88th Legislative Session Update
Your Chamber Board, Business Climate Council and staff have been advocating for the Round Rock business community during the 88th Texas Legislative Session which began on January 10. Two weeks remain of the regular session which concludes on Monday, May 29, and this legislative update provides highlights of the past 18 weeks.
10,809 bills were filed during the 88th Regular Legislative Session, up from the 9,999 filed in 2021 during the 87th Regular Session. Around 10% of the bills filed during each biennial session actually make it through the 140-day legislative process and executive review by the governor to become law.
Hundreds of bills died in the Texas House last Thursday, May 11, as it hit a critical late-session deadline and the Senate and House have begun their conference committees to reconcile language for joint-chamber passage of legislation.
May 29 is the last day of the biennial regular session followed by a 20-day period for Governor Abbott to sign or veto legislation, or allow passed legislation to become law without his signature.
A recap of the 88th Legislative Session will be provided in early June followed by the Executive Review of the 88th Legislative Session event on Thursday, June 29, at Kalahari. Below is a high-level look at some of the most relevant legislation affecting the City of Round Rock.
Local Sales Tax: House Bill 5089: HB 5089 was one of the most troublesome and misguided bills during the 88th Legislative Session. If passed, it would have upended the Texas state sales tax policy set forth over 60 years ago. HB 5089 would have placed more power into state agencies, applied a matrix of over 1,600 taxing jurisdictions to Texas businesses, created an annual loss of over $1 billion in local sales taxes for Texas communities and moved $28 million in annual revenue out of the City of Round Rock. The Round Rock Chamber strongly opposed this bill and is pleased to see it die in the Texas House.
Property Tax Relief: Property tax collections have increased by over 20% since 2017 creating additional financial burdens on homeowners, renters and businesses in Texas. The Senate, House and Governor Abbott have each committed to investing a large part of the $32.7 billion state surplus into meaningful property tax relief. Property tax relief legislation this session includes:
- the Senate passed four bills, unanimously (31-0), with $16.5 billion in property tax relief: Senate Bill 3 (increased homestead exemptions), Senate Bill 4 (reduced ISD recapture payments) and Senate Bill 5 (tax credits and exemptions for businesses). Senate Joint Resolution 3 places the final decision to Texas voters this fall.
- The House passed the Property Tax Relief Act (House Bill 2) with bipartisan support (139-5) cutting school property taxes by 28% and placing 5% appraisal caps on residential and commercial properties. House Joint Resolution 1 places the final decision to Texas voters this fall to bring $17.5 billion in property tax relief.
Though the Senate and House versions are very different, significant and measurable property tax relief is assured during the 88th Legislative Session. The Round Rock Chamber appreciates the property tax relief efforts in the Texas Senate and House and looks forward to a reconciled bill that delivers immediate and sustained tax relief for homeowners and businesses.
Economic Development (House Bill 5): The House passed the Texas Jobs & Security Act which restores local economic development incentive tools, creates jobs and accelerates the reshoring of manufacturing. The Round Rock Chamber supports House Bill 5 and awaits passage of this critical bill in the Senate.
Higher Education (House Bill 8): HB 8 supports outcomes-based funding for community colleges, dual credit scholarships and alignment with employer talent needs. It unanimously passed the House and has strong support for passage in the Senate.
Higher Education (House Bill 2132): Especially important to Round Rock, this bill makes the Texas State Technical College (TSTC) campus in Eastern Williamson County a permanent campus to support sustained economic development in our region. The Chamber is pleased to see HB 2132 pass and awaits its passage in the Senate.
Biennial Budget for 2024-2025 (House Bill 1): The Texas Constitution dictates that the legislature pass a balanced budget each biennial session. HB 1 passed (136-10) with a record $302.6 billion in spending over the next two years. The Senate appropriations bill is significantly different and includes $308 billion in spending. The Round Rock Chamber looks forward to a reconciled appropriations bill for the upcoming biennium which begins on September 1, 2023.
The Executive Review of the 88th Legislative Session event on Thursday, June 29, at Kalahari will discuss the results of the session and its implications to businesses in Texas.
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