Texas’s conservative social culture is running into its economic development efforts. And it’s happened, no big surprise, because of gay partner benefits.

The Texas insurance code currently does not allow the state’s public universities to offer benefits to the (unmarried) partners of university employees. A bill in the state legislature would change the code to allow “certain qualified individuals,” including same-sex partners of Texas professors, to qualify for benefits. That’s because the existing policy is becoming a problem. According to an article in the Daily Texan:

The McCombs School of Business [at the University of Texas at Austin] lost its top management candidate to Duke University because it was unable to offer benefits to the candidate’s partner, said Karen Landolt, director of the HireTexas interview center at the School of Undergraduate Studies. Landolt said incidents like this have happened multiple times at the University and each time reopening the search for faculty costs the University $6,000.

Landolt said because of the absence of plus-one benefits, fewer faculty members with same-sex partners are recruited to UT and this isolates LGBT students because they have fewer staff members they can relate to.

But it’s not just about human resources and how students feel. There’s a real economic development problem here:

The insurance code of the UT and A&M systems states that these schools must be competitive with private industry, and the education code requires these institutions be competitive with other higher education institutions, said Chuck Smith, executive director of Equality Texas, an organization that lobbies the state on LGBT issues. Smith said because UT and A&M do not offer plus-one benefits, they are not in compliance with these codes.

Now that is, of course, just Smith’s interpretation. Texas courts would likely rule differently. But over the long term this could dramatically impact the talent Texas could attract. The business school at UT Austin, after all, doesn’t just train future Texas business owners; it also provides the state with business ideas. Other departments at UT and A&M make discoveries and patent products and ideas that help the state significantly. Many very talented academics and businessmen are gay. And many people who are not gay find the policy objectionable, and will seek employment elsewhere.

“This is ultimately all about competition,” Smith said. “Enabling this legislation, advancing this legislation would allow our two flagship institutions to be what they were intended to be, and that is leaders not only in the state but leaders across the country.”

Republican legislator John Smithee of Amarillo expressed concern about the proposed policy because it would “lower the bar for the selection of people covered by insurance.”

Daniel Luzer

Daniel Luzer is the news editor at Governing Magazine and former web editor of the Washington Monthly. Find him on Twitter: @Daniel_Luzer