Schwab

Carlton Schwab is the president and CEO of the Texas Economic Development Council, a position he has held since Feb. 1 of 1999. Schwab was one of the guest speakers for the Greater New Braunfels Economic Development Foundation's quarterly meeting Tuesday afternoon, and broke down how the 86th legislative session impacted the state's economic development policies.

State officials deemed the 86th legislative session a success, both in general terms and in terms of the state’s economic development, during the Greater New Braunfels Economic Development Foundation’s quarterly meeting Tuesday afternoon.

Speakers Sabrina Brown, of Sabrina T Brown Consulting, and Carlton Schwab, president and CEO of the Texas Economic Development Council, praised the 2019 legislative session as having major achievements accomplished by the governor and state representatives during a luncheon meeting at the McKenna Events Center. 

After a brief intro and invocation by GNBEDF Chairman Tim Zipp, Brown took to the stage to speak on the overall successes of the session. 

“The governor started off with five emergency items,” Brown said, listing property tax reform; school finance reform; school safety; natural disaster preparedness; and greater access to mental health services.

“They passed all of these major items and more,” Brown said. “It was a really good session, I have to say. None of these bills were easy to pass. It was a good session where I do think everyone really tried to work together.”

Brown walked through each of the five initiatives, many of which were sparked by tragedies, such as the Santa Fe High School shooting, or the destruction caused by Hurricane Harvey. 

“They got a lot done this session with very little fighting, which is something we haven’t had in several sessions, so that was good for all of us and I hope good for you,” Brown said. “We realize some of these issues can be controversial … but they felt like they were doing what they were asked to do by voters.”

Schwab then took to the podium to narrow in on legislation that affects state economic development. 

Legislative priorities for economic development this session were to: protect the economic development sales tax; preserve chapter 312 of the Texas Tax Code; protect chapter 313 of the Texas Tax Code; continue funding for the Texas Enterprise Fund; maintain funding for Texas Workforce development programs; and support and promote innovation and entrepreneurship.

“We cover so many of these, if you’ve sat through some of my presentations before, our legislative priorities really don’t change much from session to session,” Schwab said.

Schwab explained chapter 312 of the Texas Tax Code governs reinvestment zones and tax abatements. Tax abatements are an economic development tool available to cities, counties and special districts to attract new industries and encourage the retention and development of existing businesses through property tax exemptions or reductions, according to the state comptroller website 

“It is the law that allows cities and counties — if they choose to do so — to do tax abatements at the local level,” Schwab said. “It passed with flying colors. We had to make a couple of changes in the law. Mainly it was a 30-day notification period which is now required if you’re going to do a tax abatement with an incoming expanding company.”

Chapter 313, also known as the Texas Economic Development Act, creates a state program for certain large businesses to limit the appraised value on their property for the purposes of local Texas public school district property taxes. 

“Chapter 313 is a little more complicated — it is the law that allows school districts to enter into value limitation agreements with high capital investment employers,” Schwab said. “We didn’t get it extended but we’ve got two more sessions to do it, so we’ll be working on that next session. 

Texas has many drivers that encourage economic development and it’s important to keep it this way, especially when another recession will come, Schwab said.

“Anti-incentive conversations have been more normalized, and that’s disturbing,” Schwab said. “We’re going to have a recession one of these days, we are. This expansion is the largest and longest in America history — it’s just the way the business cycle works, so … when that happens we’re going to need to be aggressive and have every tool available in the arsenal to help brings jobs in.”

The program concluded with Schwab and Brown taking questions from the audience 

The next GNBEDF meeting is scheduled for October and will be the State of the City. For more information about the GNBEDF, visit www.businessinnewbraunfels.com.  

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