Sadly Willaim Rehnquist authored a supreme court decision that this is constitutional. See http://en.wikipedia.org/wiki/South_Dakota_v._Dole, and also my comment above about the drinking age.
Singling out a state based on a criterion of performance is different from singling out a state by name. This goes well beyond the scope of what Rehnquist gave the nod to. Remember how ACORN managed to get their defunding overturned? This is the goose which shares sauce with that gander.
BIG difference between the SD v Dole case and this one is that the law in that case applied to all 50 states, whereas this provision applies only to Texas.