House Ways & Means met on March 27 to discuss a number of bills. This report covers discussion on the following: HB 2482 (Capriglione), HB 3555 (Plesa | et al.), HB 3651 (Bailes), and HB 4101 (Shine). An archive of this hearing can be found here.
This report is intended to give you an overview and highlight the various topics taken up. It is not a verbatim transcript of the discussions but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.
HB 2482 (Capriglione) Relating to the temporary exemption of certain tangible personal property related to data centers from the sales and use tax
- Capriglione – Have a CS; builds upon sales tax exemptions for data centers; bill ensures co-location data centers qualify for the tax exemptions
- Data centers result in $1.9b in economic output $700m in state and local taxes; lagging behind peer markets
- Bill has a large fiscal note and will work on this
Kevin Hughes, VP Stack Infrastructure – For
- Industry has continued to evolve to meet today’s infrastructure demands
- Modernizes the sales tax exemption to keep Texas competitive
- Industry to double by 2030
Natalie Stewart, VP Switch – For
- Have data facilities in Austin and Houston
- Current law prevents company from these sales tax deduction; bill levels playing field
- Bill would make us more likely to build more large facilities it the future
In closing
- Button – Mentioned the large fiscal note; see this not as an expense, but is an investment?
- Correct; see revenue state/local growing and new jobs
HB 2484 left pending
HB 3651 (Bailes) Relating to motor fuel taxes
- Bailes – Current law lacks clarify of those who fraudulently acquire or steal motor fuel
- Bill gives prosecutors another tool to fight these crimes; criminals have come up with creative ways to not pay the tax
- Amends code to revise certain definitions and adds regulations related to the Comptroller’s criminal investigative division
HB 3651 left pending
HB 3555 (Plesa | et al.) Relating to the information required to be included in or with a school district ad valorem tax bill
- Plesa – Bill provides more transparency in taxation for school districts
- Makes clear how much of their taxes remain in their school districts on their tax bill
- Builds upon Meyer’s and Bettencourt’s transparency tax bills last session
Nancy Humphrey, Board Member Plano ISD – For
- Bill addresses tax transparency that started in Plano ISD on how tax dollars are spent on education
- Taxpayers should know when property taxes increase, school district operating budgets do not, and it goes to the state
- Is a disconnect between school district tax and what they believe school budgets are
- Noble – Have talked about this a number of years; what would be broken out?
- Bill shows percentage that stays within school district and the percentage that goes back to the state
Chandra Villanueva, Every Texan – Neutral
- Bill does not provide enough context around recapture/school finance
- Charter schools are a large reason why recapture is increasing; would not include how much recapture is being used to fund charters in the area
- Concerned this will create undue criticism of school finance system; need to focus on fully funding our education system
Kevin Kieschnick, Nueces County Tax Assessor Collector and Tax Assessor-Collectors Association of Texas – Neutral
- Concerned about creating complications on tax bills
- Recommend place information on a website where they can actively retrieve it; think the school district housing that information may be better
- Thierry – Asks about recommendation on where the information would be housed
- Could be on some district’s website now, but prefer a better place than the tax bill
Christy Rome, Texas School Coalition – For
- Believe this is important information to put in the hands of taxpayers
- Is beneficial information for people on schools who do not pay recapture
Plesa, in closing
- This bill is not about charter schools or recapture, is about clarification
HB 3555 left pending
HB 640 (Johnson, Julie) Relating to the municipal sales and use tax for street maintenance
- Julie Johnson – Allows reauthorization 8 to 10 years as long as other criteria under law is satisfied
Wes Mays, City of Coppell Mayor – For
- Have spent $36m on two roadway projects; in the future are contemplating $65m of potential projects
- Utilization of this chapter is an important tool; has been reauthorized by majority of voters and only has garnered more of the vote over the years
Julie Johnson, in closing
- Bill will give more flexibility for cities to manage debt
HB 640 left pending
HB 4101 (Shine) Relating to the matters that may be the subject of limited binding arbitration to compel compliance with procedural requirements related to protests before appraisal review boards
- Shine – Have a CS; bill creates 3 new opportunities to assess limited binding arbitration
- Have worked with stakeholders on the CS to address concerns
- CS drops binding arbitration from 3 to 1
Ray Head, Texas Association of Property Tax Professionals – For
- HB 988 87(R) required CADs and ARBs to comply with adopted hearing procedural rules; provided owners the right to file for limiting binding arbitration
- This bill expands hearing procedural requirements to file for limited binding arbitration
- Property owner and property owner have a 10-day window to address or resolve a complaint
- Bill will make property tax system more efficient and ensures a meaningful avenue to hearing
- Reviewed by stakeholders including Comptroller and Texas Association of Appraisal Districts; CS addresses concerns raised
Brent South, Texas Association of Appraisal Districts – Neutral
- Were originally opposed to the expansion, but are now at a point where we feel comfortable
- CS increases limited binding arbitration to ensure appraisal review boards are following the model ARB hearing procedures set by the Comptroller’s Office
- Not to fully supporting the bill, but are neutral
Paul Pennington, Citizens for Appraisal Reform – For
- Strongly support the model hearing procedures prescribed by the Comptroller and the bill as a whole
In closing, Shine
- Is about putting the tools into the hands of property taxpayers; if proper procedures are not there, they should have a method of grievance to pursue
HB 4101 left pending