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House State Affairs met on March 25 to lay out a number of bills. This report covers discussions concerning HB 749 (Middleton) and HB 3687 (Capriglione). Part one of the hearing can be found here and part two can be found here.

 

This report is intended to give you an overview and highlight of the discussions on the various topics taken up. It is not a verbatim transcript of the discussions but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.

 

Vote Outs

HB 2586 (Thierry) (12-0)

CSHB 5 (Ashby) (12-0)

CSHB 1672 (Holland) 40-megawatt cap was raised to 100 megawatts (12-0)

CSHB 1715 (Buckley) (12-0)

 

HB 3687 (Capriglione) – Relating to the disclosure of lobbying contract information by political subdivisions

  • Cook – Often a lack of transparency related to these contracts, taxpayers are left to wonder what issue the lobbyists are actually advocating for
  • Current process for looking up this information is tedious, nearly impossible; still does not relay the legislative agenda for that subdivision
  • Would require political subdivisions to disclose certain contract information on their public website, including:
  • Whether both parties signed the contract
  • Contract duration terms
  • Financials
  • All parties involved, etc.
  • Political subdivisions would be able to post the entire contract on their website
  • Would require subdivisions of the state to identify if they are involved in certain lobbying contracts
  • Harless – Didn’t we pass something like this last time as an amendment?
  • Yes, we passed it on an amendment for a bill that did not pass, but because of the delay of the time and the single subject rule, it really limited the amount of cities
  • This is a standalone bill and would apply to all subdivisions and governmental entities in the state
  • Lucio – Would it also require the disclosure of any amount spent on a statewide association?
  • If they have a website, they would have to disclose it; for contracts for services that would require a person to register as a lobbyist
  • Lucio – So, yes?
  • Only if they have a direct lobbyist
  • Lucio – What if they do not employ a consultant outside lobbyist, but they identify someone internally to be the governmental affairs person?
  • Would they be registered as a lobbyist?
  • Lucio – Well, you do not have to register as a lobbyist if you are an employee of the city; that is an exemption
  • You can help me work on the bill if you want; currently the city or school district actually contracts with someone who is registered as a lobbyist

 

J.R. Johnson, Ethics Commission – Resource Witness

  • Lucio – What triggers someone to have to register as a lobbyist? I know Section 305 has triggers for them having to file an ethics report and register as a lobbyist
  • Yes, there is a compensation threshold and an expenditure threshold
  • Lucio – Is there a $800 threshold if an expenditure is made by someone in efforts to communicate directly with a legislative member executive branch to influence legislation?
  • Yes, per quarter and adjusted annually for inflation by the commission rule
  • The only other thing I would add to that is its expenditures on activities described limited to 6 categories
  • Lucio – Most people who register as lobbyists will look at the compensation portion and if it meets that threshold?
  • Do not have stats on that, but when we think about lobbyists who cross the expenditure threshold, traditionally thinking of concert tickets, meals, etc.
  • Lucio – How many lobbyists did you investigate in 2020?
  • Do not have that number, but majority case load at the commission is related to campaign finance or expenditure of public funds for private purposes
  • Very few complaints involve lobby registration
  • Lucio – How many lobbyists that are city employees registered with the commission?
  • I would suspect none; if they did register, they would have been doing it without being required to
  • Lucio – Because it is an exemption?
  • That is right
  • Lucio – If an individual was hired on as a city employee, then that person would not have to register as a lobbyist based on the exemption, correct?
  • I suppose that is right, yes; Chapter 305 has an express exemption for officers and employees of the state government and any politic subdivision
  • Lucio – Do trade associations as an association have to register with the Ethics Commission or just their employees?
  • Entities sometimes have to register, a rule that allows an entity not to register as long as someone representing that entity registers/reports all activity that would have been attributable to the entity

 

Public Testimony Spotlight

Adam Haynes, Conference of Urban Counties (CUC) – For 

  • Public dollars should be transparent
  • This bill will include more individuals than previous legislation attempted to
  • Does not know if the current form of the bill would make counties that are members of CUC list that information on the website, would support that
  • Transparency is the way to solve the political issues
  • Lucio – How many members are there in the CUC?
    • 34 of the most populous counties
  • Lucio – Do you often support those smaller counties?
    • Yes, we work to support all 254 counties
  • Lucio – Even those than cannot afford to join the CUC?
    • It is not a matter of affording, the focus of a larger county is different
  • Lucio – Associations represent smaller entities that do not have the resources to hire advocates
    • Agree for smaller counties, but not so for larger counties
    • County judges and commissioners function as CEOs of their counties; they are expected to be accountable, and have the funding and resource to hire legislative experts

 

Michelle Davis, Convention of States – For

  • Transparency is key – we need to know where our taxpayer dollars go, and how much goes to lobbyists that testify against our interests
  • Transparency will allow clients to know if a lobbyist is playing both sides of an issue

 

Bill Kelly, Mayor’s Office City of Houston – For

  • Our city already publishes online the contracts with lobbyists made by the city
  • Also publish testimony submitted to the legislature
  • Post-sine die, City will create a website to outline the work completed by the city and lobbyists during session and the work of representatives from Houston in the legislature
  • Harless – So you would be complying already with the law?
    • Yes, 10 years’ worth of records published about lobbying
  • Lucio – How many complaints do you get about the practice of TFL?
    • Since April of 2016, the only complaint we received was from Rep. Middleton, who was not aware of our publishing of the contracts already
    • No other complaints about TFL

 

James Quintero, Texas Public Policy Foundation – For

  • Houston does a great job putting forward this information
  • Greater transparency is needed overall
  • Challenging in status quo to establish how much is spent on TFL due to limited and hard-to-access data from Texas Ethics Commission
  • New tools and data sets are important to allow Texans to be educated about TFL costs and contracts
  • Paddie – Does this go far enough?
    • Maybe including training or an enforcement mechanism to get political subdivisions to recognize and follow through with requirements for disclosure
  • Paddie – What do you make of the fact that Houston is not getting complaints about their use of TFL?
    • We have done polling throughout the state – there is a large amount of the population that is not aware that TFL is occurring
    • 9/10 Texans oppose TFL once they learn about it
    • Houston does a great job putting forward their legislative agenda and future goals – inclusion of that clause in this bill is a great element
  • Paddie – When you ban things, you throw out the good with the bad right?
    • Yes, once we elevate the legislation, the public as a whole can have a conversation about the agenda and legislative priorities and give feedback to the city/subdivision
  • Lucio – How is TPPF funded?
    • Variety of sources, not disclosed to the public
    • We are privately funded organization
  • Lucio – Will ask you again on 749, but it seems that your right to participate and lobby should be protected, but not if you represent a public entity?
    • Individuals have rights, governments have power

 

 Ender Reed, Harris County Commissioners Court – For

  • Counties have less direct authority than cities, dependent on the legislature
  • Proud of the work that our lobbyists do on our behalf, especially relating to flood and water control and public health issues
  • Great bill to shine light on the great work being done on the county’s behalf
  • Harless – Thanks Reed and colleagues for work in Harris County

 

Becky St. John, TASB & Grapevine ISD – For

  • Grapevine ISD has never had a contract with a lobbyist, but does resolve a lot of problems with transparency
  • Recommends adding clause to increase transparency for school boards by modifying current requirements for financial reporting to include TFL contracts

 

Sherriff Tom Maddox, Sheriffs Association of Texas – For

  • Transparency is essential in maintaining public trust
  • Paddie – Grateful for the time spent on behalf of his constituents

 

Rep. Capriglione closes

  • Paddie – Did you receive any additional recommendations or input on this bill?
    • Yes, heard things similarly from Ms. St. John, increasing transparency for different groups
    • Also looking to see increased legislative agenda transparency among subdivisions
    • The more we tell people the better off we are
    • Other ideas on expanding transparency are being discussed

HB 3687 left pending

 

HB 749 (Middleton) – Relating to the use by a political subdivision of public funds for lobbying activities

  • Middleton – Will ban taxpayer funded lobbying
  • Occurs either through the direct contracting or hiring of a lobbyist, or through the payment to a nonprofit that regularly engages in lobbying or contracts with lobbyists
  • Local government should not rely on lobbyists to communicate with their representatives and senators
  • Polls show supermajority of Texans support a ban on the practice
  • This bill does not affect Chambers of Commerce or any Associations as long as they do not hire 305 registered lobbyists
  • Bill does not prevent local officials from communicating with state legislature or from using public funds to travel to Austin to communicate with or testify before the legislature
  • Lucio – Many people registered as Section 305 registered lobbyists have key working knowledge of subject matter that a majority of the legislature does not have working knowledge of; that is why we had 26 hours of ERCOT-related testimony
  • Lucio – Local entities do not have the time or resources to hire new experts or employees, to speak to committees and to members
    • It is our job to represent constituents directly
    • This bill does not prevent associations from communicating with localities
  • Lucio – But the 305 definition is very robust and broad, meaning that individuals who could qualify as 305 but not registered could be impacted by your bill?
    • Not really, difference between those individuals and lobbyists
  • Lucio – But how do those individuals spending money on communicating with the legislature not qualify? 305.003 specifies $800 spending on preparing communication with a lawmaker as being a lobbyist
    • You could interpret it that way, but this bill does not impact how 305 is currently interpreted
  • Lucio – It does not affect how its interpreted, but that is the problem; if I contact a county attorney for information, or an individual representing an association, then they would be in violation of 305, and subsequently your bill
  • Lucio – Is a chamber of commerce hires a lobbyist to communicate with the legislature about a border passage are they in violation?
    • No, chambers do not primarily represent a political subdivision
  • Lucio – So, a city could join a chamber and exploit this loophole?
    • This bill addresses direct allocations to lobbyists
  • Lucio – But indirect allocations are ok?
    • Lobbying is probably not going to go away, and I am unhappy about that, but this bill facilitates more direct representation of the citizens

 

Public Testimony Spotlight

Darrell Hale, Collin County Commissioner Precinct 3 – For

  • 87% of my precinct supports banning Taxpayer Funded Lobbying
  • Many people believe that TFL silences locally elected voices
  • Ironically, Collin County pays fees to associations for advice and information, not to lobbyists, and to see these associations testify against this bill
  • TFL is citizen tax dollars working against the citizenry against their beliefs to the contrary
  • No accountability for TFL at all, whereas elected officials are accountable through elections
  • Lucio – Do you believe in local control?
    • Yes
  • Lucio – Do you believe voters know what they are doing?
    • Local control is citizens deciding what is best for them and their jurisdiction
  • Lucio – You have the freedom to stop paying lobbyists to represent you. Are you reimbursed by the county for your trip here?
    • Yes
  • Lucio – What if I told you that my county could not afford to send its officials here?
    • I have had similar discussions with smaller cities in my jurisdiction, and I guarantee that the person from TML that will represent them could not tell you what cities are in my jurisdiction
  • Lucio – I disagree completely on that assessment on TFL; but this bill would take away my constituents’ decision to pay a group like to communicate with me on their behalf
    • Whenever the citizens are electing people to represent them, there is an expectation that the person they elect will represent them, not an unaccountable individual like a TFL
  • Lucio – Could you give me expert advice on infrastructure and bond structure?
    • No, but I could get information and educate myself through Texas Association of Counties
  • Lucio – But wouldn’t TAC go away as a resource under this bill?
    • No, they are not registered as lobbyists
  • Lucio – But they could be interpreted as lobbyists under 305.003, and they could be gone under the bill. There is a push that corporations are people, and thus can contribute to campaigns, but we want to take away the ability of local government to be engaged in the process and communicate with the legislature.
    • But the individual citizen should not have his own dollars used against him
  • Lucio – Your citizens do not want that, but my citizens might want to fund a lobbyist. Is there a constitutional prohibition on spending money on local issues? Would you be surprised to learn that there are people representing Austin in DC?
    • No, but there are differences between how the cities and counties are treated by the state and the rules the state sets for itself

 

Thomas Gwosdz, City of Victoria – Against

  • Explains and compares the discrepancy between people who work full time jobs and do not have the time to develop expertise about a subject to testify and it is necessary for them to hire professionals to help them communicate
  • Claims this bill would be detrimental to all communities in Texas
  • Lucio – If your city council wanted to prohibit expenditure of taxpayer dollars to hire lobbyists, could it do so without this bill?
  • Would be a simple matter of them choosing not to hire those lobbyists
  • Lucio – Do you think they should retain the option to hire people to help them with this process?
  • You phrased this as a local control issue, our city is in favor of retaining local control wherever possible
  • Lucio – Do you believe the voters there are informed and can make decisions on whether or not the people on that city commission are representing their interests?
  • Absolutely

 

Mark Terry, Texas Elementary Principles and Supervisors Association – Against

  • Advocate for principles and supervisors, represents the as their lobbyist basically
  • Several bills may impact several schools negatively
  • Urges to vote against this bill

 

Russell Schaffner, Tarrant County – Against 

  • Reads letter from Judge Whitley to committee on his behalf
  • Urges to move legislation that helps Texans, HB 749 will hurt Texas taxpayers
  • Would force local elected officials to choose between from leaving emergency response to a similar disaster (comparing to COVID), choice they should not have to make
  • Member and participation in nonprofit associations give local officials freedom to focus on pressing issues facing their jurisdiction without sacrificing opportunity to provides input to state legislators

 

Roland Barrera, City of Corpus Christi – Against

  • Emphasizes windstorm rates can make home ownership out of reach
  • NAS and other organizations provide over $4 billion to the economic output annually
  • Worked in conjunction with Coastal Bend Air Quality Partnership to restore air quality monitoring grant funding from TCQ that was cut in previous session
  • Picked up $10 million alone from the General Land office for affordable housing, pay lobbyists $120,000
  • Believes bill takes empowerment away from constituents that elected me to make those decisions

 

Joe Zimmerman, Mayor City of Sugar Land – Against

  • Mayor’s office maintains a legislative director
  • Corporate interests hire the best consultants and lobbyists, and we need to do the same to compete
  • Lobbyists help us to be connected to the legislature outside of our district’s representatives, and give us knowledge and advice on the legislative process
  • Anecdote of lobbyists helping the city change the law to require notification of local authority when a radiation release occurs due to an event
  • Anecdote of lobbyists helping the city acquire GLO land at a good deal for the expansion of the city airport, expansion of public safety, and a new industrial park that will produce lease revenue
  • Texas Municipal League advocacy does an amazing job, and none of my constituents would have a problem with what we pay them for
  • Metcalf – What do you pay TML?
    • Little less than $120,000 per year
  • Lucio – You bring up a great point about lobbyists being on top of sudden and new occurrences in the legislature
    • Yes, we also help smaller cities, TML ends up being almost an adjunct consultant for those cities

 

Randy Bellomy, Ellis County Republican Party – For

  • Believe in the process, but want a level playing field
  • We need to cut costs – the reason people are upset about TFL is because its increasing taxes

 

Councilman Lee Kleinman, City of Dallas – Against

  • City Council has over 40 budget hearings, where constituents are able to discuss every item of the budget, including TFL
  • Budget is also posted and open for public comment, including TFL contracts, and we take testimony and record our votes on the budget
  • Our community endorses TFL and our budgetary policies, accountable through elections
  • Lobbyists have brought $189 million to Dallas over 20 years
  • Legislature is complicated, and things move fast – lobbyists essential to know everything that is going on and react to changes last minute

 

Gerald Welty, Convention of States – For

  • Tax dollars should not be spent on lobbyists

 

Bill Kelly, Mayor’s Office City of Houston – Against

  • Houston is a varied interest before the legislature – to maintain a strong relationship and have a voice in the legislature, we need to maintain a constant presence in Austin
  • Most important thing is for taxpayers to know exactly what their money is buying them, which is why we publish and publicize all of our contracts and legislative priorities
  • Houston has used lobbying to receive funding for Harvey relief and for Pension reform
  • Lobbying budget has actually decreased $95,000 in recent years, but this legislation would force cities to hire more FTEs – costs way more, and unlikely to attract employees for 140-day terms
  • Houston’s interests often conflict with corporate and industry interests, lobbying helps level the field
  • Constituents support our lobby contracts, as well as the city council – might be due to transparency and efforts to communicate with citizens
  • Invested in positive outcomes, accountability, and transparency
  • Lobbying is a necessary aspect of local government and the state as a whole
  • Paddie – I hear talk about a level playing field, but I worry about that too, coming from a rural district. Houston has a lot of money, and can afford lobbyists and new FTEs if necessary
    • I agree, getting that access when you really need it is critical for big and small districts and cities
    • Transparency is important regardless of size and criticism

 

James Quintero, Texas Public Policy Foundation – For

  • Establishes principled take on government – should not spend taxpayer dollars on their interests
  • Eliminates expensive aspect of government budget – at least $41 million on outside lobbyists, not including Associations and in-house lobbying
  • Elimination of TFL would improve quality of legislation passed, most obvious example being SB 2
  • Biggest gain is the promise of Texans getting their voice back, currently impeded by a flood of lobbyists
  • Lucio – TPPF has 22 registered lobbyists, and we don’t know about how its funded, whats its lobbyists are paid, and who they work for, but TPPF is a private interest group and a powerful stakeholder in the lobbying field

 

Tyler Drummond, Galveston County Judge Mark Henry’s Office – For

  • Galveston County has been working with its representatives and senators to work on bills that benefit the county and citizens
  • Associations and TFLs are working to kill some of the bills that would help Galveston County, prime example
  • Provides letter from Judge Henry detailing support for the bill

 

Rick Hill, Justices of the Peace and Constables Association of Texas – Against

  • Largest association in Texas, members in every county in the state
  • Rely on legislative consultants to communicate with legislature to directly address needs and issues affecting judges and constables in the legislature, including bail reform, ministration, implicit bias training, etc.
  • Need this venue of communication and experienced individuals with knowledge key to the process and to getting work done to help citizens

 

Sherriff Tom Maddox, Sheriffs Association of Texas – Against

  • Oppose bills that harm the citizens and law enforcement of this state, such as this bill
  • Provides written copy of testimony due to late hour

 

Eric Fox, North Texas Commission – Against

  • Do not believe many citizens oppose the use of lobbyists
  • Many believe that cities and counties are at the table in the legislature during the process of recovery from economic recession and disasters
  • Lobbyists are the most efficient use of funds, rather than local officials or the hiring of new employees with full-time benefits and salary
  • Trained lobbyist advocates are essential to bringing new investments into cities and counties

 

Becky St. John, Texas Association School Board – Against

  • Claims bill represents a major shift in the way a school board trustee or designee can advocate the legislature on behalf on our school districts
  • Claims bill eliminates the ability of trustees to communicate with legislature through nonprofit associations
  • Claims bill would quiet local voices

 

Raymond McDonald, City of Conroe – Against

  • Claims this bill would prohibit a municipality from spending public funds to hire experienced professional registered advocates
  • Focused and emphasis on local communities
  • Concerned that one side of the story will be heard referring to the influence of lobbyists

 

David Stout, El Paso County – Against

  • Opposes restrictions on the ability of local governments to effectively and efficiently communicate with the legislature and other sate entities
  • Claims this bill would prohibit a municipality from spending public funds to hire experienced professional registered advocates
  • Claims this bill would prohibit us from paying dues to associations that represent our interests
  • Claims this bill will dramatically increase costs for local governments
  • Makes no sense for state to prohibit cities and counties from doing what the state itself does when it hires professional advocates in Washington D.C.

HB 749 left pending