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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)


  • 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. 

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.


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.


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)


  • 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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Public Policy

HOU in ATX: Legislative Update – Week 20

During the final days of the session, House Bill 5 passes off the Senate floor and heads to conference, the budget moves one step closer to the Governor’s desk, and we take a look at Houston-specific bills passing the legislature. Economic Development Bill Clears the Senate Floor House Bill 5 was voted out of the Senate Committee on Business & Commerce on Sunday, paving the way for a vote on the Senate floor on Wednesday. The bill author, Charles Schwertner (R-Georgetown), accepted five amendments and the final measure passed with a decisive 27-4 vote.  What’s next: The Senate made significant changes to the version that passed the House earlier this month. We expect a conference committee to be named to work out the two versions. Following the work of the conference committee, each chamber must accept the conference committee report before the bill can head to the Governor’s desk.  The bottom line: Stakeholders have raised concerns about the changes made to the legislation, but all parties recognize the importance of creating a new school property tax abatement program. Without a new program, Texas will fall behind other states in landing large-scale, capital-intensive projects.  What they’re saying: During the committee hearing on Sunday, Senator Creighton (R-Conroe) emphasized the transformational change that comes when new and emerging industries decide to locate in local Texas communities: “If we’re going launch into a new phase of new economic development incentives… [we need to think about] the culture we want to create to really land these companies that will change lives forever for Texans.” House Bill 1 and Senate Bill 30 - The State’s Budget  The budget bill is the only bill the Texas Legislature must pass each session. This week, the two chambers struck a deal on a two-year budget for the State of Texas totaling $321.3 billion.  The Legislature entered this session with an unprecedented budget surplus. However, due to constitutionally mandated restrictions on spending, the Legislature had more money available than it could spend. The budget prioritized spending on tax cuts, colleges and universities, grid resiliency, broadband, and water infrastructure.  Houston in Focus: The budget deal includes $1.25 billion for flood mitigation and storm surge protection.  $625 million for the Flood Infrastructure Fund out of one-time General Revenue Funding.  $550 million for the Gulf Coast Protection District, with $350 million of the appropriation allocated to be used as state matching funds for the Coastal Texas Program.  $50 million for the Lake Houston Dam Improvement Project.  What’s next: After the Legislature passes House Bill 1, the General Appropriation Act, and Senate Bill 30, the Supplemental Appropriations Act, both bills head to the Governor’s desk, where the Governor has line-item veto power for budget items. The Governor’s veto period ends 20 days after the last day of the legislative session.  Houston in Focus: Bills Impacting the Region    Here is a look at several bills that have passed that will directly impact the Houston region:  Senate Bill 1057, by Senator John Whitmire (D-Houston), allows the City of Houston and Houston First access to funds for much-needed renovations to the George R. Brown Convention Center.  House Bill 3474, by Representative Jeff Leach (R-Plano), the state’s omnibus courts bill, establishes six new criminal courts for Harris County.  House Bill 2416, by Representative Dennis Paul (R-Houston), creates the Gulf Coast Protection Trust Fund. The funding will be used for flood infrastructure developments within the Gulf Coast Protection District (GCPD), including the Texas Coastal Program, better known as the Coastal Spine or the Ike Dike.  House Bill 1595 and House Joint Resolution 3, by Representative Greg Bonnen (R-Friendswood), establishes the Texas University Fund (TUF), a permanent endowment fund investing in four Texas public university systems. The University of Houston will receive as much as $50 million dollars annually from the Fund.  What’s Next: End-of-Session Report    Upon final adjournment, the Partnership’s Public Policy Division will send one final update with a link to a comprehensive end-of-session report.  The overview of outcomes will provide insight into key policy issues facing the greater Houston region and how the Partnership advocated for these priority areas during the 88th Legislative Session. We look forward to sharing our work with you.    During the 88th Legislative Session, the Greater Houston Partnership will provide a weekly update on newsworthy items from Austin. You can view more policy news and archives of our weekly updates here. Subscribe here to get our weekly legislative updates
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Public Policy

HOU in ATX: Legislative Update – Week 17

This week, economic development incentive program passes the House, curriculum bill moves forward, higher-education funding and court bills in positive positions in the legislative process, and a critical CCUS bill loses momentum. Economic development bill passes the House The Texas House of Representatives overwhelmingly approved House Bill 5 by Representative Todd Hunter (R-Corpus Christi), which establishes a statewide economic development program so Texas can remain competitive in today’s global market. Why it matters: The Chapter 313 economic development incentives expired late last year after the legislature failed to extend the program during the 87th session. This raised concerns about how Texas could remain competitive in recruiting new businesses to our state. Last year, Texas competed against other states for large-scale, capital-intensive projects that went elsewhere due, in some part, to incentive packages offered by other states. “We’re no longer competing with [other] states and nations. We’re competing worldwide…This is basically going to be an economic development tool to continue to attract investments to Texas,” Hunter said. Houston in Focus: 23 Houston-area Representatives voted in favor of House Bill 5, with 16 out of 36 Representatives of the Houston delegation also signing on as co-authors of the bill. House members in opposition to House Bill 5 expressed concern about the bill’s exclusion of renewable energy projects, while others had ideological issues with incentive programs altogether. The bill’s current version includes battery storage projects “regardless of the power source.” What’s next: The Partnership appreciates the flurry of support for House Bill 5 posted on social media this week. After passage by the House, the bill heads to the Senate for committee consideration. K-12 curriculum bill advances to the Senate    This week, House Bill 1605 by Representative Brad Buckley (R-Killeen), which helps ensure students in Texas’ K-12 public schools are receiving rigorous and on-grade-level instructional materials, passed the House. This bill encourages districts to adopt high-quality instructional materials by providing the following: $467 million to school districts at the rate of a $40 allotment per student for districts choosing to use any State Board of Education and Texas Education Agency-approved curricular resource. $24 million to school districts at the rate of a $20 allotment per student for printing online materials. $100 million in grants to school districts for teacher support and training. Go deeper and explore the Texas Tribune’s Texas Schools database to learn more about the academic performance and college readiness of the state’s 1,207 districts and 8,966 public schools. What’s next: House Bill 1605 has been referred to the Senate Committee on Education. Since the Senate has already passed its companion bill, Senate Bill 2565, we can expect the item to be heard quickly in committee and receive a favorable vote on the Senate floor. New university endowment bill moves forward in the Senate On Wednesday, the Senate Committee on Finance heard House Bill 1595 and House Joint Resolution 3 by Representative Greg Bonnen (R-Friendswood). The bill and resolution would establish the Texas University Fund (TUF), a $3.4 billion research endowment supporting four Texas universities, including the University of Houston. This significant investment in the state’s public higher education system provides UH with the funding it needs to compete for federal and private research opportunities, attract world-class professors and students, and strengthen talent pipelines. The fund also provides long-term financial certainty, allowing forward-thinking projects and investments. Houston in Focus: If passed, the University of Houston could receive as much as $100 million annually to boost its research capabilities.  What’s next: With broad support from the Senate Finance Committee, the proposals are expected to continue to advance through the legislative process.  Harris county criminal courts and business courts bill advance  Adding New Harris County Criminal Courts This week, House Bill 3474, by Representative Jeff Leach (R-Plano), the state’s omnibus courts bill, passed the House. The bill establishes six new criminal courts for Harris County. The additional criminal courts were approved by Harris County Commissioners Court in an effort to add capacity in the county’s criminal justice system to address its high felony case backlog. What’s next: The bill is expected to move through the Senate smoothly in the coming weeks. Once passed, the first three courts will be set up on October 1 to align with the County’s budget, and the Governor will appoint the new judges who will sit until the next election. The additional three courts will be up and running the following fall. Business Courts This week, House Bill 19 by Representative Andrew Murr (R-Junction), which would create a specialized court system for business cases, passed the House. The bill would transform the state’s current judicial process and provide relief to the district court systems by “removing” action on certain business disputes and referring those cases to the newly established business court. Go deeper: Read the House Committee on Judiciary & Civil Jurisprudence's recommendation to implement business specialty courts in its December 2022 Interim Report. Statewide CCUS regulatory Bill Won't Cross the finish line This week, the Senate passed the gutted version of the statewide carbon capture (CCUS) regulatory bill, Senate Bill 2107 by Senator Robert Nichols (R-Jacksonville), with a vote of 29 Yeas to 2 Nays. However, the House is unlikely to hear the bill in committee.  Why it matters: As filed, the 22-page bill aimed to establish a regulatory CCUS framework clarifying pore space ownership, mineral estate protection, liability, long-term stewardship, and integration. These elements are critical for Texas to compete in the trillion-dollar global carbon storage industry against the 12 other states that have adopted similar legislation. What’s next: The uncompromising attitude among opposition groups and lack of understanding on a complex topic suggests supporters of this legislation will have to regroup and determine a new strategy going forward.  During the 88th Legislative Session, the Greater Houston Partnership will provide a weekly update on newsworthy items from Austin. You can view more policy news and archives of our weekly updates here. Subscribe here to get our weekly legislative updates
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