Office of the Governor Rick Perry

San Antonio Rotary Club

*Note - Gov. Perry frequently departs from prepared remarks.
Tuesday, June 06, 2006  •  Speech

Thank you.  I appreciate such a warm welcome on such a scorching hot day. 

Today I am mindful of the most under-estimated invention of the last 150 years: not electricity, not indoor plumbing and not the telephone, but air conditioning.

Later today I will be attending an outdoor event in El Paso, where it will be 99 degrees. 

A member of my staff, I should say, a former member of my staff, tried to tell me it will be a dry heat, as if somehow I should be grateful that there won’t be humidity to go with a temperature as hot as the earth’s core.

It is great to be in the presence of your locally elected officials, and most of all, to be in a room full of proud Texans who care deeply about this state and our future.

You have a lot to be proud of in San Antonio: a rich history that attracts tourists from around the globe, your position as the gateway to trade and opportunity in Latin America, and despite this year’s heart-breaking defeat, a championship basketball team that has won three out of the last seven NBA titles: the San Antonio Spurs.

When I think about San Antonio, what makes me most proud is the lead role this city took in getting Texas back on its feet.

If you rewind to three and a half years ago, we were in the midst of some of the worst economic and budgetary times on record. 

Our state budget shortfall had grown to $10 billion, Texans were losing jobs, and the economic ruin posed by the events of 9-11 continued to create great uncertainty.

But in the midst of all those storm clouds, we began to see a silver lining: a new Toyota plant that would bring thousands of jobs and hundreds of millions of dollars in new investment.

In fact, Toyota served as a reminder that in order to get Texas moving again, our strategy should be to invest in jobs rather than raising taxes. 

We have done that, and it is now paying dividends. 

The Texas Enterprise Fund, which was created to bring corporate expansions and re-locations to Texas in the midst of our economic downturn in 2003, has already attracted more than $10 billion in new investments and will bring 41,000 new jobs.

We decided that we also needed to focus a separate pot of money on the emerging technologies that will transform our economy and our way of life in the 21st Century, so we created the Texas Emerging Technology Fund. 

And I am proud to say that two of the very first grants, which were issued last week, went to San Antonio-based companies. 

CardioSpectra, which produces a catheter that helps doctors predict whether someone is likely to have a heart attack based on vascular plaque, received $1.35 million. 

And Xilas Medical, which has developed three medical devices that will aid in the early detection of neuropathies, foot stress and inflammation that often lead to diabetic ulcers and amputation, received $1 million.

The idea behind the emerging technology fund is that we know new technologies will generate $3 billion in revenues worldwide over the next decade: it’s just a matter of where that revenue is generated. 

I say bring as much of that money as possible to Texas by aggressively working with universities and private sector partners to move ideas and inventions from public labs to the private marketplace.

In many respects, Texas has always sold itself as a place to risk capital and pursue an idea. 

Our taxes are relatively low, our regulatory climate is reasonable, our tort laws have been reformed, and our workforce is skilled and abundant.

But as we visited with corporate re-location personnel, one obstacle kept coming up in our conversations: property taxes are way too high.

And though it wasn’t easy, and it took a number of sessions to get it done, I am proud to tell you your property tax bill is about to go down.

Thanks to a strong bipartisan vote, property taxes will be reduced by more than $15 billion over the next three years on businesses and homes. 

This year’s reduction will be roughly 11 percent, followed by an additional 22 percent, or a one-third reduction in total by the second year when the reformed business tax takes effect.

For years we have sought a tax that is fairer and broader so it can be assessed at a low rate, one that treats manufacturing and the service industry equally, and that protects our smallest businesses so that they can grow and prosper.

We now have that tax. 

It closes corporate loopholes and broadens the tax base so multi-billion dollar corporations no longer pay less than small and mid-sized businesses. 

It rewards activities a tax code should reward: every time an employer invests in worker healthcare, pension plans and new jobs, their tax liability goes down. 

And our smallest businesses, those that have gross receipts of $300,000 or less, all sole proprietors, and all general partnerships owned by natural persons are exempt.

When weighed against a 33 percent cut in property taxes, many businesses come out ahead and the total tax burden in Texas will be reduced by nearly $7 billion over the next three years.

Now, I recognize that’s a lot of numbers to take in, and if anything, conservatives talk too much about numbers. 

So let me put it in human terms.

That family looking to stop renting and buy their first home will find homeownership just got a lot more affordable. 

The company looking to expand or relocate and create new high-paying jobs for Texas workers has just had its greatest impediment removed. 

The couple that may have paid off their mortgage but can no longer afford to pay off the tax bill will now get a huge break.

But it gets better, because the school finance reform package passed by the Legislature not only cuts property taxes and reforms the state’s business tax, it provides billions of new dollars for education.

And not only will Texans get more money for education, they will get more education for their money. 

Here’s an example.  We’re not only putting more money into the pockets of every teacher with a $2,000 across-the-board pay raise, we’re providing as much as $10,000 on top of that for top performing teachers that transform Texas classrooms.

Performance pay for educators is the most systemic change to education in decades. 

How do I know it will work?  Because it has worked for more than 200 years: it’s called the American Free Enterprise system.

When you reward excellence more than mediocrity, more will strive to reach the standard of excellence.  And it can only benefit our children.

Our children will also benefit from new dropout prevention and college preparedness funding that amounts to $275 per student in every high school in Texas. 

And they will be challenged by an extra year of math and science – two subject areas critical to their success in the high-tech economy.

Taxpayers will also benefit from greater transparency in school budgeting. 

You will be able to compare your local district’s expenditures to neighboring districts and know who is putting more money into the classroom. 

There is a simple principle at work here: if taxpayers are going to pick up the tab, they ought to be able to look at every item on the receipt.

We also sent a message that we won’t stand idly by while certain schools chronically fail our children. 

If those schools refuse to change, then their management will change. 

We will not accept any school that sentences our children to a lifetime of mediocrity. 

The future of every child matters, whether they come from the colonias, a barrio, or a gated community.

I believe the greatest threat to our future is posed by a porous border that is susceptible to drug traffickers, criminal gangs and terrorist organizations.

You cannot solve the border security challenge by merely addressing the issue of illegal immigration. 

I support a guest worker program that takes workers out of the shadows of illegality, that contributes to our tax rolls and that allows us to know more about who is entering our country. 

But if Washington addresses the immigration challenge, and yet refuses to secure our border, we will remain a nation vulnerable to attack as we were five years ago.

It has come to my attention, based on a report by the Texas Rangers, that on at least one occasion, and we suspect in several other instances, members of the Mexican Military have come freely across our border in violation of our sovereign laws. 

This is alarming on many levels, but what concerns me most is this: if our border cannot prevent the entry of foreign soldiers wearing clearly identifiable uniforms, what are the odds it will stop an enemy who wears no uniform, specializes in avoiding detection, and spends every waking hour planning its next attack on America?

Let me be clear: my concern is not with the person who migrates here legally and contributes to the fabric of this great nation. 

We are a nation of immigrants, and we are better off for the contributions made by immigrants: whether they are first generation, or seventh generation Texans.

My concern is with radical elements who come to this nation only to do us great harm, and who try to exploit our free society to carry out their acts of terror.

That is the risk we face every day Washington fails to act. 

That is why I have worked with local border sheriffs to provide millions of dollars to increase their patrols and purchase new equipment. 

That is also why I formed Operation Rio Grande: an all hands on deck approach to securing our border, using the law enforcement assets of the Department of Public Safety and other state agencies to increase the law enforcement presence along the Rio Grande and further inland.

We have brought in rapid deployment teams of troopers, swat teams, game wardens to patrol the river, and funded new technologies to tighten the law enforcement net on illegal activities. 

These efforts are not focused on enforcing immigration laws, which is a federal responsibility, but our state’s criminal statutes.

And soon, with the voluntary help of private landowners, we will begin posting hidden camera surveillance along criminal hotspots so we can react more quickly to illegal activity. 

And these cameras will be live on the Internet, serving a as a virtual neighborhood watch program.

I believe we can secure our border and maintain the free flow of commerce with nations to our south. 

Texas is now the nation’s top exporting state. 

We export tens of billions of dollars in goods and services to Mexico alone. 

Free trade is about providing a future of unlimited opportunity, regardless of what side of the Rio Grande you call home.

We want Texas to be a state where opportunity is limited only by the imagination. 

That is why we have cut your taxes, invested more in your schools, and taken strong state actions to secure our border.

Our work is far from done, but I believe we are heading in the right direction.  Thank you, God bless you and God bless Texas.

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