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Texas IAF Sounds the Alarm: Chapter 313 Loopholes Will Cost State Billions

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Last year Texas IAF organizations led the charge to end Chapter 313, a program that had given away $10 billion in windfall tax breaks for corporations. However, hundreds of Chapter 313 applications are being filed in the rush to get in before the end of the program, including some with projects slated for decades from now. 

[Excerpts]

“It’s like hogs at the trough,” said Bishop John Ogletree, an official with the faith-based Texas Industrial Areas Foundation, which has opposed the arrangements.

Meanwhile, lawmakers and interest groups have begun discussing how to craft a replacement during next year’s legislative session to keep the tax breaks flowing.

The Chapter 313 deals — named for their location in the state tax code — let companies slash 10 years worth of school property tax bills they otherwise would owe on newly constructed factories and energy projects.

Over the past decade the state comptroller’s office has received an average of about 90 applications annually from companies seeking the subsidy.

Since the Legislature adjourned at the end of May 2021, by comparison, records show companies have filed requests for more than 460 new tax breaks — about 400 in the past five months alone.

Typically, companies sought Chapter 313 tax breaks for projects two to four years in the future, with the occasional oil and gas facility taking six or seven years to complete. Since last May, however, companies have applied for 120 of the subsidies for facilities not scheduled to open until at least 2028. At least 10 won’t be online for a decade or more.

Despite the program’s demise, applicants “have figured out how to extend it,” said Rev. Minerva Camarena-Skeith, of Central Texas Interfaith.

Their strategy seems to be, “Just in case, let’s get 10 years of requests in in one year,” added Bob Fleming, of The Metropolitan Organization, the Houston branch of the Texas Industrial Areas Foundation. “I don’t know anybody who can forecast their needs 30 years out.”

....by slow-walking the end of a program they said was giving away too much money to corporations at the expense of Texas taxpayers, legislators have now put the state on the hook for billions of additional tax breaks that Texans will be paying off well into the middle of the century.

[Photo Credit: Mark Mulligan, Houston Chronicle]

Lawmakers Killed a Costly Corporate Tax Break Program, but Loopholes Will Still Cost Texas BillionsHouston Chronicle [pdf]


CTI Explains How Chapter 313 Harms Texas Schools & Residents

[Excerpts]

"This takes money away from children's education and gives it to corporations, and that is a nonstarter," said Mother Minerva Camarena Skeith, [Reverend of] St. John's Episcopal Church in North Austin. "The corporation was the one that would have been their responsibility as part of our community to do their fair share of investing into our children. Right? And they have abdicated that. They just don't do that. Then we have to pick up the slack."

With Chapter 313 set to expire at the end of the year, the state's comptroller office has received a record number of applications. Since Jan. 1, 2022, school districts sent in 393 company Chapter 313 applications. In any given year before this, the office received maybe 150 applications.

"If all these things get approved, like, we could bankrupt the state," Rev. Miles Brandon worried.

"Anybody who's fiscally conservative at all should have a have a real problem with the unlimited nature of 313."

State Sees Rush of Tax Break Applications as Program Soft Deadline Approaches, KVUE [pdf]

Friends of the Land, Bastrop Interfaith, Oppose Dogwood Creek Solar 313 Application to Elgin ISDElgin Courier [pdf]


CTI & Allies Call for Living Wage Increase to $22/Hour

[Excerpt]

Council members got an earful Tuesday from the Living Wage Working Group, made up of unions and workers’ advocates, on why they say the living wage needs to be increased to $22 in the upcoming city budget. It’s been stuck at $15 since 2018.

"The high cost of living makes it difficult for city employees to live in the city that they work in,"

said [Rev.] Minerva Camarena-Skeith of [St. John's Episcopal Church and] Central Texas Interfaith.

The proposed change would apply to most city workers, from construction workers to airport employees to lifeguards, as well as workers for companies contracted by the city or companies which receive tax abatements. Departments citywide are plagued with high vacancy rates, as they lose workers to higher-paying private-sector jobs.

"$22 an hour is a starting place. We believe that it's still not a living wage," said Fabiola Barreto, Austin Policy Coordinator with the Workers Defense Project.

Austin City Council Considers Raising Living Wage for Workers, FOX News 7 [pdf] 

City Must Raise Wages to $22/Hour Working Group Says, Austin Monitor 


Texas IAF Calls For Real Action in Wake of Uvalde Shooting

Words, thoughts and prayers are not enough to address the gruesome murder scene at yet another school shooting. 

Uvalde, Buffalo, El Paso, Santa Fe, Fort Hood, Sandy Hook, plus 26 other schools and 200 other mass shootings just this year.  Our state leaders’ ongoing catering to the gun lobby, with periodic “heartfelt” platitudes of sadness, is leading our state into a death spiral.  This is idolatry of the semi-automatic weapon.

We must resist becoming numb to the slaughter of our children and families.  Action is the only appropriate response. 

In the words of Archbishop Gustavo García-Siller of San Antonio, “People are dying! We have made guns our idols, they are sacred to the point that we don’t take measures to help avoid these situations. It’s horrible. It’s a systemic problem. So, when we say that we are respecting life, how are we going to do it in this field?” 

There are measures we can take to help prevent this carnage. But after the shootings in El Paso, Texas legislators passed six state laws that expanded access to guns. 

Rabbi David Lyon of Congregation Beth Israel reminds us of the scriptural mandate: “Do not stand idly by while your neighbor bleeds. It is our higher calling to be responsible for one another.”  

We must become a state where mass shootings are a relic of the past. 

The Texas Industrial Areas Foundation, a network of churches, non-profits, unions, foundations, and neighborhoods, publicly commits to build the power we need to make this world a reality. Our commitment is to engage communities, leaders, and elected officials around policy changes for safer communities. Texas IAF calls on the legislature to pass concrete legislation that will prevent further carnage at our schools, churches and communities. 

We cannot afford another tragedy.

The time to act is now.


The Network of Texas IAF Organizations are non-partisan, institutionally based community organizations whose purpose is to train leaders to organize families around issues which affect their quality of life. The network includes Communities Organized for Public Service and The Metro Alliance  in San Antonio, The Border Organization, Valley Interfaith in the Rio Grande Valley; TMO in Houston; EPISO and Border Interfaith In El Paso; Central Texas Interfaith; Dallas Area Interfaith; AMOS- Arlington, and the West Texas Organizing Strategy.

 


COPS/Metro Calls on San Antonio to Guarantee $20/h for SA Ready to Work Graduates

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[Excerpt]

In 2020, COPS/Metro proposed the concept to city of San Antonio officials of a locally funded workforce development program using redirected existing dedicated taxes, then conducted a massive get-out-the-vote campaign in support. The residents of San Antonio responded with a resounding 77 percent voter approval. With the passage of this initiative, our city officials were given a golden opportunity to change the decades-long economic narrative from that of a low-wage town to a high-skill, high-wage city.

Wages matter. Our city needs to set a wage floor for employers that want to receive publicly funded highly trained program graduates at no less than $20 per hour.

Starting wages in our city for beginning workers need to be better than $15 per hour. Do we really think folks will enroll in full-time education training programs when the endgame pays what some fast-food entry-level jobs pay now? During the height of the pandemic, we heard unemployed members of our institutions tell us they didn’t want handouts, and that what they need is an opportunity and training for good jobs. Good jobs that pay a living wage and include benefits. The people of San Antonio expect wages that will change San Antonio’s economic narrative, not sustain it.

[Photo Credit: Josie Norris, San Antonio Express News]

Commentary: SA Ready to Work Should be Guaranteeing $20 Per HourSan Antonio Express News [pdf

 


CTI Leaders Take Hard Stand Against NXP's Corporate Welfare Request to AISD

When NXP sprung a request for a Chapter 313 tax subsidy before the Austin Independent School District, Central Texas Interfaith leaders decided to descend upon a meeting of the Board of Trustees to ask them to reject the request.  Chapter 313 tax subsidies are 10 year tax breaks to major gas, oil and manufacturing corporations that drain $1 Billion from state coffers on an annual basis.  In response to a barrage of 20 CTI leaders testifying over the phone and in person against the tax giveaway,  NXP (the company requesting the subsidy) changed the number of promised jobs on their application during the meeting from the statutory minimum of 25 to 500 overall. 

[Excerpt]

The majority of community members who provided testimony on May 19 asked the board to vote against the Chapter 313 agreement with NXP.  [Twenty] speakers were members of Central Texas Interfaith, a nonpartisan coalition of congregations, schools and unions that opposes Chapter 313.

“Hardworking taxpayers don’t get this kind of giveaway. Nor do small businesses, or responsible corporations,” said Central Texas Interfaith leader Trenton Henderson. “We want our money to go to public schools, but not to pay the bills for corporations shirking their responsibility to public education. Without a Chapter 313 agreement, NXP would have to pay their full share of school taxes.”

Austin ISD Moves Forward With Semi-Conductors Agreement, Faces Community OppositionCommunity Impact [pdf]

Austin ISD Considering Proposal That Would Help Lower Recapture Payments, Faces OppositionCBS Austin [pdf]

NXP Seeking Up To $140 Million in Tax Breaks for School DistrictsAustin American Statesman [pdf

Chapter 313 Incentives: What They Are and Why They're Suddenly the Talk of the TownAustin Business Journal [pdf]

Oped: Don't Ask Texas Schoolchildren to Fund Your Corporate ExpansionAustin Chronicle [pdf

AISD Board Meeting Broadcast, Austin Independent School District [calls begin at -2:33:30, in person testimony at -1:52:30] 


DAI Fair Banking Assembly Teaches Immigrants How to Avoid Predatory Loans

As part of a civic academy series held across Dallas, St. Luke Catholic Church leaders taught fellow parishioners basic principles of fair banking and how immigrants (including those without legal residency) can avoid predatory lending practices.  Parish ID cards, first developed in Dallas in collaboration with the Dallas Catholic Diocese, featured prominently in the discussion, as did the collaboration with Resource One Credit Union in alternative lending strategies. 

In photo, lay leader Claudia Cruz, shares her experience with the impact of predatory lending.  [Photo Credit: Ben Torres, Revista Católica]

Protegiendo Families Inmigrantes de Abuso BancarioRevista Católica [pdf]


Historic SA Ready to Work Program Launches with COPS/Metro Support

When the pandemic precipitated a massive unemployment crisis in 2020, COPS/Metro immediately pushed the City Council to pump $75 Million into support of displaced workers as they trained for higher paying jobs. 

Leaders then engineered SA Ready to Work as a ballot initiaitve to help 15,000 more residents over the next five years, leading the San Antonio Express-News to call the workforce proposal "COPS/Metro’s baby."  That fall, COPS/Metro leaders educated and delivered more than 50,000 voters to the polls, and Prop B passed with 77% support.   

Even as they celebrate the launch, leaders continue to call on employers to raise the minimum wage standard for new graduates. 

[Excerpts from San Antonio Report]

San Antonio’s new jobs training and placement program officially launched Monday, opening enrollment to what city leaders hope will help thousands of residents develop lifelong career skills that should immediately lead to good-paying jobs.

SA Ready to Work, a $230 million five-year program...has been cast by advocates as a monumental anti-poverty effort in the wake of the pandemic’s economic shocks that could serve as a role model for cities across the country....

COPS/Metro — a grassroots coalition of congregations, schools and unions that has long advocated for anti-poverty measures and campaigned aggressively for the program’s approval — plans to host around 500 house meetings to encourage residents to enroll in the program. Some have already occurred, said Isaiah Banta, an organizer with the group.

[Photo Credit: Scott Ball, San Antonio Report]

Massive City Job Programs Launched, Open for EnrollmentSan Antonio Report [pdf]

As Historic Jobs Program Rolls Out in San Antonio, Do We Still Need It?Texas Public Radio [pdf]


Central Texas Interfaith Opposes Chapter 313 Tax Subsidy to NXP

[Excerpt]

NXP Semiconductors, which is based in the Netherlands and has two fabrication plants in Austin, is seeking tax breaks from the Austin Independent School District under the state's Chapter 313 incentive program for proposed expansion. An initial presentation to the district's board Tuesday night didn't specify the amount, but previous incentives agreements from Texas school districts for similar Chapter 313 deals have been for tens of millions of dollars.

The Chapter 313 incentives program — which is named after a portion of the tax code — has been controversial. It's set to expire at the end of this year because state lawmakers declined to renew it during last year's legislative session, although deals struck before then won't be affected....

Under the Chapter 313 program, school districts are reimbursed by the state for the corporate tax breaks they agree to provide. That attribute has made Chapter 313 controversial among critics who say school districts have no reason not to grant them, and that the program siphons money from taxpayers statewide as handouts to corporations.

“There's no such thing as free money," said Doug Greco, lead organizer with Central Texas Interfaith, a group that opposes all Chapter 313 deals and has worked to help end the program.

“It's money that is being drained out of the state budget that could be going to schools," Greco said. "When you add these (deals) up, it's just a drain on the system that we can't sustain. Let's stop the gold rush here."

[Photo Credit: Mark Matson, Austin American Statesman]

Chipmaker NXP Considers Austin for $2.6 Billion Expansion, Up to 800 New JobsAustin American Statesman [pdf]


EPISO/Border Interfaith Challenges Candidates with 3 Key Questions

[Excerpts]

The El Paso Interreligious Sponsoring Organization (EPISO) and Border Interfaith held its first in-person candidate accountability session Sunday since the pandemic.

The six El Paso County Commissioners Court candidates remaining in the May 24 primary runoff election for Precincts 2 and 4 were invited to the session where they were asked to state their position on policies such as colonias, education and economic development programs....

The incumbent for Precinct 2, David Stout, and Judy Gutiérrez, a candidate for Precinct 2, both attended the meeting.

Sergio Coronado and David Adams, are both candidates for Precinct 4, and they were in attendance.

"I thought it was a great meeting. I wish more organizations, people would take the time to inform themselves, of what their candidates are willing and wanting to do for the people... how you’re [candidates] aligning to my needs," Coronado said.

[Photo Credit: KFOX 14/CBS4]

Precinct 2 & 4 Candidates Feeling Confident After Attending Community MeetingFOX News 14 [pdf]