Phil Stephenson

CPA Phil Stephenson (R-Wharton), above, says he can reduce property taxes with a new school funding plan and fix teacher pension fund shortfalls with life insurance policies. His bills have already been filed this legislative session which got under way Tuesday in Austin.

Texas’ 87th Legislature gaveled to a start Tuesday with COVID disaster response and redistricting before lawmakers and, if Wharton County’s representative has any say, school funding.

Rep. Phil Stephenson, R-Wharton, is championing a bill he says he can turn the largest portion of most homeowners’ tax statement into a voluntary bill. He also has a plan to solve teacher and other state pension fund woes.

How does he think schools should be funded? Sales tax.

“It’s accounting 101,” the long-time CPA turned statesman told the Leader-News. “Why aren’t we funding schools with sales tax? The most important thing in the world is education ... The businesses should be paying.”

H.B. 288 along with HJR 19, filed before the session opened, outlines his plan to replace the amount homeowners are paying for their school district’s maintenance and operations not by raising sales tax, but rather covering services.

“It’s not a rate change, it’s just expanding the base,” Stephenson said.

Listed first in the bill is charging sales tax on financial services from tax returns to accounting firms like the one he’s run for decades.

The bill would also charge sales tax on engineering services, law offices and real estate agencies, if ultimately approved.

“Businesses like mine (services) make enough to fund schools and put money in a rainy day school fund,” Stephenson said. “I tell businesses to think of it this way – those are your future workers.”

Services sales taxes would then be rebated to school districts similarly to the monthly payments made to cities.

Stephenson tackles state pension concerns in HB 248 in a formula he says will ultimately produce billions, by buying teachers $100,000 life insurance policies and using the interest/value of the policies to fund retirements.

No one has to die for the trust to fund, the dollars are pulled from premium index.

“Everything’s in there to make things grow,” Stephenson said.

Should a death occur, however, the teacher’s beneficiary would collect half the policy. The state, which paid all the costs, would collect the rest.

The initial investment would be borrowed dollars, but it won’t take long to retire the debt, Stephenson said. “In one generation of teachers, you don’t need money to borrow ... and it will multiply like a crazy thing ... It’s an income generator that pays for itself.”

It’s a plan the CPA says he’s been working on for six to seven years.

Reelected in 2013 following a bout of Texas’ redistricting which pulled Wharton County’s previous state representative out of the district boundaries, Stephenson has served on financial committees each session.

In the 86th regular session, Stephenson held posts on the Pensions, Investments and Financial Services Committee as well as the Corrections Committee.

Stephenson and nine other rural Republican representatives later dubbed X-men became the targets of a plot to be ousted from office in the 2020 November election led by then House Speaker Dennis Bonnen.

“It’s going to be a struggle (this session),” Stephenson said. “Bonnen may not be there, but he’s there.”

The former speaker’s war chest, he said, “has $3 million to promote the ways he thinks things should be.”

Bonnen ultimately admitted to the effort after a taped conversation between him and Empower Texas’ leader Michael Quinn Sullivan was made public.

Bonnen did not run for re-election.

A farm pesticide bill authored by Stephenson last session and signed by the governor allowed producers to dispose of unused chemicals.

This session, Stephenson says he’s going to work to keep it in place.

“There’s a lot of things I’d like to do, but I don’t know if I can do it in 140 days (the length of Texas’ biannual legislative session),” Stephenson said.

COVID disaster response is prompting concerns over balanced state budgets, but Stephenson says they have to find some way to bring everything together. “You’ve got to balance the budget,” he said. “You can’t just let a virus or anything adjust it.”

The virus and response to it will, of course, play a major role in the session, Stephenson said, starting with getting representatives gathered, holding hearings and the like.

The spread must be stopped, he said, but added, “We cannot hurt the economy.”

For now, he and the Texas citizens as a whole must wait to see what bills are filed in response to the situation and what orders the governor issues.

With the COVID issue and all others, Stephenson said, he intends to do his best to serve his constituents.

“The only thing I want in life is to be remembered with people saying ‘He’s a fair guy.” I don’t need to be a hero,” he said.

(0) comments

Welcome to the discussion.

Keep it Clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
PLEASE TURN OFF YOUR CAPS LOCK.
Don't Threaten. Threats of harming another person will not be tolerated.
Be Truthful. Don't knowingly lie about anyone or anything.
Be Nice. No racism, sexism or any sort of -ism that is degrading to another person.
Be Proactive. Use the 'Report' link on each comment to let us know of abusive posts.
Share with Us. We'd love to hear eyewitness accounts, the history behind an article.