This column by TAB CEO Glenn Hamer and RGV Partnership CEO Daniel Silva was published by the Rio Grande Guardian.
If a football coach had the team’s wide receiver play with his hands tied, fans would be in an uproar. It doesn’t make sense to play the game at a disadvantage while the rest of your competitors have both hands available. That is what Texas is doing in the race for capital-intensive projects if we fail to create a new economic development program this legislative session.
Thankfully a bill has been filed to keep Texas winning. House Bill 5, The Texas Jobs and Security Act, by Chairman Todd Hunter (R-Corpus Christi) creates a new, modernized economic development program to ensure we will continue beating out our competitors and winning jobs for Texas communities.
The Texas Miracle is like a three-legged stool: no income tax, light regulatory touch, and potent economic development incentives. HB 5 tightens that third leg.
Opponents of previous programs claim companies would come to Texas without some form of tax abatement incentive. That’s simply not true. Sure. All Texans can list reasons that our state is the best choice, from low cost of living to quality community colleges and research institutions, strong workforce and vibrant cultures — even the connectivity of our airports. But we cannot ignore that other states are offering generous tax incentives that Texas has to compete with. That’s why previous economic development programs were created. We have lost major capital-intensive projects to other states in the past and if we do not create a new way of offsetting the tax burden, we will lose future projects to other states. For those that question tax abatements, keep in mind the abatements are temporary. And without them, we risk zero economic investments being made. Which means zero new jobs and zero new tax revenue for Texas communities.
There is a robust grassroots effort to help create a new, transparent, and modernized economic development tool this legislative session. There are over 200 chambers of commerce, economic development councils (EDC) and trade associations that represent a variety of industries. With representation from Amarillo to El Paso, Longview to Odessa and Beaumont to Corpus Christi, the coalition truly spans across the entire Lone Star State. And that includes the Valley.
The South Padre Island (SPI) EDC and SPI Chamber of Commerce, the City of Rio Hondo, Harlingen EDC, Brownsville Community Improvement Corporation, Greater Pharr Chamber of Commerce, Edinburg Chamber of Commerce, McAllen EDC, as well as the Starr County Industrial Foundation are some of the regional groups participating in advocacy efforts.
These chambers of commerce and economic development groups support bills like HB 5 because they understand that when communities land major capital investments they translate to jobs, economic activity, and long-term tax revenue for government services, including schools. They also understand that Texas is accustomed to winning across multiple fronts: semiconductor exports, advanced manufacturing, the auto industry and energy sector. For the RGV, economic development tools can be especially beneficial to expanding the region’s budding space and energy industry. All of that is at risk if we don’t pass HB 5.
Governor Greg Abbott has commented on the importance of a new tool for communities. Speaker Dade Phelan named HB 5 a House priority. A statewide poll showed 77% of Texas voters believe temporary tax discounts are worth the return on investment. It doesn’t make sense to be against economic growth.
Pass HB 5. The Texas Jobs and Security Act will help ensure we can continue beating out our competitors and winning jobs for Texas communities.