A bill to greatly expand a costly corporate welfare program was killed in the Texas House on Monday.
Chapter 313 of the Texas Tax Code allows school districts to offer large tax breaks for 10 years to renewable energy and other businesses. The tax breaks come at no loss to the school districts. Instead, the state supplements the lost revenue to the districts from sales taxes and other state-collected taxes.
The program has drawn criticism from both the right and left; both the Republican Party of Texas and the Democrat Party of Texas call for the abolition of Chapter 313 abatements and corporate welfare in their party platforms.
As filed, House Bill 1556 by State Rep. Jim Murphy (R–Houston) would not only extend the program for 10 years, but it would also expand the types of projects eligible for the subsidies to existing companies that are simply doing “renovations, improvement, and modernization.”
Murphy, notably, serves as the Texas House Republican Caucus Chair.
An amendment proposed by State Rep. Tony Tinderholt (R–Arlington), however, removed this new provision.
Despite Murphy’s appeal to his colleagues to vote against the amendment, a bipartisan coalition of members voted to strip renovations from eligible projects by a vote of 81-61.
Another amendment, brought by Democrat State Rep. Jon Rosenthal (Houston), required that recipients offer their employees at least $15 hourly wages, plus benefits. The amendment was accepted without debate.
Another amendment by Rosenthal would require recipients to hire at least 50 percent of the workforce from the county the project is located in. That amendment passed 86-59.
Then, State Rep. Trey Martinez Fischer (D–San Antonio) proposed an amendment that would require voters to approve potential project recipients.
That caused Murphy to tap out.
After some deliberation on his amendment, Murphy made a motion to postpone the bill to June 1 (the day after the legislative session is scheduled to end), effectively killing his own bill.
The move does not spell the complete end to the Chapter 313 program, however. Over the weekend, members of the Texas House voted 112-29 to extend the Chapter 313 program for another two years. The bill was approved with almost no debate.
That bill has now been sent to the Texas Senate.