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2011 April 18 - 12:00 am

MONEY TREE: Texas House Passes Budget With Steep Spending Cuts

AUSTIN, Texas (AP) — The Texas House approved a bare-bones budget that would make deep cuts to public education and health and human services over the next two years.

The proposed budget calls for the state to spend $77.6 billion of its own funds over the two years. It would underfund public schools by almost $8 billion and Medicaid by $4 billion. The plan reinstates funding to four community colleges that had been set to have their funding cut off. Those cuts would instead be evenly distributed among all community colleges in Texas.

Republican Rep. Jim Pitts, who leads the budget committee, said budget writers did their best given the combination of a fiscally conservative House and available revenue, which was short by more than $14 billion.

Gov. Rick Perry and lawmakers agreed to use $3.2 billion of the state’s Rainy Day Fund to help close a shortfall in this year’s budget. But Perry has vowed to reject any 2012-13 budget that would further tap the reserve fund.

The fund, which relies on oil and gas tax revenues, is expected to have a balance of more than $9.4 billion at the end of the budget period if left untouched.

Under the proposal, schools would still be underfunded by about $800 per student. It still doesn’t include money for full-day pre-kindergarten, teacher incentive pay, arts education and numerous other school programs.

Analysts say more than 108,000 school employees would lose their jobs under the plan.

The part of the budget that pays for health care programs for needy, elderly and disabled Texans still faces a more than $4 billion shortfall.

The House plan reduces reimbursement rates to nursing homes and other Medicaid providers, a change that could jeopardize 45,000 residents in the state’s 550 nursing homes that depend on Medicaid, experts said.

The budget still would cut Medicaid reimbursement rates by 10 percent. That’s on top of 3 percent rate reduction that state leaders requested this year. Medicaid, the state and federal cost-sharing program, serves 3.1 million Texans _ mostly children, pregnant women and adults with disabilities.

Nursing home advocates say the true cut to nursing homes is closer to 33 percent because of recent changes in the federal-state funding formula. The state’s share has increased, but budget proposals are not paying for that increase.

``In many cases the cuts in health and human services are making life and death decisions,’’ said Rep. Dawnna Dukes, an Austin Democrat who voted against the budget proposal. ``Texas children, senior citizens and disabled Texans deserve better. ... This budget is unacceptable to our constituencies who have sent us to ensure a first class education for our children, protect our citizens, care for those who no longer can care for themselves and provide services to those who have nowhere else to turn.’’

The Senate is working on its own plan and the proposal still has far to go before being finalized later this year.

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