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87th Legislative Summary: Transportation, Infrastructure and Business Issues

Published Jul 01, 2021 by Steven Will

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With the end of the 87th Texas Legislative Session, the Partnership produced a summary report on its legislative priorities. This post focuses on outcomes related to priorities of Houston's business community including transportation, infrastructure, economic development and legal liability protections. 

Coastal Barrier

Senate Bill 1160 - PASSED INTO LAW
Senate Author: Senator Larry Taylor (R-Galveston)
House Sponsor: Representative Dennis Paul (R-Houston)

Highlights: 

  • Creates the Gulf Coast Protection District for the coastal barrier project, enhancing protection for the greater Houston area and the Texas economy from the devastating effects of hurricanes and storm surges

The Partnership supports the construction of a coastal barrier to protect the Houston region from hurricanes and storm surge. At the federal level, we anticipate that the U.S. Army Corps of Engineers will release a Chief's Report this summer, after which Congress can authorize and fund the project. To receive federal funding, the state is required to designate a local sponsoring entity. 

SB 1160 creates the local sponsoring entity - the Gulf Coast Protection District - for the coastal barrier project. The district will have the authority to issue bonds, impose fees and taxes not to exceed legislative limits, and exercise eminent domain to facilitate the construction of the project that would protect the Houston area and Texas economy from the effects of hurricanes and storm surges. 

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Transportation Budget

Senate Bill 1 - PASSED INTO LAW
Senate Author: Senator Jane Nelson (R-Flower Mound)
House Sponsor: Representative Greg Bonnen (R-League City)

SB 1, includes a 2.9 percent decrease, from $31.1 billion last session to $30.2 billion this biennium. This does not threaten or delay the state's commitment to the State Highway Fund, serving transportation needs, and TxDOT's reductions primarily reflect the loss of one-time funding sources.

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Chapter 313

House Bill 1556 - FAILED TO PASS
House Author: Representative Jim Murphy (R-Houston)
Senate Sponsor: None
 
House Bill 4242 - FAILED TO PASS
House Author: Representative Morgan Meyer (R-Dallas)
Senate Sponsor: Senator Brian Birdwell (R-Granbury)

In 2001 the Texas Legislature and Governor Rick Perry worked to establish a new economic development program designed to attract capital-intensive businesses, high-paying jobs and expand the property tax base. The program would offset Texas' high business property tax rates relative to other states by offering a 10-year limited abatement to school property taxes, which often comprise 50percent of a local property tax bill. The program came to be known as Chapter 313, after the section of the tax code where it is located. It specifically targeted the manufacturing, R&D, power generation, computer centers and renewable power business sectors. Qualifying businesses received an abatement of their local school district maintenance and operation property taxes, while continuing to pay all other property and sales taxes. After the 10-year abatement period, the facility rolled onto the local tax rolls at the full rate.

The program was reauthorized and reformed in 2013, adding additional reporting requirements and oversight by the Texas Comptroller of Public Accounts. Qualification requirements were further strengthened to target those projects which otherwise would not have located in Texas. Through September of 2020, Comptroller reports estimated the program brought over $200 billion in capital investment and 56,000 direct and indirect jobs to Texas, including nearly 100 separate manufacturing projects in the Houston region. With the program set to expire on December 31, 2022, HB 4242 proposed a simple 2-year reauthorization with no changes to the program, so the Legislature could better study the issue in the interim. 

The Partnership worked with a statewide coalition, known as Keep Texas First, consisting of other chambers of commerce, businesses and economic development organizations to coordinate the reauthorization effort. Ultimately, all reauthorization legislation failed to pass. 

Chapter 313 is scheduled to expire at the end of 2022. Without Chapter 313, Texas will have the fourth highest business property taxes in the nation for large, capital-intensive projects, putting our state at a severe disadvantage for recruiting new companies.

The Keep Texas First coalition is already coordinating ways to work with the Legislature to restore our economic competitiveness until a more permanent solution can be found.

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Legal Liability Protections

Senate Bill 6 - PASSED INTO LAW
Senate Author: Senator Kelly Hancock (R-North Richland Hills)
House Sponsor: Representative Jeff Leach (R-Plano)

Highlights: 

  • Offers statewide liability protection for businesses, education institutions, health care facilities and government offices complying with posted government safety protocols, extending beyond COVID-19 to all pandemics 

The COVID-19 pandemic exposed businesses to a quickly-changing set of regulations and recommendations from government and health care entities. Companies, particularly small businesses with limited resources, faced the very real prospect of being sued for not properly protecting employees or customers from contracting COVID-19, even if the companies were acting in good faith. 

SB 6 provides explicit statewide liability protection for businesses, education institutions, health care facilities and government offices operating in good faith and in compliance with all posted government safety protocols. The bill extends beyond COVID-19 to all pandemics.

Efforts to enact nationwide liability protections remain ongoing in Congress, and the Partnership continues to work with our Texas delegation to achieve that outcome.

See the full 87th Legislative Session summary report

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