We, the undersigned, call on all AISD Trustees and Trustees-Elect to end consideration of NXP’s $100Million Chapter 313 property tax break application to the Board. While we want economic development and good jobs in Central Texas, Chapter 313 prohibits school boards from requiring high living wage and worker safety standards as part of these agreements, unlike city and county incentives in which good job standards can be negotiated. Chapter 313 is a failed corporate giveaway program that was killed in the last legislative session by Central Texas Interfaith/Texas IAF, the Texas AFL-CIO, and other union and advocacy groups. Central Texas Interfaith calls on all AISD trustees to vote against NXP’s Chapter 313 application to the Board.
Chapter 313 is Texas’ largest corporate welfare program which costs taxpayers over $1 Billion annually, money which could be going to public schools and other public needs. Not only do corporations get out of paying most of their property taxes (for 10 years) they would otherwise owe for our schools, but the state must replace that revenue with taxes collected from all Texans. The current legislation ends in December of 2022, which has led to a “gold rush” of over 450 applications, which could cost taxpayers as much as $10 Billion/year. Not only do state taxpayers foot the bill for this with state taxes; over time, local taxpayers and businesses will also be paying more. With the support of Central Texas Interfaith and its sister organization Valley Interfaith, school boards in Elgin ISD and Port Isabel ISD school have rejected Chapter 313 applications, as well as several other districts. We urge AISD to do the same....
The AISD board is scheduled to vote on a $100 Million Chapter 313 school property tax break to NXP corporation at its Thursday, Nov 17th meeting, with a board information session scheduled for Thursday Nov. 10th. While we want economic development and good jobs in central Texas, Chapter 313 prohibits school boards from enacting high living wage and worker safety standards as part of these agreements, unlike city and county incentives in which good job standards can be negotiated. Chapter 313 is a failed corporate giveaway program that was killed in the last legislative session by Central Texas Interfaith/Texas IAF, the Texas AFL-CIO, and other union and advocacy groups. Central Texas Interfaith calls on all AISD trustees to vote against NXP’s Chapter 313 application to the Board.
Chapter 313 is Texas’ largest corporate welfare program which costs taxpayers over $1Billion annually, money which could be going to public schools and other public needs. Not only do corporations get out of paying the property taxes (for 10 years) they would otherwise owe for our schools, but the state must replace that revenue with taxes collected from all Texans. The current legislation ends in December of 2022, which has led to a “gold rush” of over 450 applications, which if passed could cost taxpayers as much as $10 Billion/year.
WEAK/NONEXISTENT JOB AND WORKER SAFETY REQUIREMENTS IN CHAPTER 313
- Chapter 313 has NO wage, job creation, or worker safety requirements for construction and building trade jobs.
- For permanent jobs, Chapter 313 has extremely weak job creation and wage requirements, and no workers safety requirements.
- Companies are only required to create between 10-25 permanent jobs regardless of the size of the tax break.
- These jobs are only required to meet 110% of the median manufacturing wage.
- There are no worker safety requirements required by Chapter 313.
- The Comptroller routinely grants waivers even to these weak requirements.
- School boards are prohibited by law from enacting stronger wage, job creation, and worker safety requirements.
NXP APPLICATION TO AISD FOR CHAPTER 313 AGRREMENT
- NXP (formerly Motorola/Freescale) is Dutch multinational Chip Manufacturer with nearly $11 Billion in annual profits is asking for over $100 Million in school property tax breaks over the next 10 years to expand its operation in Austin. Ordinary taxpayers, small businesses, and most other corporations do not get these tax breaks.
- In its initial applications to the AISD board, NXP promised only 50 jobs in exchange for its tax break, at a cost to taxpayers of $2,000,000/job. After being called out by CTI, the company changed the jobs promised to 500 on the night of the initial board meeting, but still short of the 800 it had promised in the media.
- Central Texas taxpayers will be investing in 3 major bonds (AISD, ACC, City of Austin) and are facing rising Austin Energy rates and other inflation costs. Now is not the time to grant tax breaks to billion-dollar corporations.
- NXP is free to approach the city and county for tax incentives, entities which have much higher job creation and worker safety requirements. They also have the newly passed federal CHIPS Act available for them to pursue public funding. Unlike Chapter 313, these programs do not take potential funding from schoolchildren.
Bastrop Interfaith and Friends of the Land, a farmland preservation coalition, worked with local Elgin residents and landowners to defeat a 10-year Chapter 313 corporate tax abatement at the Elgin ISD School Board last night by a unanimous vote. Solar Proponents, a startup owned by an oil and gas hedge fund, would have clear-cut over 2,100 acres of trees bisected by Little Sandy Creek to build an industrial solar farm. While the community had been testifying monthly since May at the school board meetings against the project, last night was the first time the public got to hear from Solar Proponent about the project. Speakers argued the project endangered Greenbriar Community School and neighboring homes with water runoff in an area already prone to flooding with an already diminishing refuge for wildlife.
“In these past six months, we haven’t heard a single person speak in favor of this project. Compare that to more than 1100 signers of our petition to stop this project and all the comments here you have so patiently listened to since then,” said Skip Connett, a leader with Bastrop Interfaith and founder of Friends of the Land at last night’s school board meeting.
“We spoke for our communities and our trees. Our school board listened,” Connett said after the vote.
This past May, Bastrop Interfaith and Friends of the Land, one of its member institutions, opposed the initial Chapter 313 application which would have given the company a 10-year school property tax abatement from Elgin ISD. Chapter 313, Texas’s largest corporate welfare program, costs taxpayer $1Billion/year to fund these tax breaks, money which could be going to public schools. Chapter 313’s reauthorization was killed last legislative session by Bastrop Interfaith and the Texas IAF along with allies. However, the program doesn’t expire until this December, and there has been a rush of nearly 500 applications by companies looking to get tax breaks before the deadline.
Reverend Minerva Camarena Skeith of St. John's Episcopal Church explains to Jon Stewart how Central Texas Interfaith/Texas IAF organizations fight corporate incentives that negatively impact public budgets, including schools.
“What’s happening right here, right now, very powerful.” -- Jon Stewart
In a Behind the Scenes Cut, Rev. Minerva Camarena-Skeith describes how communities can organize.
Full episode and panel discussion streaming on Apple TV+.
In meetings with Hays County Commissioners, Corridor Interfaith leaders in Central Texas emphasized the importance of workforce development in one of the fastest growing counties in the county. The Commissioners Court responded, increasing its public investment in long-term job training by 10% to $55,0000 in the upcoming fiscal year.
Capital IDEA graduate Mary Helen testified, saying: "After working as a paramedic... I went back to college and earned my RN degree. I currently work as an ICU nurse at Ascension Seton Network and provided care to the first COVID patients in our region."
The Chapter 313 program, authorized in 2001, allows Texas school districts to cap the taxable value of a property for some new projects, saving companies tens of millions of dollars in taxes, or more. It is set to expire at the end of December, after a bipartisan coalition in 2021 stopped efforts to reauthorize the program.
Critics of Chapter 313 call it corporate welfare that deprives Texas public schools of funding....
The Rev. Miles Brandon of St. Julian of Norwich Episcopal Church in Round Rock spoke in support of ending the program for good. He appeared on behalf of the Texas Industrial Areas Foundation and Austin Interfaith, both community... groups.
Clock is Ticking on Texas' Chapter 313 Incentives -- and Major Projects May Miss Out, Austin Business Journal [pdf]
Last night the City of Austin voted on a budget that includes one of the highest living wages for their workers: $20/hr for municipal workers including contracted workers and those employed by corporations benefiting from City tax subsidies. At the urging of Central Texas Interfaith, through meetings with individual council members and communications that persisted even as votes were taken on amendments, the City of Austin expanded emergency assistance for struggling renters and sustained spending on essential human development initiatives including long-term workforce development and after-school programs.
- $20/ hour base pay for all City of Austin staff, contract employees and employees of corporations receiving City tax subsidies - Sponsored by CM Fuentes
- $8 Million in emergency rental assistance - Sponsored by CM Vela
- $3.1 Million for long term workforce development - Sponsored by CM Alter
- Increased funding for AISD programs including Parent Support Specialists and Primetime After School programs - Sponsored by CM Tovo
Central Texas Interfaith commends the Mayor and the entire City Council for investing in these important initiatives.
Last summer, Central Texas Interfaith/Texas IAF leaders and nonprofit allies shut down Chapter 313 (a state tax exemption program giving away hundreds of millions of dollars per year to industrial and petrochemical companies). Since then, over 400 corporate applications flooded the system ahead of the program's expiration date at the end of this year -- more than twice as many than before. Central Texas Interfaith leaders took to every medium available to raise the alarm about the potential impact on school district budgets across the state.
[Excerpts from Austin American-Statesman]
"It's fiction," said Trenton Henrichson, a computer engineer and a leader of Central Texas Interfaith, a group that is opposed to the incentives. "If you're talking about (fabrication plants) 10 years in the future... you’re just making stuff up.”
....Leaders of Central Texas Interfaith called such applications "smoke and mirrors," saying the plans are fuzzy and local officials have no way to evaluate them. The organization helped lobby against renewal of the Chapter 313 program during last year's session of the state Legislature, saying the corporate tax breaks granted under it have decreased the amount of money available for public education in the state.
'Smoke and Mirrors' or Long-Range Planning? Possible Samsung Tax Breaks Stir Debate, Austin American-Statesman
What Could Epic Samsung Expansion Mean for Central Texas? Opportunities Savored, Concerns Raised, Austin Business Journal
CTI Leaders Take Hard Stand Against NXP's Corporate Welfare Request to AISD, Community Impact, CBS Austin, Austin Business Journal, Austin Chronicle, and Austin Independent School District
Henry Saenz is technically retired but has been working part-time for the city of Austin as a facility service representative at the Austin Convention Center since 2006. In that time, his hourly pay has gone from $9 an hour to $15 an hour.
Saenz lives with his 98-year-old mother and doesn’t have to pay rent, which is how he affords to stay in the city, he said. When his mother dies and his family sells the house, he’ll have to move, he said.
“I hate to leave this town, but I just can't afford to live here,” Saenz said. “I can imagine how hard it is for someone who doesn't have the advantages that I've experienced, whose money has to go to rent.”
In his role with Central Texas Interfaith, a local advocacy group, Saenz has been among those calling on the city to pay all its employees at least $22 per hour.
[Photo Credit: Kamryn Wooten]
Austin Considers Proposal for a $22 Minimum Wage for All City Employees, Austin American Statesman [pdf]
NXP Semiconductors, which is based in the Netherlands and has two fabrication plants in Austin, is seeking tax breaks from the Austin Independent School District under the state's Chapter 313 incentive program for proposed expansion. An initial presentation to the district's board Tuesday night didn't specify the amount, but previous incentives agreements from Texas school districts for similar Chapter 313 deals have been for tens of millions of dollars.
The Chapter 313 incentives program — which is named after a portion of the tax code — has been controversial. It's set to expire at the end of this year because state lawmakers declined to renew it during last year's legislative session, although deals struck before then won't be affected....
Under the Chapter 313 program, school districts are reimbursed by the state for the corporate tax breaks they agree to provide. That attribute has made Chapter 313 controversial among critics who say school districts have no reason not to grant them, and that the program siphons money from taxpayers statewide as handouts to corporations.
“There's no such thing as free money," said Doug Greco, lead organizer with Central Texas Interfaith, a group that opposes all Chapter 313 deals and has worked to help end the program.
“It's money that is being drained out of the state budget that could be going to schools," Greco said. "When you add these (deals) up, it's just a drain on the system that we can't sustain. Let's stop the gold rush here."
[Photo Credit: Mark Matson, Austin American Statesman]
Chipmaker NXP Considers Austin for $2.6 Billion Expansion, Up to 800 New Jobs, Austin American Statesman [pdf]