Texas IAF Stands Firm with Legislators That Voted Against House Bill 5

Two Years of Texas IAF Opposition Leads to Reforms to Limit Giving School Money for Corporate Tax Breaks 

The Texas Senate and House passed a compromised version of HB5 that still fundamentally represents misguided economic development to the benefit of out of state corporations that would come here for other factors anyway.  This perpetuates a corporate welfare state which Chambers of Commerce and industry groups could never prove otherwise.

However, a 2-year campaign by Texas IAF and allies led to some major reforms in HB5 compared to the now defunct and failed Chapter 313 program.  When these tax abatement deals are proposed at local school districts, there will now be a fair fight for taxpayers and public school supporters concerned about corporate welfare.  HB 5 Reforms to Chapter 313 include:

  • Elimination of kickbacks to school districts which induced them to approve these corporate tax breaks that benefited 5% of Texas school students the expense of the other 95%
  • Cutting the overall school district tax abatement a corporation can get to 50% (down from 100%)
  • Requiring approval of each agreement by both a local school board AND the governor, ensuring that both local voters and state taxpayers have representation when each abatement is proposed.
  • Requiring school boards take to at least 30 days before their final decision, make the decision by vote in a public meeting, and post the proposed abatement deal and relevant documents to the public at least 15 days in advance (now currently only 4 days).

Read complete statement at first link below: 

Statement on Passage of House Bill 5Texas IAF

New Tax Break Program for Manufacturing, Oil and Gas Heads to Abbott's Desk After Last-Minute DealHouston Chronicle [pdf]

Texas Lawmakers Approve New Corporate Tax BreaksAustin Business Journal [pdf]

Lawmakers Pass Business Incentive Law, Critics Say it Hurts SchoolsKXAN Austin [pdf]

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