Please find a brief update on how things are progressing at the Texas Capitol …

Constitutional carry and other politically polarizing bills make progress. This week saw a tense day on the floor of the House, as the body considered a bill often referred to as “Constitutional Carry”. In essence, the bill would remove the requirement to obtain a permit to carry a firearm. The vote followed party lines for the most part, but about 10% of Democrats did vote for the bill. The bill will move to the Senate with a new political backdrop; yesterday, a former Travis County (Austin) deputy killed three family members in Northwest Austin. The event will also likely impact discussions around bail reform; as the deputy was arrested last June after being accused of sexually assaulting a minor. SB 21, the Senate’s bail reform bill, passed the full chamber this past week. Other politically charged bills on the move this past week included:

ERCOT releases summer forecast as PUC gets new commissioners. ERCOT released a preliminary assessment of resource (generation) adequacy for this summer. It identified nearly 10,000 MW of reserve capacity above predicted peak demand. However, ERCOT did identify three worst-case scenarios that could lead to power outages should those conditions play out. The assessment comes as ERCOT had to issue a request to consumers to conserve energy last week. The request came on an unusually hot spring day; spring is typically when many generators are offline for scheduled maintenance. Two important steps were taken last week to install new leadership at PUC: Commissioner Will McAdams was sworn in and the Governor appointed the chair of the Texas Water Development Board to the PUC, Peter Lake.

Biden Administration rescinds Texas’ 1115 Waiver. On Friday afternoon, the Biden Administration rescinded an extension of Texas’ 1115 Waiver. The extension was pushed through at the end of the Trump Administration. While the Biden Administration has cited procedural problems with the extension, we suspect the Administration has both substantive issues with the extension and that this is in part a reaction to the recent jabs that the Administration has traded with Governor Abbott and other state leaders on issues such as the border and the lifting of COVID restrictions. The waiver, which provides billions of dollars in Medicaid money to the state’s hospital safety net, has long been a political lever in the Medicaid expansion debate. The Texas House did pass a bill to extend coverage to postpartum women to a full 12 months; currently Medicaid coverage ends after 60 days. But other, more comprehensive Medicaid expansion bills have stalled.

Budget night is April 22 in the House. The House’s version of SB 1, the state’s budget, will be considered by the full House this Thursday. We expect the bill to pass easily and move to conference committee, where key lieutenants in both the House and the Senate will work out differences between the two chambers. That discussion is likely to be informed by a revised Biennial Revenue Estimate from the Comptroller. We expect that revision to come in early May – after the Comptroller has the benefit of seeing another month of revenue collections. April collections could be quite robust given three important factors: the lifting of COVID restrictions, stimulus checks, and falling unemployment.

Here’s a brief update …

A pair of election reform bills has thrust Texas into the midst of a national debate on voting laws. Two bills are moving through the Texas Legislature that make changes to Texas voting practices. Senate Bill 7 would limit extended early voting hours (from 6 am – 9 pm), prohibit drive-thru voting and make it illegal to proactively mail out absentee ballot applications, something Harris County attempted this past election. The Senate passed the bill, where it will now head to the House, prompting several high-profile corporations to decry the bill. The public rebuke comes on the heels of MLB’s decision to move the All Star game from Georgia after it passed an election reform bill. This in turn prompted strong responses from Governor Abbott and Lt. Governor Patrick. The Governor declined an invitation to throw out the first pitch for the Texas Rangers in response to MLB’s decision. Speaker Phelan also pushed back on the corporate backlash, suggesting he’d like to go “line by line” with them, noting that last election saw “certain areas of the state creating election law out of thin air”.

Speaker Phelan lays out health care priorities. The Speaker was joined by Republican and Democrats alike at a press conference to lay out his bipartisan health care legislative agenda: “Health Families, Healty Texas”. The package of legislation is highlighted by legislation to expand telemedicine (HB 4), extend Medicaid coverage for postpartum mothers (HB 133), and a bill to fund research regarding brain disorders (HB 15).

A new PUCT commissioner has been appointed. The Governor has made his first appointment to the Public Utilities Commission since the resignation of all three members in the aftermath of Winter Storm Uri. Will McAdams will appear before Senate Nominations later today. While we expect some pointed questions, particularly as it relates to market intervention and re-pricing, we do not expect his nomination to ultimately face substantial objection. McAdams is a veteran of the Capitol, having previously been a policy advisor on electric issues to former Speaker Dennis Bonnen and Senate Business and Commerce Chair Kelly Hancock.

The border crisis continues to be a significant macro-political issue. As the number of apprehensions of migrants reaches all-time highs along the southern border, the Governor’s activity in response has increased. Last month, he launched Operation Lone Star, sending the Department of Public Safety and the National Guard to crack down on Mexican cartels and smugglers in high-threat areas. Last week, he visited Weslaco to check on operations. In addition, after allegations of sexual abuse in a federally run detention center in San Antonio, Governor Abbott launched an investigation into the center and demanded that the federal government close the facility for unaccompanied minors in a letter to Vice President Kamala Harris. You can watch Governor Abbott’s appearance on Fox News Sunday here.

With Committee work still at a frenzied pace, floor action in both chambers has picked up speed. Priority bills begin to crisscross the Capitol. Here’s a sample of some of the major movement this week:

  • Senate Bill 1, referred to House Committee/Set for hearing. This is the state’s budget.

  • Senate Bill 3, referred to House Committee. This bill would require the weatherization of all generation, transmission and natural gas facilities, prohibit retail electric variable rate plans, and establish an energy emergency alert system to ensure notification of potential outages.

  • Senate Bill 5, referred to House Committee. This bill would form a statewide broadband office, require the office to create a statewide broadband plan, and establish a broadband development incentive program.

  • House Bill 5, passed out of the House. This is a near identical companion to SB 5 (mentioned above).

  • House Bill 10, referred to Senate Committee. This bill remakes the ERCOT governing board.

  • House Bill 11, referred to Senate Committee. This bill would require the weatherization of the state’s generation fleet.

  • House Bill 16, referred to Senate Committee. This bill would prohibit retail electric rate plans indexed to the wholesale price of electricity.

  • House Bill 103, passed out of the House. This bill would establish an active shooter alert system.

  • House Bill 1239, passed out of the House. This bill would prohibit local ordinances from closing places of worship.

Both chambers are expected to pass major legislative responses to Winter Storm Uri this week. Both chambers are scheduled to consider bills filed in response to the power outages last month. As soon as today, the Senate will consider SB 3, an omnibus bill that creates the Texas Energy Reliability Council to ensure the state’s natural gas needs are met, requires the weatherization of all generation, transmission, and natural gas facilities, and prohibits retail electric variable rate plans (among other changes). For a quick summary of the bill’s measures, click here. The full House will consider HB 10 (reforming the ERCOT board), HB 11 (winterization of generation), HB 12 (creating a statewide disaster alert system), and HB 16 (prohibiting retail electric indexed products).

Twinning broadband bills clear committee. Companion bills SB 5 and HB 5 both were favorably voted out of their respective committees this week. The bills are nearly identical and would establish a state broadband office, require a state broadband plan to be created, and create a broadband development incentive program. The incentive program would still require a legislative appropriation. Both bills have significant bipartisan support.

Other major priority bills are moving in both chambers. After progress on major priority bills was delayed for weeks by the fallout from Winter Storm Uri, last week saw major bills voted out of committee (see broadband above) and this coming week will see both chambers take up priority bills. Here’s a sampling of what’s on tap:

  • House of Representatives. Several key bills are scheduled for hearing … HB 4 (expanding the use of telemedicine) and HB 6 (election integrity bill). HB 6 was scheduled for a hearing last week before a procedural error forced an abrupt end to the hearing. Last week, House committees also heard bills that would limit the ability of local governments to use lobbyists and a bill designed to punish cities who slash police budgets. The latter bill was heard on the same day as the George Floyd Act, which would ban chokeholds, require officers to intervene if their partner is using excessive force, and limited qualified immunity for police officers (a major sticking point for Republican lawmakers).

  • Senate. Committees took testimony and voted out SB 4 (preventing local governments from making financial commitments with professional sports teams unless they commit to play the National Anthem) and SB 7 (election integrity). And other priority bills are eligible to be heard by the full Senate this week: SB 8 (which would ban abortion once a heartbeat can be detected) and SB 9 (which would trigger an outright ban on abortion should Roe v. Wade and related cases are overturned).

COVID vaccines will be available to everyone starting today. The Governor announced last week that every adult would be eligible for a vaccine beginning this week. The announcement comes as the state is set to receive 1 million first doses this week. The state surpassed 10 million vaccines administered last week. New cases have plummeted since January highs as the state nears the 3-week mark since the Governor lifted the mask mandate and reopened business to 100%. A legal battle over the lifting of the mask mandate produced an initial victory for the City of Austin, where a state district judge sided with the City in its efforts to continue to enforce its mask mandate.

The crisis at the border continues. The crisis at the southern border, which has seen a record number of migrants including thousands of unaccompanied children crossing the border, continues to be a major issue with state leaders. Last week, a significant number of Congress visited the border in the Rio Grande Valley. This comes on the heels of several weeks of criticism by Governor Abbott about the lack of preparedness of the Biden Administration for the wave of migrants. Expect this issue to continue to be a major thread in Texas politics.


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