A Texas interfaith leader is confident that the Chapter 313 “Vampire Fund" can be defeated again.
“Central Texas Interfaith (CTI) and its nine Texas IAF sister organizations led the charge to kill Chapter 313 during the last legislative session and are fighting to stop any attempts to reauthorize Chapter 313, or any similar proposals by a different name,” Rev. Miles Brandon, pastor of St. Julian of Norwich Episcopal Church in far northwest Austin, told Austin Journal.
“This program is literally sucking the blood out of our school funding system and state budget, yet lobby groups continue to try to bring it back from the grave like Dracula, to borrow a metaphor from your previous article,” Brandon said.
Chapter 313, created in 2001 in an effort to encourage manufacturing investment in the Lone Star State, allowed public school districts to offer tax breaks for businesses that invest in their communities.
But in the last year, some school districts started rejecting this request from companies, including the Austin Independent School District, which turned down a Chapter 313 request from NXP, a major semiconductor company.
Chapter 313 was allowed to expire at the end of 2022, and reauthorization was stopped during the last legislation by a bipartisan group of legislators, the Texas IAF and allies.
CTI has good reason for opposing Chapter 313, Brandon said, saying it's bad policy that gives a handout to those who don’t need it, while harming the people who deserve a hand up.
“This is not only corporate welfare, but corporate welfare taking money from schoolchildren,” he said. “There are other economic development tools that may involve taxpayer subsidies to private industry, but don’t involve school board decision-making and our school finance system. Chapter 313 is an especially sinister horror show, especially because it involves companies asking to skirt their school taxes. It should stay in the graveyard of failed programs.”
Brandon said Chapter 313 is a spent force, a vampire that has been staked and set out in the sun. It should be allowed to dissolve.
“We have seen no concrete proposals by industry groups, in large part because of how damaged and unpopular the program has been,” he said. “Everybody hates something about Chapter 313, except the major corporations that receive these taxpayer giveaways."
Other voices favor Chapter 313.
On Feb. 14, the Texas Association of Business, Texas Oil & Gas Association and Texas Association of Manufacturers wrote a letter to the Texas Legislature in a final attempt to bring back Chapter 313. The letter stated that the program is critical to ensuring Texas can compete for the large capital intensive investments that will bring jobs and long-term revenue to Texas communities.
On Feb. 22, Texas Industrial Areas Foundation Organizations (Texas IAF) released a statement regarding industry groups’ attempts to resurrect the Chapter 313 program.
“It is shameful that major lobby groups in oil, gas, and manufacturing are asking chambers of commerce and city economic development directors to support taking money from schoolchildren to line the pockets of major corporations,” Texas IAF stated in the news release.
It said proponents have no concrete proposal and that Chapter 313 is a failed program that will cost taxpayers over $31 billion in the next several decades to support tax breaks for multinational corporations.
In the release, Texas IAF said its members agree with Comptroller Glenn Hegar’s comment in December 2022 when he spoke of the program’s incentives.
“Despite receiving billions of dollars in property tax abatements over the life of the program and potentially billions more in approved incentives just this year, these companies and their attorneys are asking Texas taxpayers to shoulder even more despite the Legislature’s decision to discontinue the program,” Hegar said.
Hegar’s wise words should be heeded, Texas IAF said.
“This legislative session, Texas needs to invest in workforce development and education, not corporate welfare on the backs of schoolchildren,” it said.
While lawmakers wrestle with this program that seeks to rise from the undead, Brandon thinks people across the Lone Star State should be informed and aware of its dangers.
“Ordinary Texans, small business owners and most corporations pay their fair share of taxes, including school taxes, which fund our most precious resource, our children,” he said. “We want economic development, and we want strong industry in Texas, but we want it by investing in workforce and education, not by giving away $31 billion in taxpayer money, which is now the amount Texas are on the hook for because of Chapter 313 agreements.”
Brandon said the Texas Legislature needs to focus on other issues this session.
“We think they should file the letter away, and most will because this program is radioactive," he said. "Texas taxpayers are currently on the hook for $31 billion in Chapter 313 agreements to industry, money which could be going to our public schools. That’s about the size of entire surplus. There is major opposition by legislators of both parties to renewing Chapter 313 or anything that looks or smells like it. It is failed and damaged policy.
“If anything emerges, it should totally decouple economic subsidies from school district decision-making and school funding,” Brandon said.
The Network of Texas IAF Organizations are nonpartisan, 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 and ICAN in San Antonio, The Border Organization, Valley Interfaith in the Rio Grande Valley, TMO in Houston, EPISO and Border Interfaith In El Paso, Austin Interfaith, ACT in Fort Worth, Dallas Area Interfaith, AMOS - Arlington, The West Texas Organizing Strategy, and Beaumont, Port Arthur and Orange.
Central Texas Interfaith includes about 50 member institutions, mainly congregations, but also clinics and labor organizations and public schools in 10 counties in central Texas. It’s part of the Network of Texas Industrial Areas Foundation Organizations (Texas IAF) and is made up of non-partisan, institutionally based community organizations whose purpose is to train leaders to organize families around areas that affect quality of life.