Rep. Cason files bill to eliminate the Texas Economic Development ActApril 13, 2021
AUSTIN, TX – Representative Jeff Cason announced his filing of House Bill 2971, the End Corporate Welfare in Texas Act. This bill repeals Chapter 313 of the Texas Tax Code (also known as the Texas Economic Development Act) in its entirety. Any existing agreement under this code would continue until their current 10-year expiration.
Created by the 77th Legislature in 2001, Chapter 313 of the Tax Code was put in statute with the intention of stimulating economic development in school districts throughout the state by way of property tax abatements.
“In reality, however, by the paltry amount of actual economic stimulation created by Chapter 313 has been heavily outweighed by the cost to the taxpayer,” Rep. Cason said. “Because the taxpayer has been required to make up for the lost revenue, and the corporate welfare created by Chapter 313 has created little in actual job growth, the overall benefit to the state has been a net negative.”
In 2013, the Texas Comptroller issued a report suggesting that taxpayers spent $341,363 for every new job created by Chapter 313. Wind-power generation, which makes up the majority of Chapter 313 agreements, has an even poorer record with regards to job creation – a total cost to the taxpayer of $1,245,413 per created job. Because these abatements are essentially lost revenue to school districts, the state – and ultimately the individual taxpayer – are responsible for paying for lost revenue, with an estimated loss of $916 million in 2022 and over $1 billion in 2023, according to the Comptroller’s office.
In 2017, the University of Texas released a study on the Chapter 313 program, suggesting that 85 percent of the companies receiving the abatement would have located in Texas for other reasons, meaning that Chapter 313 has little effect in actually attracting companies to the state.
HB 2971 has been referred to the House Committee on Ways & Means, chaired by Rep. Morgan Meyer (R) of Dallas.
HELP SUPPORT THIS BILL!
Call the members of the committee and ask that they support HB 2971:
Chairman Morgan Meyer (512) 463-0367
Vice Chair Shawn Thierry (512) 463-0518
Rep. Angie Chen Button (512) 463-0486
Rep. Sheryl Cole (512) 463-0506
Rep. Bobby Guerra (512) 463-0578
Rep. Trey Martinez Fischer (512) 463-0616
Rep. Jim Murphy (512) 463-0514
Rep. Candy Noble (512) 463-0186
Rep. Eddie Rodriguez (512) 463-0674
Rep. Scott Sanford (512) 463-0356
Rep. Hugh Shine (512)463-0630