Tuesday •April 15,1)!
Senators approve legislation to end tax breaks for businesse
AUSTIN (AP) — Saying tax breaks for businesses cost
school districts millions of dollars, Texas senators vot
ed Monday to put an end to the practice.
“It is not right for a business to demand an educat
ed workforce, yet also demand tax breaks that create a
hardship on the local school district,” said Sen. David
Sibley, R-Waco.
His bill would prevent school districts from giving
new property tax exemptions or taking part in new tax
increment financing plans after Sept. 1.
Under a tax increment financing plan, which can be
initiated by a city, a portion of taxes paid by a property
owner is put into a hind used for improvements bene
fiting the property. For example, property taxes may be
used to pay for a mall parking lot.
School districts would be able to honor agreements
approved before Sept. 1, but they could not increase
their level of financial participation in the deals after
the law takes effect. The bill, which was approved on a
non-record vote, goes to the House for consideration.
Sen. Jeff Wentworth disagreed with Sibley on the
need for the bill, saying economic development deci
sions should be left at the local level.
“Tve had calls from local school boards that say... it’s
good for us, and we don’t want to be deprived of this
tool,” said Wentworth, R-San Antonio.
School board and administrator groups, however,
have said they face pressure to grant thetaxbreak|
“For years, the industries have been playing one®
against another,” said Sen. Gregory Tuna, D-SanArn®
In 1995, 160 school districts forfeited $14311
in tax revenue after abatement agreements remtJ
$9.9 billion in property from local tax rolls.Moil
$480 million in local property tax revenuewasloa)
tween 1985 and 1995 due to tax abatements,acc
ing to state figures.
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