The boards of directors of the Temple Chamber of Commerce, the Greater Killeen Chamber of Commerce, the Harker Heights Chamber of Commerce and the Belton Chamber of Commerce have joined together to advocate for the prohibition of unfunded state mandates on local political subdivisions.
Unfunded mandates are state laws that are passed by the Texas Legislature that require a local political subdivision to perform certain functions with no provision for state funding to offset the cost of the implementation of those mandates.
Resolutions and position statements adopted by the four business organizations state that among the reasons for their position is that the practice significantly contributes to the necessity to increase local property tax rates. Rick Kasberg, Chairman of the Temple Chamber of Commerce said, “It is ironic, and a bit hypocritical, that while the state is imposing this cost without state funds to pay for them, they are attempting to place significant limits on increases in local property taxes. Obviously, this is not sound public policy and cannot be sustained.”
Most all local political subdivisions, including counties, cities, school districts, community colleges and universities are financially impacted by unfunded mandates. A 2016 Unfunded Mandate Survey, by the Texas Association of Counties, contains the details of the impact of thirty unfunded state mandates on Texas’ 254 counties. The county’s cost for supporting the Judicial System alone was $1.570 billion.
Locally, for example, unfunded mandates on Indigent Health Care cost the citizens of Bell County $4.08 million, or 3.66 cents on the property tax rate. The Indigent Legal Defense mandate cost the citizens of Bell County $3.6 million or 2.65 cents on the tax rate. Among other unfunded mandates are the Hazelwood Act, which provides free education to veterans and members of veteran’s families at higher education institutions and the Disabled Veterans Property Tax Exemption. Kasberg said, “No one, that I know of, is opposed to extending these benefits but there is the question of why the state has refused to offset the costs.”
Dr. Bobby Ott, Superintendent, Temple Independent School District said, “unfunded mandates have been one of the largest contributors to the rising costs of public education. Many would argue that some mandates are with merit and some are without. No matter, the culmination of these mandates has driven the growth of school district budgets, and conversely reduced per pupil expenditures. When you consider the impact of inflation, growing student populations and the increased costs of utilities, unfunded mandates only complicate these inevitable factors. Further, in many cases it restricts the local decision-making of elected officials and leaders responsible for allocating revenue to meet the needs of those they serve locally.”
Rod Henry, Temple Chamber president, said “It is a fact that a Fiscal Impact Note is included on any proposed state legislation when that legislation is filed. The purpose of that Fiscal Note is to provide the financial impact of that legislation on the state when the bill is under consideration. However, the Fiscal Impact Note includes no financial impact on the local political subdivisions. We believe this to be poor public policy that should stop immediately.”
Kasberg noted “The bottom line, no matter how beneficial and well intentioned, unfunded mandates have a direct impact upon the cost of doing business by driving up local property taxes.”
The chambers are asking legislators to, at a minimum, pass legislation prohibiting state mandates without providing state funds to pay for the full implementation of those mandates.
The chambers are encouraging their member businesses to contact members of the legislature to voice concerns.
Rod Henry, Temple Chamber, firstname.lastname@example.org, 254-773-2105
John Crutchfield, Greater Killeen Chamber, email@example.com, 254-526-9551
Gina Pence, Harker Heights Chamber, firstname.lastname@example.org, 254-699-4999
Randy Pittenger, Belton Chamber, email@example.com, 254-939-3551