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The Senate Committee on Water, Agriculture & Rural Affairs met on May 11th to hear invited and public testimony on interim charges covering rural employment, rural immigration, meat packing facilities, and agricultural theft. An archive video of the hearing can be found here.

This report is intended to give you an overview and highlight of 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.

 

Opening Comments

  • Perry – Long way to go on broadband, connectivity & equality will continue to be the economic driver for those that choose to come back to rural areas and those that stay
  • Perry – Also have immigration issues impacting rural communities

 

Rural Employment: Study and make recommendations on rural small business development and workforce needs. Consider and recommend innovative methods for business development in rural parts of the state.

 

Panel 1

Brian Daniel, Texas Workforce Commission

  • Last 5 months have been record-setting in terms of payroll jobs created, info indicates this will continue to grow
  • In service sector & others still seeing growth, rate at which jobs are opening up is impressive
  • 56% of state lives in 10 counties, job markets differ greatly depending on the area of the state
  • Continuing to look at ways to drive rural jobs, have found housing and transport to be barriers
  • 600k open jobs in the state right now, 1% are remote work
  • Solving rural broadband problem will go a long way to getting more jobs in rural areas
  • Rural areas have shown 2.1% job growth since 2011
  • Perry – Lubbock ISD just broke ground on a facility 100% dedicated to agriculture, serves kids staying on the family farm or going into vet business; asks after programs like this
    • Have dedicated workforce boards around the state that work with ISDs
  • Perry – This facility was a bond, local populace was in support; partnerships for programs like this are something ISDs can do
  • Springer – When we look at incentives driving businesses relocating to the state to pick rural Texas, 313 didn’t work well for rural Texas in terms of job creation; need to figure out how to incentivize rural growth and what those companies look like
  • Springer – Growth isn’t moving to rural Texas, looking at remote work and agencies is an opportunity to drive rural economies
    • Had several jobs pre-COVID stationed throughout the state & are increasing most roles; highlights attorneys, distributed call centers, etc. set up by TWC
  • Eckhardt – What stats do we have on difficult industries to recruit into for rural areas? Health care? Construction?
    • Broadly this is middle-skills jobs, roughly 60% of jobs in the state overall, things like construction doing a specific thing
    • Health care, nursing, etc. continue to be challenging; nurses are trained in rural communities but then will migrate to urban areas due to salaries
    • Continuing education for additional credentials could be an incentive for the health care workforce to stay in rural areas
    • Tend to think construction crews as seasonal, only cures are things like reskilling and companies getting out in front instead of hiring in deficits
  • Eckhardt and Daniel discuss aging populations in rural areas
  • Eckhardt – Do we have the resources to support workforce supply?
    • Wanting to see progression in the workforce but also graduating large numbers of students
    • Reskilling and upskilling is important, high school recruitments are important; companies that do this continue to have develop their workforce
    • Companies move to take advantage of the workforce, so workforce training support economic growth
  • Eckhardt – Do we have supply of workforce to meet demand?
    • Do have ability to staff those jobs, but the people would need to stay there
  • Kolkhorst – Highlights nursing shortage program that is already in statute, just needs to be funded; as we do these things and get more nurses into he workforce, market will correct in terms of high wages
  • Kolkhorst – Have we had any success in getting those with families back to rural areas?
    • We are seeing some of this, particularly with housing pressures in rural areas
    • As hospitals sand up better rural facilities, nurses, etc. see more opportunities
  • Kolkhorst – Challenge with rural employment and health care is that it is hugely important to deliver healthy babies in rural areas, but many facilities are shutting down or seeing workforce challenges
  • Powell – How are we going to balance all of the needs to make sure people moving back have housing, childcare, transportation infrastructure, etc.?
    • Communities that will engage on these issues earlier will have more success
    • State can assist in developing educational facilities, water infrastructure, and broadband, etc.
  • Perry – Seeing movement to anchor cities, e.g. Lubbock; many move into hub cities and still work in rural areas
  • Perry – You said 1% of the 600k open jobs are remote?
    • Correct
  • Perry – Would’ve thought it would’ve be a lot larger than that
  • Perry – Highlights need for schools and industries to promote trades
  • Springer – 40% of those looking to change jobs are looking for a remote job, they want the flexibility
  • Springer – State agencies can help local communities incentivize people to move there

 

Tim Kleinschmidt, Texas Department of Agriculture

  • TDA touches anything “rural” or “agriculture” related in some fashion
  • Highlights TDA programs focused on rural communities, incl. grants, loans for ag and eco dev, etc.
  • Looking forward have several proactive ag and rural workforce targeted projects
  • Perry – Of the money you receive, what is federal?
    • CDBG is primarily HUD, total budget is probably 87% federal
  • Perry – For things like CDBG, these are evergreen and need payback?
    • These are grants
  • Perry – Saw several that are payback
    • Not familiar with any
  • Kolkhorst – On the CDBG programs, challenging for rural cities is the money goes to larger communities & rural communities need to identify projects, apply, etc.; hugely burdensome
  • Kolkhorst – Asks after new funding program, can cities apply to fund middle-mile service?
    • Broadband businesses would be a qualifying business, could support fiber to businesses
  • Kolkhorst – Spent $500m on things like pole replacement, but rural broadband is not unlike electricity in the 1930s, feeds into education, health care, etc.; behind on expanding broadband
  • Eckhardt – Support needed for expanding CDBG program is astonishing, many communities shy away from the program because of the investment needed
  • Perry – Asks for list of funding going to communities; highlights issues with CDBG and other funds in meeting requirements, not sure all of the barriers to access are federal; tried to help a city access funds and both TDA and federal gov disclaimed responsibility

 

Panel 2

Ashlynn Messer, Lubbock Coronado FFA Chapter

  • Provides overview of FFA and supports for students across the state
  • Perry – These types of programs help every student, large education possibilities across rural and urban communities
  • Taylor and Springer commend Messer on her testimony and highlight the benefits of FFA involvement

 

Martin Luna, Roscoe Collegiate ISD

  • Highlights student experience at Roscoe Collegiate ISD, incl. Pathways career prep program during high school that set up the courses of study
  • Shares his experience going through the Pathways program toward teaching math
  • Perry – Great example program, if opportunities are available in communities, can develop our own and keep our own
  • Taylor – Encouraging to see a product of the P-TECH program giving back to the community

 

Connor McKinzie, Texas Tech Student

  • FFA supports student growth through learning and competitive events, large number of events throughout the year; large organization
  • Lubbock ISD AgriSTEM system is great at connecting agriculture and students, opportunities for FFA programs across the state
  • Kolkhorst – SB 801 agriculture education program last session came from an FFA member in Flatonia
  • Perry – Possibilities exist to move FFA program into general high school curriculum

 

Panel 3

Justin Jaworski, Cisco Development Corporation

  • Rural areas have been rediscovered, reinvestment is very encouraging
  • Facing similar problems in rural areas as with 30 years ago; workforce, connectivity, and infrastructure
  • Economic Development Sales Tax has been the leading tool for revitalizing rural areas; Type A/Type B sales tax is cherished as a source of local money and local control of incentives
  • Connectivity between state and local programs has yet to be obtained in a way that makes sense for the rural communities
  • Springer – Are you referring to the CDBG issue being connected better?
    • Yes; have heard a lot of using more of the SBD program, but sometimes you’re referring clients to places two counties apart
    • Goes back to connectivity, ability to meet in person, etc.
    • Pretty much any small community will offer the state free office space for business development
  • Springer – Possibility to do incentives to build out buildings for TxDOT personnel, other state functions, etc.
  • Springer – On Chap. 380s, do you partner with Cisco and others to do some revitalization through this? Where city can waive some part of sales tax or give it back to someone to do a project
    • Yes, Cisco just landed a $10m travel center with 60 employees, used the Eco Dev sales tax with Chap. 380 to do an infrastructure upgrade
  • Springer – Sometimes we need to tweak things, I’ve seen the 380 work in situations like this
  • Powell – You’re advocating for the flexibility with A&B funds to do the things needed in your community?
    • Yes, statute doesn’t interfere with communities, perfect as they are
  • Powell – Saw some ideas on using A&B to incentivize businesses to keep staff, one of the critical elements that allowed businesses to keep staff and stay open during COVID; have also seen funds used to help educate the workforce, flexibility to match communities is important

 

Chloe Coniaris, Advantage Capital

  • Provides overview of Advantage Capital; helps small businesses with capital in communities underserved by conventional methods of capital, one of the US’ largest nonbank investors in rural communities
  • TX is the 4th largest venture capital market, $2.6b in venture financing in the first few months of 2022, but less than 1% goes to areas outside of Austin, DFW, and Houston
  • Capital gap has real consequences for rural small businesses, barriers incl. small scale of capital need between $1m-$5m & few organized sources of this type of capital
  • Several states have tapped into federal funds and prioritize targeted flexible financing combined with incentivized public-private funding
  • Other states support workforce training, affordable financing in certain communities, etc.
  • Springer – Utah and Ohio have renewed their programs, what type of businesses have opened there?
    • Utah has Rural Jobs Act Program, ACT Aerospace located in a rural area and Advantage Capital invested, 80 employee business
  • Springer – We have Texas Enterprise Fund and 313s, but not seeing venture capital outside of the triangle
    • Highlights infographic that shows venture capital by Congressional district, majority has gone to those areas
  • Springer – Had an idea last session, but sometimes ideas are slow to propagate; have roads, houses, etc. in rural Texas, if we can keep kids there it gives us opportunity
  • Eckhardt – What is the biggest impediment to venture capital in rural areas? Capital outlay too small?
    • Nature of current lending landscape, Dodd-Frank Act reduced incentive for small loans from banks to small businesses
    • Venture capital has previously always gone to CA, NY, and MA, TX is now the 4th largest, but not flowing to rural areas due to no incentive & investors not aware of markets
  • Eckhardt – Asked Samsung if they considered Bastrop, and they said no, had not looked at anything but Travis and Williamson

 

Lynn Kelly, Stonehenge Capital

  • Stonehenge Capital is a TX based investment firm with focused on underserved communities, have invested $100m in small business across TX
  • Rural businesses make up 24% of all employing businesses in the state & create or sustain 30% of jobs and 20% of the state’s economic output
  • Rural counties have higher rates of entrepreneurship, but urbanization has shifted investment to urban areas
  • Annually 2-3 private equity investments <$500m occur in rural TX, compared to 400 statewide
  • 92% of Stonehenge investments have been in urban counties
  • In absence of an eco dev incentive, investors have historically invested in urban areas with access to significant infrastructure
  • Stonehenge participated in a program in Nevada that used an insurance premium tax credit that allowed Stonehenge to finance a rural community health center, addressing health care needs in rural Nevada & creating jobs for the community
  • Perry – Are these all debt instruments or are there equity components
    • Coniaris, Advantage – It is both debt and equity financing that can be provided under these programs
  • Perry – Catch 22 with all the sophistication requirements on the front end, but these increase overhead needed for entities to participate; asking about equity/debt because there is trend of bundling up all these mom & pop businesses to sell at high premiums quickly, creating a problem and equity is a big piece of this conversation
  • Springer – Last session’s proposal was a $500m investment, but funds wouldn’t be pulled for 36 months due to jobs and other targets; what are other states doing to ensure expected returns are hit?
    • See benefit in ensuring private capital is raised up front before state tax dollars are used; protection up front through application process, then investments must be done within a defined timeline
    • Have seen programs with financing required at a certain rate, something to be included in the statute
    • Annual accountability provisions also require reporting metrics, can be to regulators, state, or local communities
    • On the tax credit side, claw back provisions are important
  • Springer – Goal on these is not for one or two large deals to gobble the whole market
    • Agrees, have seen states put limits to avoid this
  • Powell – Asks after focusing investments on needs of communities
    • Kelly, Stonehenge – Certain investment targeted to industries, e.g. loans needing to meet certain exit thresholds for manufacturing businesses
    • For rural Texas, increased focus on agriculture and manufacturing
    • Each state has enacted a cap on the level of investment and were able to diversify the number of businesses receiving investments, balanced across sectors
  • Powell – Solar & wind businesses able to be financed by the capital you provide?
    • Yes, have worked with several renewables, highlights work with PosiGen installing solar panels in low-income communities
  • Powell – Also businesses that may be good for the new build back better federal funds; can you speak about some of the things the legislature might consider to make an easier shift to investments in rural communities
    • Coniaris, Advantage – An eco dev program that targets capital into rural areas, e.g. defining rural areas and requiring 100% of capital invested go to those areas
    • Also doing this with a view to attract companies that have invested in rural communities elsewhere
  • Eckhardt – Notes a majority of investment capital continues to go to urban areas; looking at the state portion of the sales tax as that tax benefit to make up the delta?
  • Perry – Its better served as advantage for this one; it is not the sales tax, it is a different process
    • Coniaris, Advantage – Other states use the insurance premium tax credit
  • Eckhardt – Looked at an additional mechanism with brick-and-mortar investment similar to the PACE program? Debt paid back on a property investment and spreads the debt out
    • Coniaris, Advantage – Is a need to invest in brick-and-mortar; they would be complimentary
  • Eckhardt – For opportunity infrastructure such as broadband, assessment on insurance premiums cover that?
    • Coniaris, Advantage – Capital to go towards broadband projects?
    • Eckhardt – Will get with you offline on that
  • Perry – Is up to the state to determine the definition of rural for this legislation? Would not consider Travis County rural
    • Coniaris, Advantage – Look to the state to determine what is rural or not; typically use USDA’s definition of 50,000 or less
  • Perry – Are companies that will never subscribe to the ESG metrics
    • Coniaris, Advantage – Invest based on the guidelines the state has given with program parameters
    • Kelly, Stonehenge – Travis County investment was not an example of a rural investment; this is an urban and rural issue

 

Nicole Everingham, Texas Rural Water Association

  • Perry – This witness is here to share info about water supply operators
  • Serve 760 operators that serve rural and urban communities
  • Water operators are struggling with employment recruitment and retention
  • Is s recognized national need and were tasked with creating workforce apprenticeship programs through the Department of Labor
  • Are starting first cohort this June; includes 280 hours of technical instruction and 4,000 hours of in-field training over two years
    • Have applied to be a training program through Veterans Affairs
    • Partnering with schools and the TWC to get the programs off the ground
  • 34 rural water associations have working programs in place
  • Are grant funded through the Department of Agriculture and have a sub-award through USDA
  • Biggest barrier for systems to participate that there is a fee to participate in the program
    • Looking for funding for these systems; looking for funding thorough the Workforce Innovation Opportunity Act
  • Looking for advise on where to find additional funding
  • Perry – What are the size of connections?
    • They vary, but most rural serve about 10k; are not turning anyone away from the program
  • Perry – What is the fee? Taking students at what age?
    • Is a 4k fee for the two-year program; aim to take younger individuals, but the easiest ones to bring in is those already in the system
  • Perry – Need to have a larger discussion to fill specific voids in our workforce

 

Public Testimony

Susan Hayes, Self

  • Need to expand Medicaid to aid rural hospitals
  • Need to create more competition in the health insurance marketplace; including prohibiting the redlining of rural Texans
  • Need to promote a more robust rural healthcare workforce
  • Need to address the labor workforce deficit in agriculture; workforce is aging out

 

Renzo Soto, Texas 2036

  • Full implementation of HB 3767, Tri Agency Workforce Initiative, is necessary; including the charge to disaggregate workforce data be region
  • Need to reform and organize the state’s community colleges including the recommendations by the Texas Commission on Community College Finance
  • Currently only 0.02% of community college funding is coming from state formulas
  • Leveraging both will ensure workforce and education system are geared towards rural communities

 

Steven Golla, Texas Veterinary Medical Association

  • Since 20 years ago had a shortage in rural veterinary medicine
  • Labor shortage in veterinarians and vet technicians; students have debt issues and rural communities do not have the pull for families to live there
  • Texas Tech veterinarian program just opened, but there is more work that needs to be done
  • Perry and Golla discuss the Texas Tech veterinary program and the need to increase the veterinary workforce

 

Q&A

  • Eckhardt – Why is agriculture workforce depleting?
    • Hayes – Was already a decrease before the pandemic; since immigration is down from Mexico, cannot find the workforce
    • Because of this, people are stopping growing fruits and vegetables; Texas has increasingly imported food from California and Mexico
  • Perry – A reason could be asylum-seekers are not looking to be a part of workforce; now fund rural hospitals at Medicaid levels
  • Kolkhorst – Recently passed a bill that ensures inpatient and outpatient are paid for and 1115 waiver approval gets rural hospital funding in a better place
    • Hayes – Are losing healthcare workforce; mostly due to burnout
  • Eckhardt – Work with Texas 2036 to establish what we are losing in workforce?
  • Perry – TWC and Texas 2036 are
    • Sobo – Will share results of a study on changes to the workforce during the pandemic

 

Rural Immigration: Consider the Federal government’s open border policies and practices of releasing illegal immigrants in rural areas of the state. Report on the impact to rural Texas, and their local ability to address social, health, and law enforcement needs.

 

Panel 1

Steve McCraw, Texas Department of Public Safety

  • Every community is impacted by illegal immigration, cartels benefit from this & see widespread damage
  • Legislature appropriated resources to allow for permanent and surge response in rural areas, addresses gaps in illegal activity
  • 1.3m apprehensions in 2021, impacted defense between ports of entry
  • Border counties and non-border counties are impacted, large and small communities are impacted
  • Cites case in Fort Bend County of Honduran migrant who had been murdered, also case in Kinney County of a high-speed chase
  • Smugglers are advertising using social media
  • State resources have been impacted, resources are limited and being stressed keeping up with activity
  • Don’t know what’s going to happen from May 23rd, but are expected to be proactive, may need to increase response
  • Perry – We have 600 vacancies at TxDPS, is that high?
    • It’s high now, wen through a biennium with only 2 training courses
  • Perry – If we had those classes, assume it’s COVID-related, would have 300 positions open
    • Weren’t funded for those
  • Perry – Have people leaving the job because they didn’t sign up for military duty, are morale problems extensive or a one-off?
    • Wouldn’t say it’s a one off, we do have issues; if the world changes everyone will need to be involved
  • Perry – OTMs and asylum, majority coming in from the 170 country list OTM?
    • 70% are Mexican nationals, not all asylum seekers
  • Perry – Need to know what happens when they come across the border, broken down into Mexican national, OTM, etc., assume the 30% are being turned away
    • More than three categories, Mexican nationals, OTMs, transcontinentals, etc.
  • Perry – What are your options for disposition?
    • For the state it’s easy, if there is just immigration then we hold, detain, and refer to border patrol
    • Database checks can quickly identify if an individual has previously been deported, arrested, etc.; ICE will hold these individuals and deport
    • This is a problem with individuals from Iran, Iraq, or Syria, no agreement and need to find another country
    • ICE is empowered to act as immigration to some extent, can hear the asylum claims and refer to others
    • Contingency plans for May 23rd are really designed for processing; how fast we can move people
    • Other categories incl. special interest aliens from terrorism threat countries that warrant additional scrutiny; NGOs are working with CBP to move these individuals to different parts of the country
    • Working with Val Verde County to set up a processing center in concert with TDCJ, next step is to move to Jim Hogg to replicate
  • Perry – NGOs pick up asylum seekers and turn them back?
    • Not us, Border Patrol can do expedited return, treaty with Mexico
    • Title 42 isn’t used all the time
    • Even if someone is turned back, they can come back tomorrow
  • Perry – What’s the process
    • Process is done by Border Patrol, ICE is responsible for what happens after
  • Perry – Pulls resources out of rural communities, want to make sure we’re being effective for the resources used
  • Perry – What I’m hearing from you, we’ve got no jurisdiction; unless they’re trespassing, we have no control
    • Agrees
  • Perry – Texas is very limited to what we can do and are doing based on jurisdiction, but doing a yeoman’s job in picking up the pieces; wanting to be able to tell the average person what we’re doing
    • Best thing would be if federal partners prevented this from happening in this first place, only way to stop activity is to secure an area
    • Texas National Guard has been assisting
  • Perry – Can Texas National Guard secure the border, do they have jurisdiction?
    • They do, they can lay concertina wire, make arrests under Gov’s authority
    • Need manpower, tech, and infrastructure to secure zones along the border
    • Coupled with this, if they do cross over, and we have the landowners on board, we can charge them for criminal trespass
  • Kolkhorst – In 2021, apprehensions were 1.3m; highest year before that was?
    • 1986 at 720k
  • Kolkhorst – Expectations if Title 23 goes away is 3.6m
    • If DHS predictions are correct that’s 18k a day, 60%, so about 3.6m
  • Kolkhorst – Rio Grande sector is #1 in the nation
    • Goes back and forth with Del Rio
  • Kolkhorst – We have 1 and 2?
    • And too often 3
  • Kolkhorst – References cases McCraw cited earlier; Honduran immigrant killed by we suspect?
    • We believe it’s gulf cartel for losing human cargo
  • Kolkhorst – What about what happened in Jackson County on Friday?
    • Tractor trailer with large numbers of people inside, several had to be treated for dehydration, overheating
  • Kolkhorst – County judge said trailer was opened, 100 people found, and most fled into fields nearby; now have to call every surrounding county; judge said they tried to use heat sensors, but these failed, number of deaths will not be known until the field is harvested
  • Kolkhorst – Also had local residents scared because law enforcement was present and weren’t aware where everyone was
  • Kolkhorst – In Lee County, every time a trooper leaves the county, Lee County has one less trooper; deputy and trooper in Lee County pursued suspect and deputy was shot in the pursuit
  • Kolkhorst – We’re being forced to send troopers to the border and we’re losing county protection; will need our own army of DPS troopers to bring order and law
  • Perry – No end in the current state and will just get worse; do you have statistical way of identifying those who cross who are from cartels or in organized crime?
  • Perry – How many licensed police officers do we have across the state?
    • 70k-80k
  • Perry – 80k licensed police officers, of the 18k/day, do you have a metric to say how many would be connected to organized crime?
    • Wanted to report back to policy makers something factual, looked at apprehensions from 2011, 147k had been convicted for state crimes from homicide to burglary
    • No question it’s a problem, see it in those referred to Border Patrol
  • Perry – Would be interested to know population over that time period; concerned we have 80k police officers in the state, outmanned and outnumbered quick, is that a concern?
    • Of course it’s a concern, with the national narrative difficult to recruit into our profession
  • Perry – Highlights difficulties of law enforcement with limited personnel, many rural counties have 1 officer and DPS shores up the local LEOs; what is going on at the border can have some really bad outcomes
  • Perry – If I understand the Constitution, number one job of federal government is protecting the states from enemies and protecting borders
  • Kolkhorst – Highlights issues with property damage, cites constituent that asked for possible assistance with fence damage
    • No question sit’s a responsibility of the federal government
  • Perry – Are we doing everything we can do? Is there something else that can be done other than manpower?
    • Manpower is it
  • Perry and McCraw discuss lack of resources, low morale
  • Springer – Did you talk about how many are trafficked across the border?
    • Right now it’s running around 29k a week in Texas

 

Tim Kleinschmidt, Texas Department of Agriculture

  • TDA does not collect metrics on illegal immigration, do feel it is a burden on health system, but no data
  • Stakeholder comments do support what McCraw said
  • Consequences incl. economic consequences, impact on plant safety inspections without LEOs
  • TDA will be doing a survey on ag and rural businesses losses due to immigration
  • Perry – Include property damage, property theft
    • Exactly, will get you that
  • Perry – So basically fruit & vegetable inspections are no longer happening?
    • Depends on when troopers are used for that
  • Perry – Consequence is citrus greening, etc.?
    • Yes, citrus greening, pests, etc.
    • Not an international issue, receive more plants with issues from Florida than anywhere else
    • LEOs being pulled away from border work means crops aren’t inspected
  • Perry – This is one of those things that happens when resources are diverted to a federal problem
  • Eckhardt – What percentage of the agricultural workforce in Texas is immigrant?
    • Don’t have any data on that, percentage of farmers and producers that depend on immigrant labor is huge
  • Eckhardt – Does TDA have any plans to conduct studies on the necessary flow of goods and labor to promote agriculture in Texas?
    • We do deal in that world, have done grants to speed inspections
  • Eckhardt – And we may not need to do a study on how much of that labor is immigrant-based because US Dept. of Labor and Census Bureau does it for us, correct?
    • To the extent it gets done; we don’t
  • Eckhardt – Their statistic as of 2018 was that 27% of our ag labor force is immigrant-based
    • Wouldn’t surprise me at all
  • Perry – AG will speak specifically to some of the visas and opportunities that are available for the ag workforce
  • Eckhardt – Appreciate the comments earlier on humanitarian issue, concerned we’re using too blunt of an instrument and creating unintended consequences on our agricultural industry
  • Perry – You’re going to work on getting data, which is good especially between now and May 23rd
  • Perry – I don’t think a lot of OTMs are coming into agricultural sector, in your survey it would be good to ask about visa status, undocumented workers, Mexican nationals, OTMs, etc.; would like to know if they’re here for work & betterment or if they’re just looking to get into a country that provides a lot of free stuff
  • Perry – Workforce in my communities are all their to earn a living and leave when that purpose is fulfilled; very different group than what we’re seeing now, many don’t seem to be jobseekers

 

Murtaza Sutarwalla, Office of the Attorney General

  • Immigration and effect on Texas is a #1 priority for AG Paxton, has filed 11 laawsuits against Biden admin on the border
  • Waiting on response from the supreme Court on “Remain in Mexico” policy case
  • Currently have a pending lawsuit on Title 42 where federal gov could rapidly expel immigrants due to the pandemic
  • AG ready to assist any counties with need
  • AG Paxton has dedicated significant time in visiting rural communities speaking to landowners, residents, etc.
  • Texans are afraid of what is happening, heard from residents in Kinney County that they don’t leave their homes at night
  • Hands are tied in enforcing immigration law under state law, caselaw grants federal gov exclusive jurisdiction
  • Biden admin policies seem to only benefit the cartels and illegal immigration
  • Legal system provides many avenues to come to the country legally, incl. 11 temp worker programs, H-2A, H-2B, etc.
  • Highlights requirements and process for obtaining temporary visas like H-2A or H-2B; process ideally takes 90 days for ag workers, 60-120 days for non-ag workers; cost is around $650 per visa
  • Highlights burden on health care, property damage
  • Perry – $650 per worker?
    • Per worker
  • Perry – Employer typically eats that?
    • They are supposed to eat that and not charge the worker
  • Perry – Some crossing the border are legitimately looking for opportunity, we have provided paths & many employers have used this over time
  • Perry – There is a problem on the border where an equipped battalion could push back; people in charge only understand force
  • Perry – 11 opportunities to come into this country and participate, ways to get into the country legally could be improved, but we’re not there today
  • Perry – Not encouraging this, but we have a group of citizens who are discussing vigilante actions; if Title 42 goes away, it doesn’t end well
  • Eckhardt – You are not an expert in federal immigration law and that is not your role, correct?
    • I’ve practiced immigration law
  • Eckhardt – Regarding H-2A and H-2B, are these adequate for our labor needs for agriculture, is that adequate?
    • Kleinschmidt, TDA – Not familiar with those numbers
  • Eckhardt – Can ask some questions about H-2A and see if this is sufficient; where we have demand, but no sufficient pathway, it becomes human trafficking
  • Perry – Do you know how many family farms or operations we have?
    • Would have to go to the federal authority
  • Perry – Cotton farmers in north Texas have spent significant amounts to avoid having to find labor
  • Perry – If you left all local resources intact, you couldn’t put a dent in the problem have now right?
    • McCraw, TxDPS – No, don’t have an option but to address this
  • Perry – What is coming soon is real, Texas is the frontline, practical outcomes are not good for this country or this state; federal gov action is close to treason
    • McCraw, TxDPS – Cartels are here to stay
  • Perry – Used to handle things covertly without fanfare, Constitution’s General Welfare provision didn’t expect this situation being created; will need bold & creative moves at the federal level or Texas will be left with no options
  • Kolkhorst – Immigrants are treated as slave labor, allowing this to happen

 

Panel 2

Susan Kibbe, Executive Director South Texans’ Property Rights Association

  • STEPRA formed Brooks County in 2006 due to border security issues
    • County has the largest border patrol checkpoint in the nation
  • Focus on landowner liabilities, property damages, and other damages related to trespassers
  • Thanks leadership for the funding supporting Operation Lone Star
  • Last session worked with Kolkhorst and Hinojosa on SB 634 and SB 576
  • Property damage is ever increasing in every county; are replacement, time, and expense costs to fix this damage
    • Provides the committee with photos showing property damage
  • Current policies of the federal government leave communities and citizens vulnerable
  • Look forward to working with the committee to mitigate the lack of action by the federal government
  • Perry and Kibbie discuss the increasing number of those who die crossing the border

 

Sheriff Roy Boyd, Goliad County

  • Have provided committee with documents overviewing crime statistics
  • Received Operation Task Force Lonestar grant funding
  • 2020-2021 Brooks County reported 1105% increase in illegal immigrants attained, pursuits up 400%, and stolen vehicle recoveries up 766%
  • Warrant arrests, overall arrests, and felony cases related to border crime all were up
  • Are a small county of 824 people; sheriff spent $116k housing smugglers alone since the county does not have a jail
    • Sheriff has applied to Operation Lone Star to recoup some of those dollars
  • Spent $20k on smuggling cases alone and McMullen County has spent over $100k repairing fences
  • Have faced similar cases in Goliad County; main issue is that this is no longer illegal immigration, it has become a “slave trade”
    • The cartel’s number one cost is paying off the Mexican government
  • Operation Lone Start funding has made a world of difference; started March 28 and have added more staff and have created a mission-focused task force with other agencies
    • Since this time had 94 convictions, 24 felony cases, and have recovered 10 stolen vehicles
  • Are facing manpower shortages; one of the reasons is the lengthening of the police academy and adding more requirements
  • Only way to stop this issue is to close down the ports in order for the Mexican government to start border security efforts

 

Sheriff Urbino Martinez, Brooks County

  • Have a checkpoint in Brooks County about 70 miles from the border and are a corridor to the major Texas cities
    • Is mainly used for human trafficking; most cases they go through private property
  • Since 2009, the county has recovered 859 bodies of undocumented crossers; 119 last year and 27 since January 2022
  • Have had approximately 100 smuggling cases and are burning around $4k in fuel responding to border issues
    • Spend funds and time replacing fences
  • Face other issues such as felony vehicle evasions and sexual assaults
  • 30% of volunteer fire department costs are responding to issues related to border crossing
  • Have around 4k calls EMS

 

Q&A

  • Kolkhorst – Who are those getting sexually assaulted?
    • Martinez – Those are undocumented women who have that expectation when they cross
  • Eckhardt – Is a need for state investment; are businesses who are exploiting these people
  • Perry – Correct, is people laundering
    • Boyd – Is money and people laundering
  • Eckhardt – How can we need to increase multi-jurisdictional cooperation in order to not prosecute the victims on the slave trade?
    • Martinez – Is a multiple-tiered issue; need to get to the top part which is policy
  • Eckhardt – Judges are giving recognizance bonds to those who have a history of trafficking?
    • Martinez – Notes that in a specific instance the individual made bond
  • Eckhardt – Held the first criminal trespass case last week on someone who is likely a victim; how do we actually get the bad guys
    • Boyd – They typically do not deport them, give them a notice to appear which exempts law enforcement on the federal side from doing anything
    • Boyd – Individuals are all guilty in participating in organized criminal activity; throwing them in jail is the only tool sheriffs have to combat the cartels
  • Eckhardt – Agree with your written testimony on shared evidence, increased communication, and inter-operability; how do we get there?
    • Boyd – If you wanted to include inter-operability in your next grant cycle; current are sharing codes/frequencies
    • Martinez – Lower-level shares information; when you get to a higher tier that gets harder
  • Eckhardt – Need better local, state, federal collaboration
    • Boyd – Do currently collaborate with the federal government
  • Perry – Have multi-jurisdictional collaboration and have invested in that; the federal government ties their hands
  • Eckhardt – Agree there is a personnel issue and need to deal with it in a temporary
    • Boyd – Had two recommendations for Abbott and TCOLE; one to reactivate retirees without going to academy
    • Boyd – Want to allow federal employees who have a disciplinary mark on their file, such as refusal to take a COVID-19 vaccine, to be able to work for the state
    • Boyd – TCOLE has that restriction
  • Kolkhorst – Rulemaking or a statue change?
    • Boyd – Rulemaking
    • Springer – Need to get that on TCOLE’s Sunset recommendations
  • Kolkhorst – Were granted $965k, need more?
    • Boyd – Grateful for those funds
  • Kolkhorst and Boyd discuss how arrests are made to deter illegal crossings
  • Perry – This is entirely the result of a federal policy

 

Panel 3

Dr. John Graves, CEO Dimmit Regional Hospital Carrizo Springs

  • Support a population of about 22k in Dimmit and Zavala Counties
  • Are concerned about Title 42 expirations, but had non-governmental organizations to buffer that issue
  • 53% of hospital visits are Medicaid-Medicare patients; do not turn anyone away from emergency room and undocumented patients are fully funded by a federal program
    • Have support from DPS and border patrol offices
    • A few are unfunded
  • Very are for undocumented immigrants to qualify for emergency Medicaid; is typically pregnant women
  • Few are uninsured that go into charity care that could be a burden on the tax base
  • Over the last year 135 undocumented patients were brought into order patrol and 3 were not which was a minimal cost, but would be a concern after Title 42 expiration
  • Have a security team at the hospital
  • Perry – How much do you pay for that?
    • $150k
  • Perry – Does it matter who brings them into your ER if you get paid or not?
    • Has to be a border patrol or trooper to get paid by the federal government
  • Perry – State could ask residency in order to track in order to determine how Medicaid is going to pay for this down the road; see any issues with that?
    • Forms are already there, but we do not force them to fill it out
  • Perry – Does the health and human services code prohibit inquiring about residency status?
    • Resource Witness – No it does not; speaking about program operated under the 1115 waiver; potential impediment to adding that information is that would have to be approved by federal partners
  • Perry – Need to think about this next session; would like to know the total healthcare cost
    • Resource Witness – Total uncompensated pool is $3.7b per year, currently negotiating pool size for the next five years

 

Stephen Diebel, Texas and Southwestern Cattle Raisers Association

  • Undocumented crossers are a huge problem to cattle raisers and ranchers in terms of their physical health and property damage
    • Has large costs associated for property owners
  • Perry – Will have agricultural theft unit up to discuss this as well; members are scared?
    • Yes
  • Springer – How many special rangers? Need anything from TCOLE? May need to facilitate collaboration on the destruction of property
    • About 30; is spread across regions

 

Public Testimony

Susan Hays, Self

  • Immigration system has been broken for decades and both parties are at fault of this; Title 42 is part of the cause
  • Immigrant workers often arrival late and can only be in the U.S. for 10 months
  • Immigration has peaked at certain times – 1954, 1986, 2014, 2019
  • Perry – We know we have more people coming through and if we removed Title 42 there’s a fair chance we’ll get an estimate of 18 thousand; how can you make the statement that we’re not close to the high mark?
    • Because I looked at the data of Mexicans and OTMs
  • Perry – What I’m hearing is you’re not getting those seeking work opportunities, you’re getting a different brand of folks coming into the country
    • When people seek asylum, they aren’t given permission to work
  • Perry – You have to admit that there’s a different character of individual coming through today
    • Because of the rising in cartels and trafficking
    • There has been a solution passed in the U.S. House which is the Farm Workforce Modernization Act but Texas Senators have opposed it; that would create a line for Mexican and make a way to people to immigrate legally
  • Perry – The future does not look good in its current state; we’ve seen nothing but spin and rhetoric that ignores the people

 

Sheena Rodriguez, Secure the Border, Latinos for America

  • Has been on the banks of the border and seen the pain inflicted on Texas citizens attempting to cope with rise of crime and sex trafficking
  • Elected officials on all sides of political spectrum to take bold and immediate action to secure the border
  • Just came back from Liberty County in East Texas which was overrun by the cartel
  • Senator Springer agrees with those claims and says she can reach out to his office for help

 

Meat Packing Facilities: Study the need for additional meat packing facilities in Texas. Evaluate and report on the increased cost to Texas ranchers and revenue lost in the Texas economy when meatpacking facilities are utilized outside of Texas.

 

Timothy Stevenson, Associate Commissioner Department of State Health Services

  • Runs Texas meat and poultry safety program
  • State program works with small processors
  • Maintains program meets federal safety standards
  • Perry – If you’re not selling to retail where does that licensure fit in?
    • State licensure establishments can sell retail anywhere in Texas
    • Federally inspected establishments can sell outside the state of Texas
  • All meat packing facilities are inspected either by state or feds?
    • Yes; I should specify that custom exempt establishments within the state/federal program could only provide the product back to the owner of the animal
  • For the small establishment is it per head/per day?
    • Yes, 10-500 is considered small
  • Springer – So that custom delivered back non inspected is only if they’re processing less than 10 per day?
    • No, custom is the owner and the establishment
  • Springer – Then it wouldn’t have to be inspected?
    • If the establishment is not fully inspected then it is not required for every animal
  • Springer – Could three brothers for example get a custom and split one cattle?
    • If it were one person, they would get the animal back and split to whoever because it’s marked ‘not for sale’
  • Springer – There was a question that says if people wanted to partner up they would pre-package it out?
    • They could get a private label and then do what they want with it
  • Perry – To be clear, every package will be inspected at some level either quarterly or otherwise?
    • Correct
  • Springer – If you’re expecting the same standards as the USDA why does someone pick one over the other?
    • The state program caters to the ‘at least or equal to’ and is not the same as the federal standards
  • Perry – How many USDA placards does Texas have?
    • In the state program we have approximately 340 and total federal we have 547; that’s double counted for slaughter and processing
  • Perry – So that’s approximately 800 and how many cattle do we have in Texas?
    • I don’t know that number but we’re number one in the United States
  • Perry – Are we meeting the market or not?
    • No, there’s a waitlist for custom exempt establishments
  • Perry – When packing plants got shut down due to COVID, we opened up places to get retail but you’re saying that didn’t happen?
    • No, we didn’t have the latitude; it was a federal issue
  • Kolkhorst – I’m hearing from cattle ranchers that there is an issue of not having an adequate supply of meat packers. Is there a barrier to entry?

 

Justin Benavidez, Assistant Professor for Texas A&M in Amarillo

  • Texas High Plains has capacity to feed 3.2 million herd of cattle at a time
  • Harvest capacity is similar to fed cattle production
  • Common for cattle to cross state lines for harvest so additional growth will increase demand for fed cattle and should lower cost of beef
  • Cost of building a new packing facility and paying staff are concerns
  • Perry – What’s the sweet spot between mega packing plants and small ones?
    • There is no head per day figure because we see barriers at different stages
  • Perry – Has the drought began to impact feed supply?
    • From 2021 to 2022 we lost 2 percent of the national cow herd
    • We’re seeing liquidation of cows due to the drought and we still don’t have capacity
    • That impact has not hit the grocery stores yet
  • Springer – How much of the harvest capacity is owned by the large companies?
    • 84 percent
  • Springer – Of the 5 million cows set out, what percentage is under contract?
    • I don’t know that number
  • Springer – Do you know the number of calves that go through the auction versus being contracted?
    • I am unaware of those numbers
  • Kolkhorst – Why was the Cargill plant in Plainview shut down in 2013?
    • Margins for packers were at an all-time low
  • Kolkhorst – Does Cargill own other plants?
    • Yes
  • Kolkhorst – The prices at the grocery store are not matching what producers get paid. Am I seeing that wrong?
    • No ma’am and additional capacity will lift the boats of consumers in terms of lowering prices and increases demand for live animals; so those effects mean better prices
  • Kolkhorst – I believe our food supply is national security so I think we will need to address this. There are some people in our nation’s capital who don’t want to see beef production. Texas must step into this void to correct this.
  • Springer – One of the challenges is a workforce. In the Panhandle they were bringing workers from many different countries. Native Americans don’t have the desire to work in a packing facility.
  • Perry – It pays well. We never thought about support outside of renewables for 30 years and there’s opportunity in food. I’d like to know your capacity and where you all need to be if we want to start fixing this.

 

Kevin Buse, Texas Cattle Feeders Association

  • Owner and operator of cattle feed yards
  • U.S. produces 18% of the world’s beef
  • Beef production and processing must be improved
  • State economy would benefit by establishing fed cattle packing plants
  • Adequate beef processing capacity is critical
  • Over last decade, several packing plants have been closed
  • 2020 study found that excess processing capacity fell to negative in early 2017
  • This is independent from consumer demand for beef
  • Processing capacity must be expanded
  • Kolkhorst – Is the Corpus Christi plant part of the 4 owners that own 84 percent of the meat packing capacity?
    • No, they are independent
  • Kolkhorst – What is their capacity?
    • 800 head per day
  • Are they the only large independent in Texas?
    • Yes, along with the plant in Herford Texas
  • Springer – It is a scientific operation and a feat; hopefully we can find a solution like large asset job creating projects

 

Dustin Dean, Texas and Southwestern Cattle Raisers Association

  • Texas is dynamic; some cattle fed here and cattle fed in other states
  • Goal to get more money for cattle
  • Texas is the poster child for building a packing plant
  • We want all the beef that is sold to be inspected thoroughly
  • Kolkhorst – We will have to get creative; perfection is the enemy of the good
  • Perry – Is financing available?
    • Absolutely. The USDA has funding that comes through
  • Perry – Be sure you have activate lobbying available for ESG conversations and keep this legislature body in that conversation
  • Perry – Have y’all maximized the technology?
    • Not as much but I think there are opportunities

 

James O’Brien, Texas Farm Bureau

  • Relies on processor slaughterhouse but experiences challenges with economic efficiency
  • Springer – How many head are you having slaughtered per month?
    • We’re certified as a small producer and that’s limited to 50 a year and we push 4 per month
  • Springer – What’s the lead time when you’re booking out?
    • We hold a date every month at Dustin’s plant
    • There can be a 3 month delay sometimes
  • Springer – Do you pick it back out and then you’re shipping it to consumers?
    • Correct

 

Public Testimony

Tahne Arrington, Self

  • Farmer and veteran
  • No processing facilities in Charlotte County and travelling stresses the animals out
  • Springer – Is anyone offering mobile processors?
    • No because Charlotte is less than 1 thousand people

 

Jarred Maxwell, Foodshed Investors

  • Processing has become a bottleneck
  • All are having difficulty with availability and quality of processing
  • Proposes increasing funding and training opportunities so Texans can operate small facilities
  • Springer – We need all sizes of processing facilities; especially with the rise of online marketing and being able to know you have a partnership

 

Judith McGeary, Farm and Ranch Freedom Alliance

  • Supports investment in state inspected facilities
  • But if we focus all energy there, the regulations aren’t appropriate for the scale of small operations
  • The scale appropriate solution is custom exempt processors with inspections on a periodic basis
  • Create a state law that clarifies that the farmer keeps records of herd shares and consumers are informed that it’s being inspected in an uninspected slaughterhouse
  • That would lessen the pressure on state inspected producers and build a resilient web of facilities of different capacities
  • Kolkhorst – Has there been any USDA repercussions in the state with animal share laws?
    • USDA made threats to that effect but have not taken official action in states like Wyoming
  • Kolkhorst – Do you think there would be a different reaction with a state the size of Texas?
    • I cannot predict what USDA would do

 

Agricultural Theft: Study the impact of cattle theft on farming and ranching operations throughout Texas and recommend cost-effective measures to mitigate loss and increase security.

 

Jim Schwertner, President/CEO of Schwertner Farm

  • Largest livestock dealer in U.S.
  • Need to correct statute to where local DA has control of cases because cattle theft is rampant
  • Need to help TSCRA
  • Need to increase penalties for theft
  • Kolkhorst – If Senator Springer files a bill, I will co-author; how does theft happen?
    • Animal drugs have gotten so expensive that employees will steal and resell them
    • There’s a tougher penalty on human drugs
  • HB 1480 enhanced the definition of agriculture trespassing and is being used for arrests by the attorney general
  • Federal government just passed a law that will limit the amount of credit a packer can get so we need to increase the capacity in Texas for more packing houses
  • Kolkhorst – The best solution comes from the people and from the markets.

 

Scott Williamson, Texas and Southwestern Cattle Raisers Association

  • Seven rangers along TX/OK border are commissioned by DPS
  • Special rangers are misunderstood as agricultural investigators; they are experienced criminal investigators
  • Completely funded by TSCRA
  • Market inspection program inspects all cattle that go through public market in Texas; 85 cents/head
  • Cattle theft is priority but they work all agriculture-related crimes
  • Perry – With influx of immigration issues, are you seeing more of a volume of theft?
    • I am not seeing that across the northern part of the state; mainly damaging property
  • Perry – You’re more focused on the white-collar aspect of it?
    • I wouldn’t say more focused on it, but it takes up more of our time
    • Financial crimes are more common
  • Springer – If there are additional things we could do for the special rangers in terms of expanding what they can do and expanding overtime
  • Kolkhorst – Crime Victims Fund could be a help for ranchers; could maybe do a subset on this

 

Closing Remarks

Perry – Wanted to clear things out for the summer, will have meetings in later it the fall