Office of the Governor Rick Perry

NFIB Small Business Day

*Note - Gov. Perry frequently departs from prepared remarks.
Tuesday, March 08, 2005  •  Speech

Thank you, Will (Newton, president).  It is an honor to be with the men and women whose small businesses are the backbone of the Texas economy...
...the members of the National Federation of Independent Business.

Three months ago, when I was in Washington, I looked up your national president… Jack Faris. 

Jack gets credit for one of the all-time best one-liners I have heard in a press conference. 

He said, “I’m from Washington, D.C., the nation’s only work-free drug zone.”

I have enjoyed a great relationship with Jack…
...and of course with the membership of this great organization. 

Perhaps that’s because… like you… I know what it is like to sign the front side of a paycheck, and the back side too.

Small business is truly the engine of the Texas economy. 

98 percent of all businesses in this state are small businesses.

And while the large job creation announcements get a lot of the ink...
...small businesses are a vital part of the net job growth of 162,000 new jobs we have experienced since September of 2003.

Things are looking up in Texas.  Economic indicators are on the rise...
...job growth is on the rise...
...and entrepreneurs are starting to come out of the bunker again, knowing they can risk their capital in the Texas economy.

In fact, you can be quite proud of two recent announcements by Site Selection Magazine. 

First, they declared last fall we now have the best business climate in the nation. 

And second, last week they announced Texas was home to the highest number of expansions and relocations across the country in 2004.

And those of you from the metroplex can be proud that they declared Dallas/Fort Worth as the top metropolitan area in the country when it came to expansions and relocations.

These things didn’t happen overnight...
...nor did they happen by chance. 

They are a result of our combined efforts over the years to create a business climate that encourages growth and welcomes entrepreneurship.

When you endorsed me for lieutenant governor in 1998...
...then first such endorsement in the nation by NFIB for a candidate for lieutenant governor...
...it sent a strong signal that the cares and concerns of small business should be central to the public policy passed in the senate.

And that first year we worked to lower the tax burden for small businesses...
...eliminating franchise tax filings for small businesses with less than $150,000 in annual gross receipts.

Last session, we worked together to overcome a $10 billion budget shortfall without raising the tax burden on mom and pop businesses one cent. 

In fact, Wanda Rohm stood up with me at my state of the state address to drive home an important point:...
...that we can’t merely listen to the voices of big government when setting the state budget...
...we have to listen to the quiet engine of progress...
...the men and women who pay the taxes, create the jobs and create opportunity for Texas workers.

Together we also passed the most sweeping lawsuit reforms in the nation that have freed more employers to spend their capital expanding and creating jobs instead of fighting off junk lawsuits in the courtroom.

The victories of the past give me great confidence for the future...
...if we continue to stand together, and if you continue to make your voice heard.

You could not have picked a better time to come to Austin and participate in the legislative process...
...because this session of the legislature is critical for the future of thousands of small businesses, our economy as a whole and this entire state.

No issue is more important to our future than reform of public education...
...an issue that I know looms large in the minds of many in this audience today.

There are a few key principles that guide me when it comes to education reform. 

First and foremost, this debate is not only about how much we spend on public education... it’s about how we spend it too. 

The forces of the status quo want billions of new dollars poured into the status quo without any guarantee that our children will learn more. 
I say we can do better.  We can reform education by making excellence the goal of every school. 

We can change the focus from minimum standards by emphasizing maximum achievement. 

And we can ensure we get more education for our money... not just more money for education.

Second, I believe that Texans deserve a real property tax cut that stands the test of time. 

You can’t give Texans real property tax relief without giving them real appraisal relief.

It’s not a tax cut if your rate goes down but your total bill goes up. 

Just as we won’t stand for taxation without representation, let’s end taxation by valuation.

In the same spirit, I applaud NFIB’s call for a portion of future budget surpluses to be dedicated to local property tax relief...
...in fact, I not only applaud it, I put it in my plan last year.

And third, as we look for funding sources to offset a significant reduction in property taxes, we must protect the engine of growth in Texas... job creation.

Jobs are the best long-term source of revenue for priorities like education, healthcare and transportation.

I believe members of the legislature are working hard to strike a balance between these competing needs.

House Bill 3 is a starting point.  And like all past tax reform bills, it will not be a final product until members of the House and Senate meet in conference.

But regardless of what differences you may have with the bill in its current form, it’s imperative that the process continue forward...
...that we continue to work with the leadership of both houses in meeting the goal of tax fairness so that property tax relief stays on track.

I encourage you all over the next two months to work with legislators to come up with the right mix of revenue options that can offset a significant property tax cut...
...and provide our schools with the resources they need to ensure the next generation of workers has the skills necessary to succeed in the workplace.

And just as importantly, let’s keep our eye on the ball when it comes to education reform. 

The bill being debated on the House floor today... House Bill 2... addresses three great concerns:...
...it provides real property tax relief...
...it provides more for education...
...and just as importantly, it reforms education so we get more for our money.

House Bill 2 doesn’t raise the next tax burden on Texans by one cent.

As parents of schoolchildren...
...and as business leaders who dependent on a well-prepared workforce as well as a reasonable and fair tax system...
...I ask you to weigh in on this debate and stand up for real reform in education and real property tax relief for Texas.

I ask for your help in addressing this great challenge and two others that are of vital interest to Texas employers.

First, it is high-time to end Texas’ status as home to some of the highest workers compensation costs in the nation.

Those who think workers compensation is a minor issue should consider the price paid by O’Reilly Auto Parts. 

Texas is home to one-third of their workforce...
...and nearly two-thirds of their workers compensation costs. 

Stories like this are all too common. 

The fact of the matter is, the workers comp system in Texas is broken...
...so broken, in fact, that it might actually qualify for workers comp.

We need a reform plan that lowers the cost for employers...
...ensures workers get the care they need in a timely manner so they can return to work...
...and makes it much easier for physicians and health care providers to participate in the system.

We must also address the fact that too few Texans have access to affordable, employer-sponsored insurance options.

The statistics are alarming.  According to the Kaiser Foundation, Texas ranks 18th in the nation for the percentage of children covered by Medicaid...
...but 46th in the nation for the percentage of children covered by employer-sponsored health insurance.
If these trends continue...
...and if federal leaders do not make reform of Medicaid a top priority...
...subsidized health care is going to one day bankrupt the states.

That is why we have to act now to help the private sector...
...especially small businesses...
...to be able to afford to offer insurance to employees and their families.

I was proud to work with NFIB and many other groups last session to remove mandates on health plans for small employers...
...and today there are plans that cost up to 30 percent less. 

We also made it easier for small businesses to pool together so they have greater leverage in the marketplace to help lower insurance costs.

Today we can build on those reforms by promoting market-driven plans that are newly available...
...health savings accounts that put individual Texans in better control of their health care decisions.

Health savings accounts make patients better consumers...
...and they make the health care system more responsive to market forces.

We cannot reach our goal of making sure as many Texans as possible have access to quality healthcare until more small businesses can afford to provide insurance for their workers.

As the legislature addresses these and many other issues, I want you to know that my door is open to the members of this organization and all who come in good faith to build a better Texas.

I thank you for what you do for Texas.  You give our people something far greater than jobs and paychecks...
...and that is the hope of a better tomorrow and an opportunity to live the American dream.

Thank you, and God bless you.

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