Speaker 1: Pat Trip Cast listeners. A couple of weeks ago, we
Speaker 1: brought you my conversation with Comptroller candidate Don Huffin's a Republican. Now,
Speaker 1: for a special episode, I bring you my conversation with
Speaker 1: the Democratic candidate Sarah Eckhard. I hope you enjoy it.
Speaker 1: This episode of the trip Cast is sponsored by Texas
Speaker 1: Matters and members of the Texas Tribune. Senator, good morning,
Speaker 1: thanks for being here.
Speaker 2: Thank you for having me, Matthew. Thank you to Texas
Speaker 2: Tribune family for having me.
Speaker 1: Absolutely we are very happy to have you here. I'm
Speaker 1: going to start the conversation with some hot off the
Speaker 1: presses polling news. I don't know if you saw this.
Speaker 1: This morning, the University of Texas Politics Project put out
Speaker 1: its regular poll and raising some eyebrows at the very
Speaker 1: top of the ticket, Senator Representative Taller Rico leading John
Speaker 1: Cornyan forty percentage points to thirty three percentage points in
Speaker 1: a hypothetical matchup in a hypothetical matchup against Ken Paxton
Speaker 1: tell Rico leading forty two percent to thirty four percent.
Speaker 1: That comes off of some polling that just was released yesterday,
Speaker 1: also suggesting a tall Rica lead at the top forty
Speaker 1: four to forty one over Cornan forty six to forty
Speaker 1: one over Paxton. Neither of those polls poled the controllers race,
Speaker 1: to my great disappointment heading into this conversation. But I'm curious,
Speaker 1: I mean, it is not common in Texas to be
Speaker 1: seeing polls like that for Democrats. I'm curious how you
Speaker 1: see this and what you think that this means, you know,
Speaker 1: politically for the state right now, and then particularly for
Speaker 1: your race as well.
Speaker 2: Well, clearly this is a wave election. I've been traveling
Speaker 2: all over the state and talking to people Republicans and Democrats.
Speaker 2: Folks are really fed up with thirty years of one
Speaker 2: party rule, and people really do get it that one
Speaker 2: party rule is not good for us, whether it's Republican
Speaker 2: or Democrat, that it has a tendency to be wasteful,
Speaker 2: and also it tends toward abuse, and folks retired of
Speaker 2: being abused. So we're going to see a wave of
Speaker 2: election this year. People feel that they have a choice
Speaker 2: for the first time in literally decades, and they are
Speaker 2: going to make that choice. And so I'm proud to
Speaker 2: be on a ticket with James and other great Democrats
Speaker 2: in order for us to restore balance and get out
Speaker 2: of this abusive cycle.
Speaker 1: How much do y'all see this as a slate of candidates,
Speaker 1: how much of that, how much do you envision? And
Speaker 1: how much of y'all y'all already sort of working together
Speaker 1: as you look forward these next few months.
Speaker 2: We have a lot of coordination. I mean, I've known
Speaker 2: James and Gina and Vicki and John and of course
Speaker 2: Nathan for years, and we've worked together for years for
Speaker 2: better policy for everyday Texans. So this is a naturally
Speaker 2: coordinated group of people. And the Democratic Party is producing
Speaker 2: candidates that are truly capable of providing good government to
Speaker 2: regular Texans. It is unfortunate that the Republican Party is
Speaker 2: producing some of the worst candidates that we've seen in years.
Speaker 2: And what I tell my Republican friends who are disappointed
Speaker 2: in their choices over on the Republican side is you
Speaker 2: won't get better choices on the Republican side until you
Speaker 2: vote for a Democrat. You can always go back to
Speaker 2: voting Republican when your party starts producing good candidates again.
Speaker 1: So you mentioned James, Gina, Vicky, you all of those folks,
Speaker 1: are you know Travis County politicians what's going on there?
Speaker 1: Why are we seeing so many Travis County candidates for
Speaker 1: state white office this year?
Speaker 2: And you know, there must be something in the water,
Speaker 2: what we have left of it. I think that we
Speaker 2: have seen through redistricting, this condensing of talent into our
Speaker 2: urbanized areas, and redistricting has has forced all of the
Speaker 2: Democratic talent into a smaller and smaller pool. And so
Speaker 2: we're seeing we're seeing some of us fish jump in
Speaker 2: the pond, frankly, and I think that that is exactly
Speaker 2: what's needed. I think that we need to have good
Speaker 2: candidates running in every single election all across the state
Speaker 2: of Texas, including statewide races.
Speaker 1: Okay, so I talked about the reasons for optimism for Democrats.
Speaker 1: This time, let's talk about some of the reasons for skepticism.
Speaker 1: I mean, the first one is just you talk about
Speaker 1: Texans being tired of you know, one party rule. That
Speaker 1: being said, they have continued to choose one party rule
Speaker 1: for basically every election this this century. Why do you
Speaker 1: think it is that that is the case. Why do
Speaker 1: you think it? You know, Democrats have been able to
Speaker 1: break through so far.
Speaker 2: I think part of it is the patronage system that
Speaker 2: grows up inside of a one party system. When you
Speaker 2: have one party rule, there's significant patronage in corporate tax
Speaker 2: breaks and no bid contracts and whatnot. And so you
Speaker 2: start to see, particularly in Texas where there is tragically
Speaker 2: no campaign finance limit, you see these huge war chests
Speaker 2: which scare off competition and also drown out any competition.
Speaker 2: But I think in a wave election like this, grassroots
Speaker 2: campaigns actually are more effective than huge billboards on every
Speaker 2: highway and major major media advertising that nobody watches anymore,
Speaker 2: and nobody trusts when they do see it.
Speaker 1: Yeah, so let's let's talk about that. You know, another
Speaker 1: thing that was in this poll. They didn't pull your
Speaker 1: race ut. They did pull favorability, right, don Haffein's your
Speaker 1: opponent twenty two percent favorable, nineteen percent unfavorable, fifty eight
Speaker 1: percent don't know enough to have an opinion you particularly,
Speaker 1: sixteen percent favorable, eleven percent unfavorable, seventy three percent don't know.
Speaker 1: You know. You may point out right that that's a
Speaker 1: higher net positive for you than your opponent, but to me,
Speaker 1: the big takeaway, the biggest two numbers on those lists
Speaker 1: are don't know. The comptroller obviously there's you know, let's
Speaker 1: be honest, there's a lot of people who don't know
Speaker 1: even that we have a comptrolleror what that job does.
Speaker 1: There's a lot of work to be done in terms
Speaker 1: of defining who you are to a state wide audience,
Speaker 1: to defining who your opponent is state wide audience. And
Speaker 1: it's going to be hard to get attention in this
Speaker 1: race when there's so much at the top of the
Speaker 1: ballot and other things going on. Reflect for me a
Speaker 1: little bit on that. What's the strategy. How can you
Speaker 1: get the word out? You know, particularly when, as you mentioned,
Speaker 1: you're likely to be going up against someone who's going
Speaker 1: to spend a lot of money in this race.
Speaker 2: You know, the challenge is letting people know what the hell,
Speaker 2: what the heck is a comptroller and who are these
Speaker 2: two people vying for it. That's absolutely the challenge getting
Speaker 2: across the entire state, where most people think the comptroller
Speaker 2: just writes checks, when in fact, the comptroller is the
Speaker 2: check on the abuse of power. And you've got two
Speaker 2: candidates in this race, one who is a robber baron
Speaker 2: himself and another who has actually been the check and
Speaker 2: balance on budgets and on misuse misappropriation of government funds.
Speaker 2: So you're absolutely right. The challenge is letting people know
Speaker 2: how important this office is and also that you have
Speaker 2: a real choice in who controls this office. Somebody who
Speaker 2: is going to throw wide the door to robber barons,
Speaker 2: or someone who's going to stand at the door and
Speaker 2: follow the money and follow the law for the people
Speaker 2: of the state of Texas.
Speaker 1: Yeah, I mean the you know, Senator Huffines has he
Speaker 1: poured a lot of money into the primary, right And
Speaker 1: one of the things we learned, at least on the
Speaker 1: Republican side of the primary, is a lot of times
Speaker 1: we see, you know, the right wing of the party
Speaker 1: or the left you know, or the more centrist wing
Speaker 1: of the party can often you know, win or have
Speaker 1: more success in a particular election. This year, in the
Speaker 1: Republican primary in particular, what you saw was that the
Speaker 1: campaigns that had the resources turned out pretty well. John
Speaker 1: Cornan at the top of the ticket, spent you know,
Speaker 1: his supporter, spent a ton of money supporting him, surprised
Speaker 1: a lot of people by being the top vote kitterer
Speaker 1: in that race. Mays Middleton for the the AG's race,
Speaker 1: and then Senator Huffines again, fifteen million dollars of his
Speaker 1: own funds going into that campaign seemed to really make
Speaker 1: a difference. He shocked a lot of people buy winning
Speaker 1: that race outright, not getting to a runoff. I mean,
Speaker 1: is there are you going to be able to compete
Speaker 1: with that? What is your how do you kind of
Speaker 1: go about getting the resources necessary to pull this off?
Speaker 2: Well, I'll raise the money necessary and then we're going
Speaker 2: to do a lot of outreach. This is definitely a
Speaker 2: grassroots campaign. And every campaign I've ever run has been
Speaker 2: a grassroots campaign with a lot of outreach voter to
Speaker 2: voter saying hey, I heard about this race and you
Speaker 2: should pay attention to it. And I've won every race
Speaker 2: that way. Mister Haffines has only ever purchased political power
Speaker 2: or tried to. He spent considerably on one term in
Speaker 2: the Texas Senate, and then he lost that race he
Speaker 2: was beat. And then he spent considerably on trying to
Speaker 2: buy the governor's mansion and he was beat. And then
Speaker 2: of course he's recently purchased the Epstein ranch in New Mexico.
Speaker 2: So I think that this is indicative and he's spending
Speaker 2: a tremendous amount of his own money in this race,
Speaker 2: But I think people are tired of seeing very wealthy
Speaker 2: men purchase power and then continue to be rich and
Speaker 2: powerful on the dime of the public.
Speaker 1: There, I think is an ongoing debate within the Texas
Speaker 1: Democratic Party about how in a state that has traditionally
Speaker 1: voted Republican during our you know, uh, during this modern era.
Speaker 1: You know, do you, as a Democrat try to appeal
Speaker 1: to the middle. Do you try to appeal to those undecided,
Speaker 1: more moderate voters, or do you try to ignite the
Speaker 1: base and get you know, young people and get a
Speaker 1: movement excited and on that I'm curious, like, what do
Speaker 1: you think where do you fall on that equation? How
Speaker 1: do you think you know you should be running these races,
Speaker 1: this race and your your colleagues up and down the
Speaker 1: ticket should be running these races.
Speaker 2: I think that I would like to be able to
Speaker 2: run strictly on capabilities. I'm a lawyer. I have a
Speaker 2: master's in public affairs, including public finance and tax policy.
Speaker 2: I've been a prosecutor, a county commissioner, a county judge,
Speaker 2: which is the chief executive of the county. It's not
Speaker 2: actually a judge, and a black robe, and I've been
Speaker 2: a state senator for the last almost six years staring
Speaker 2: into the heart of darkness. So I am prepared to
Speaker 2: do the revenue estimate and review the budget for its balance.
Speaker 2: I am prepared to do the analysis of what our
Speaker 2: investments are in Texas, whether they're working for us, and
Speaker 2: whether they're not, and if they're not working for us,
Speaker 2: who they're working for. I would love to run on
Speaker 2: just that, But to your point, capturing people's attention really
Speaker 2: requires going out there and telling the larger narrative about
Speaker 2: what's happening in politics today, what's wrong with state and
Speaker 2: federal politics, which is that we have thrown open the
Speaker 2: gates to robber barons who stay rich and powerful on
Speaker 2: your dime. And people don't like that, and they do
Speaker 2: want a watchdog. My opponent a couple of weeks ago,
Speaker 2: I was very flattered that he is matching my language
Speaker 2: saying that he wants to be a watchdog. But let's
Speaker 2: talk about what a watchdog actually is. A watch dog
Speaker 2: guards the house from robbers. Mister Huffines is a robber.
Speaker 2: He will throw the door open for what he calls
Speaker 2: monetized solutions to other robber barons. Like himself, and when
Speaker 2: he talks about cleaning out the garage, he means letting
Speaker 2: our car get taken and then burning the garage down
Speaker 2: to hide the evidence of the theft.
Speaker 1: Okay, so it's November of this year, and I keep
Speaker 1: wanting to say twenty twenty five. You know, I know
Speaker 1: that November twenty twenty six you have been elected controller.
Speaker 1: It's a major, massive moment in Texas politics because a
Speaker 1: Democrat has been elected statewide this century. What has happened
Speaker 1: between then and now to have allowed that to happen
Speaker 1: is what is your path?
Speaker 2: First? My path is to get the word out that
Speaker 2: people actually have a choice. They do not have to
Speaker 2: just sit back and allow this this theft. Basically, they
Speaker 2: have choices in this election, and they have choices that
Speaker 2: can win. Also, it's important to speak with every voter,
Speaker 2: Republicans and Democrats, because I can tell you from experience
Speaker 2: inside the Texas Senate that my Republican colleagues are also
Speaker 2: a lot of them very dissatisfied with one party rule.
Speaker 2: They feel the boot on their neck more keenly than
Speaker 2: I do, because I can still speak my mind. But
Speaker 2: my Republican colleagues know that if they question the current leadership,
Speaker 2: the retribution will be swift. That's deeply concerning to them.
Speaker 2: And frankly, if I'm Greg Abbott right now, if I'm
Speaker 2: standing on the deck of the ship and I look
Speaker 2: to my right and my shipmates are Dan Patrick, Ken Paxton,
Speaker 2: May's Middleton and Don Huffines, I'm sleeping with one eye open,
Speaker 2: or I might not survive the night.
Speaker 1: Okay, let's talk a little bit about the Controller's office.
Speaker 1: Why did you choose this office to run for this office?
Speaker 2: You know, this is the most exciting, boring office you'll
Speaker 2: ever hear about. This is the boiler room of Texas policy.
Speaker 2: It really is the engine. It's checking on the engines
Speaker 2: of government. I'm a policy wonk. I love the way
Speaker 2: government works, and I also really hate the way government
Speaker 2: doesn't work. Getting inside the machinery of government to see
Speaker 2: where we are investing with success and where we are
Speaker 2: not investing is exciting to me. So a chance to
Speaker 2: have all of the numbers and three thousand dedicated public
Speaker 2: servants who will do the analysis, do the comparisons, and
Speaker 2: set our investments in the context of federal, state, and
Speaker 2: local investment is extremely exciting to me, and gives an
Speaker 2: opportunity to more deeply inform Texans but also their representatives
Speaker 2: when it comes time for the legislature to convene.
Speaker 1: Okay, let's talk about some of the functions of the job.
Speaker 1: You know, you mentioned what is a comfortable to do.
Speaker 1: I'm imagine most people in this room know. But let's
Speaker 1: let's talk about how it works and how you view
Speaker 1: some of that work. Of course, one of the newest
Speaker 1: tasks for the office is the administration of the school
Speaker 1: voucher system. You were in the Senate when this came up.
Speaker 1: You voted against the school voucher system or the you know,
Speaker 1: the proposal to implement vouchers in Texas. First of all,
Speaker 1: I guess before we get into how you would manage it,
Speaker 1: just tell me about that vote.
Speaker 2: Sure, So you know, I have worked for a legislative body,
Speaker 2: and I have been in a legislative body as well
Speaker 2: as being in an executive function. So I have I've
Speaker 2: been staff, I've been a legislative and I've been executive.
Speaker 2: It is in my capacity, in my legislative capacity, I
Speaker 2: fought tooth and nail against the voucher program. I felt
Speaker 2: then and I feel now that that billion dollar investment
Speaker 2: will not produce a better result for far and away
Speaker 2: the vast majority of Texas school children. In fact, I
Speaker 2: believe that much like many corporate tax breaks, this is
Speaker 2: a subsidy that is subsidized, that will subsidize activity that's
Speaker 2: already occurring and not improve the educational circumstances for most
Speaker 2: Texas children. So, yes, I voted against it. As your comptroller,
Speaker 2: I will be in the executive branch. The executive branch's
Speaker 2: role is to implement policy. I will implement that policy,
Speaker 2: and I will do it. I will follow the law,
Speaker 2: and I will follow the money. And in following the
Speaker 2: law and following the money, I will report out honestly
Speaker 2: who is benefiting most, least and not at all from
Speaker 2: that program, and deeply inform the legislature for the next session.
Speaker 1: Yeah, you talk on your campaign website about auditing the system.
Speaker 1: Is that sort of what you're talking about? What does
Speaker 1: that look like? And auditing of the.
Speaker 2: Voucher Auditing the voucher system requires that every August the
Speaker 2: Comptroller reports out the demography if who receives those vouchers.
Speaker 2: It also requires a detailed line item of how the
Speaker 2: voucher was the voucher dollars were expended, whether it was
Speaker 2: on tutoring, transportation, school uniforms, and whatnot. This is important
Speaker 2: information for the Texas legislature to have to know how
Speaker 2: that billion dollars or frankly four billion, which is what
Speaker 2: it's expected to be by the at least by the
Speaker 2: twenty thirty one session, where that money is going, and
Speaker 2: what you're getting for it. So that's what I mean
Speaker 2: by auditing. Auditing is an important function of government, both
Speaker 2: financial auditing and performance auditing, and that is a function
Speaker 2: of the Comptrollers.
Speaker 1: So this roll out of this system has been managed
Speaker 1: by Acting Controller Kelly Hancock, one of your former colleagues
Speaker 1: in the Senate. How do you feel about how this
Speaker 1: has been administered? You know, again setting aside the vote,
Speaker 1: like you talked about, how do you feel like this
Speaker 1: has been administered by the office so far.
Speaker 2: I served with Kelly Hancock in the Senate and I
Speaker 2: had great admiration for him in the Texas Senate. He
Speaker 2: actually was one who questioned the one party rule in
Speaker 2: the Texas Senate and the retribution was swift and frankly,
Speaker 2: Governor Abbott's protection could not save him, and I was
Speaker 2: deeply disappointed that my former colleague, well, I'll just say
Speaker 2: it broke the law by refusing to certify Muslim schools.
Speaker 2: That was frankly illegal, and the courts declared it so,
Speaker 2: and so he was forced ultimately to certify Muslim schools.
Speaker 2: That was deeply concerning. I have seen some interesting trends
Speaker 2: in the early numbers. So the families who applied skewed white,
Speaker 2: skewed toward children already in private school, and also skewed
Speaker 2: higher income. But interestingly, in the first tier distribution, roughly
Speaker 2: half were at two hundred percent of federal poverty line
Speaker 2: and below, and roughly half did not have their children
Speaker 2: previously in private school. So I'm intrigued by that. I
Speaker 2: have some theories on why why the distribution fell out
Speaker 2: that way, but we won't know yet until we have
Speaker 2: the numbers. And that's why it's so important for government
Speaker 2: to be not only effective, efficient and fair, but transparent
Speaker 2: so that we all can double check it and make
Speaker 2: sure it is effective, efficient and fair.
Speaker 1: You mentioned, you know, the possible cost of this going
Speaker 1: up to maybe four billion at some point. The number
Speaker 1: of people who applied for this program far outpaced the
Speaker 1: amount who will likely be able to participate due to
Speaker 1: the amount of funding that was available. It is written
Speaker 1: into the law that the Controller shall request in the
Speaker 1: upcoming legislative session the amount to fully fund the program. That,
Speaker 1: of course, will be the decision of the legislature as
Speaker 1: to whether to allocate that money. How do you view
Speaker 1: how would you view your role? What would you be
Speaker 1: doing during that legislative session in that conversation of do
Speaker 1: we put more money into this? Where does this program
Speaker 1: go from here?
Speaker 2: You know, I quibble with the wording request. It is
Speaker 2: the responsibility of the Comptroller's office under the law as
Speaker 2: it was written, to calculate how much which would be
Speaker 2: necessary to fund all the children on the wait list
Speaker 2: who are eligible for the program. That's different from requesting
Speaker 2: the funding, and I think that is an important function
Speaker 2: of the comptroller to calculate how quickly this program could
Speaker 2: escalate in the amount of money it is. It's soaking
Speaker 2: up in a very low tax state. I think that
Speaker 2: the Tax Institute, which is a nonpartisan think tank federal
Speaker 2: think tank. It calculates the state and local tax burden
Speaker 2: and compares it against all states, and Texas has the
Speaker 2: sixth lowest tax burden in the United States, that's combined
Speaker 2: state and local tax burden. So when you're looking at
Speaker 2: a program that is quadrupling in as many years in
Speaker 2: a very low tax environment, it is taking up space fungible.
Speaker 2: You know, money being fungible for other needs. Is subsidizing
Speaker 2: private schools a higher priority than water, infrastructure or some
Speaker 2: of our other needs like healthcare. That is a question
Speaker 2: for the legislature to answer, but it is a job
Speaker 2: of the comptroller to calculate how much more money this
Speaker 2: particular program is occupying of what is a limited tax revenue.
Speaker 1: You mentioned you know your intention to follow the law.
Speaker 1: Do you see any room within the law to change
Speaker 1: aspects of this program or how it's administrated, any opportunities,
Speaker 1: any things you would like to do, You know, in
Speaker 1: this position of power with regard to.
Speaker 2: The program, the rule setting function of any agency is
Speaker 2: extremely important and it's often overlooked. The legislature when they
Speaker 2: set policy, can't know every nuance of the implementation of
Speaker 2: that policy, and agencies fill those gaps with rule making.
Speaker 2: So there may be opportunities to make this particular program
Speaker 2: more effective, efficient, fair, and transparent that are in line
Speaker 2: with the legislative intent. And I would certainly want to
Speaker 2: explore those to make it the most effective, efficient, fair
Speaker 2: and transparent program within the law.
Speaker 1: Another important aspect of the controller's job, of course, is
Speaker 1: supplying the biennial revenue estimate that essentially sets the amount
Speaker 1: of money that the legislature can spend every two years
Speaker 1: and put in the budget. You have witnessed this process
Speaker 1: several times as a state senator. How do you feel
Speaker 1: like that process goes right now? Is this system working?
Speaker 1: Has the previous controller done a good job of estimating
Speaker 1: and you know, declaring how much the legislature has to spend.
Speaker 2: I think Glenn Hager did an excellent job of estimating
Speaker 2: the revenue. Of course, toward the end of his last term,
Speaker 2: he had the pleasure of his historic budget surpluses, and
Speaker 2: I think that his revenue estimate was was very accurate.
Speaker 2: I also am mindful that part of the revenue estimate is,
Speaker 2: and we may get to this is the property valuation study.
Speaker 2: The property valuation study is important to that revenue estimate
Speaker 2: because of the amount of property tax that is transferred
Speaker 2: to this state for redistribution for public education purposes. In
Speaker 2: public education is the largest of our investments at the state.
Speaker 2: So this is a this is a this is an
Speaker 2: uncomfortable circumstance where the Comptroller's property valuation study requires, in
Speaker 2: some cases for central appraisal districts or appraisal districts to
Speaker 2: appraise your property higher to meet market and meet the
Speaker 2: revenue requirements of the state.
Speaker 1: So do you see that work going on largely pretty
Speaker 1: similarly to the way it has gone on, you know
Speaker 1: in the past.
Speaker 2: I think so, I think what I would seek to do.
Speaker 2: First of all, you know, the first thing I want
Speaker 2: to do is break one party rule. And I think
Speaker 2: then everyone will be the sigh of relief, both Republicans
Speaker 2: and Democrats, because I think without one party rule, my
Speaker 2: Republican colleagues will be freed to speak their minds as well,
Speaker 2: which would be really, really valuable. But also to get
Speaker 2: inside the Comptroller's office and re establish and reinforce that
Speaker 2: the revenue estimate is not a political document, it is
Speaker 2: not to be politicized one way or the other, and
Speaker 2: that there will not be reward or retribution in the
Speaker 2: revenue estimate. It will be clean and everyone will be
Speaker 2: able to rely upon it. That needs to be stated
Speaker 2: over and over and over again. We will not cook
Speaker 2: the books. They shall not be cooked.
Speaker 1: So there has been you know you mentioned. Providing this
Speaker 1: estimate has been pretty fun, I think for the cultural
Speaker 1: over the last few years. Last legislative session of twenty
Speaker 1: four billion dollar surplus coming in the session before that
Speaker 1: thirty three billion. These are you know, astronomical numbers compared
Speaker 1: to history, by far, the two largest surpluses that have
Speaker 1: you know, the state has encountered going into a legislative session.
Speaker 1: There are a lot of people who think that that
Speaker 1: might not be the case in twenty twenty seven. Are
Speaker 1: you one of those people?
Speaker 2: I think that any credible analysis of our current economy
Speaker 2: would indicate that we will probably see some pretty significant
Speaker 2: volatility in sales tax revenue, which is the largest revenue
Speaker 2: source for the state of Texas, and all those severance
Speaker 2: tax the oil and gas tax will likely increase. It's
Speaker 2: a lagging indicator, and it probably won't hit quickly enough
Speaker 2: to even out the volatility of our sales tax revenue.
Speaker 2: So yes, I do not think these historic budget surpluses
Speaker 2: can continue in an economy where Texas has the largest
Speaker 2: raw number of business bankruptcies of any other state in
Speaker 2: the US right now, the largest number of uninsured individuals
Speaker 2: of any other state in the US. These issues are
Speaker 2: These are not political narratives. These are just the numbers, y'all.
Speaker 2: And I don't think that the numbers are indicating that
Speaker 2: we will continue to have these surpluses in the near term.
Speaker 1: What do you think that's going to mean for the legislature,
Speaker 1: for the state government.
Speaker 2: Well, let's talk about public education funding for a moment.
Speaker 2: The legislature and I voted for this. This was good policy.
Speaker 2: The legislature bought down the school portion of your property
Speaker 2: taxes and now is carrying a buy down figure of
Speaker 2: roughly fifty one billion dollars. That's good. That means the
Speaker 2: state is paying a larger percentage of the state's obligation
Speaker 2: to provide public education. That's a good thing. But without
Speaker 2: these budget surpluses, we are all already hearing legislature legislators
Speaker 2: talking about backing away from that fifty one billion or
Speaker 2: certainly not increasing that fifty one billion, which means the
Speaker 2: legislature will probably want to return to over relying on
Speaker 2: property taxes for the state obligation to educate every child.
Speaker 1: Do you think the state should I mean, in a
Speaker 1: world where you know, when you when you use surplus
Speaker 1: funds to pay for property tax cuts, if you want
Speaker 1: those property tax cuts to last, you have to continue
Speaker 1: to use state dollars to do it. Right. This is
Speaker 1: you know this, This is this is simple you know
Speaker 1: simple math, math and budgeting. So in a world where
Speaker 1: there is not a big surplus, it's going to be
Speaker 1: harder to pay for that mass amount of money. I mean,
Speaker 1: do you think the legislature should try to unwind any
Speaker 1: of this? Is that something that should explore if indeed
Speaker 1: we get into a situation where there's a lot less
Speaker 1: money to spend on it.
Speaker 2: Well again, and I go back to the fact that
Speaker 2: by an unbiased, non partisan federal think tank, we are
Speaker 2: the sixth lowest combined state and local tax burden in
Speaker 2: the United States. That means the average Texan and everyone
Speaker 2: above average tax for their wealth is paying less than
Speaker 2: almost everyone else in the United States. So the state
Speaker 2: over relies on property tax significantly. We should be looking
Speaker 2: at other appropriate revenue sources for the state, like the
Speaker 2: THHC industry instead of killing it. The THC industry could
Speaker 2: provide a significant revenue source that would assist the state
Speaker 2: in its obligations, like public education.
Speaker 1: You you were here when your opponent, Don Hafines was
Speaker 1: on the stage talking about some of these same issues.
Speaker 1: He said that he wants to be closely involved with
Speaker 1: you know, if he wins closely involved with the you
Speaker 1: know estimate that will come out at the very beginning
Speaker 1: of the session, right around when the new controller takes over.
Speaker 1: You know, I would assume that work is already happening
Speaker 1: in the controller's office. It will happen before we even
Speaker 1: know who the next controller is. I wonder how you
Speaker 1: feel about that, Like do you think, you know? Essentially,
Speaker 1: like are you do you do you want to reserve
Speaker 1: the right to you know, change or revise or pull
Speaker 1: back on, you know, the decisions that are going to
Speaker 1: be made before you come into office.
Speaker 2: Well, first off, when mister Huffines was here with you,
Speaker 2: he openly admitted he's never reviewed a revenue estimate before.
Speaker 2: And I think it is clear from his statements in
Speaker 2: this space but also in his campaign rhetoric, that he
Speaker 2: would like to suppress the revenue estimate. I think that
Speaker 2: it is important to keep political thumbs off the scale
Speaker 2: of the revenue estimate. I certainly reserve the authority to
Speaker 2: amend the revenue estimate if after I take office, I
Speaker 2: see that there was a material error that caused either
Speaker 2: a lower or higher estimate that will then cause problems
Speaker 2: in balancing a budget. That's the comptroller's job, y'all. But
Speaker 2: I am absolutely uninterested and frankly would be a watchdog
Speaker 2: against putting a political thumb on the revenue estimate at
Speaker 2: any time before I take office or after.
Speaker 1: One of the things that I really wanted to understand
Speaker 1: from him was how willing is he to sort of
Speaker 1: use the office to be sort of a bull in
Speaker 1: a china shop, right, to really kind of use the
Speaker 1: different levers of the Comptroller's office to you know, put leverage,
Speaker 1: use leverage, put pressure on you know, legislators, other statewide
Speaker 1: officials and folks like that. I'll ask you the same question.
Speaker 1: I mean, in a world where you are elected, I
Speaker 1: think you know, it seems unlikely to me there will
Speaker 1: be so much of a democratic sweep that you're working
Speaker 1: with a Democratic House Senate, in all statewide officials. That
Speaker 1: means you're probably going to disagree with folks at times.
Speaker 1: How willing are you to sort of disrupt in that situation?
Speaker 1: How willing are you to kind of grind the gears
Speaker 1: of government to a halt in order to get what
Speaker 1: you want.
Speaker 2: Well, I think that you heard in this room from
Speaker 2: mister Hawfines that he's willing to withhold checks that he's
Speaker 2: legally obligated to cut to various departments of state government
Speaker 2: if he disagrees with what they're doing. That's not what
Speaker 2: the comptroller's job is. But what the comptroller's job is
Speaker 2: is to honestly report out how our investments are performing.
Speaker 2: And so if a if I as comptroller, when i'm comptroller,
Speaker 2: if I see an investment that's not panning out for
Speaker 2: the state of Texas, I will definitely report that out
Speaker 2: to the people of Texas and the Texas legislature. This
Speaker 2: investment is not producing public, you know, public benefit for you.
Speaker 2: You might want to take a look at this. And also,
Speaker 2: through having an effective, efficient, fair and transparent comptroller's office,
Speaker 2: I can also turn to well the independent press as
Speaker 2: well as independent think tanks and say, here is a
Speaker 2: body of data that I think that you should really examine.
Speaker 2: And we have not had a comptroller who has invited
Speaker 2: in independent review of comptroller held data for a very
Speaker 2: long time. That's not to say that you can't get
Speaker 2: the data the Comptroller's office, but you have to know
Speaker 2: in advance what you're asking for. It's it's it's it's
Speaker 2: pretty opaque.
Speaker 1: You you know, have, of course as a senator, worked
Speaker 1: with other Republicans. It's part of the job. The Senate,
Speaker 1: you know, famously a tightly held by Republicans, particularly the
Speaker 1: tenate Governor Dan Patrick. How have you navigated that and
Speaker 1: how does that translate to this position?
Speaker 2: Well, I'm a Democrat in Texas, so of course you
Speaker 2: have to work with Republicans. I have friends on both
Speaker 2: sides of the aisle. But my Republican friends are are
Speaker 2: very concerned about mister Huffines and and frankly concerned about
Speaker 2: a growing disassociation of policy from the facts of what
Speaker 2: most Texans are facing. So I think my Republican colleagues
Speaker 2: will be relieved to have an honest broker in the
Speaker 2: Comptroller's office.
Speaker 1: A more obscure function of the controller, but one that
Speaker 1: I want to ask about is that they are required
Speaker 1: by law to maintain a list of companies that boycott Israel,
Speaker 1: that boycott energy, companies that boycott companies that are affiliated
Speaker 1: with China. These are very high stakes lists to be
Speaker 1: on because it will can greatly restrict how you can
Speaker 1: do business with the state, or if you can do
Speaker 1: business with the state at all if you are on
Speaker 1: this list. It's been a controversial thing. You've seen some
Speaker 1: companies get upset about being on it and really try
Speaker 1: to lobby against it. How do you envision maintaining those lists?
Speaker 2: Again, my job will be to follow the law and
Speaker 2: follow the money. So I will follow the law in
Speaker 2: compiling that list, but I will also follow the money.
Speaker 2: And this is what I mean by that, calculating the
Speaker 2: impact of excluding these companies on the bond rating and
Speaker 2: the cost of renting money by local and state governments.
Speaker 2: So by taking these companies off the list, you shrink
Speaker 2: the pool of ready capital for projects at this at
Speaker 2: the local and the state level, and that costs you money.
Speaker 2: That costs taxpayer dollars. So not only will I follow
Speaker 2: the law, even though I disagree with it, I will
Speaker 2: also follow the monetary impact of having restricted our access
Speaker 2: to capital through maintaining this list.
Speaker 1: So I mean, there are you know, there are many
Speaker 1: people in your party who are very you know themselves
Speaker 1: upset agree at Israel in particular, you know the way
Speaker 1: they've administered this war and causa. Uh you do you? Do?
Speaker 2: You not?
Speaker 1: Do you see any issue with maintaining such a list?
Speaker 2: And I see all kinds of issues with maintaining that list.
Speaker 2: But again, this is an executive position, not a legislative position.
Speaker 2: As a legislator, I stood on the floor of the
Speaker 2: Senate and said, lists, lists, lists, We keep creating lists.
Speaker 2: That's what authoritarian regimes do. We're keeping lists of authoritarian regimes,
Speaker 2: and we are becoming one. So yes, I voted against
Speaker 2: such lists. But as Comptroller, I again would have to
Speaker 2: follow the law, but I would also have the authority
Speaker 2: and frankly, the responsibility of reporting out to Texans and
Speaker 2: the Texas legislature what the fiscal impact is of restricting
Speaker 2: our access to capital by maintaining these lists.
Speaker 1: Okay, folks in the audience and watching on livestream have
Speaker 1: been sending in some questions that Matt has been sending
Speaker 1: to my phone. I will soon be pulling up my
Speaker 1: phone to look at it. I'm not playing Candy Crush,
Speaker 1: I'm doing that. But there's still time to get a
Speaker 1: question in as we go through that part. So please,
Speaker 1: if you have questions, for the senator, please put them in.
Speaker 1: But I'm going to ask you one more before we
Speaker 1: get to that, which is just about the sort of
Speaker 1: executive function of, you know, overseeing an agency with many
Speaker 1: employees and you know, in a significant budget. Your opponent
Speaker 1: talked pretty openly about an interest in cutting down in
Speaker 1: the number of staff, and I think seemed to be
Speaker 1: hinting pretty strongly that he saw a decent amount of
Speaker 1: turnover coming in that office if he were to win,
Speaker 1: and some redirection of, you know, some of the work
Speaker 1: that folks did. He talked about taking people whose job
Speaker 1: it is to audit businesses for tax compliance and instead
Speaker 1: refocus them on auditing government programs in the state. How
Speaker 1: do you see the staff of the Comptroller's office right now?
Speaker 1: Do you foresee big changes if you were to be elected.
Speaker 2: I was in a church recently where a handful of
Speaker 2: prisoners came up to me and said, we all work
Speaker 2: for the comptroller's office. You have to win. I was
Speaker 2: in Gillespie County, out in the whole country, and a
Speaker 2: nice one and walked up to me and said, oh
Speaker 2: my god, I work at the Comptroller's office. You have
Speaker 2: to win. Last night, I was at an event and
Speaker 2: somebody walked up to me and says, my father works
Speaker 2: at the Comptroller's office and he's going to take early
Speaker 2: retirement unless you win. So we will see a significant
Speaker 2: brain drain out of the Comptroller's office if I don't win,
Speaker 2: and that will be really, really bad news for Texas.
Speaker 2: So I don't think that mister Huffines would have to
Speaker 2: do a big staff production. I think you'd see a
Speaker 2: stampede to the door in advance of being asked to
Speaker 2: do things that are unsavory. No auditor worth their salt
Speaker 2: wants to put their thumb on the scale for political purposes.
Speaker 2: An auditor who has spent their career making sure that
Speaker 2: our tax system is fair and equally applied does not
Speaker 2: want their skills turned on auditing government, which is what
Speaker 2: he said he wanted to do.
Speaker 1: That.
Speaker 2: He wanted to turn these auditors who are uh expert,
Speaker 2: you know, have expertise in looking for tax dodges, uh
Speaker 2: and instead have them look at local governments. And he
Speaker 2: was very specific about that, he wants to look at
Speaker 2: local governments. Uh. Mister Huffines was very clear that he
Speaker 2: wants to use the office for political retribution, and that's
Speaker 2: not what the office is for.
Speaker 1: Uh.
Speaker 2: And that is dangerous, y'all. That's what happens in a
Speaker 2: one party system that exists too long. It starts to
Speaker 2: take retribution on itself. And I think that's what we're
Speaker 2: we're seeing now.
Speaker 1: Yeah, and he's talked about, you know, dojing Texas government. Uh,
Speaker 1: I'm going to take a leap and assume that you
Speaker 1: would not use that term to to talk about, you know,
Speaker 1: the review of state government. That being said, I mean,
Speaker 1: the Comptroller's Office has a long history of of you know,
Speaker 1: review inefficiency within state government. Uh, you know, dating back
Speaker 1: to the back when there were Democrats in the office
Speaker 1: and gained a lot of national attention for the work
Speaker 1: being done there. I mean, what about that aspect of
Speaker 1: the job? Do you do you see? Do you like
Speaker 1: the idea of kind of turning a magnifying glass to
Speaker 1: state government and trying to find ways to save money.
Speaker 2: Well, first you have to understand the machine before you
Speaker 2: take a hammer to it. And John Sharp was a
Speaker 2: great example of that. He was and is a very
Speaker 2: deep thinker, really knows how the machinery works. And he
Speaker 2: used what were called the gears the government efficiency and
Speaker 2: Effectiveness reports to inform the legislature where improvements could be
Speaker 2: made and where real cost savings could be had. And
Speaker 2: that's uh, that was super super useful. But of course
Speaker 2: those gear reports were moved out of the Comptroller's office
Speaker 2: and moved into the LBB. And that's there was a
Speaker 2: reason for that. The Texas Comptroller is in independently elected
Speaker 2: statewide official. The one party rulers much preferred to have
Speaker 2: those effectiveness and efficiency reports in the LBB where they
Speaker 2: could be controlled better. And I think the proof is
Speaker 2: in the pudding the LBB. Now, the fiscal notes that
Speaker 2: come out of the LBB often say that there is
Speaker 2: no fiscal impact on our local governments. For instance, even
Speaker 2: though seventy percent of public roads are funded by local governments,
Speaker 2: more than fifty percent of healthcare is I mean sorry,
Speaker 2: courts are funded by local governments. Roughly ninety percent of
Speaker 2: law enforcement is funded by local governments, and yet the
Speaker 2: LBB consistently reports out no significant impact in their fiscal
Speaker 2: fiscal notes on bills.
Speaker 1: All right, thank you everybody for your questions. Let me
Speaker 1: ask some of them here. Dale from Austin asks Texas
Speaker 1: is the highest consumer of government spending on climate disasters.
Speaker 1: What can the office do to deal or mitigate this
Speaker 1: huge expense for taxpayers?
Speaker 2: Such a great question. So yes, Texas has more extreme
Speaker 2: weather events than any other state in the Union, and
Speaker 2: those extreme weather events are getting more frequent and more severe.
Speaker 2: In twenty twenty four, December of twenty twenty four, right
Speaker 2: before the legislature convened, we had our first ever Texas
Speaker 2: flood report that came out from the Texas Water Development
Speaker 2: Board showing that a little over twenty percent of all
Speaker 2: of Texas is in a flood zone. And then it
Speaker 2: gave very specific recommendations for what Texas could invest in
Speaker 2: to mitigate the risk to Texans living in flood zones.
Speaker 2: And we hardly touched the document. And then what happened.
Speaker 2: We had a flood and a lot of people died.
Speaker 2: And that's the kind of investment we need to be
Speaker 2: looking at. We are under invested in mitigating risk from
Speaker 2: extreme weather and we need to look at that. The
Speaker 2: State of Texas has hardly any investment in water infrastructure.
Speaker 2: For instance, the state lends money to locals to build
Speaker 2: the water infrastructure they need, but it's expected that that
Speaker 2: be a revolving fund and that the money come back
Speaker 2: from fees off of those water utilities, so we really
Speaker 2: do need to make a deeper investment. We have made
Speaker 2: a step in the right direction with twenty billion dollars
Speaker 2: toward the water Fund, but the Texas Water Development Board
Speaker 2: recently increased their estimate of our overall need to just
Speaker 2: over one hundred and seventy billion. So this is the
Speaker 2: kind of investment we need to be looking at at
Speaker 2: the state level. Some of our communities across the state
Speaker 2: of Texas don't have the bonding capacity to make that
Speaker 2: kind of investment without assistance from the state and from
Speaker 2: the federal government.
Speaker 1: All right, Steve from East Texas asks if you can
Speaker 1: clarify your position on the various grant programs the Controller
Speaker 1: administers and how you will support these programs if elected
Speaker 1: to office.
Speaker 2: The Comptroller's office has become a grab bag of a
Speaker 2: number to administer a number of grants. One of them
Speaker 2: is the bad which you know, I'm going to flub
Speaker 2: what BEAD stands for, but essentially it's the federal grant
Speaker 2: for extending broadband all across the state of Texas. Texas
Speaker 2: remains one of the states that is lagging behind in
Speaker 2: access to broadband, and there is roughly one point three
Speaker 2: billion dollars left in that grant, and Comptroller Hager suggested
Speaker 2: sending the money back, which I think is concerning. I
Speaker 2: understand why he suggested sending it back. It has to
Speaker 2: do with a Trump administration change in the utilization of
Speaker 2: the money, and the Trump administration would call the job done,
Speaker 2: and therefore Comptroller Hager suggested them sending the money back.
Speaker 2: But I would want to make sure that we repatriate
Speaker 2: every federal dollar that Texans have paid for. We pay
Speaker 2: a lot in income tax, and we should be repatriating
Speaker 2: every formula fund that's available, and we don't. We don't
Speaker 2: in medicaid funding, we don't in supplemental nutritional assistance, we
Speaker 2: don't in indigent civil and criminal courts. We're just not
Speaker 2: repatriating our federal tax dollars. And that is unfortunately political
Speaker 2: but foolish economically. That's our money. We should make sure
Speaker 2: that we get our fair share and that we use
Speaker 2: it for the people of the state of Texas.
Speaker 1: Excellent, Emily and Austin ask if you don't win, how
Speaker 1: would this election affect your future work in the state Senate?
Speaker 2: My work in Texas as a public servant, frankly doesn't
Speaker 2: change whether I'm comptroller or state senator. My mission is
Speaker 2: for government to be effective, efficient, fair and transparent and
Speaker 2: actually deliver services to the state of Texas instead of
Speaker 2: quibbling over culture issues ad nauseum. We often see the
Speaker 2: current leadership and again, this is a one party thing,
Speaker 2: Democrat or Republican. This one party thing says, look over there,
Speaker 2: there's an emergency, a disaster is being declared right over there,
Speaker 2: while over here they're picking your pockets and giving away
Speaker 2: corporate tax breaks and snow bit contracts. That's the kind
Speaker 2: of thing that needs to stop. And I will work
Speaker 2: to end that kind of pay to play patronage whether
Speaker 2: I'm in the Texas Comptroller or whether I'm in the
Speaker 2: Texas Senate. But I'll tell you the Texas Comptroller is
Speaker 2: a way better platform to combat that kind of behavior
Speaker 2: than in Dan Patrick's Senate.
Speaker 1: All Right, Jacob from Austin asks or says, Texans pay
Speaker 1: a lot in property taxes. Most of those are assessed
Speaker 1: at the local level, but are used to pay for rhoades, jails, courts,
Speaker 1: mental health, elections, indigen healthcare, and many other state services.
Speaker 1: What role can the Texas control our play when it
Speaker 1: comes to truth and taxation to ensure the state pays
Speaker 1: for services rather than shifting that burden to property tax payers.
Speaker 2: One of my goals has always been, you know, I
Speaker 2: went to state government because I was for twenty two
Speaker 2: years in local government and I was frankly getting tired
Speaker 2: of the state, the state that had just stopped governing
Speaker 2: and just did nothing but complain about those of us
Speaker 2: who still did. So one of my chief goals in
Speaker 2: public service is to put in context how we pay
Speaker 2: for things. And like I mentioned, ninety percent of law
Speaker 2: enforcement is paid for by your local property taxes. More
Speaker 2: than fifty percent of courts are paid for by your
Speaker 2: local property taxes, more than seventy percent of your public
Speaker 2: roads are paid for by local property taxes. And an
Speaker 2: emergency response that's usually fronted by your local property taxes
Speaker 2: and then reimbursed by the federal government. But we're starting
Speaker 2: to wonder whether the federal government is going to continue
Speaker 2: to reimburse right, And so it's important, and you know,
Speaker 2: give me the question again because I want to make
Speaker 2: sure I address it. Let's see, okay, O, truth and taxation,
Speaker 2: Truth and taxation. So it's important that the Comptroller actually
Speaker 2: lay out in easily found infographics where your money is
Speaker 2: coming from. To pay for these services. It requires a federal, state,
Speaker 2: and local partnership. But what we're seeing is we're over
Speaker 2: relying on that property tax in order to avoid looking
Speaker 2: for appropriate revenue sources and also stop the bleedout on
Speaker 2: corporate tax giveaways. Let me tell you can I riff
Speaker 2: for a moment on corporate tax incentives. The tax code
Speaker 2: is super powerful for incentivizing behavior that the market would
Speaker 2: not otherwise produce, and behaviors that are good for public benefit.
Speaker 2: But when you start to give preferential tax treatment to
Speaker 2: corporations to do what's already in their best interest, you
Speaker 2: are simply giving your money away and you are forcing
Speaker 2: the tax burden onto everybody else. So it's important that
Speaker 2: the Comptroller do the kind of analysis necessary to show
Speaker 2: what public benefit has actually been returned for the investment
Speaker 2: in these corporate tax breaks. It's also important that the
Speaker 2: Comptroller's office claw back corporate tax breaks that do not
Speaker 2: live up to their promise in public benefit. We've not
Speaker 2: seen a lot of that from the Comptroller's office. I
Speaker 2: could only find one in the recent past, and it
Speaker 2: was on a solar farm. I have a hard time
Speaker 2: believing that corporate tax breaks on the promise of a
Speaker 2: public benefit that was not already being produced by the market.
Speaker 2: I have a hard time believing that we have seen
Speaker 2: no corporate tax breaks that didn't live up to their expectations.
Speaker 1: Okay, thank you for everyone for your questions. I think
Speaker 1: we have time for one more. Sorry for not being
Speaker 1: able to get to all of them. There's some really
Speaker 1: good questions in here, but I'm going to ask herb
Speaker 1: from Austin's because I think it's a good one to
Speaker 1: close on center Eckhart, as controller, you'll be watching over
Speaker 1: this of my precious tax dollars. Is there any particular
Speaker 1: reason that I should trust you over your opponent to
Speaker 1: do that.
Speaker 2: You should trust me over my opponent because my opponent,
Speaker 2: my opponent is a robber baron, and he hangs out
Speaker 2: with robber barons. I mean, jeff yass has given the
Speaker 2: man two million, I'm sorry, one million dollars in campaign contributions.
Speaker 2: A million dollars in campaign contributions. I am not a
Speaker 2: member of the Epstein class, y'all. I don't know the
Speaker 2: kind of I don't run with the kind of people
Speaker 2: who will give me a million dollar check. Jeff Yass
Speaker 2: has given Greg Abbott ten million dollars. If y'all don't
Speaker 2: know jeff Yass, he is the big proponent of SCHO
Speaker 2: school vouchers all across the nation. So you can trust
Speaker 2: me to follow the law and follow the money, irrespective
Speaker 2: of what the robber barons want. I will not participate
Speaker 2: in political retribution or political reward with your tax dollars.
Speaker 1: Okay, well, I want to say thank you to everyone
Speaker 1: who is here today. A big thanks particularly to our
Speaker 1: members who help make events like this possible, and a
Speaker 1: big thank you to you Center, Drackhard. It's been a
Speaker 1: great conversation.
Speaker 2: It's been a great conversation. Thank you, Matthew, and thank
Speaker 2: you all.