Texans should know how their tax dollars are spent

06/24/2014 5:03 PM

06/24/2014 5:04 PM

The Texas Senate Committee on Open Government is reviewing the transparency of information available on state websites regarding state expenditures, reports and contracts.

The committee invited me to testify this week.

Transparency of the public purse matters because it promotes fiscal responsibility, bolsters public confidence in government and checks corruption.

Texas has been a leader in online transparency through the work of Comptroller Susan Combs and numerous transparency advocates, but more needs to be done, especially to protect and promote taxpayers’ ability to monitor public handouts to private entities.

The governor has taken an especially aggressive approach to economic development spending. For instance, the Texas Emerging Technology Fund (TETF) cost Texas’ budget $425 million since its inception, intended to provide incentives for commercialization of emerging technologies.

Outlays like these are controversial because they come alongside major cuts to public programs like education and healthcare. As Attorney General Greg Abbott has stated, government should “get out of the business of picking winners and losers.”

Just the possibility that taxpayer handouts could be used as political favors requires an even greater level of transparency to ensure cash grants, tax credits and other forms of economic development subsidies are truly justified.

Unfortunately, this heightened transparency does not exist. Taxpayers have no way of knowing the fate of $22.6 million or 11.6 percent of subchapter D funding from the Texas Emerging Technology Fund, money designed to provide incentives for commercialization of emerging technologies.

According to the governor’s FY13 legislative report for the TETF, 17 private entities that received funding through subchapter D commercialization grants have ceased operation.

Neither the governor’s website nor the reports to the Legislature provide any indication of whether the state has successfully recouped this money.

It’s not possible for taxpayers to evaluate whether the $22.6 million was a prudent use of tax dollars. What we do know is that Texans will pick up the tab in the form of additional program cuts or higher taxes.

Certainly, any investment carries a risk of loss. But when companies fail to deliver on the agreed-upon public goals, the public should be able to gauge the appropriateness and effectiveness of these investments.

My organization is filing 17 open records requests with the Office of the Governor to assert my public right to access this information.

It is a confusing and time-consuming task, even for a group that specializes in watchdogging tax and budget issues. The obstacles make it extraordinarily hard for average taxpayers to hold their elected officials accountable for spending decisions.

So long as taxpayer dollars are being spent on economic development, heightened transparency is crucial.

In order to decide which of these subsidy programs deserve state support, we need to make clear which companies receive how much, what they are expected to deliver in return, whether they make good on those promises and whether they are held accountable when they don’t deliver.

Without that transparency and accountability, we can’t be confident that these subsidies aren’t being wasted or used as political favors.

Sara E. Smith is program director for the Texas Public Interest Research Group (TexPIRG). sara@texpirg.org

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