LEGISLATIVE REPORT

TACO QUARTERLY

Some assume that after the 140-day legislative session, legislators go back to their regular jobs back in the district; they’ll strategize for the next political campaign, assist in local constituent issues, or just live with the laws they passed. Although much of this happens, legislators are still busy with the legislative process. The cost of providing basic government services has increased exponentially with economic and population growth: Texas has seen explosive growth in new businesses being created or relocated to Texas, along with increases in residents. As a result, the legislative process, even when the legislative session ends, still has much life to it and TACO is very much involved in this interim time. We are busier than ever before!

At the end of the legislative session in May, the Speaker of the House and the Lt. Governor provided various “charges” or subject matter for the various House and Senate committees to study, and to take testimony from state agencies, businesses and the general public. These charges often result in committee meetings during the interim period and those hearings may take place at the State Capitol or locations around the state to get maximum input from the general public and interested parties.

It is the expectation that TACO will be involved in some of these interim charges (listed below) and we look forward to member’s input to help craft good public policy as it relates to the RV Park industry.

SENATE FINANCE COMMITTEE

Property Tax Relief: Examine and recommend ways to reduce Texans’ property tax burden. Review and report on proposals to use or dedicate state revenues in excess of the state spending limit to eliminate the school district maintenance and operations property tax.

Inflation: Review and report on the effect inflation is having on the business community and state government, including state salaries, retiree benefits, the state economy, and cost of state services.

Inflation: Review and report on the impact of inflation on units of local governments’ revenue collections and property taxpayers’ tax bills, including the homestead exemption.

SENATE LOCAL GOVERNMENT COMMITTEE

Property Tax Reform: Review the effect of Senate Bill 2 (86th Legislature), the Texas Property Tax Reform and Transparency Act of 2019, and related legislation passed by the 87th Legislature. Make recommendations for further property tax reform and relief.

Appraisal Reform: Review the implementation of Senate Bill 63, House Bill 988, and other related legislation passed by 87th Legislature. Make recommendations to ensure appraisal guidelines are effective and taxpayers have enforcement mechanisms.

SENATE BUSINESS & COMMERCE COMMITTEE

Electricity: Assess the electricity market in Texas. Study issues impacting the Texas electric grid, including weather preparedness, transmission planning, maintenance scheduling, and the natural gas supply chain. Study the consequences of increased electric vehicle usage and charging on the generation, transmission and distribution, and retail sectors of Electric Reliability Council of Texas (ERCOT) and evaluate their potential impact on increased electric demand and reliability of the grid. Evaluate potential benefits of real-time transparency of the intrastate gas market with respect to the functions of ERCOT and the Texas Energy Reliability Council. Examine the growth of renewable energy generation in the state and evaluate its impact on grid reliability. Make recommendations to strengthen the reliability of the grid, and meet the future generation needs of ERCOT through new and existing dispatchable generation. Assess plans to expeditiously add new dispatchable generation. Monitor the implementation of Senate Bill 2 and Senate Bill 3, 87th Legislature.

TACO Comment: A reliable electric grid is vital to all businesses in Texas, large and small. Affordability and reliability are primary concerns. TACO will monitor and provide input if necessary, regarding the electricity market on travel and tourism in Texas.

HOUSE COMMITTEE ON WAYS & MEANS

Study and consider methods of providing additional property tax relief, including the use of $3 billion in available American Rescue Plan Act funds that were held for future tax relief by the 87th Legislature, and other sources of revenue.

Explore options to reduce business property tax burdens and options for limiting the growth of property tax bills. 3. Study Texas’ property tax appraisal system and make appropriate recommendations to improve the appraisal system. The study should include: • Assessing the accuracy of appraised values and operational effectiveness of appraisal districts. • Evaluating methods of selecting chief appraisers, appraisal review boards, and appraisal district directors; and • Evaluating existing appraisal protections for taxpayers and ease of taxpayer participation in the appraisal process.

TACO Comment: Property tax and appraisal reform is necessary to keep business property taxes at a proper and sustainable level that not only unburdens businesses from high property taxes but also provides the necessary funding for cities and counties to continue to provide necessary services.

JULY 2022 QUARTERLY LEGISLATIVE REPORT LEGISLATIVE REPORT

By Ron Hinkle - TACO Legislative Consultant

PROPERTY TAX RELIEF

There have been several serious discussions already in the House and Senate committees regarding property tax relief. One recommendation that is being discussed is using a combination of financial tools to drive down property taxes.

One potential solution offered is to use a combination of state surplus dollars, unspent surplus from the Permanent School Fund and an increase in the sales tax rate to spend down the highest portion of the property tax bill–the school maintenance & operations (M&O) tax.

This potential solution was brushed off in earlier discussions but lately seems to have gained a bit more the attention from some of the legislative budget writers. The upside is the potential of totally eliminating the highest portion of the property tax for residential and commercial owners. The downside for some is the use of the state surplus and the increase in sales tax. One concern is the question of will there always be a state surplus to use to pay down that M&O portion of the property tax. The other concern is the impact of the increase in sales tax (some estimate it would need to be between 8% and 14%) on the consumer and on businesses. No one has the final plan: but the fact that rising property tax burdens are becoming more and more of a concern is a bright spot in an otherwise dismal situation.

ERCOT (the grid operator known as the Electric Reliability Council of Texas)

It is heavy on many people’s mind (and utility bills) that the price of electricity is going up. This is due primarily from action taken by the Public Utility Commission (PUC) in response the Winter Storm Uri that almost became a significant disaster–and in some Texans’ lives was a true disaster. The actions taken by the PUC are complicated due to the novelty of how PUC and ERCOT is managing the electric grid. One of the concerns about the near-total outage last winter was ensuring enough reserve to fulfill the demand of electricity users. ERCOT has made investments to procure higher levels of reserve power than before, and to make it available faster. Modifications also include policy changes designed to make wholesale electricity prices rise quicker initially as conditions on the grid tighten, before topping out at a lower level than was allowed at the time of the February 2021 grid disaster. That move is designed to prompt more generators to come online sooner and help head off emergencies. Estimates of ERCOT’s price tag for buying more reserves from January 1 through May 31 this year range from $210 million to $385 million; the impact of the policyinduced changes to wholesale prices are estimated at about $475 million over that time. The forecast for the full-year amount, should it merely double, is between $1.37 billion and $1.72 billion in costs. In both cases, Texas ratepayers are ultimately on the hook for the costs as they pass through the system. The PUC responds that there is more reliability on the grid.

TEXAS SUNSET ADVISORY COMMISSION

The Texas Legislature created the Texas Sunset Advisory Commission in 1977 to make state government more efficient, effective, and accountable. The Commission gives the legislature more control over state agencies and programs.

There are 21 separate state agencies under the Sunset review. Among them are the Commission on Environmental Quality (TCEQ), Texas Public Utility Commission (PUC), the Electric Reliability Commission of Texas (ERCOT), & the Texas Economic Development (EDT) and Tourism office.

TACO has met with Texas Sunset Advisory Commission staff regarding TCEQ’s antiquated measurement of meters and connection requirements for RV Parks. TACO sent a letter to the Sunset staff providing some recommendations, and aside from monitoring the sunset process will be meeting with individual members of the Sunset Advisory members to further discuss important policy changes to TCEQ.

TACO will be monitoring the hearings on the PUC and ERCOT and will seek to join the conversation about providing more affordable electricity.

The Governor’s office of Economic Development and Tourism is a successful office, especially on the tourism side of the division. A portion of the Hotel Occupancy Tax dollars are used to provide an advertising and marketing campaign to the U.S. and to key international markets to attract visitors to Texas. This successful function has led Texas to be the 3rd most-visited state in the nation and the 7th most-visited state by international visitors. TACO will support the continuation of the tourism division.

FUTURE LEGISLATION FOR TACO

TACO is diligently working with its partners and supporters on a number of legislative fronts as TACO marches towards the January 2023 legislative session.

TACO will have reintroduced liability protection legislation for RV Parks. In addition, TACO will have legislation filed that will bring TCEQ to modernization in terms of how water districts and Water supply Corporations provide water utilities at reasonable rates. TACO will

TACO GUIDE DISTRIBUTION IS GOING FANTASTIC THIS YEAR!

Hundreds of RVers request the TACO Guide every month through our website TexasCampgrounds.com because of the Texas Saver Card. Plus we get requests for case shipments all the time. Below is a picture of cases requested in just two weeks last month.

For more information about advertising your park or services in the TACO Guide call 817-426-9395.