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AUSTIN – The Texas Observer reports that in August 2024, the business magazine Inc. released its annual list of the top 5,000 fastest-growing private companies in the United States. At 815th, a burgeoning upstart called ClassWallet cracked the list’s top 20 percent for the third straight year. By expanding its operations managing school voucher programs for states across the country, earnings for the Florida company grew by 610 percent over the previous three years. Founded in 2014, ClassWallet now has more than 200 employees and has contracts to administer school vouchers and other educational programs in 18 states through its “digital wallet” platform. Indeed, managing school vouchers has become a big business. And, as Governor Greg Abbott and the Republican-controlled Texas Legislature gear up to pass their own program this session, private companies like ClassWallet are descending on the Capitol to lobby for the vouchers legislation and the lucrative contracts it could generate. This comes as other states have drawn scrutiny over myriad problems with the private contractors, including ClassWallet, they’ve hired to administer their voucher programs.

Senate Bill 2, which sailed through the upper chamber early last month, is a universal school voucher proposal that would give students $10,000 a year to attend private school or $2,000 for homeschooling. Lawmakers have initially set aside $1 billion in funding for the Texas school voucher program in 2027, though the Senate bill’s fiscal analysis says the program’s net cost could balloon to $3.8 billion by 2030. The bill stipulates that up to 5 percent of appropriated funds may go to pay up to five outside vendors like ClassWallet, which the legislation calls “certified educational assistance organizations” (CEAOs), to act as middlemen between the state, parents, and private schools by processing program applications and voucher payments. If the bill were to pass, these private companies could soon be reeling in tens and even hundreds of millions of taxpayer dollars per year. These private vendors could, under the bill, be tasked with managing a complex application process, connecting parents with private schools and education vendors, accepting payments, and “verify[ing] that program funding is used only for approved education-related expenses.” “They’re a for-profit pass-through, which just means the state appropriates dollars, the vendor holds it, they reserve a small fee for themselves, and then they pass it on to the consumer,” Josh Cowen, education policy professor at Michigan State University and author of the book The Privateers: How Billionaires Created a Culture War and Sold School Vouchers, told the Texas Observer.

HOUSTON – The Houston Chronicle reports that the future of Army Corps projects along the Texas Gulf Coast, like the overhaul of flood control systems around Houston and the widening of the Houston Ship Channel, are in question after House Republicans on Tuesday passed a stopgap funding bill to keep the government open through September. Their bill calls for reducing the Army Corps of Engineers’ construction budget by $1.4 billion, a 44% cut. In addition, the White House would assume control over which projects get funded, decisions that are currently made by Congress. The bill nows moves to the U.S. Senate, where Republicans must win over at least seven Democrats to clear the 60-vote threshold needed to consider the measure. To avoid a government shutdown, Congress must pass a spending bill by the end of Friday.

Public officials and contractors in Texas are scrambling to figure out what the possible Army Corps cuts could mean for their projects, said Rep. Lizzie Fletcher, D-Houston. “It’s anyones guess what the Trump administration will do, but that’s a huge part of the problem. It’s the chaos and uncertainty continuously coming out of this administration,” she said. “The port project is hugely important not only to our regional economy but our national security.” A spokeswoman for Rep. Troy Nehls, R-Richmond, denied the $1.4 billion reduction in Army Corps spending was a “cut,” saying the department’s previous year’s budget had been inflated due to the injection of funds from other legislation. “These funds were expended for a one-time purpose. So, no, House Republicans are not cutting any funds for the Army Corps of Engineers,” he said. The continuing resolution passed by House Republicans on Tuesday calls for a $13 billion reduction in non-defense spending and a $6 billion increase in defense spending — relatively small amounts considering the $6.8 trillion federal budget. It passed in a narrow 217-213 vote, with the Texas delegation split along party lines.

AUSTIN – The Houston Chronicle reports that as state House members began debating a school voucher plan on Tuesday, Gov. Greg Abbott appeared more optimistic than ever that his signature legislation would finally pass the chamber where it has died repeatedly. The difference from past sessions — when a coalition of House Democrats and rural Republicans blocked the bill — is the new speaker now leading the House, Dustin Burrows, Abbott said. “We’ve been down this pathway before, but have never been so close to getting this passed,” the governor told a crowd of supporters in Austin. “And the reason is, because we have not had a speaker willing to step up and stand for school choice.”

For the first time in years, Abbott and a Texas House speaker are aligned, at least publicly, on his vision to send public dollars to families for private education. Burrows took over this year for former House Speaker Dade Phelan, who declined in 2023 to publicly back a voucher plan and later dropped his bid for reelection after Abbott helped unseat several of his former supporters. Burrows, a Lubbock Republican and former Phelan ally, appeared alongside Abbott last month in San Antonio, and he joined the governor again on Tuesday to address a crowd of supporters at the Texas Public Policy Foundation, a conservative think tank in Austin. “These are your elected representatives who are about to make school choice a reality in Texas, something that’s been fought for for 30, 40, 50 years — and it’s going to happen,” Burrows said. “It’s a big day, a monumental day.”

McALLEN (AP) — The Trump administration is dropping a civil lawsuit against the largest provider of housing for unaccompanied migrant children over allegations of repeated sexual abuse and harassment of minors in its facilities.

The dismissal was filed on Wednesday after the federal government announced they would no longer use services by Southwest Key Programs. The complaint, filed last year during the Biden administration, alleged a litany of offenses between 2015 and 2023 as Southwest Key Programs, which operates migrant shelters in Texas, Arizona and California, amassed nearly $3 billion in contracts from the Department of Health and Human Services.

“Out of continuing concerns relating to these placements, HHS has decided to stop placement of unaccompanied alien children in Southwest Key facilities, and to review its grants with the organization. In view of HHS’ action, the Department of Justice has dismissed its lawsuit against Southwest Key,” the HHS said in a statement.

Children who were still in shelters operated by the provider were moved to other housing.

Southwest Key Programs furloughed employees across the country. “Due to the unforeseen federal funding freeze and the stop placement order on our unaccompanied minor shelters and Home Study Post Release programs by the Office of Refugee Resettlement, we have made the difficult decision to furlough approximately 5,000 Southwest Key Programs’ employees,” the company said in a statement shared Tuesday.

According to allegations in the 2024 lawsuit, Southwest Key employees, including supervisors, raped, inappropriately touched or solicited sex and nude images of children beginning in 2015 and possibly earlier.

Among the accusations: One employee “repeatedly sexually abused” three girls ages 5, 8 and 11 at the Casa Franklin shelter in El Paso, Texas, with the 8-year-old telling investigators the worker “entered their bedrooms in the middle of the night to touch their ‘private area.’”

The lawsuit also alleged that another employee, at a shelter in Mesa, Arizona, took a 15-year-old boy to a hotel and paid him to perform sexual acts for several days in 2020.

Children were warned not to report the alleged abuse and threatened with violence against themselves or their families if they did, according to the lawsuit. Victims testified that in some instances, other workers knew about the abuse but failed to report or concealed it, the complaint said.

“DOJ’s lawsuit revealed horrific sexual abuse and inhumane treatment of children detained in Southwest Key shelters,” said Leecia Welch, an attorney who represents unaccompanied children in a separate case. “It’s shocking to me that the government now turns a blind eye to their own contractor’s actions. I hope the impacted children will have other legal recourse and support in healing from their abuse.”

At least two employees have been indicted on criminal charges related to the allegations since 2020.

The civil lawsuit had sought a jury trial and monetary damages for the victims.

AUSTIN – A dozen Texas House Republicans who replaced pro-gambling lawmakers said this week they would oppose “any attempt to expand gambling” this session — a setback for efforts to legalize casinos and sports betting in the state.

The 12 GOP freshmen were joined by three returning lawmakers who voted in 2023 to allow online sports betting, but now say they will reject any such proposal. That measure passed the 150-member House with 101 votes two years ago, narrowly clearing the two-thirds threshold needed to amend the Texas Constitution.

The net loss of more than a dozen votes jeopardizes the chances of recreating that tenuous coalition, unless supporters can find votes elsewhere to make up the difference.

In a letter sent Tuesday to Rep. Ken King, chair of the House State Affairs Committee, the lawmakers sought to deal a death blow to the latest proposals to legalize casinos and sports betting, both of which were filed in the House last month. Neither has been referred to a committee this session, though both went through State Affairs in 2023.

“We are confident this legislation does not have the votes necessary to pass the Texas House this session,” the letter reads. “Given the certainty of its failure, I urge you not to waste valuable committee time on an issue that is dead on arrival.”

A spokesperson for King, R-Canadian, did not immediately respond to a request for comment.

The effort to legalize casinos in Texas has even less wiggle room than the sports betting contingent. Two years ago, a constitutional amendment to authorize “destination resort” casinos received 92 votes in the House, eight shy of the two-thirds mark.

Of the 15 signatories on the letter to King, nine are GOP freshmen whose predecessors voted for the casino measure. A returning member who signed the letter, Rep. J.M. Lozano, R-Kingsville, also supported casino legalization — along with sports betting — and is now vowing to oppose both.

That represents a net loss of 10 votes from the 92 who backed the casino proposal in 2023.

Supporters have tried to sway skeptical lawmakers by arguing that a vote for the constitutional amendment would merely put the issue before voters on the statewide ballot and let them decide whether to allow gambling, taking the final call out of lawmakers’ hands. In contrast, regular bills become law without that extra hurdle, as long as they avoid a veto from the governor.

A statewide poll conducted in January by the University of Houston’s Hobby School of Public Affairs found that 60% of Texans support legalized sports betting and 73% support authorizing “destination resort casinos.”

Matt Hirsch, a spokesperson for the Texas Destination Resort Alliance — an initiative of the Las Vegas Sands casino empire — said it is “essential for elected officials to listen to their constituents and respect their right to vote.”

“Denying Texans the chance to vote on this matter not only undermines the democratic process, but also disregards the voices of the very people they represent,” Hirsch said in a statement. “The voters of Texas know that destination resorts have the potential to bring significant economic benefits, job creation, and increased tourism to Texas while eliminating the scourge of illegal gaming in Texas.”

Sands has deployed an army of lobbyists to push for casino legalization in Austin, and its owner, Miriam Adelson, has spent millions on statehouse elections in a bid to grow the ranks of gambling supporters in Texas’ lower chamber. Eight signatories of the anti-gambling letter accepted contributions last year from Adelson via the Texas Sands PAC — though Adelson-aligned PACs donated far more, collectively, to several of the signatories’ opponents.

In an apparent reference to the 2026 elections, Hirsch said his group “will make it perfectly clear to the voters in each of these districts where their representative stands.”

Karina Kling, a spokesperson for the Texas Sports Betting Alliance, said, “Poll after poll shows Texans overwhelmingly want the chance to vote on legalizing sports betting and we hope the Texas Legislature will give them that chance.” The group is a collection of the state’s pro sports teams, racetracks and betting platforms, such as FanDuel and DraftKings.

Efforts to loosen Texas’ gambling restrictions have repeatedly failed since they were first enacted in 1856 and further tightened in 1973. The House’s approval of the sports betting measure in 2023 was the furthest either chamber has gone toward expanding gambling, though the move was largely symbolic, because Lt. Gov. Dan Patrick — a Republican who runs the Texas Senate — immediately quashed the measure in the upper chamber. Patrick has repeatedly claimed there is minimal support among the Senate’s GOP majority to expand gambling.

With the 74-year-old Patrick in office until January 2027 and vowing to seek another four-year term, the legislative battle over gambling has been centered almost entirely in the House. Supporters are aiming for incremental wins in the lower chamber that would, they hope, lay the groundwork for when the Senate is run by a more sympathetic lieutenant governor.

Article originally published by The Texas Tribune. To read the originally published article, click here.

McALLEN — Texas senators advanced a resolution Monday that calls on the U.S. State Department to ensure Mexico meets its obligations to deliver water to the U.S. under a 1944 water treaty.

The Water, Agriculture, and Rural Affairs Committee voted in favor of the resolution after hearing testimony from state and Rio Grande Valley officials on how Mexico’s failure to deliver water has impacted the local farmers and stalled growth.

“It’s really causing a lot of severe issues not only for the Valley but along the river from El Paso down to Brownsville,” state Sen. Juan “Chuy” Hinojosa, D-McAllen, said at the start of the hearing.

“The reality is that even commercially, the growth of the Valley is being stunned because we cannot issue any more builder’s permits because there’s no water” Hinojosa said. “Hopefully, the present Trump administration will be a lot more aggressive in trying to address the issue.”

Under the 1944 treaty, Mexico is required to deliver a total of 1.75 million-acre feet over a five-year cycle. The current cycle ends in October, yet Mexico is behind on its water deliveries by more than a million acre-feet.

The largely symbolic resolution is the latest push from Texas officials to push the federal government to pressure Mexico. Last year, Texas’ congressional delegation secured $280 million in disaster assistance for Valley farmers.

State Sen. Charles Perry, the Lubbock Republican who chairs the committee, praised the efforts of Maria-Elena Giner, the commissioner of the U.S. International Boundary and Water Commission, a division of the U.S. State Department that oversees the water treaty.

Under Giner’s leadership, the IBWC secured an amendment to the treaty that provided Mexico more opportunities to deliver water.

However, Perry pointed out that the IBWC has no enforcement power and would like the Trump administration to include the water treaty in their tariff negotiations.

“It would be nice to include water release under the 1944 treaty in those tariff negotiations so that we could get some relief in the Valley,” Perry said.

The lack of water for farmers and ranchers has already had harmful effects on the industry. For example, the last sugar mill in Texas closed in 2024.

Texas A&M AgriLife Extension estimated that the total economic value lost to South Texas because of the lack of irrigation water is about $993 million per year.

Brian Jones, who sits on the board of the Texas Farm Bureau, testified before the committee about his struggles as a farmer in the Valley.

Jones said he is in “survival mode,” planting only half of his crop for the last three years.

“What is crystal clear is that Mexico has no intention of sharing any amount of water they can capture for their own use,” Jones said.

In 2022, a tropical storm filled their reservoirs, but Mexico didn’t deliver any of that water to the U.S. despite already owing 350,000 acre-feet of water at the time.

However, the lack of water is not just because of Mexico’s noncompliance.

In the past, local farmers were able to rely on seasonal tropical storms to fill up the water reservoirs, but the rain missed those watersheds last year. Future rains would fail to make up the debt.

“It’s almost mathematically impossible for them to meet their obligations on this cycle,” Jones said.

The treaty allows Mexico to pay their outstanding water debt during the next five-year cycle but because there is no timeline, Mexico could theoretically wait until the end of the next five-year cycle to deliver the water it owes for this cycle.

David Dunmoyer with the Texas Public Policy Foundation, a conservative think tank, said that while the resolution is a critical starting point, the state can’t rely on Mexico alone for water.

“We need an ‘all of the above’ approach that’s desal-produced water and looking to the future of water infrastructure,” he said.

Cities and water districts across the Valley have been seeking different sources of water. But city and county leaders told the committee more money is needed to build the infrastructure to obtain and properly treat that water for public use.

While the major impacts have been limited to the agriculture industry, Mark Dombroski, assistant general manager and chief operating officer for the Brownsville Public Utilities, warned that drinking water for cities like Brownsville and McAllen will be at risk if water remains scarce.

“Invest in South Texas and help us secure alternative water solutions now,” Dombroski said. “Delaying action only makes the crisis worse and solutions more expensive.”

Article originally published by The Texas Tribune. To read the originally published article, click here.

For four years while President Joe Biden was in office, Texas lawmakers passed a variety of state laws aimed at curbing illegal immigration into the state and approved spending billions of Texans’ taxpayer dollars in an effort to secure the border.

The Legislature created a mandatory minimum sentence of 10 years in prison for people convicted of human smuggling. Lawmakers passed a law that gave state and local police the authority to arrest people suspected of being undocumented — it has not gone into effect while its constitutionality is litigated. And legislators have plowed $11 billion into Operation Lone Star, Gov. Greg Abbott’s ongoing border crackdown that deployed state police and Texas National Guard along the state’s nearly 1,300 miles of border with Mexico.

Now with President Donald Trump back in office, lawmakers are not relenting. They have filed dozens of bills that could further cement the state’s role in immigration enforcement — long the sole responsibility of the federal government — should they become law.

The proposals range from trying to force cooperation with federal immigration authorities to giving property tax breaks to border landowners who allow the state to build border barriers on their property.

Lawmakers have filed at least nine similar bills that would require local law enforcement agencies enter into agreements with U.S. Immigration and Customs Enforcement.

Under a 1996 federal immigration law, ICE can delegate local authorities to carry out certain types of immigration enforcement in local jails — where officers can be deputized to question inmates about their immigration status and to serve administrative warrants — and in the field, where officers can be permitted to question people about their immigration status through a model the Trump administration has revived after it fell into disuse following allegations it led to racial profiling.

Such programs serve as “force multipliers” for ICE, an agency of about 6,000 officers with limited resources, according to the federal agency, immigration lawyers and policing experts.

Abbott and Lt. Gov. Dan Patrick have called for Texas authorities to be required to cooperate with federal immigration authorities.

While specifics vary, most of the proposed state laws share the same idea: Require local law enforcement to request entering into partnership agreements with ICE known as 287(g) agreements — a reference to the legal statute from which they originate.

Senate Bill 8, filed by Republican state Sen. Joan Huffman of Houston and Georgetown Republican Sen. Charles Schwertner, would require sheriffs in counties with more than 100,000 residents to request a 287(g) agreement with ICE.

Among the criticisms of 287(g) agreements is the potential extra costs for counties that devote resources to processing and jailing immigrants and face potential legal liabilities if an officer is accused of wrongdoing, such as violating a person’s civil rights. The bill would establish grants for sheriffs in counties with fewer than 1 million residents, but not for sheriffs of large Texas counties.

Patrick designated the bill a top priority of his for the legislative session even before it was filed.

As of early March, 43 Texas law enforcement agencies already had 287(g) agreements in place, the majority of which are for the jail programs. Only the attorney general’s office, Nixon Police Department and sheriffs in Goliad and Smith counties had signed 287(g) agreements for the “task force model” that grants police limited immigration enforcement authority while conducting their routine duties.

Lawmakers are also looking at ways to study the costs of illegal immigration.

State Sen. Mayes Middleton’s Senate Bill 825 would task the Texas Department of Public Safety with conducting a study on the economic, environmental and financial impact of illegal immigration. The state last performed such a study in 2006, when then-state Comptroller Carole Keeton Strayhorn found that undocumented immigrants contributed more to Texas than they cost the state.

Meanwhile, House Bill 2587 by state Rep. Mike Olcott, R-Fort Worth, seeks to study the cost of providing hospital services to undocumented immigrants. Last summer, Abbott ordered hospitals to start asking patients for their citizenship status. Hospitals can’t refuse to provide medical treatment based on a patient’s answer.

Rep. Ryan Guillen, a Republican from Rio Grande City, has proposed expanding a fund the state established in 2023 to reimburse homeowners in border counties whose property has been damaged by border crime — which can include everything from migrants cutting fences while passing through their land to damage from high-speed police pursuits of suspected migrants and smugglers that end in a crash.

House Bill 246 would expand the potential sources of revenue for the fund so the attorney general’s office, which administers it, could accept donations, gifts and other revenue designated by the Legislature, which appropriated $18 million in state money for the fund over the 2023-24 biennium.

Lawmakers also have introduced bills that would require companies to use E-Verify — a federal government website that helps businesses determine whether an immigrant is legally allowed to work in the U.S. — if they want to bid for state contracts.

House Bill 1308 would require state agencies to only award contracts to businesses that participate in E-Verify. The proposal would also apply to subcontractors hired by a company with a state contract.

The bill, sponsored by state Rep. Carl Tepper, R-Lubbock, would also suspend the business license of any business that contracts with the state if they stopped using E-Verify during their state contract.

As part of Tepper’s bill, people who suspect a state agency has hired an undocumented person can send information to the Texas Attorney General’s office for possible investigation.

Like Tepper’s proposal, House Bill 2744, sponsored by state Rep. Cody Vasut, R-Angleton, would require all state contractors to use E-Verify, and would also impose a $10,000 fine for each undocumented worker a state contractor is caught employing.

For the past four years, the state has approached border landowners seeking permission to build barriers along the 1,200-mile-long Texas-Mexico border. But the state has faced a challenge in finding enough willing landowners to lease part of their land to the state.

House Bill 247, introduced by state Rep. Ryan Guillen, R-Rio Grande City, would give a property tax break to landowners who have allowed state or federal border barriers to be built on their property.

The proposal says the state tax break would be available to any landowners who allow the state or the federal government to install “a wall, barrier, fence, wire, road trench, technology” or any type of infrastructure “to surveil or impede the movement of persons or objects crossing the Texas-Mexico border.”

Another proposal, Senate Bill 316 by state Sen. Brandon Creighton, R-Conroe, would allow the state to use eminent domain to take private property for border wall construction. The proposal does not say how much money a private landowner would get if the government seizes their property. But under Texas law, the owner would “receive adequate compensation.”

Article originally published by The Texas Tribune. To read the originally published article, click here.