick posted his testimony before the House Higher and Public Education Finance Select Committee on his Mike Falick's Blog.

Headline of the Week award goes to Annex for a post titled, "A $200,000 Bounty For A Write In Opponent To Sheila Jackson Lee?"

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This edition of Out There was compiled and written by Patrick Brendel, who hails from Victoria but is spending the spring in the mid-Atlantic region. We cherry-pick the state's political blogs each week, looking for news, info, gossip, and new jokes. The opinions here belong (mostly) to the bloggers, and we're including their links so you can hunt them down if you wish. Our blogroll — the list of Texas blogs we watch — is on our links page, and if you know of a Texas political blog that ought to be on it, just shoot us a note. Please send comments, suggestions, gripes or retorts to Texas Weekly editor Ross Ramsey.

Rep. Byron Cook, one of the first House members accused of giving full-time benefits to part-time employees, named a House subcommittee "to clarify the state’s employment laws and House Rules for both employees of the House Civil Practices Committee as well as all House Capitol, District and Committee staff employees..."Cook, chairman of the House Committee on Civil Practices, pegged the investigation to differences over a memo on the scandal from Rep. Jessica Farrar, D-Houston. He says it's accurate, but says aides to House Speaker Tom Craddick have called it incorrect. The subcommittee he named will find out what's right and what's wrong and go from there. Rep. Mark Strama, D-Austin, will chair that group, joined by Reps. Jerry Madden, R-Garland, Richard Raymond, D-Laredo, and Robert Talton, R-Pasadena. Craddick has asked Rep. Larry Phillips, R-Sherman, to investigate the issue. Phillips heads the House Committee on General Investigating & Ethics. Some members of Cook's committee wanted to leave it there, but he wouldn't recognize their challenges, instead forming his new subcommittee and then moving on to other business. Cook started his committee's meeting with a statement:

A matter has also recently arisen that not only encompasses our committee, but the entire House of Representatives which I want to address. Beginning post session 2007, there have been formal and informal inquiries by Speaker’s office regarding the employment status of certain House employees. Though I firmly believe the agenda behind these inquiries is political and in my case, in retaliation to my challenging the Speaker on an appropriation he was holding up regarding state funding for the Texas State Railroad in my district, I also feel the ethical and legal questions posed as to the benefit status of state employees must receive fair scrutiny rather than witch-hunts in the press. I am particularly disappointed that the Speaker's office has engaged in a wholesale effort to mislead members of the press, a few of whom have bought into a biased, one-sided version of events. As time goes on, additional media scrutiny has demonstrated that the long-standing tradition in the House of using on-call employees, particularly those with certain professional skills and expertise, is practiced as much by those who support the Speaker as by those who oppose him. Compounding these press articles’ false and discriminatory portrayal of this issue, Speaker’s office and our own House Administration Committee have made conflicting statements with little regard for their effect on the process and the self-esteem of the men and women who are serving our legislature in a dedicated, hard working and ethical manner. I also firmly believe that all House members take their oath to serve the laws of the state and rules of the House seriously, and that for the Speaker to imply otherwise without assuming his accountability is shocking as he himself is ultimately responsible for approval of House employee practices including on-call employees, here again, a common practice in the House for many years. Representative Jessica Farrar has written a memo to her democratic colleagues that outlines the laws and House Rules for legislative employees. I thought her memo did a thorough job of explaining an employee’s status especially the on-call employees who serve both our committees and district offices. The Speaker’s office said the memo is “filled with inaccuracies,” therefore, I believe it is necessary that I appoint a subcommittee to clarify the state’s employment laws and House Rules for both employees of the House Civil Practices Committee as well as all House Capitol, District and Committee staff employees… as the laws and House rules should be the same. The subcommittee will consist of Representative Strama as Chair; with Representative Madden, Talton and Raymond serving as members. I will ask the subcommittee to prepare a report in a timely manner and respond back to this Committee and our entire House Membership.

And Farrar's memo is attached.

The first broadside of the state's general elections -- an attack on Corpus Christi Democrats in the Legislature -- is in the mail.The Nueces County GOP send the mailers hitting two state representatives they're trying to knock off. The ads, below, swing at Juan Garcia III and Abel Herrero for taking campaign contributions from Mauricio Celis, who has since been accused of impersonating a lawyer and other crimes. The two Democrats have returned money they got from Celis in the current election cycle, and in Garcia's case, all of the money he's received from Celis.

How the House and Senate voted on final passage of the business margins tax bill in special session two years ago.

House final vote on HB 3 — the business margins tax bill, on 4/25/06:

 

AYES – 81 (10 Democrats, 71 Republicans)

• Democrats: Kevin Bailey, Robby Cook, Donna Howard, Vilma Luna, Jim McReynolds, Joe Pickett, Chente Quintanilla, Patrick Rose, Mark Strama, Michael Villarreal.

• Republicans: Charles "Doc" Anderson, Leo Berman, Roy Blake, Dennis Bonnen, Dan Branch, Betty Brown, Fred Brown, Bill Callegari, Scott Campbell, Warren Chisum, Byron Cook, Frank Corte, Joe Crabb, Tom Craddick, Myra Crownover, John Davis, Glenda Dawson, Dianne White Delisi, Mary Denny, Joe Driver, Rob Eissler, Kirk England, Dan Flynn, Dan Gattis, Charlie Geren, Toby Goodman, Tony Goolsby, Bob Griggs, Kent Grusendorf, Pat Haggerty, Mike "Tuffy" Hamilton, Peggy Hamric, Rick Hardcastle, Glenn Hegar, Fred Hill, Ruben Hope, Bob Hunter, Suzanne Gratia Hupp, Carl Isett, Jim Jackson, Terry Keel, Jim Keffer, Phil King, Lois Kolkhorst, Mike Krusee, Edmund Kuempel, Jerry Madden, Brian McCall, Tommy Merritt, Sid Miller, Geanie Morrison, Anna Mowery, Joe Nixon, Rob Orr, John Otto, Larry Phillips, Jim Pitts, Elvira Reyna, Gene Seaman, Todd Smith, Wayne Smith, Burt Solomons, Joe Straus III, David Swinford [initially recorded absent, but said his machine failed to register his vote], Larry Taylor, Vickie Truitt, Corbin Van Arsdale, Buddy West, Martha Wong, Beverly Woolley, Bill Zedler.

NAYS – 68 (53 Democrats, 15 Republicans)

• Democrats: Alma Allen, Rafael Anchia, Lon Burnam, Joaquin Castro, Norma Chavez, Garnet Coleman, Yvonne Davis, Joe Deshotel, Dawnna Dukes, Jim Dunnam, Harold Dutton, Al Edwards, Craig Eiland, Juan Escobar, David Farabee, Jessica Farrar, Kino Flores, Steven Frost, Pete Gallego, Helen Giddings, Veronica Gonzales, Yvonne Gonzalez Toureilles, Ryan Guillen, Ana Hernandez, Abel Herrero, Scott Hochberg, Terri Hodge, Mark Homer, Chuck Hopson, Jesse Jones, Tracy King, Pete Laney, David McQuade Leibowitz, Armando Martinez, Trey Martinez Fischer, Ruth Jones McClendon, Jose Menendez, Paul Moreno, Elliot Naishtat, Rick Noriega, Rene Oliveira, Doro Olivo, Aaron Pena, Robert Puente, Richard Raymond, Allan Ritter, Eddie Rodriguez, Jim Solis, Senfronia Thompson, Sylvester Turner, Carlos Uresti, Mark Veasey, Hubert Vo.

• Republicans: Dwayne Bohac, Carter Casteel, Keith Elkins, Linda Harper Brown, Will Hartnett, Harvey Hilderbran, Charlie Howard, Bryan Hughes, Delwin Jones, Bill Keffer, Jodi Laubenberg, Ken Paxton, Debbie Riddle, John Smithee, Robert Talton.

ABSENT – 1

• Roberto Alonzo, Democrat.

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Senate final vote on HB 3, the business margins tax bill, on 2 May 2006

 

AYES – 16 (2 Democrats, 14 Republicans)

• Democrats: Ken Armbrister, Frank Madla.

• Republicans: Kip Averitt, Kim Brimer, John Carona, Bob Deuell, Robert Duncan, Craig Estes, Troy Fraser, Chris Harris, Jane Nelson, Steve Ogden, Kel Seliger, Florence Shapiro, Jeff Wentworth, Tommy Williams.

NAYS – 14 (10 Democrats, 4 Republicans)

• Democrats: Gonzalo Barrientos, Rodney Ellis, Mario Gallegos, Juan "Chuy" Hinojosa, Eddie Lucio, Eliot Shapleigh, Leticia Van de Putte, Royce West, John Whitmire, Judith Zaffirini.

• Republicans: Kevin Eltife, Mike Jackson, Kyle Janek, Todd Staples.

ABSENT – 1

• Jon Lindsay, Republican

Tax Day may now be just a memory for many Texans, but there is an even bigger tax day looming for Texas businesses — Franchise Tax Day. While businesses are cutting checks, some for the first time, many have raised a question about an issue concerning the vitality of this state. Will the state of Texas cut its own checks if the new tax exceeds the initial forecast?

Economists and tax experts predict the state will rake in the money, far exceeding the state’s revenue expectations. If their predictions are correct, after reducing property taxes, the surplus should immediately be refunded to those footing the bill: Texas businesses.

Paying taxes is important. Although we may not like it, everyone must pay their fair share for taxes to work effectively and efficiently.

However, when the actual tax revenue exceeds what lawmakers predicted in the state budget, we have to question if the state should keep the extra dollars to fund frivolous government projects or if the money should be given back to businesses.

Last session, state budget officials projected an $11.9 billion total — roughly $6.1 billion in new revenue — would be raised in 2008-2009 through a revamped franchise tax. The new revenue was allocated solely for property tax relief, which in the end helps all Texans. Whether you own property or rent, both your company and personal checkbook will feel the relief.

Property tax is not the only mandate pinching our wallets though; we have the flexibility for more. Once tax relief has been distributed to property owners, the state should consider tax relief options for Texas business owners. Otherwise, we will suffer the same economic fate of most other states.

Recent reports have consistently indicated all year that while the national economy has been sinking, Texas has kept its head above water. Our low unemployment rates and healthy trade environment alone are helping fuel our surge.

The simple fact is you cannot have economic prosperity without business. When a business is unencumbered by harsh regulations, employers have more flexibility to give back to their local communities. Whether hiring additional workers and reducing the unemployment rate or developing new locations that increase consumers’ access to more goods and services, a healthy business environment is absolutely necessary for a state on the move.

Last year, Forbes Magazine ranked Texas in the top five best states to do business. With an endorsement like that, is it surprising that our economy is surging, while other states are in a financial slump?

Texas isn’t in the lead by luck; we’re ahead because state leaders like Gov. Rick Perry, Lt. Gov. David Dewhurst and Speaker Tom Craddick understand that Texas business is the fuel that keeps the Texas economy moving.

For that reason, the only sensible option for a surplus is for state leaders to give it back proportionately to the businesses footing the bill. Those additional funds won’t be wasted, but will be used to provide more good paying jobs and to strengthen our economy for years to come.

Bill Hammond is president of the Texas Association of Business. Founded in 1922, the Texas Association of Business is a broad-based, bipartisan organization representing more than 140,000 small and large Texas employers and 200 local chambers of commerce.

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On the eve of House committee hearings on so-called Ghost Employees — people getting full-time state benefits for part-time work — three Democrats say the hearings should be open to the public and should include consideration of new rules governing the people who work for legislators in the lower chamber.

But the head of the House Committee on General Investigating & Ethics — Rep. Larry Phillips, R-Sherman — says he'll hold the hearing in closed-to-the-public executive session.

Phillip's committee has two pieces of business. First, there's the issue of whether anyone in the House has been doing anything that's against House rules or state law. Second, Phillips says the committee will look at changes in the rules and possibly, the law, so it's clear how lawmakers should act in the future.

"If there are things that are happening that don't make sense or aren't appropriate, that needs to stop," he says. "I don't think it's that complicated."

Phillips says the emphasis is "looking at the future, and at what we are going to do so that the public will have confidence." But it's not all about the rules and how they should be changed; an executive session wouldn't be needed for that. He says the closed session is necessary "because we'll be looking at personnel matters."

"The public expects us to take care of and be good stewards of tax dollars..." he says. "This question is clearly within the purview of this committee, and it's incumbent on the House to maker sure the public has confidence in what we do."

That's as close as he comes to saying they'll look at specific allegations about sketchy employment practices.

In their letter to all members of the House, three Democrats — Reps. Garnet Coleman of Houston, Jim Dunnam of Waco, and Craig Eiland of Galveston — wrote that the meeting should be open to the public. They say no one has pointed to a violation of law or House rules, and say the closed session cloaks the politics underlying the scandal. They've accused House Speaker Tom Craddick of stirring up the trouble; his aides deny that, and Craddick's been quoted as saying he was surprised by the allegations.

The three Democrats suggested some rule changes that would prevent part-timers from getting full-time benefits, bar non-elected officials from receiving "elected-class" benefits, allowing members to hire "on-call" employees, requiring monthly accounting of employee overtime, vacation, and sick leave, and preventing full-time employees from holding outside jobs.

A House committee looking at so-called Ghost Workers abruptly stopped, citing a criminal investigation by Travis County prosecutors.Rep. Larry Phillips, the Sherman Republican who chairs the General Investigating and Ethics Committee, had planned to look into reports that some House members have been listing part-time employees as full-timers, a cheat that gives those workers free health insurance. His aim was to look at what's been going on, and to consider changes in law and House rules that would clear up the practice in the future. But Phillips backed down, saying he's talked to people from the Travis County District Attorney's office and that he doesn't want to do anything in his committee that gets in the way of their investigation. He said he's not closing the door on a future investigation by his committee, though: "The public wants to make sure there's a thorough investigation." Another House panel has announced, but hasn't started, it's own investigation. That panel was created by Rep. Byron Cook, R-Corsicana, who himself has been accused of giving full-time benefits to an employee who currently lives in Denver, Colorado, and commutes to Texas.

When it comes to state pension benefits, it turns out that someone who wants to game the system doesn't have to lie. They just have to read the free handbook from the Employees Retirement System and follow the instructions. For former legislators who served for at least eight years, each additional year on the state payroll is currently worth $2,875 annually, once they start collecting their pensions. Those pensions are based on years of service multiplied by 2.3 percent of a state judge's salary, which is currently $125,000. Former lawmakers can start collecting their pensions at age 60 if they served for at least eight years in elected office, and at age 50 if they served for at least 12 years. (They have options as to how they get their benefits, but those are the basics.) A 65-year-old former lawmaker with 16 years in the Legislature, for instance, would be eligible for an annual pension of $46,000. If she worked for a state agency for two years on top of that, the annual benefit would increase to $51,750. The regs say the beneficiary gets credit for a month as soon as that paycheck is recorded and the retirement benefit deducted from it. If our imaginary former lawmaker is on the books for $200 monthly, and allowed the $12 deduction for retirement each month, the benefits would accumulate. As long as she's on the payroll when the monthly checks are cut, she gets the pension bennies for that month. She doesn't even have to work full-time.

This bit from the Texas Government Code is in play at the moment. Local prosecutors working on the Ghost Employee case want legislative committees to avoid accidental distribution of Get Out of Jail Free cards to people who know things about the payroll flap. They're briefing them on this:

301.025. REFUSAL TO TESTIFY. (a) A witness called by either house or by a legislative committee does not have a privilege to refuse to testify to a fact or produce a document on the ground that the testimony or document may tend to disgrace the person or otherwise make the person infamous.

(b) The legislature may require a person to testify or produce a document concerning a matter under inquiry before either house or a legislative committee even if the person claims that the testimony or document may incriminate him.

(c) If a person testifies or produces a document while claiming that the testimony or document may incriminate him, the person may not be indicted or prosecuted for any transaction, matter, or thing about which the person truthfully testified or produced evidence.

(d) A witness has a right to counsel when testifying before the legislature or a legislative committee.

State Auditor John Keel says he has not been asked to look at the House employment mess and isn't conducting an audit of the payroll system there.

The State Auditor's Office has been mentioned in some stories (here and elsewhere) as a possible investigator, along with Travis County prosecutors, various House committees, and the Attorney General.

Keel says they haven't seen any such requests, on paper or otherwise. They're not involved.

One problem with an audit of legislative records is that some possibly critical pieces of paper just don't exist. It's a faith-based accounting system. Lawmakers sign up their employees and say whether they're full or part time and what their pay should be. But the House doesn't require time sheets or any other proof of the hours that were actually worked. That makes it more difficult to prove that someone worked, say, 40 hours a week. Ultimately, it's an honor system.

That sort of hole in the paper trail can make it hard to tell the difference between a cheater and someone who follows the rules.

In political terms, that's a mess: How do representatives seeking reelection prove their House employees really work the hours for which they're paid?

While legislators battle over what's fair to them, a lot of their employees get hosed. Texas lawmakers already get far more than full-time work from many of their employees, and they're largely exempted from laws guaranteeing overtime pay and comp time for the long hours their staffs put in during legislative sessions and when interim committees are cranking out reports. If you did a proper accounting of the time the non-elected people actually work in the Pink Building, you'd have to bring sacks of money for overtime, or get used to empty halls after sessions, when staffers traded hours off for extra hours worked. As it stands, overtime for legislative staffers is rare. And whether employees get any time off for the extra hours is, like the time sheets and everything else, up to the individual legislators.

A Carrollton legislator wants the names of former legislators now working as regular state employees and adding time to the top-drawer retirement accounts set up for all of the state's elected officials.

Rep. Jim Jackson, a Republican, asked the Employees Retirement System for "records of all former state elected officials, past and present, who after leaving office were listed as full-time employees with any state agency that makes them eligible to participate in the employee class of ERS."

He also asked for salary information and whether they've transferred time earned as regular employees to their elected class accounts.

Jackson said in his letter that "the preferential treatment of former members of the elected class is unnerving," a reference to the state law that allows them to transfer their work time into the more lucrative elected class accounts.

He wrote that he was particularly incensed about "on-call" employees, who don't have set hours but get time on the state payroll that adds to their retirement benefits.

We recently looked at the state pension plan's brochures, and an employee's full- or part-time status has nothing to do with whether and how they accrue time for pensions. To get credit for a month's work, you need only be on the payroll on the particular day in that month when the checks are cut, and allow the pension deduction to come out of your check.

The difference between elected class and employee class, for most people, is in the base salary that's used to compute benefits. For state employees, that base is the average of their three highest-salary years. For elected officials, it's keyed to the pay of state district judges, currently $125,000.

State employees who make more than that actually do better than retired officeholders. But most make much less, and also have to wait longer or work longer to collect the benefits. Officeholders can retire at age 60 if they served for eight years, and at age 50 if they served for 12 or more. State employees can retire when their combined age and years of employment reach 80.

Here's a quick and almost certainly incomplete list of former elected state officials who currently (or recently) have been on the state payroll as regular full- or part-time employees. From statewide office: Former Railroad Commissioner Charles Matthews. From the state Senate: Ken Armbrister, Chet Brooks, and Kent Hance. From the House: Ben Campbell, Terry Keel, Mike McKinney, Terral Smith, Miguel Wise, and Zeb Zbranek.

Matthews was the only one in that bunch who's elected state position was a full-time job. Texas legislators are part-timers, and get better benefits than the full-timers who work for them. One more note: Former county officials, like Jackson, can transfer their county time into the state system, or vice-versa.

The state didn't have the right to remove children from a West Texas religious community, the state's 3rd Court of Appeals in Austin ruled. The judges said the Texas Department of Family and Protective Services didn't have evidence that the 460+ kids were in imminent danger. The case was filed on behalf of 48 FLDS mothers by Texas Rio Grande Legal Aid, a non-profit outfit. State officials are deciding whether to appeal the court's opinion, which is available here.

• The state's latest round of eight-liner raids hit a big political contributor. Gordon Graves, the head honcho of Aces Wild, has given $587,825 to Texas statewide officeholders in the last eight years, including $125,500 to Lt. Gov. David Dewhurst, $113,500 to Gov. Rick Perry, $43,000 to Attorney General Greg Abbott (who's office claimed credit for the raids), and $18,375 to Comptroller Susan Combs.

• The Howzitgoin Department: Overall crime in Texas rose in 2007, but violent crime was down. According to the Department of Public Safety, the number of crimes per 100,000 population rose 0.7 percent from 2006 to 2007. Property crime rose 1 percent; violent crime fell 1.2 percent. Details: Murder, up 2.2 percent; rape, up 0.3 percent; robbery, up 4 percent; aggravated assault, down 1.4 percent; burglary, up 5.8 percent; larceny-theft, up 2.2 percent; motor vehicle theft, down 1.8 percent. The report's available online here.

• New media: U.S. Sen. John Cornyn picked up several endorsements in the state's Border counties, and he's posted little videos of some of them on his website.

• Democrat Chris Turner turned a tax-holiday tout into a towel-snap, encouraging Arlington voters to take advantage of the sales tax holiday on energy efficient appliances and noting that Republican Rep. Bill Zedler voted against the break. Zedler, Turner says, voted against it as a stand-alone measure, but for it when it was wrapped into another bill.

• The state GOP's number one House target — Rep. Juan Garcia, D-Corpus Christi — wrote a $17,000 campaign check to the Intrepid Fallen Heroes Club in January. That's the same amount his campaign received from the Mauricio Celis, and Garcia aides say it undermines a GOP attack on their guy. The Nueces County GOP sent out mailers attacking Garcia (and Rep. Abel Herrero) for taking money from Celis. The Republicans say Garcia also got money from a PAC to which Celis contributed. The Garcia reply? None of Celis' contributions were in that PAC when it was giving to the candidate; it had already been contributed elsewhere. Garcia's challenger is former Rep. Todd Hunter, who served as a Democrat but is running as a Republican.

Add Chris Bell to your list of candidates who might show up in the special election to replace retiring Sen. Kyle Janek, R-Houston, later this year.

The Houston Democrat, a former congressman and city councilman, says he's been getting "a lot of calls" encouraging him to run.

Two and maybe three Republicans are in the hunt. Janek is backing Austen Furse, who's raising money and actively campaigning. And Grant Harpold, a Houston attorney and GOP precinct chair, has announced his candidacy. Former Harris County GOP Chairman Gary Polland has talked about it, but hasn't announced his plans.

Janek plans to retire on June 2 and unless Gov. Rick Perry declares an emergency election, Janek's successor will be chosen in a special election on November 4 — the same day as the general election.

That timing forces current House members to choose between running for reelection or running for the Senate. Two of them — Republican Charlie Howard of Sugar Land and Democrat Scott Hochberg of Houston — have expressed an interest in running. Howard says he won't run if he has to forfeit the House seat. Hochberg says he won't make a decision until he knows what Perry plans to do.

Bell, meanwhile, is getting calls. The Austin American-Statesman got the first bead on the story with an interview of Sen. Kirk Watson, D-Austin, who said he's among the people trying to talk Bell into the race. Watson lost a statewide race before turning to the state Senate; Bell, who finished second in the 2006 race for governor, would be in similar straits.

It's Republican turf, but not prohibitively so. Statewide Republican candidates won in SD-17, but by slightly smaller margins than they won statewide. The Texas Weekly Index there is 15.4, meaning that the average statewide Republican beat the average statewide Democrat by that many points in the last two election cycles. That's a Republican lean, but it's still competitive, particularly if it's a bad year for the GOP.

And some polling from the district — done by some of the people trying to draw Bell into the contest — hints that it might be a bad year, with 63 percent saying the country is on the wrong track, and 53 percent giving George W. Bush a negative job rating.

Bell, who's been thinking about running for U.S. Senate if and when Kay Bailey Hutchison gives up that post, admits he's mulling a change in direction. He hasn't made up his mind yet, but says running the state race doesn't necessarily take him out of contention if the federal seat opens up (Hutchison's current term is over in 2010, and there's been speculation — add three paragraphs of caveats and provisos here — that she'll resign early to focus on a run for governor).

The Texas Senate currently has 20 Republicans and 11 Democrats. Janek's seat is one of three where the hackocracy expects competition. The others: SD-10 in Fort Worth, where Republican Kim Brimer will face Democrat Wendy Davis; and SD-11, where Mike Jackson of La Porte will face Democrat Joe Jaworski of Galveston.

Former Comptroller John Sharp will head the newly formed Ryan Foundation, a charity formed by the Dallas-based tax consulting firm where he has been a principal. He'll give up the tax gig to run the foundation. The announcement for that outfit says it'll be funded with grants from Ryan, public and private partnerships, and the consulting firm's clients. Does this sound like a job description for someone who wants to run for office? "He will focus on improving the quality of life of others in the community though active participation in charitable outreach efforts."

State Auditor John Keel got the — take a deep breath — David M. Walker Excellence in Government Performance and Accountability Award from the National Intergovernmental Audit Forum. That's for "sustained contributions" to the craft and for leadership. His staff nominated him.

Missy Mandell left the Lower Colorado River Authority, where she was most recently manager of federal affairs, to open her own consulting firm. Mandell worked for a number of politicians before joining LCRA in 1989.

Gov. Rick Perry appointed:

• Three new members to the Texas State Board of Veterinary Medical Examiners and tapped Bud Alldredge of Sweetwater to head that group. John David Clader of Pleasanton, David Kercheval of Grandview, and David Rosberg Jr. of Mason will join that panel. Kercheval is an exec with Agricultural Workers Mutual Auto Insurance. The other three are veterinarians.

• Joshua Carden of Weatherford, Cathy Landtroop of Plainview and Lewis Timberlake of Austin to the OneStar Foundation board. Carden is an attorney in Rep. Phil King's firm. Landtroop is a development officer at Texas Tech University. And Timberlake is a professional speaker.

• Wroe Jackson, a student at St. Mary's University School of Law, and Michael Savoie, director of the Center for Information Technology and Management at the University of Texas at Dallas, to the Guaranteed Student Loan Corp.