In this issue:

1. Overview of the 78th Legislature
2. Library Budgets
3. Telecommunications Infrastructure Fund (TIF)
4. Updates
5. Bill Review

The driving philosophy of this session was to reduce government and balance the budget without raising taxes-a platform on which most elected officials campaigned. The state's leadership also listed several priority issues, such as medical and homeowners insurance and tort reform. All of these issues were dealt with legislatively, and state leaders abided by their commitment not to raise taxes. Overall, the state cut about $10 billion from its current budget level. That's almost a full 10%. Quite simply, this budget situation is the worst one since World War II.

While early drafts of the state's budget listed 10 to 15% cuts for all agencies, some funding was restored to education, higher education, and health and human services. In the final draft of the Appropriations Bill, these politically sensitive areas were cut only between 5 and 10%. While the legislature worked to keep programs alive, they focused on administrative cuts and reductions in "non-essential" services. Some of the more controversial reductions included: fewer children insured under the Children's Health Insurance Program and Medicaid; reductions in services related to mental health and mental retardation; $500 reduction in health insurance pass through for some state employees; and cuts in home care services for the elderly.

The Legislature appropriated no direct funds to the Texas Education Agency (TEA) for the Texas Library Connection (TLC). That program, which was created in the mid 1990's, was funded at $4 million per year. The funding for the program came from a direct appropriation from the Telecommunications Infrastructure Fund (TIF) to TEA. The question as to whether TLC will remain now is in the hands of TEA, which must determine what (if any) other agency funds can be directed to the program. TEA will likely also look at strategies that might include vendor involvement or spreading the cost of the program to districts in a membership driven framework. TEA, like all other state agencies, will review its budget and determine what programs can be supported over the next biennium.

The Texas State Library and Archives Commission took an across the board cut of about 12.5% of state funding for all programs. The TexShare databases, which are currently paid for through TIF funding of some variety, were reduced even more substantially. Funding for the program dropped from the approximate current level of $10.5 million per year to $4.5 million in each fiscal year of '04 and '05. (That amount includes TIF dedicated general revenue, $1 million in federal funds, and an estimated $500,000 or possibly more in fees.) It should be noted that the $4.5 million level is $1.5 million over the amount appropriated for TexShare databases prior to TIF support in 2001. The additional $1.5 million comes from the State Library's commitment to keep the program as strong as possible. Other programs were funded as follows: Library Systems ($7.5 million in 2004; $7.55 million in 2005) and Loan Star Libraries ($2.71 million per year). The percent reductions (based on total program cost and all available state and federal funding sources) from 2003 levels are as follows: Systems 2004-6.25%; Systems 2005-5.6%; and Loan Star Libraries 2004-2005-6.9%.

The TIF Board was appropriated no money for any new grants in 2004 or 2005. The agency was appropriated no administrative funds for 2005, so it must close its doors by August 30, 2004. Interestingly though, the Legislature did vote to raise the cap of allowable funds the state could collect from the TIF assessment. Many of you will recall that, when TIF was created back in 1995 to deploy a telecommunications infrastructure in the state, the total cap on funds that could be raised through the TIF assessment on phone bills and charges to local phone companies was $1.5 billion.

Legislators added an amendment to a bill that was progressing late in the legislative session. The amendment basically raised the cap by $250 million, thus allowing the state to take in a total of $1.75 billion through 2005. The amendment did not extend the life of TIF nor did it give direct "pass through" authority to telecommunications companies currently paying the TIF assessment out of their own receipts. The additional funds will presumably stay in the state coffers to help certify the state budget (but may be used later), since none of the expected additional funds were appropriated for use in a grant program for schools, libraries, higher education, or healthcare (the current eligible recipients of TIF funds).

There has been much talk about a special session. The governor has stated that he will call a special session to address school finance. At this time, no date has been set, although discussion has focused on the fall of 2003 or January 2004. While the governor may call another special session for other issues, none has yet been called.

A special Q&A session will be held on Thursday, July 10, at Annual Assembly to discuss the legislative session. TLA Director of Communications Gloria Meraz, TLA Legislative Committee Chair Jana Knezek, In-coming Chair Julie Todaro, State Librarian Peggy Rudd, TEA Director of Library Services Mary Lankford, TIF Taskforce Chair Rhoda Goldberg, Texas State Library and Archives Commission Chair Sandra Pickett, and TLA Legal Counsel Sam Stone will be in attendance to answer questions and discuss the legislative session with any interested members. If you cannot attend but have questions, you may contact Gloria Meraz directly (gloriam@txla.org <mailto:gloriam@txla.org>). Also, please see the full legislative review at: http://www.txla.org/html/legis/78th_review.html.

TLA thanks all library supporters who sent letters (some multiple times!), made phone calls, participated in Legislative Day, got others in your community to speak for libraries, visited with state legislators, rallied community and parent groups, and came to Austin to testify. The Association would also like to express its thanks to legislators who supported library issues. Some of these legislators include: Sen. Eliot Shapleigh (El Paso); Rep. Sylvester Turner (Houston); Sen. Judith Zaffirini (Laredo); Rep. Jim Pitts (Waxahachie); Sen. Jeff Wentworth (San Antonio); Rep. Bob Hunter (Abilene); Rep. Terry Keel (Austin); Rep. Joe Pickett (El Paso); Rep. Jesse Jones (Dallas) and Rep. Timoteo Garza (Eagle Pass). TLA would further like to thank all members of the Finance and Appropriations Committees who supported funding for library programs. Library supporters are urged to contact their legislators and thank them for their support of library issues.

This session was downright grueling, and there were no real winners. Despite the bad news, the library community fought hard and can be proud of its efforts. The 79th Legislature will convene in January 11, 2005. Our work to influence the outcome of the 79th legislature has already begun. We'll be there-first in line to have our programs restored.

• HB 46 (S. Turner)/SB 124 (Shapleigh). Relating to the continuation of the Telecommunications Infrastructure Fund (TIF). The bill would continue TIF to 2009 and raise the fund cap by $500 million. Both bills died in committee.
• HB 1770 (Keel). Relating to the circumstances in which municipal consent is required for the creation of a library district. Companion: SB 1049. The bill passed the House, but the companion was not heard by the full Senate for a vote.
• HB 228 (Keel). Relating to the circumstances in which municipal consent is required for the creation of a library district. The bill died in committee.
• HB 2306 (J. Jones). Relating to the New Millennium license plate and public libraries. The bill was rolled into a large omnibus bill, which died on a point of order.
• HB 854 (West). Relating to the eligibility of public schools and libraries for certain funds. The bill requires the creation and implementation of an Internet use policies in school and libraries in order for those institutions to be eligible for new TIF grants. The bill has been signed into law. [Note: Since, in practical terms, the TIF grant program has ended, the bill will have no impact.]
• HB 1635 (King). Relating to eliminating libraries from eligibility for TIF funding. Referred to Regulated Industries. The bill died in committee.
• HB 1842 (West). Relating to requiring a separate area in a public library for adult and computer use. The bill died in committee.
• HB 2121 (Wilson). Relating to the criminal and civil consequences of conduct involving the theft of or tampering with certain communication or information services. Companion: SB 1116. The bill died on a point of order in the House.
• HB 2763 (Garza). Relating to the Texas public library endowment fund. The bill basically gives the Texas State Library and Archives Commission permission to use money in the endowment fund for TexShare. At this time, there is no funding in endowment fund. The bill died in committee.
• HB 2769 (Chisum). Relating to changing the composition of certain state agency governing bodies to ensure that commissions have an odd number of members. The bill was amended to increase the size of the Texas State Library and Archives Commission from six commissioners to seven. Companion to SB 287 (Ellis). The bill passed both chambers and has been sent to the Governor for signature.
• SB 1049 (Wentworth). Relating to the creation and taxes for a library district. Companion bill to HB 1770. The bill was not brought before the Senate for a full vote.
• SB 1154 (Shapleigh). Relating to state publication maintained by the Texas State Library and Archives Commission. An amendment was added to the bill concerning public library districts (essentially HB 1770). The bill passed both chambers but may be vetoed by the Governor.
• SB 1401 (Fraser). Relating to the abolition of the Telecommunications Infrastructure Fund Board and transfer of all duties and powers related to the administration of the Telecommunications Infrastructure Fund (TIF) to the comptroller of public accounts. The bill died in committee.

• HB 526 (Smith). Relating to the creation of reports on the vulnerability of local government computer systems and electronic data to harm allow unauthorized access. The bill died in committee.
• HB 548 (Wohlgemuth). Relating to an exemption from the sales and use tax for certain assessments and fees related to telecommunications. Referred to Ways and Means. The bill died in committee.
• HB 605 (Mowery). Relating to the number of administrators employed by a school district and the salaries paid to those person. Referred to Public Education. The bill died in committee.
• HB 909 (Gallego)/SB 265. Relating to the continuation and functions of the State Board for Educator Certification. The bill includes provisions on how the Board should handle complaint, certification renewals, and public input. The bill died in committee.
• HB 1038 (Grusendorf)/SB 396 (Shapleigh) Relating to a technology immersion pilot project in public schools, wherein students would be provided with laptop computers. HB referred to Public Education. Hearing on 3/11. SB referred to Education.
• HB 1107 (Eissler). Relating to the minimum salary schedule for certain professional public school employees. Referred to Public Education. The bill died in committee.
• HB 1228 (Pena). Relating to the salary paid to certain professional employees of public schools. Referred to Public Education. The bill died in committee.
• HB 1253 (Crownover). Relating to the employment status and salary entitlement of public school educators. The bill was not brought to the House for a full vote.
• HB 1367 (McReynolds) Relating to the minimum salary schedule for certain professional public school employees. Referred to Public Education. The bill died in committee.
• HB 1576 (Gallego)/SB 555 (Shapleigh). Relating to the telecommunications planning and oversight council. HB referred to State Affairs. SB referred to State Affairs. Passed and sent to the Governor for signature.
• HB 1999 (Gutierrez). Relating to the compensation for public school classroom teachers and other educators. The bill would include career ladder salary supplement to the "gross monthly salary." The bill died in committee.
• HB 2110 (Rangel). Relating to abolishing the State Board for Educator Certification and transferring its powers and duties to the commissioner of education at TEA. The bill died in committee.
• HB 2912 (Homer, et al). Relating to the uses of sales and use taxes and 4B funds. The bill passed both chambers and has been sent to the Governor for signature.
• HB 3459 (Pitts). Relating the uses of the Technology Allotment, certain appropriations, and benefits to state employees. This bill provided the legislative mechanism to give the state authority to use funds from the Telecommunications Infrastructure Fund for the TEA Technology Allotment. The bill also included a last minute amendment to raise the cap on allowable TIF assessment revenues by $250 million. The bill passed both chambers and has been sent to the Governor for signature.
• SB 413 (Madla). Relating to the study of educational opportunities for emergency services personnel. The bill died in committee.
• SB 682 (Janek). Relating to a state allotment to school districts for teacher salaries. Referred to Education. The bill died in committee.
• SB 699 (Shapleigh). Relating to the establishment of a public education Internet portal. Referred to Education. The bill did not pass the Senate.