The potential economic and tax revenue impact of Texas’ ‘Fair Access’ laws threaten to stifle the state’s business environment
AUSTIN, TEXAS – Today the Texas Association of Business Chambers of Commerce Foundation (TABCCF) released a new economic impact study illustrating the financial impact of Texas’ Fair Access law, passed in 2021, that prohibits financial institutions from doing business with public entities in the state of Texas based on certain corporate governance policies. The study, developed by TXP and authored by economist Jon Hockenyos, brings to light new data and analysis on the adverse economic impacts of Texas laws that prohibit public contracting with certain banks based on their independent business decisions.
Notably, the new study finds that Texas’ ‘Fair Access’ laws will result in:
$668.7 million lost in economic activity;
$180.7 million in decreased annual earnings;
3,034 fewer full-time, permanent jobs; and
$37.1 million in losses to State and local tax revenue
“Texas is the premiere destination for businesses, large and small, thanks in large part to the economic environment created by the Governor, Lt. Governor, Speaker and the entire legislature,” said TABCCF Executive Director Stephanie Matthews. “It’s second to none. Companies want to move here, and we want them to move here. However, as this latest study shows, certain laws can have a negative impact on businesses and place additional, unnecessary burdens on our state’s taxpayers. It is important for our state’s policymakers to understand the implications of these laws in order to ensure Texas remains the top U.S. state for business.”
“These findings illustrate that when government attempts to mandate values, no matter what kind to businesses, the market loses,” said Jon Hockenyos, author of TAB’s latest study, The Potential Economic and Tax Revenue Impact of Texas’ Fair Access Laws.
Texas’ pro-business climate has propelled the state to the 8th largest economy in the world. However, less competition in the municipal bond market is leading to higher interest costs, which in turn increases the debt burdens of local governments, straining resources and levying additional costs on Texas taxpayers. This could partially undermine the historic $18.1 billion property tax reduction package passed by the Texas legislature in 2023.
To read the full economic impact study, click here.
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