TheDMAWay

Texas Legislative Update

by DMA Staff | May 25, 2017
DMA-Texas-Legislative-Update-May 25 2017

DuCharme, McMillen & Associates, Inc. (DMA) provides this update relating to the 85th Texas Legislature Regular Session.

SB 1, the General Appropriations bill, is still in conference committee.

Before the start of the legislative session, Lieutenant Governor Dan Patrick announced his priorities, which included three tax matters – SB 2 (Property Tax Reform), SB 15 (First Responder Property Tax Relief), and SB 17 (Franchise Tax Reduction). These three tax bills were filed by Senators Paul Bettencourt, Donald Huffines, and Jane Nelson, respectively, and all three bills passed the Senate in March 2017. The House stalled SB 15 and SB 17, and the House Ways & Means Committee voted out a committee substitute for SB 2. Last week, before the House procedural deadlines pertaining to senate bills, Lieutenant Governor Patrick released public statements that the Senate would not act on certain matters until the House passed two of his priorities - property tax relief and the transgender bill, also threatening to press the Governor for a Special Session. Within a day of those public statements, the House Ways & Means Committee called for a hearing and voted out SB 15 and SB 17. SB 15 is on its way to passage, but SB 17 never made it onto the House’s last calendar for senate bills, which means it is dead. HB 28 by Dennis Bonnen, the only other bill proposing to phase out the franchise tax, has been left pending in the Senate Finance Committee. Because Lieutenant Governor Patrick made no demand for its passage in his special session threat, there does not appear to be any political force to advance the franchise tax relief any further.

In DMA’s last report, we mentioned that the Senate Finance Committee voted out SB 1713 by Carlos Uresti that would impose notice and reporting requirements on remote sellers similar to Colorado’s statute upheld by the United States Supreme Court, but the version that the Senate ultimately passed did nothing other than require the Comptroller to study alternative methods to increase sales and use tax collection compliance. SB 1713, as engrossed, did not garner any traction in the House, and the bill is dead.

SB 2 by Paul Bettencourt and other property tax bills that propose some reform are still being considered and modified. At this late stage of the session, we will have to see the final versions to know what proposals within those bills remain, or have been dropped or added. DMA will provide summaries of all tax bills that have passed after the current legislative session concludes on May 29, 2017.

Please do not hesitate to contact your local DMA office should you have specific questions or requests.