Senator Eliot Shapleigh - El Paso, Texas

Gov. Rick Perry outlines his priorities for the legislative session in his state of the state speech Tuesday at the Capitol.

Coming off a rocky session two years ago and with a serious re-election challenge looming, Gov. Rick Perry signaled with his state of the state speech Tuesday that his No. 1 goal for the new legislative session might be simply surviving it.

Perry largely avoided bold strokes in his 48-minute address to a joint session of the state House and Senate.

Instead, he urged lawmakers to stick with the fiscal policies that have guided the state for the past six years and to boost spending on a few of his favorite programs, such as a job-relocation fund and cancer research. He also threw his support behind some proposals with appeal to social conservatives, whose support he would need to hold off a challenge from U.S. Sen. Kay Bailey Hutchison in next year's Republican primary.

Early in his speech, Perry heralded the way lawmakers weathered a budget shortfall in 2003 by cutting spending instead of raising taxes, saying that approach helped put the state in better fiscal shape than most others today. Unmentioned was an influx of federal dollars that helped the state manage that shortfall.

"We tightened our belt, made spending cuts where we could and focused on key priorities," Perry said.

But the Legislature has changed considerably in the past six years, and it's not clear whether lawmakers will follow Perry's fiscal lead. The 26-vote majority that Republicans enjoyed in the House in 2003 has shrunk to two votes. In the Senate, the partisan split is the same now as it was then, but the Democratic caucus has become more liberal.

Several Democrats said Perry's speech neglected critical issues.

"He ignored the fact that Texas has the highest percentage of uninsured children in the nation, that Texans must pay some of the highest insurance rates in the country, and that few homeowners have realized the property tax savings that were promised to them," said Sen. Kirk Watson, D-Austin.

One Perry proposal that could generate debate would ensure that a college student's tuition rate as an incoming freshman is frozen for four years.

College costs have consistently increased since lawmakers — with Perry's assent — gave up their tuition-setting powers in 2003, handing them to boards of regents instead.

"This will help Texas families plan while giving students another incentive to finish on time," Perry said.

But Perry's idea stops short of a full tuition freeze that would lock all students in at today's rates.

Under Perry's plan, "one class is going to have to pay for the freeze of the previous class," said Rep. Garnet Coleman, D-Houston. "It allows tuition to continue to rise exponentially."

Perry also sought to pacify small businesses owners who have criticized the state's new tax on their gross margins, which Perry pushed in 2006 to help pay for a cut in school property tax rates.

Perry said businesses with less than $1 million in taxable revenue should not pay the tax. The threshold now for a total exemption is $300,000, while those with revenues of less than $900,000 pay less than the 1 percent paid by other businesses subject to the tax.

"It could eliminate a lot of complaining from small businesses," said Senate Finance Committee Chairman Steve Ogden, R-Bryan.

With state sales tax receipts expected to decline as the recession takes hold in Texas, Perry targeted a few areas of the budget for spending increases. He called for the Legislature to increase spending on efforts to fight crime and illegal immigration along the Texas-Mexico border. He also requested more money for college financial aid, incentives for the film industry and incentive pay for teachers.

Perry requested $260 million — a $35 million increase — for one of his favorite projects, the employer-recruiting Texas Enterprise Fund. And he asked the Legislature to allocate $150 million for a disaster relief fund.

At least a few points in the speech seemed to take direct aim at Republican primary voters. Perry reaffirmed his support for requiring voters to show photo identification at the polls, as well as a special driver's license to identify residents whose visas have expired.

Perry also threw his support behind a proposal requiring women seeking an abortion to first have an ultrasound. The proposal by Sen. Dan Patrick, R-Houston, and state Rep. Frank Corte Jr., R-San Antonio — which also calls for women to listen to the fetal heartbeat— passed the Senate in 2007 but stalled in the House. The bill says it would not be mandatory for women to view the ultrasound image.

Perry urged lawmakers to support the legislation, calling it "another layer of protection for the most vulnerable Texans."

Lesley Ramsey, director of the Texas Association of Planned Parenthood Affiliates, later said the proposal "does not have the woman's health or best interests in mind."

"This legislation is a political tactic aimed at appeasing the governor's primary base," Ramsey said.