State lawmakers weigh fiscal cliff's potential impact in Texas

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by MARK WIGGINS / KVUE News and photojournalist MICHAEL MOORE

Bio | Email | Follow: @MarkW_KVUE

kvue.com

Posted on December 11, 2012 at 6:46 PM

Updated Tuesday, Dec 11 at 7:21 PM

AUSTIN -- What do disasters, schools and the unemployed have in common? They could all be affected in Texas if the nation goes over the "fiscal cliff" -- a mix of automatic tax increases and spending cuts set to take effect at the beginning of 2013 if Congress is unable to reach a compromise to reduce the federal budget.

A special committee of the Texas House of Representatives met Tuesday to find out what that could mean for the state. Experts testified Texas could potentially lose more than a billion dollars in federal funding, more than half of which State Rep. Dawnna Dukes says would impact education.

"For programs for children who are at risk and who have difficulty in learning," emphasized Dukes. "And we know that Texas is one of those states that has a very high population of those individuals."

While Social Security and Medicaid would be safe from the across-the-board spending reductions called for under the "sequestration" portion of the fiscal cliff, many state health programs would not be.

"There were 59 different federal grants that could be impacted across the five health and human service agencies," explained Health and Human Services Commission (HHSC) Director of Budget and Fiscal Policy David Kinsey.

Health officials say the state relies on federal money for mental health and drug rehabilitation programs, much of which comes in the forms of either federal grant money or matching funds. Many of the programs that would be subject to funding cuts under sequestration are those that serve the most vulnerable Texans.

"The women, infants and children program that provides nutrition assistance to moms, infants and children under five," Kinsey gave as an example.

"We're watching the news like everyone else," Texas Workforce Commission (TWC) Executive Director Larry Temple told KVUE. The commission projects sequestration would mean cuts that could total $60 million. Of that, $20 million would come from child care services for about 3,600 children.

Without federal assistance, TWC would have to consider closing some field offices and eliminating staff, a scenario in which workers dedicated to helping Texans find employment could themselves be left searching for work.

"Most of that is people who are seeing people who are unemployed, trying to help them get back to work or funding child care," said Temple.

The effect defense cuts could have on Texas' active military bases such as Fort Hood is unclear, but local officials warn that any such effects would likely fall like dominoes on surrounding military communities like Killeen. Sequestration cuts likely would reduce operations and maintenance funds for the Texas National Guard, a potentially major problem in the event of a statewide emergency.

"If they're not ready to go to war, they're not going to be ready to respond to a national disaster in Texas either," explained Brig. Gen. John Nichols, Assistant Adjutant General Air for the Texas National Guard and Commander of the Texas Air Guard. "I don't think we'll have complete failure, but we'll be stressed highly."

Ultimately whether the cliff can be avoided won't be decided in Austin, but in the nation's capital. The committee will present its findings January 7 for submission to the 83rd Texas Legislature, which convenes January 8.

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