Texas Association of Manufacturers Praises Legislature for Strengthening Texas Economy with Smart Policy

May 27, 2019

AUSTIN -- The Texas Association of Manufacturers (TAM) applauded the members of the Texas Legislature for their work this session to strengthen the Texas economy with smart policy related to taxes, economic and workforce development and natural resources.

“Public policy that encourages investment in Texas is the cornerstone of our ability to compete in the global marketplace,” said Tony Bennett, president of TAM.

Several of TAM’s priorities passed the Legislature including an extension of Chapter 312 of the Texas Tax Code (HB 3143), which allows cities and counties to grant temporary property tax exemptions to new investment projects; HB 1607, which better aligns the Texas franchise tax deduction rules with federal contracts for the aerospace and defense industry; and HB 3, which includes provisions that will bolster workforce development in Texas. These bills are now headed to Governor Abbott for his signature.

“Chapter 312 is one of the most important economic development tools we have to attract major industrial investment to the state. Renewing Chapter 312 keeps us on the field to compete with other states and nations for coveted investment dollars,” said Bennett.

Noting the importance of HB 1607, Bennett said, “From aerospace research and flight training to military aircraft development and space exploration, Texas is a hub for government and defense-related aerospace and aviation. Before HB 1607, Texas was the only state that did not allow defense contractors to deduct unusually long-term, high-cost servicing expenses for military, space, and government security projects. Better aligning the Texas franchise tax deduction rules with federal contract requirements boosts our ability to attract these high-wage and high-tech jobs.”

Workforce development is a long-standing priority for Texas manufacturers and Bennett praised provisions in HB 3 to introduce career and technical education (CTE) opportunities to students beginning in 7th grade. “Allowing CTE into middle school is an important step toward career awareness and industry exploration because in 8th grade, students must select one of five endorsements for high school. Exposure to technologically-advanced manufacturing opportunities sooner in a student’s career will put them on a path to take advantage of all these high-quality jobs have to offer.”

Bennett also noted that the Texas State Technical College (TSTC) has pioneered the nation’s first commission rate-funding accountability model wherein TSTC only gets funded after graduates’ results are achieved and only when students are successful in their careers, based on the first few years of graduates’ income. Under HB 3, TSTC will receive their full commission rate as graduate results are achieved. “The TSTC accountability model sets the standard for outcome-based funding in higher education,” he said.

Finally, Bennett described the importance of HB 2846, which requires the City of Houston to sell its stake in the proposed Allen’s Creek Reservoir project to joint owner Brazos River Authority (BRA) so that construction can move ahead after a 45-year delay. “A lack of new water supplies in Brazoria and Galveston Counties was slowing expansion and job growth in the petrochemical and other manufacturing sectors in the region,” said Bennett. “A reliable water supply is essential for manufacturing industries in Brazoria, Galveston and Fort Bend counties, which contribute $29 billion a year to the Texas economy. HB 2846 assures continued economic growth in these sectors.”


Contact: Gretchen Fox, 512-694-4326