Nearly half of Texas Enterprise Fund recipients returned the favor to Perry or RGA
Texas’ business-friendly climate has been one of Gov. Rick Perry’s favorite talking points on the campaign trail, and he’s played up the role of incentive programs like the Texas Enterprise Fund in luring companies to the state with tax breaks.
But the Perry-controlled TEF and the Emerging Technology Fund have also been the source of much of the criticism Perry’s faced for creating a pay-to-play atmosphere in the state.
A report released Thursday by the campaign finance watchdog Texans for Public Justice — a group that’s made particularly great sport of Perry’s campaign contributions since he entered the presidential race — counts 43 companies that received grants from the TEF and returned the favor with contributions to either Perry’s campaign fund, or the Republican Governors Association. (For years before his presidential campaign, Perry was an officer with the RGA, which was, in turn, his most generous campaign contributor.)
These 43 companies have received $333 million from the fund since it was created in 2003, TPJ writes, and delivered $7 million to either Perry or the RGA. Hewlett-Packard and General Electric top the list, with $720,000 and $640,000 in donations respectively, most of which went to the RGA.
The report also notes that three of the companies in Perry’s stock portfolio — Perry dissolved his blind trust last month after keeping his investments hidden in a blind trust for years, revealing investments in 37 companies — received TEF money totaling $12.2 million.
What’s more, some of the fund’s biggest projects haven’t amounted to much at all. The group says they found “much wreckage among
the TEF projects that have generated the most political contributions,” from delayed job creation targets to aborted programs that left the state without creating a job, and returned the money they’d gotten.
The Texas Observer points out that the companies represent nearly half of the recipients of TEF money, and TPJ research director Andrew Wheat told them the campaign contributions amount to a conflict of interest:
Having the government give out public money to private companies is inherently controversial,” he said. “If indeed a government is going to have this kind of program it would seem to be prudent to have it heavily insulated from the political process, which this one definitely is not.”
Texas A&M University’s Institute for Genomic Medicine received $50 million from the fund, and has returned the favor with nearly $600,000 to Perry and the RGA, the report finds — $500,000 of it directly to Perry. As the Observer points out, though, the A&M program has drawn particular scrutiny just this week from the Wall Street Journal, which pointed out the inflated job creation claims attributed to the program.
As recently as Tuesday night, Perry touted the fund as a big win for Texas, as Bloomberg reports:
Asked during the Oct. 11 Bloomberg-Washington Post debate in Hanover, New Hampshire, about the taxpayer-funded programs, he said most of the money spent on job creation didn’t go to campaign donors, and that the Texas legislature looks at the program every two years.
Those programs “are part of the reason that Texas has led the nation in the creation of jobs,” Perry said. “You have to be able to give a climate where people know they can risk their capital and have a chance to have a return on that investment.”
Bloomberg noted Thursday that some of the companies mentioned in the report disagree with its conclusions:
“The report is misleading,” said Andrew Williams, a spokesman for Stamford, Connecticut-based GE. The company “donates to both the Democratic and Republican governors associations annually on a nearly equal basis regardless of who is chairing either association.”
In 2010, GE gave $205,900 to the RGA and $130,000 to the Democratic Governors Association, Internal Revenue Service records show.
The same records show that in 2010, HP gave $151,800 to the RGA and $150,054 to the DGA.
TPJ: Perry’s Piggybank TEF