• $4 Million Says Reports of Builder Agency's Demise Exaggerated
• Big Bucks Back Bogus Bureaucracy

The Texas Residential Construction Commission (TRCC) is undergoing a state Sunset Commission review to determine if it merits the tax dollars it consumes. Consumer and homeowner groups support the Sunset staff’s recent recommendation to scrap the agency because it adds insults to the injuries of those who buy lemon homes.

The recommendation to abolish the “fundamentally flawed” TRCC¹ now goes to the lawmaker-controlled Sunset Advisory Commission, which will offer its own advice on the matter to the very legislature that huddled with homebuilders to create this lemon agency in 2003. Lawmakers at this week’s Sunset Commission hearing did not welcome calls for TRCC’s abolition.²

It will be difficult for the legislature and the state’s two top officials to view this sunset objectively. Apart from working with the homebuilding industry to create the TRCC five years ago, these officials have taken almost $4 million from the industry in the past three years.

The 10 lawmakers on the Sunset Advisory Commission took a total of $223,050 from homebuilders in this period.³ Lieutenant Governor David Dewhurst and House Speaker Tom Craddick, who appointed the eight Republicans and two Democrats to the Sunset Commission, took a total of $600,382 from homebuilders in that period.⁴ The builders gave another $649,218 to Governor Rick Perry, who wields veto power.

The Houston Chronicle’s Clay Robison recently reported that the 10 lawmakers now sitting on the Sunset Commission have taken a staggering $446,000 from Houston homebuilder Bob Perry over their legislative careers.⁵ In the past three years, Bob Perry has given almost $2.9 million to the governor, lieutenant governor and Texas lawmakers. This head of Houston-based Perry Homes accounts for 72 percent of the $4 million tracked in this report.

John Krugh

In a 2006 study analyzing the crossover between Governor Perry’s campaign contributors and political appointees, TPJ found that the appointee with the most employer-related gubernatorial contributions was Perry Homes Corporate Counsel John Krugh.6 After Krugh helped draft legislation to create the TRCC, Governor Perry appointed him to a TRCC seat that Krugh still occupies. Houston Democratic Rep. Garnet Coleman was referring to this appointment when he told the Austin American-Statesman, “In Texas you can buy your own state agency, then regulate yourself.”7

The industry’s influence is extensive. Just six lawmakers did not appear to receive homebuilder contributions during the period studied. These Democrats were: Sen. Leticia Van De Putte and Rep. David Leibowitz of San Antonio, Reps. Dan Barrett and Lon Burnam of Fort Worth, Rep. Jessica Farrar of Houston and Rep. Barbara Mallory Caraway of Dallas.⁸

¹  “Texas Residential Construction Commission Sunset Hearing Material,” Texas Sunset Commission, September 2008. http://www.sunset.state.tx.us/81streports/trcc/trcc_hm.pdf
²  “Sunset Commission Questions Whether Abolishing TRCC Is the Right Solution,” Quorum Report, September 23, 2008.
³   Some lawmakers joined the Sunset Advisory Commission recently. Dewhurst tapped Senators
Hegar and Hinojosa for the panel in January 2008. Craddick appointed Representatives
Isett and Harper-Brown in October 2007.
⁴  Apart from lawmakers, there are two so-called “public” members of the Sunset Commission. Lieutenant Governor David Dewhurst appointed retired Compass Bank executive Charles McMahen to the commission. Speaker Craddick appointed Ike Sugg, head of Abilene’s Bar None Hunt Co.
⁵  “A Builder, A Commission, A Lot of Cash,” Houston Chronicle, August 24, 2008.
⁶  "Governor Perry’s Patronage," Texans for Public Justice, April 10, 2006. http://www.tpj.org/page_view.jsp?pageid=979&pubid=744
⁷  “Unassuming home builder getting more notoriety for latest donation than for record amounts in 2002,” Austin American-Statesman, August 28, 2004.
⁸  Judgment calls are involved in distinguishing some contributors whose primary interest is hammer-and-nail homebuilding from residential developers who job-out more of these building functions. Some of the six lawmakers took money from contributors who skate this line. Van de Putte, for example, received $250 from Henry Cisneros, the head of CityView, which forms joint ventures with homebuilders to build housing. TPJ coded CityView as a residential developer but has no problem with those who prefer to characterize it as a homebuilder. The same is true for the head of Houston’s William Carl & Co., who gave Jessica Farrar $500. TPJ codes mobile homes separately from homes built on-site and did not count mobile-home money here (Van de Putte and Farrar took money from the Texas Manufactured Housing Association PAC). During the 2006 cycle, when Bob Perry accounted for 61 percent of the money raised by the PAC of HillCo Partners lobby firm, that PAC gave $3,556 to Van de Putte and $1,000 to Burnam. So far in the 2008 cycle, Bob Perry has supplied 36 percent of the money raised by HillCo’s PAC. This cycle HillCo’s PAC has given $3,827 to Farrar, $1,500 to Burnam and $1,000 to Mallory Caraway. Classified as lobby money, HillCo PAC contributions were not counted in this study.