October 20, 2006
By Kenneth Dierschke
We had a terrific Legislative Conference in September. This meeting was exciting because it sets the stage for what we expect to be a successful session of the Legislature for Farm Bureau and Texas agriculture. We hold this conference every other year, in advance of the regular session, always in Austin.
We had some star power this time around. Gov. Rick Perry was there, laying out his plans for the session. The governor talked about the Legislature's achievement of facing a budget shortfall and balancing that budget without a tax increase. This session will begin with a substantial surplus in the state treasury.
The governor spoke enthusiastically about Texas' progress in renewable energy, noting that the Lone Star State has overcome California as the leading producer of wind energy.
Lt. Gov. David Dewhurst addressed our Farm Bureau leaders as well. He talked of the improvement in eminent domain laws and of his intention to address water issues in the next session. Dewhurst, the presiding officer of the Texas Senate, plans major legislative initiatives in education and he promised to beef up the state's child protection laws.
Our dinner speaker was an old friend of Farm Bureau. John Sharp, former Comptroller and head of Gov. Perry's Texas Tax Reform Commission, talked about the new "margins tax" approved during last summer's special session of the Legislature.
According to John, the new tax should provide meaningful property tax relief. This tax is broad, meaning that it will not hit some taxpayers disproportionately, as the property tax does.
While Farm Bureau opposes new taxes, this particular law allows for a 30 percent reduction in local property taxes. Farm Bureau has long pushed for reductions in property taxes, and the margins tax appears to fit the bill. The tax is paid by corporations or limited liability partnerships, and is calculated by subtracting either the cost of goods sold or salaries from gross receipts.
The full tax relief of this legislation will not be available until 2007, and the new tax does not become effective until next year. There is also a $300,000 exemption for the margins tax, exempting many farmers and ranchers.
We had some excellent panel discussions on the margins tax, property taxes, animal health, eminent domain and animal welfare.
The bottom line for this conference is that we are now prepared for what promises to be an exciting and challenging session of the Legislature.
As always, much of our legislative success will depend on our involved and active members. The first step will be to work for and elect those candidates who support our issues. Then, we have to keep an eye on the process when the gavel falls in January.
We have sound policies that will benefit Texas agriculture and the rural areas of our state. I hope you will stay in contact with your elected officials and be prepared to contact them, write letters to the editor or perform any of the many tasks that will help us achieve our goals.