John Sharp Takes Questions From The House
Ohh….John Sharp Is Now Taking Questions From Members Of The House…..
Ok…he’s still speaking. I just missed a nice quip about why he’s not governor, but I was trying to find the bills online, so I can’t quote it verbatim, but it was something about Bob Bullock…
Some quotes from Sharp:
“One of the things that we discovered in the process is that, regardless of what you do, there are industries who will spite it.”
“No matter what your margin is, your taxable margin will not exceed 70 percent.”
“We didn’t try to develop it within the tax commission office and then bring it out and let industries see it. What we did was work with businesses every day.”
“There are two ways to make a business tax fair…put all businesses in it (2.4 million registered businesses). We thought you wouldn’t like that very much. There is another way to make it fair and that is to go back to the original root and the original intention of the franchise tax…include only those people who get the liability protection under the tax. If you’re a sole proprietor or a general partner of a natural person, you’re not in this tax.”
“Any business that is $300,000 or less in receipts is exempt from this tax…”
“It is not an onerous tax, we believe, for anyone. We are pleased with the support we’ve received from the business community…”
He’s criticized the Comptroller’s office for not realizing that his plan used the surplus and then asks the members, basically, didn’t they realize that was what was going on?
“The fact of the matter is it balances and it balances very well.”
“We bring to you today a plan that is about a six billion dollar reduction in school M&O taxes…and one that I think has unprecedented business support…”
“We’re the first to admit that there’s not a state in the nation that does this.” But, he notes that other states may follow Texas’s lead.
“What this surplus looks like to me…and I’m not comptroller I’m not pretending to try to be….is it looks just like the oil boom of the 1970s…when it stops it really stops…You don’t want to be in the position of using all of your surplus and then half of it goes away…”
Rep. Rene Oliveria:
Q: I’ve been told by the Equity Center there will be a funding gap in this plan is that true?
A: What happens has to deal with the yield per penny. We didn’t change any of that. In other words, we are not a school finance organization, we didn’t…
Q: To be fair to you, it wasn’t in your charge…as long as we have a property tax component in our school finance system…as long as we don’t make any adjustments, this gap is going to continue to grow…Are you saying this has been addressed?
A:Â It is not the compression of the breakdown to a dollar….what I believe the Equity Center is concerned about is that as the tax rises back, you still have the gap…
Rep. Craig Eland:
Q: We also know that, built into the formula…we’re really only dropping it…a net of 20 cents.
A: The cap comes down to a dollar thirty…Originally, the bill…was going to effect everything on January 1 of next year. In the end we tried to put [17?] cents of it early…the supremes wanted us to do it now…the reason alll of it doesn’t go into effect on January 1 was to satisfy the Supreme Court.
…”We couldn’t wrap our arms around what meaningful discretion was…”
Q: But, if you have bonded indebtedness that’s not going to change?
A: I doubt that the state of Texas can crash your bonds…
Q: I understand that, that’s not being duiscussed. When we say it’s going down to a dollar, everybody hears that. I’m just trying to figure out what to tell my constituants.
A: You tell your constituants that Maintenance & Operation school taxes go down to a dollar.
Q: And they’ll say ‘I don’t care, what’s my tax bill going to be.’ It’s at $1.82 now, what’s it going to go to in two years.
A: Mr. Eland, I can explain it to you but I can’t understand it for you.
Q: And I can explain it to you and you can’t understand it.
Scott Hochberg:
Q: Have you looked specifically at how this business tax would [effect] the business cycle?
A: It is the most stable thing we could come up with…
Ruth Jones McClendon
Q: When you set the rate for the business tax, was it a consious decision you made not to set the rate to such a point where you could have money for the teacher pay raise and other reforms some of us have been looking at so that when we passed your version of the bill…we could do some of those reforms:
A: What you’re talking about was outside of our charge. Our charge was to address the supreme court decision, to get property taxes down…we were not a school finance commission. The way we looked at this rate was we tried to find a mechanism that would produce about the same money as if it were an income tax or something like that…every state has a business tax, we have one that is kind of voluntary…we tried to get the same kind of percentages as we would from a retailer as from Dow Chemical or Texas Instruments or someone like that…One percent and a half a percent sounds kind of made to order, but they work pretty well for most businesses.
Q: As you looked at it…did you ever think about going back to the governor and ask him if he would allow your commission…[to see if the charge could be changed to see if some school finance funding reforms could be changed]?
A: No, we didn’t because we considered it one heck of a task to try to fix this…
Popularity: 5% [?]
Do you know that you can 
