# Texas Constitutional Amendment Prop 3 **URL:** \ **Category:** Politics & Elections\ **Created:** [October 11, 2013, 8:37pm UTC](https://boards.straightdope.com/t/texas-constitutional-amendment-prop-3/671021 "2013-10-11T20:37:21Z")\ **Posts on this page:** 4\ **Page:** 1
**Author:** ![Irishman](https://avatars.discourse-cdn.com/v4/letter/i/b487fb/32.png) [@Irishman](https://boards.straightdope.com/u/Irishman)\ **Post date:** [October 11, 2013, 8:37pm UTC](https://boards.straightdope.com/t/texas-constitutional-amendment-prop-3/671021/1 "2013-10-11T20:37:21Z")
Texas has a few Texas Constitutional Amendments up for vote this year. I’m reading my way through them to try to understand what they mean. Some of them are described well enough [here](http://www.tlc.state.tx.us/pubsconamend/analyses13/analyses13.pdf) (pdf) that I can make sense, but a few are lacking details or just too jargon-laden for me. I’d like some help making sense of these things, or pointing me at more info. For simplicity, I’m breaking the ones I care about into separate threads. I’m going to look at Prop 3, Prop 4, and Prop 6. This thread will be Prop 3. Prop 3 is listed as HJR 133. HJR 133 authorizes local political subdivisions (i.e. cities, counties, etc) to extend the length of time that aircraft parts could remain in Texas before being subject to ad valorem taxation (i.e. property tax). Under current law, materials may remain for up to 175 days before being taxed as property. The intent is to allow materials to be kept in warehouses and such prior to being used in fabrication of goods or shipped to other states. This proposed amendment would extend the tax exemption window to 730 days, i.e. 2 years. The preposal for the ballot reads: > [@](#): > > The constitutional amendment to authorize a political subdivision of this state to extend the number of days that aircraft parts that are exempt from ad valorem taxation due to their location in this state for a temporary period may be located in this state for purposes of qualifying for the tax exemption. The supporters of the proposed amendment argue > [@](#): > > The current 175-day limit on how long certain tangible personal property may be held in a Texas business’s inventory to qualify for a freeport tax exemption unfairly disqualifies aircraft parts, which generally are held in inventory for longer periods. Aircraft parts may not be needed by a customer for many months, so an inventory does not turn over very quickly. In addition, the raw materials for the parts may be in limited production, requiring Texas aircraft parts suppliers to purchase in bulk and maintain large inventories for long periods to have parts on hand when needed. If the parts are detained in Texas for more than 175 days after the date the suppliers acquire or import the parts, the parts do not qualify for the current exemption. This tax burden places Texas aircraft parts suppliers at a competitive disadvantage with suppliers located in other states where goods destined for out-of-state shipment are exempt from property taxation. Although the freeport exemption was authorized as a business incentive, the current time frame for turning around inventory is too short to meet the needs of the Texas aviation industry and may be a deterrent to business relocations to Texas or expansion of operations already in Texas. I think I understand the intent of the proposal. The supporters feel that the current law is insufficient for aircraft parts suppliers, and that aircraft parts suppliers are somehow subject to conditions that don’t apply to other industries, and as such, should have a longer window. That is an arguable opinion. My question with regards to this preposal is the argument relating to other states and the possible competitive disadvantage. Are their other states that have longer tax exemption windows, or no taxation, for aircraft parts and materials held in inventory? Or is this a more theoretical “it could happen” kind of justification? In other words, just how real is this competitive disadvantage? ---
**Author:** ![BrainGlutton](https://avatars.discourse-cdn.com/v4/letter/b/82dd89/32.png) [@BrainGlutton](https://boards.straightdope.com/u/BrainGlutton)\ **Post date:** [October 12, 2013, 4:05am UTC](https://boards.straightdope.com/t/texas-constitutional-amendment-prop-3/671021/2 "2013-10-12T04:05:52Z")
> [@Irishman](#): > > For simplicity, I’m breaking the ones I care about into separate threads. :dubious: But, why is a tax on aircraft parts one of those?! ---
**Author:** ![ElvisL1ves](https://avatars.discourse-cdn.com/v4/letter/e/5daacb/32.png) [@ElvisL1ves](https://boards.straightdope.com/u/ElvisL1ves)\ **Post date:** [October 12, 2013, 4:14am UTC](https://boards.straightdope.com/t/texas-constitutional-amendment-prop-3/671021/3 "2013-10-12T04:14:44Z")
[Yes, it’s pretty common](http://www.nbaa.org/admin/taxes/state/), and the aviation industry does have the clout to get state taxes removed on the basis of competitiveness with each other. The assets are easily portable, so are the people and businesses, and the states generally would rather keep them. ---
**Author:** ![Irishman](https://avatars.discourse-cdn.com/v4/letter/i/b487fb/32.png) [@Irishman](https://boards.straightdope.com/u/Irishman)\ **Post date:** [October 15, 2013, 8:41pm UTC](https://boards.straightdope.com/t/texas-constitutional-amendment-prop-3/671021/4 "2013-10-15T20:41:35Z")
> [@BrainGlutton](#): > > :dubious: But, why is a tax on aircraft parts one of those?! I should have said “the ones I need help understanding” instead of “I care about”. > [@ElvisL1ves](#): > > [Yes, it’s pretty common](http://www.nbaa.org/admin/taxes/state/), . Thanks.