Brian Christian Consulting

The Deadline Action Calendar, that milestone of every Regular Session of the Texas Legislature that coincides with the advent of Spring, has been posted.  We are now at the point where we are counting in days and not months.  It is a good time, then, to check in on where things stand (and, yes, with events quickly moving some of this will get outdated pretty fast).  But first, let us recap how we got here.

I recently went back and looked at my speculations on what COVID would mean for session.  This trilogy of thought exercises began over a year ago, when we were standing at the base of a mountain of unknown elevation.  The very real fear was that the budget had imploded, and that the threat of a super-spreader event at the Capitol could result in a drastically altered session.  Worst-case scenarios included a truncated session, a budget put-off until a Special Session (or a one-year budget to allow a recovery to take hold), and only a handful of issues being considered, with everything else fighting for oxygen.

I did get some things right.  Large gatherings of outside groups have been nonexistent, and, at least initially, there was still a vibe in early January that issues like COVID liability protection would be the focus.  But internal and external developments altered session’s trajectory pretty quickly.

First, as noted in my other dispatches, the budget was not nearly as bad as feared.  Robust sales tax revenues and state-agency belt-tightening helped pull the current biennium out of the ditch.  And, while details are still being worked out, federal relief money is available.  The House and the Senate versions of the budget were remarkably close in content and spending.

Second, the long, drawn-out contest of the federal election has prompted certain legislatures, including Texas’, to tackle election laws.  Predictably, the issue has driven a Gibraltar-sized wedge between the political parties and put business interests in a bit of a squeeze.  The question remains whether members will compartmentalize enough to take care of business, such as the budget and other priorities, or whether we will see a sequel to the walkouts of 2003.

Third, the polar vortex blew away ERCOT and the Public Utility Commission of Texas and created a major point of disagreement between the House and Senate on reforms and price rollbacks.  At this writing, major legislation is still in play but that loud ticking you hear is time running out.

Finally, and most importantly, the Capitol has, to this point, admirably managed COVID.  This is due in no small measure to vaccinations and the hard work and commitment of the young men and women staffing the testing tent.  It is also a testament to good planning by the House and Senate ahead of the session.  To my knowledge, there have been no positive tests among members since the first week.  Plus, the steady increase in vaccine distribution makes it feel like the vice is loosening a bit.  It has also meant that after a tentative first 60-days, the pace has accelerated, which may make the last few weeks of session a bit more frantic than normal.

Speaking of the calendar, the Texas House rules tend to drive the schedule.  Here are some remaining key dates:

• May 10th is the last day House committees can report HBs and HJRs.
• May 14th is the last day for third reading on the Supplemental Calendar.
• May 22nd is the last day House committees can report SBs and SJRs, BUT May 23rd is the last day a Daily Calendar with SBs and SJRs are distributed.
• May 26th is the last day for SBs and SJRs on third reading.
• By midnight on the 29th, all CCRs must be distributed.
• May 31st is sine die.

And the first Special Session starts June 1^st.  Hey, anything is possible!

So, where do things stand on some of the budget and environmental issues I have been highlighting?  Let us take a look….

The Budget.

The Senate passed its version of the appropriations bill (Senate Bill 1) unanimously on April 6^th.  There were no amendments.  Agencies like the Texas Commission on Environmental Quality (TCEQ) are having a rather good session, all things considered.  Highlights for TCEQ include funding to maintain air quality monitors, additional money to support an increase in the number of aggregate production operation investigations resulting from legislation passed last session, and targeted pay raises for certain high-turnover positions at the agency.

The House Appropriations Committee, in turn, voted its version of SB 1 out on April 12^th and sent it to Calendars.  It is anticipated that it could be debated on the floor on or around April 22^nd.  The House is also always a bit more of a free-for-all, so look for a longer floor debate and dozens if not hundreds of amendments.  Given that committees are voting out fewer bills (a side-effect of the late start for committees and the crush of other issues), I would expect a significant number of budget Riders, many of which will be general law disguised as spending instructions.  Extra vigilance on the floor debate will be in order.

Radioactive Waste.

Full disclosure—I work on issues related to low-level radioactive waste management, so here I will merely highlight and not opine.  Senate Bill 1046 (Birdwell/Seliger) and HB 2692 (Landgraf) were both considered in their respective committees during the week of March 22^nd, and HB 2692 was voted out of committee on March 24^th.  The Senate committee followed suit with SB 1046 on April 8^th.  In short, the bills would amend statutes relating to the importation of low-level radioactive waste for disposal in Texas.  The action in the House will now shift to the Calendars Committee.  The committee bills are similar, with the only difference being the addition of the “Nelson Amendment” to SB 1046.

Aggregates and Allied Industries.

Full disclosure again—I also work on aggregates issues, but the same rule will apply.  As with last session, a number of bills have been filed to regulate aggregate production operations (e.g., quarries and sand mines) and their related operations such as concrete batch plants.  House Bill 4341 (Biedermann) would create an aggregate production operation program at the Railroad Commission, transferring certain duties from TCEQ.  House Bill 4478 (Huberty) would require APOs near the San Jacinto River to develop restoration plans.  House Bill 1912 (Wilson) and Senate Bill 1209 (Schwertner) are companions.  They could expand public meetings on air permits to include other jurisdictional entities (e.g., TxDOT) and require permit conditions for noise, light, and air quality monitors.  These bills join dozens of others that cover topics such as siting, who can request contested case hearings (for example, Senate Bill 1166 by Campbell, which was heard in committee on April 8^th), and land reclamation.

House Bill 1627 would grant Harris County and the City of Houston the authority to preempt the issuance of air permits for concrete batch plants and was heard on March 29^th in House Environmental Regulation.  Additionally, Representative Walle and Senator Hinjosa have filed bills that would require concrete batch plant applicants to file a plot plan with their application.  Representative Walle’s plot plan bill was voted unanimously out of committee on April 12^th.

The Texas Emissions Reduction Plan.

Recall that last session, a bill was passed to establish the TERP Trust Fund outside of the Treasury, with revenues from the various surcharges, as well as the transfer from the state highway fund ($300 million for the biennium in TxDOT’s budget), going directly to the fund starting September 1, 2021.  Senate Joint Resolution 52 by Chairman Birdwell proposes a constitutional amendment to fully effectuate the creation of the TERP Trust Fund.  Nearly 20 other TERP related bills revisit the Trust Fund approach and revenue allocations, as well as expand existing programs and create new incentives.  A bill to watch is SB 1263  by Chairman Birdwell.  The committee substitute is anticipated to modify some of the accounting and funding mechanisms for the program and represents a close collaboration with Chairman Nichols.  The bill was considered in committee on April 8^th.

Environmental Justice.

Focus on these issues at the federal level has prompted several bills to be filed in the Texas Legislature.  Senate Bill 1294 (Eckhardt) and its companion House Bill 1191 (Goodwin) would establish an Office of Environmental Justice at TCEQ.  The office would play a role in permitting.  Other bills that would provide for representation of environmental justice communities include Senate Bill 365 by Miles, and House Bill 714 by Reynolds.  Finally, Senate Bill 1304 (Blanco) and its companion House Bill 3858 (Ordaz Perez) would create a duty for TCEQ to respond to any inquiry in the language in which it was received and expand the types of public notices subject to alternative language requirements.  HB 3858 was considered by House Environmental Regulation on April 12^th.  Interestingly, the TCEQ has proposed a rule that would accomplish many of the same goals of the Blanco and Ordaz Perez bills, though under its general authority.  Some have argued that it would be better to let TCEQ’s rulemaking process play out.

Emissions Events.

House Bill 2369 (Morales Shaw) would requiring the staggered shutdown of regulated entities in advance of a potential weather-related disaster.  The concept is to regulate the timing of shutdowns.  A number of bills have also been filed to eliminate the affirmative defense for emissions events, such as Senate Bill 684 by Senator Blanco.  House Bill 1820 (Zwiener) takes a broad view of TCEQ enforcement authority and features penalty enhancements, including for emissions events.  That bill was heard in House Environmental Regulation on April 12^th.  A committee substitute, among other things, throttled back on the proposed changes to the regulation of emissions events, but would still result in across-the-board higher penalties.

Sunset.

The Sunset Safety Net bills have also been filed.  Senate Bill 713 (Buckingham) and House Bill 1860 (Cyrier) move up the Public Utility Commission’s sunset review to the 2022-2023 cycle.  Interestingly, the filed version of the bills also removed the Texas Low-Level Radioactive Waste Disposal Compact Commission from sunset review, but the Committee Substitute for SB 713 restores the requirement.  Additionally, House Bill 1600 (Canales) will save any agencies under the current review cycle whose bills do not make it (this is a must pass bill).  All will need to be closely tracked as they can evolve to include other agencies.

So, this is just a snapshot of a handful of environmental bills.  If you were to compare things now to where they were two years ago, I suspect you would find far fewer environmental bills being voted out of committee.  So, my admonition to keep an eye on budget Riders in the House remains in force.

Additionally, many of the issues we are seeing now will reappear during the Sunset Reviews of the Article VI agencies set to effectively start this summer.  Lobbyists and other interests are already saying, for example, that the state would be better served by evaluating TCEQ holistically during Sunset.  This session’s trial run on some of these issues is good practice for what lies ahead.

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