Two Years of Texas IAF Opposition Leads to HB 5 Reforms to Limit Giving of School Money for Corporate Tax Breaks
The Texas Senate and House passed a compromised version of HB5 that still fundamentally represents misguided economic development. A 2-year campaign by Texas IAF and allies, however, led to major reforms in HB 5 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:
Read moreTexas IAF Rally Takes On "Vampire" Chapter 313 Legislation
[Excerpt]
A surprising legislative success in 2021 is on track to be undone in 2023, unless a grass roots left-right coalition can block legislation and the forces behind it that are trying to go backward....
In the name of jobs and economic development, a 2012 tax code trick called Chapter 313 essentially funneled state money, via school district property tax breaks, to private companies doing new industrial construction. The school districts that granted tax breaks under Chapter 313 were reimbursed — and many still are being reimbursed — by the state, meaning we as taxpayers reimbursed them. It was the ultimate insider game of channeling public benefit to private companies.
Read moreValley Interfaith: Tax Breaks Should Not Be Paid For w/Funds That Could Go to Schools
[Excerpt]
In the attached audio interview, Rosalie Tristan and Joe Hinojosa, both organizers with Valley Interfaith, Joe Higgs from IAF, and Bob Fleming, an organizer with The Metropolitan Organization of Houston, say tax breaks for large corporations should not be paid for with monies that would otherwise go to public education.
[Photos: Rosalie Tristan (left), Joe Hinojosa (holding sign in center) and Bob Fleming (right)]
Valley Interfaith: Don't Suck Money Out of Public Education to Help Large Corporations, Rio Grande Guardian [audio]
Texas IAF Orgs Denounce "Vampire" Legislation That Would Suck the Life from Texas Schools
The Network of Texas IAF Organizations, a labor and faith coalition that has staunchly opposed using school property tax breaks for incentives... railed against the Texas Jobs and Security Act.
"It looks like it was written on the back of a napkin,"
stated Jose Guerrero, a leader with Central Texas Interfaith from Saint Ignatius Catholic Church.
The organization believes the proposed bill would have even less regulation than Chapter 313, including the exclusion of minimum job requirements as a key factor in a project's eligibility for approval. "It is hard to imagine that they would propose a program with even less accountability, fewer specifics (like no job requirements), and more leeway for companies to take taxpayer dollars from school children to line their pockets," Guerrero stated.
Read moreValley Interfaith, Texas IAF Underscore Lasting Consequences of Chapter 313 Subsidies
[Excerpt]
"In December, legislators killed a controversial tax abatement program known as Chapter 313, but its effects will last decades....
“There’s no accountability at the statewide level; nobody administers it,” said Bob Fleming, an organizer with [T]he Metropolitan Organization of Houston who campaigned against Chapter 313 reauthorization back in 2021. “A bunch of local school districts make singular decisions based on what they think is in their interest. Nobody is looking out for the statewide interest. Local school districts are overmatched when the $2,000 suits walk into the room.” ....
“It’s a perverse incentive,” said Doug Greco, lead organizer at Central Texas Interfaith, one of the organizations that helped shut down reauthorization of Chapter 313 in the 2021 legislative session.
“We approach it on a school funding basis,” said Greco, who is already gearing up to fight any Chapter 313 renewal efforts in 2023. “It’s corporate welfare and the people who pay over time are Texas school districts.” ....
“The district my granddaughter goes to is losing $4 million to $5 million every year,” said Rosalie Tristan, referring to Edinburg Consolidated Independent School District. Tristan is an organizer with the community organization Valley Interfaith who lives north of McAllen in the Rio Grande Valley.
“They could be using that money to get more teachers for these students,” she said. “For a parent, or for a grandparent raising her granddaughter, it’s a hit in the gut.”
[Photo Credit: Pu Ying Huang, The Texas Tribune]
Critics Say State Tax Break Helps Petrochemical Companies and Hurts Public Schools, The Texas Tribune [pdf]
Port Isabel School District Votes Down Ch. 313 Tax Break After Valley Interfaith & Allies Speak Out
At the Point Isabel ISD Board meeting, Texas LNG sought last-minute approval for tax abatement through the expiring Chapter 313 program. Leaders from Valley Interfaith, alongside allied organizations, made the case to the board.
[Excerpt]
On a unanimous vote Tuesday night, the school district voted not to go forward with the applications.
Several Port Isabel area residents voiced opposition, both to Texas LNG on environmental grounds, and to the abatements, saying Texas LNG deserves to have to pay its fair share of taxes.
Valley Interfaith and the other objectors said Texas LNG doesn’t need the abatement because the project has been planned for years and the company has already decided to build the facility here.
“Valley Interfaith congratulates the superintendent and PIISD Board members for their willingness to look at the facts and reject this application for huge tax abatements for an LNG export terminal they
have long planned to build in the Port of Brownsville area,” said Father Kevin Collins, O.M.I. pastor of S. Eugene of Mazenod Church in Brownsville and Valley Interfaith. “They don’t need to take money from Texas school children to build a profitable LNG export facility at a time when the whole world is clamoring for liquified natural gas,” Collins said.
Point Isabel School District Rejects Texas LNG Tax Abatement, The Brownsville Herald [pdf]
Texas IAF Blocks $10 Billion Dollar Corporate Tax Giveaway to Big Oil
[Excerpts]
When organizers set out to overturn Texas’s giveaway program for the oil and gas industry, they had a long game in mind. Over 20 years, the tax exemption program known as Chapter 313 had delivered $10 billion in tax cuts to corporations operating in Texas — with petrochemical firms being the biggest winners. This year, for the first time in a decade, the program was up for reauthorization. Organizers decided to challenge it for the first time.
At the beginning of last week, as Texas’s biennial legislative session approached its end, the aims of organizers remained modest. “We thought it would be a victory if the two-year reauthorization passed so we could organize in interim,” said Doug Greco, the lead organizer for Central Texas Interfaith, one of the organizations fighting to end the subsidy program.
At 4 a.m. last Thursday, it became clear that something unexpected was happening: The deadline for reauthorization passed. “The bill never came up,” Greco told The Intercept. Organizers stayed vigilant until the legislative session officially closed on Monday at midnight, but the reauthorization did not materialize....
“No one had really questioned this program,” said Greco, of Central Texas Interfaith. The reauthorization was a once-in-a-decade chance to challenge it. “We knew in our guts that the program was just a blank check, but we also are very sober about the realities of the Texas legislature.”
....As legislators met in a closed session to hammer out the bill, Greco heard from a colleague. “One of my organizers said there’s 20 oil and gas lobbyist standing outside this committee room,” he recalled.
Former Gov. Rick Perry, an Energy Transfer board member, tweeted his support for reauthorization. But as last week of the session ticked by, the bill didn’t come up. “It became clear that the reputation of the program had been damaged,” Greco said.
In 19 months, Texas’s subsidy program will expire, but that doesn’t mean the fight is over.
“We know there’s going to be a big conversation over the interim — we are under no illusions that this is not going to be a long-term battle.”
Organizers, though, recognize that the subsidy’s defeat marks a shift: “The table has been reset.”
In Blow to Big Oil, Corporate Subsidy Quietly Dies in Texas, The Intercept [pdf]
How Skeptical Texas Lawmakers Put an End to a Controversial Tax Incentive Program, Houston Chronicle [pdf]
Texas Legislature Dooms Chapter 331, Which Gives Tax Breaks to Big Businesses, Business Journal [pdf]
Missed Deadline Could Doom Controversial $10B Tax-Break Program, Houston Chronicle [pdf]
A Texas Law Offers Tax Breaks to Companies, but It's Renewal Isn't a Done Deal, Texas Tribune [pdf]
Losers and Winners from Chapter 313, Central Texas Interfaith