Texas Comptroller Glenn Hegar speaks at the University of Texas | Image Source: youtube.com - Credit: TexasPoliticsProject
Texas Comptroller Glenn Hegar speaks at the University of Texas | Image Source: youtube.com - Credit: TexasPoliticsProject
An article published by BizPac criticizes Chapter 313 of the Texas Tax Code saying it "does not deliver development" as promised to taxpayers.
"As small businesses were shuttered under the COVID restrictions, Texas taxpayers subsidize billion dollar corporations with 37.5% property tax discounts and the corporations want more," BizPac writes.
Texas' Tax Code Chapter 313, also known as the Texas Economic Development Act, offers taxpayer agreements to build or develop a property or create jobs in exchange for "a 10-year limitation on the taxable property value for school district maintenance and operations tax."
BizPac highlighted that for over the past year the tax revenues have been rapidly declining due to the COVID-19 pandemic due to changes in federal recovery money.
Chapter 313 allows for individual school districts to grant tax breaks for new local investment projects. The state of Texas is then responsible for covering the difference. Experts suggest that school districts almost never reject a Chapter 313 deal. Patrick Michels of the Texas Observer has noted that the Chapter 313 program itself "is built to encourage schools to give away the state’s money." The schools have no incentives to deny a Chapter 313 investment deal and "often gain millions by handing out tax breaks." Chapter 313 gives away enough tax breaks to pay for 50,000 students' education each year.
BixPac suggests that about $1 trillion of school district property value is misrepresented or underreported to the Texas Education Agency. It also reports that the bill creates $65,000 annual salary jobs at a cost of approximately $200,000 a year to the average taxpayer (a net cost of about $135,000 to Texans each year).
Unelected district administrators should not be encouraging 99% devaluations of the school district’s property estimation without approval from Texas voters, BizPac states.
BizPac is a business political networking organization that works with elected officials in both the state and federal government. They seek to develop partnerships between the business community and Texas government and to assist in the development of business-friendly legislation.
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