Reprint from the Progress Times - May 4, 2007
©Progress Times 2007 - All Rights Reserved

Trailer Tax Bill Reaches Senate Finance Committee

By Kathy Olivarez

While H.B. 1928, eliminating property taxes on RVs and park models, passed the Texas House after being introduced by Representative Kino Flores, the companion bill (SB 841) introduced in the Senate by State Senator Eddie Lucio is still under consideration by the Senate Finance Committee.

The bill specifies that RVs and park models should not be subject to property taxes. People who purchase these two types of units pay sales tax when they purchase their units. These units are designed to be temporary living quarters to be used in connection with recreational, camping, travel or seasonal use.

Owners of mobile homes (manufactured housing larger than 400 square feet) and site built homes do not pay sales taxes when they purchase their homes.

Gene Phagan, president of the Upper Valley Home Owners Association, who flew to Austin, April 26, to address the State Senate, said the bill is facing serious opposition from some lawmakers. It had been his hope that the bill would be passed by the senate that day.

The Upper Valley Homeowner’s Association is made up of representatives from about 20 different RV parks located in the Upper Valley who oppose the double taxation. While some parks are relatively small, others have several hundred lots. The amount of taxes charged to each lot owner differs based on the age and size of the unit and improvements made to the lot. None of the members of the Upper Valley Homeowner’s Association own the lots where their units are located. The park owners are taxed on the land but the owners of the RVs and park models are being taxed for "improvements."

The Senate Finance Committee’s major concern is whether school financing will be adversely affected by removal of the taxes.

Phagan told the Senate that Hidalgo and Cameron Counties were the only two counties in the state that continue to tax the units after the Texas Congress has twice told counties not to tax them. Members of the Upper Valley Homeowner’s Association consider this tax double taxation and many have threatened to look for other places to winter if the tax is not repealed.

Senator Eddie Lucio’s office said the matter would be considered again next week. Valley residents, park owners, and Valley chambers of commerce, who support the removal of the tax to support the Winter Texan industry in the Valley, should contact Lucio’s office to express their support of SB 841.

For more information on how to send letters of support to Senator Lucio by supporting removal of this tax, call his Brownsville office at (956) 548-0221.