From the Office of State Senator Kel Seliger, District 31

May 25, 2011
Contact: Gina Dowdy, (806) 374-8994

Legislation to Protect Odessa Taxpayers Heads to the Governor

AUSTIN — Today, Senate Bill 1120 by Senator Kel Seliger received approval by the House of Representatives and is on its way to the Governor's desk for final approval and signature. Once it is signed into law, local government corporations will be prohibited from receiving property tax exemptions outside of the boundaries they were created to serve. "This bill addresses the misuse of current law to harm county, hospital, community college, and school district tax bases," Senator Seliger stated.

In 2008, the West Texas Municipal Power Agency (WTMPA) formed the High Plains Diversified Energy Corporation, a non-profit local government corporation. Under current law, local government corporations, like High Plains, are eligible to receive nonprofit tax-exempt status on any property in the state that they own. Late last year, High Plains finalized plans to purchase two privately owned power plants in Odessa, which is not associated with WTMPA. Without change to current law, the City of Odessa would lose approximately $6.4 million in property tax revenues due to High Plains tax-exempt status.

Senate Bill 1120 (SB 1120) will prevent local governmental entities from being impacted by a loss in their property tax revenue without their consent. Specifically, SB 1120 affirms that any property owned by a local government corporation will not be exempt from the tax roll if the property is located outside of the boundary of the municipality it was created to serve.

"If a local government corporation wants to operate an energy company in another county, it should pay taxes like any other utility," said Senator Seliger.

Seliger has represented Ector County and 25 counties of District 31 that span from the Panhandle to the Permian Basin in the Texas Senate since 2004. Seliger currently serves as Chair of the Senate Select Committee on Redistricting, as well as actively serving on the Education, Finance, International Relations and Trade, and Natural Resources Committees.