The Texas Legislature adjourned the 88th Regular Session sine die on the afternoon of May 29, 2023. It only took a meager few hours before Governor Abbott called the first special session with the very specific directives to pass legislation (1) cutting the property tax rate solely by reducing the school district maximum compressed tax rate and (2) to address border security by increasing or enhancing the penalties for certain criminal conduct involving the smuggling of persons or the operation of a stash house.
No one was surprised by the announcement of a special session by Governor Abbott, other than maybe the speed at which the session was called. At the writing of this column, it appears the Texas legislature could be in for a repeat of the 87th Legislative Session where multiple special sessions were called back-to-back and the legislators worked throughout the summer of 2021. There are certainly many more priorities the Governor wants to have addressed and hopefully the House and Senate can come to terms on exactly how to address these pending issues. It may be another long, hot summer for our representatives in Austin.
Even with the legislature’s work yet to fully be done, I would like to talk about the positive things that happened during the regular session that is officially adjourned and, in particular, the new policies of the 88th Legislature that will help the oil and gas industry in West Texas.
As you are aware, infrastructure investment, or the lack thereof, is paramount to the success of the Permian Basin. After many, many years of declining oil and gas production, infrastructure upgrades had been something one only heard about happening in other parts of the State and Country. It appeared to be presumed by those in Austin that the Permian Basin had ample supply of electricity, pipeline capacity, roads, hospital beds, school classrooms, broadband internet, etc.
The magnificent and breathtaking rise in oil and gas production in the last decade changed everything, bringing with it countless new opportunities that were created that spanned all social classes across the Permian Basin. This rapid increase also brought with it the challenges of an aging infrastructure system and the need for new and expanded capacities in every area imaginable. In no small part due to the advocacy of PBPA and others, legislators in Austin have taken note, and frankly how could they not?
With the record amount of tax revenue the industry has pumped into the coffers in Austin the last several years, the benefits of what we produce in the Permian Basin are found across the state. In fact, the tax revenue generated by oil and gas operations is the basis for which property tax relief, border security expansion, school security enhancements, and the much-needed mental health access and care are being provided. Other significant investments are being made in power generation and electric grid expansion, water recycling research, broadband access, etc. While many of these topics were addressed in the 88th regular session, several others are anticipated to be addressed in this summer’s special sessions. Only time will tell if these come to fruition.
I would like to extend my sincere thanks to the PBPA Legislative Committee for their tireless work and their continued efforts to keep up with everything oil and gas, and really all things Permian Basin, in Austin. It is a mountainous amount of information and the fluidity and speed of changes that occur is relentless. The committee worked so well together for the benefit of the overall PBPA organization. Legislative outreach is one of the PBPA core functions and you provided an invaluable service for us all. Thank you so much!