WEEK IN REVIEW
TAX CUTS, BORDER SECURITY, ROAD FUNDING
HIGHLIGHT WEEK'S ACTION
(Austin) — Lawmakers unveiled a plan to cut $4.6 billion in taxes at a press conference Tuesday, $600 million more than was originally in the filed Senate budget. Lt. Governor Dan Patrick joined bill authors Senator Jane Nelson of Flower Mound and Georgetown Senator Charles Schwertner to promote the measures. Patrick told reporters that it's time for meaningful tax relief. "Texas' economy stays strong if people have more money in their pockets and if businesses have more money in their pocket to create jobs and grow their businesses," he said.
The bill package is made up of three measures, Senate Bills 1, 7 and 8. SB 1, by Nelson, increases the homestead exemption by indexing it to the average home price in Texas each year. "Home values, obviously, have risen over the years but the homestead exemption has remained flat," she said. It will go up and down with property values in Texas, and Nelson said in 2016, her bill would set the exemption at about $33,000 a year, more than twice the current exemption of $15,000. SB 7, also by Nelson, is a flat cut of the state franchise tax, lowering the levy by 15 percent or about $1.5 billion per year. SB 8, by Schwertner, increases the franchise tax exemption from $1 million to $4 million, meaning businesses that take in less than that amount would not have to pay the franchise tax. Schwertner said that will mean 62,000 small businesses in Texas will be exempted, at a loss of only eight percent of franchise tax revenue. "Senate Bill 8 provides meaningful tax relief to the small businesses who need it most while still maintaining a balanced budget," he said. These bills are scheduled to come before the Senate Finance Committee for consideration next week.
The Senate Transportation Committee approved a bill that its author says is critical to meeting road funding needs in the coming years . Committee Chair Robert Nichols told members that TxDOT must have a reliable, stable revenue stream if it is to keep up with growing demand. "TxDOT has to know, six, eight, ten years out what they're going to have or they cannot even begin design work", said Nichols. "It's extremely important." His bill would set aside a portion of motor vehicle sales tax revenue and dedicate that to transportation funding, which he said could top $2.5 billion per year. Lt. Governor Dan Patrick said that he plans on bringing the bill up for consideration before the full Senate next week. "It is very important that that bill passes," he said. Governor Greg Abbott has designated transportation funding an emergency issue, meaning that related bills aren't restricted by the Constitutional prohibition of passing legislation in the first 60 days of session.
The Senate Finance Committee wrapped up its initial round of budget hearings this week, ending a month of hearing agency reports and requests for funding. One of the session's top issues, border security, was before the panel this week and members discussed how to meet the goal of securing the international border with Mexico. The Senate filed budget has $815 million in money earmarked for border security, but Finance Chair Nelson said it's up to lawmakers to decide the best way to spend it. Next week the committee will take up a slate of tax relief bills.
The Senate will reconvene Monday, March 2 at 2 p.m.
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