Texans to Pay Out Tax Abatements for 41 More Wind and Solar Plants in 2021

February 17, 2021
TFR Staff
Corporate Welfare, Property Tax

As extreme cold batters the Lone Star State and power failures leave millions huddling for warmth in their homes, dealing with broken pipes, and rendering many roads unnavigable, many Texans are looking to the latest from ERCOT or the weather forecast to see when they might find relief from a crisis caused by poor planning, an across-the-board failing of many electrical companies, and an over-dependence on wind and solar power.

But while this storm may be on track to hopefully dissipate by the weekend, there’s already another on the horizon—and this one was created by our state’s policymakers. Leaders from the governor down to your school board are taking your tax dollars and creating the next energy crisis through Chapter 313 tax abatements.

Crafted by state lawmakers, Chapter 313 of the tax code allows school districts to grant property tax abatements to businesses. Unlike similar tax abatement agreements (which have their own problems), the revenue lost by the school district is made up for by state taxpayers.

You heard that correctly.

If a school district anywhere in the state inks a Chapter 313 agreement the local school district gets the funds they would have collected in taxes on that business from taxpayers across the state. Live in Lubbock? You’re on the hook for the Chapter 313 abatement given to a company in Longview. Work in McKinney? You’re paying the property tax bill for a business in McAllen.

Since its inception, businesses have received more than $10 billion in property tax exemptions—about $1 billion annually. That’s $1 billion from state coffers to school districts in order for them to subsidize businesses.

But it’s not just any business. The overwhelming majority of businesses subsidized under 313 agreements are so-called “renewable energy” projects. In fact, 41 of the 67 businesses that have already been approved under the program and will start receiving a state-funded property tax subsidy this year are solar or wind energy producers. Here’s that list:

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While wind and solar energy aren’t inherently bad, and in fact can be useful in certain circumstances, they are inherently unreliable and impossible to ramp up in adverse conditions—a feature that contributed to the state’s electrical power crisis both in terms of current failure and in due to the market conditions they create.

While the events of this past week have exposed the need for extensive reform of the state’s electrical grid it’s clear that eliminating the taxpayer handouts is a must for taxpayers and consumers alike.