Debate in Concho County exposes issues with Chapter 312

There’s a growing body of research that highlights the negative effects of tax abatements granted for renewable energy under Texas Tax Code Chapter 312 and 313. Among the effects are the harm to the reliability of the electric grid, the hidden cost to Texans via taxes, and the unfortunate experiences of those who live next to large wind farms.

However, another problem became clear in Concho County yesterday as county commissioners and hospital district directors heard public testimony on their proposal to give abatements to a new wind farm: the lack of transparency in the process. In both cases, it was pretty obvious that the negotiations with the windfarm were just about finished and public testimony was, at least functionally, a formality rather than an opportunity for citizens to have meaningful input into the process.

Local government deliberations with businesses for Chapter 312 agreements (counties and special districts) and Chapter 313 (school districts) are largely exempt from public information and open meetings laws in Texas. This means the negotiations between the often-large, multinational corporations bringing wind development to rural Texas and the local officials take place behind closed doors. Usually, the public isn’t notified until a statutorily-mandated public hearing is scheduled.

Concho County provided a clear example of why this isn’t a good idea. Both county commissioners and hospital district commissioners had already negotiated a deal with the developer with the wind farm operator. The contracts were finalized and ready for signature. No one from the general public was given a copy until requests were made by meeting attendees. When they finally got their hands on it, attendees were expected to sort through the legalese in real time, without the opportunity for counsel or evaluation by other experts. This sets up a poor dynamic between residents and their officials.

It might seem easy to point fingers at the elected officials, but it isn’t that simple. They are agents of the county, seeking new dollars to, ideally, provide the most and best services. When a business threatens to pull out a $500 million investment unless it gets an abatement, it makes some degree of sense for them to sign the agreement (though they would do well to consider whether the long-term harms are worth the money.) The real issue at hand is with the Legislature. The state has set up a system where a few local elected officials are incentivized to make decisions that make some sense locally but are detrimental to Texans from a statewide perspective. 

Combine the broader outcomes with the poor relationships at the local level and it should be plain. Chapter 312 and 313 agreements for renewable energy are a bad deal for Texas.