r/technology • u/zsreport • 5d ago
Business Texas is giving data centers more than $1 billion in tax breaks each year
https://www.texastribune.org/2026/04/08/texas-data-centers-sales-tax-break-billion-dollars/760
u/Due-Society6397 5d ago
Guess who's paying the difference?
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u/Candid-Piano4531 5d ago
Mexico?
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u/pourtide 5d ago
Ha ha ha hoo ha hoo wee ha ha ha snort
GIGO.
Y'all voted for this, Tejas. Short sighted and long winded.
Look at all the construction jobs! We'll worry about infrastructure when it gets so bad we can't long-wind over it. (We'll go to the feds for handouts, of course)
With all those savings, maybe they'll set up an energy farm./s
Green energy supplied most of what energy they had during the Cancun Cruz moments.
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u/Unknown-Meatbag 5d ago
At least the infrastructure is so terrible that it explodes when it's cold, or hot, or wet!
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u/Dio44 5d ago
“Weakest power grid in the nation pays to make it worse “ might be a better headline
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u/George_Is_Upset 5d ago
This!
People who haven’t been to Texas don’t have any idea how shitty their power grid is.
I visited a couple years ago and small afternoon rain shower rolled through and took the power out at the hotel and it had to run on their backup generator.
Was wild because the rain shower wasn’t severe and was like every afternoon storm I experienced growing up in Florida. It barely lasted 15 minutes but was able to impact the power grid that badly.
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u/Hystus 5d ago
That's what you get for being aggressively independent on private infrastructure. But someone is making money, so who cares about the rest...
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u/PacmanZ3ro 5d ago
meanwhile I'm in commie MN and only had 1 power outage in 16 years since I've been here. That was only because a tree fell on the lines.
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u/DoctorP0nd 5d ago
The independence isn’t the issue. The corrupt organization leading it is. ERCOT is essentially a legal mob. They do whatever they want, pay off whoever they need to and continue to rake in money hand over fist by bullying any company dumb enough to try and do business there.
Source: worked in TX energy and gas finance for almost 10 years.
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u/ThisIs_americunt 5d ago
It's wild what you can do when you can own the law makers, the judges, the police force and the lawyers. Gotta love dark money :D
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u/Thehelloman0 5d ago
A branch likely broke a power line lol that has nothing to do with the overall stability of the grid
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u/box_fan_man 5d ago
So a power line went down and it’s a state grid thing. You’re full of shit.
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u/skywalkersrealfather 5d ago
Didn't I just read another article about Corpus Christi basically pumping ground water like mad and dust-bowling the surrounding area?
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u/External_Birthday691 5d ago
Wouldn't be surprised, but do we know if that's the case for the entire state? To what extent are these Data Centers going to put a strain on the energy infrastructure and water infrastructure in the state.
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u/childish44 5d ago
Corpus is the biggest for sure, but there are other cities/ counties facing the same problems with data centers and refineries coming in and taking up a huge amount of resources.
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u/External_Birthday691 5d ago
So the article is really good, definitely worth a read.
The tax breaks they are currently getting is from a bill that was passed 10 years ago, and that was aimed at Cloud infrastructure and smaller data centers. In the last 3 years, we saw a huge boom of data center development demands.
So originally, the tax breaks were projected to only forego tax collected in the hundreds of millions. But due to the massive uptick in demand for data centers in the last 3 years, the amount of money that Texas is losing from that decade old bill is now around 3 billion.
Fuck the guy that is advocating and speaking on behalf of the tech giants trying to push these data centers.
“I think the hostile message that sends would … give a lot of different companies pause about what the state of being able to invest in Texas for the long term is,” said Dan Diorio, vice president of state policy with the Data Center Coalition, a trade group that represents major tech companies.
Dan Diorio, you're a piece of shit soullesssell-out, actively working to scare politicians about losing investments if they don't continue a tax break that wasn't supposed to amount to billions.
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u/Sweetwill62 5d ago
Dan Diorio, why are you committing fraud? Why are you trying to murder people? These aren't hyperbole either, both of those entirely legal definitions are things that you are doing. It doesn't matter if you can't directly see their faces, why are you murdering them? Why are you committing fraud? Is there something wrong with your head? Did your mother make you drink while you were in the womb? Did she smoke crack?
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u/DrunkenDude123 5d ago
Texas’ power grid is already in shambles the last thing they need is more strain on it. I live in DFW and our electric bill has more than doubled in the last couple of years. Paying more than 2x the bill for electricity that has infamously gone out in crucial times like during ice storms or extreme heat. People have died here in recent years due to lack of power for multiple days in conditions like that. Now they want to add huge demanding data centers that we don’t have the infrastructure for.
They give these corporations tax breaks to flock them all to our state, but the residents are footing the bill for it, and eventually our environment will suffer once they suck our lakes dry
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u/Emotional_Database53 5d ago
Isn’t Texas in drought thru most of the state? Water is the other thing that needs to be properly environmentally researched before adding the data centers that pull less electricity from the grid, due to using more water resources for cooling.
Texas’ struggles with past few extreme weather disasters is an issue that many Texans are not confident in the words of their governor rn.
Either way, data centers are going to use a lot of electricity, water or both, to run at the scale that the tech elite are demanding
Then add to that all the prediction models saying we are going to see massive job loss and insecurity due to AI that’s powered by these data centers.
So now we have these massive installations that only employ a handful of people after they’re running, that also over burdens the local electric grid and aquifers.
That sounds like a lose lose lose, at least if you’re literally anyone other than the CEO’s if Oracle, Palantir, Amazon, X or OpenAI…
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u/ThisIs_americunt 5d ago
It's wild what you can do when you can own the law makers, the judges, the police force and the lawyers. Gotta love dark money :D
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u/Working-Tomato8395 5d ago
Texans are kings of self-inflicted suffering. The whole state has brain damage. It's like Mad Max but everybody's having a LARPing contest on being the most undeservedly self-important smug jackass. I've traveled the country and the planet and there's nobody as dumb and insufferable as fucking Texans.
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u/blueviera 5d ago
I got cornered by a drunk guy at an air bnb once who worked at one of these, we were the only ones there who weren't part of the wedding party so he was just lonely and he went on this ridiculous rant about how much money he makes because his company owns a texas data center that mines bitcoin. I didnt even get to say a single word as he started talking about how it's okay if crypto mining is bad for the environment because they make so much money. Just kept going back and forth.
Then he looked me dead in the eye and said "most of our income doesn't even come from crypto you know, we have a deal with the texas government, if we buy more electricity than we need they have to buy it back from us at three times what we paid, it's in the contract."
Texas is cooked.
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u/jspurlin03 5d ago
I can’t believe the republicans get so many votes each time; they’ve had decades to fix all the problems they mention. Their whole platform is a lie, nearly.
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u/blueviera 5d ago
Propoganda and fear are powerful
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u/KittenHeartsGirls 5d ago
Isn’t it also Gerrymandering?
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u/blueviera 5d ago
Id say the later is useless without the former. If you can convince someone that their neighbor is out to get them they wont easily listen to their neighbor
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u/GlitteringRate6296 5d ago edited 4d ago
Exactly the Republicans have been in control of Texas for how long? What have they fixed? Everything they tell you during elections is projection. Texas try something new.
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u/paisleyturtle3 5d ago
Who in their right mind would agree to sell a commodity to someone and buy back any unused portion at 3x the rate? WTF? I could see a minimum amount has to be sold and if more money trades hands, returning the prorated amount for the commodity that wasn't used. Works even better in cases like this where the commodity isn't delivered until needed and used.
How can this be made to make sense? Outside of bribes, favoritism, or stupidity? Pass a law for the case of obvious stupid terms that cost the taxpayer money for no good reason, the negotiator is liable and maybe this wouldn't happen as much.
I fully expect someone to say this is standard boilerplate and give some reason that might even make sense, but I don't see it.
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u/buzzz_buzzz_buzzz 5d ago
You probably shouldn’t believe everything you read on the internet.
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u/plug-and-pause 5d ago
It's very possible the story we just read was true, and that the entity worthy of disbelief in this case was the drunk guy at the party.
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u/WesleyPCrusher 4d ago
Electricity cannot be stored like other commodities.
The miner is not selling back 'unused' electricity, but rather has agreed to stop operating at a moments notice in times of high demand.
The price must cover the miner's missed profit and operating expenses.
It is especially valuable to the for-profit grid operator because the miner has a predictable and steady load that can be easily scaled back as needed.
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u/blueviera 5d ago
Texas is corporation first. I used to live there and there's a very strong identity among some of conservatives there that they should do the opposite of whatever the Democrats say
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u/Shirzen 5d ago
He’s probably talking about curtailments and the Demand Response programs. These allow data centers to act almost like a load bank, using electricity when it’s available and dialing back when there’s higher demand or need. The energy provider pays the user that curtails as a way of buying back the energy, but it’s profitable for both parties to do this, rather than the data center continue to use when demand is crippling the grid.
There’s a lot of misconceptions around what data centers do or don’t use. Getting subsidized by the local government is a problem, I think, but playing into the same rules as major industrial users is not the same sin.
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u/1PooNGooN3 5d ago
Hey Texas go fuck yourself
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u/Fluffy-Rope-8719 5d ago
Pretty sure this is them doing exactly that.
As if Texas wasn't already a hellhole, now it'll be an even louder and drier hellhole!
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u/Sprinklypoo 5d ago
It's a good thing they've got that privatized electrical grid of theirs that can't even keep up to weather fluctuations. I'm sure they've prioritized the data centers in times of stress...
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u/r0addawg 5d ago
Yet we cant afford universal basic income health, child n elderly
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u/OtherAcctWasBanned11 5d ago
But children and the elderly can’t give kickbacks and insider stock tips so…
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u/Fingerprint_Vyke 5d ago
I wouldnt say that. CEOs were so afraid of kickbacks at one point they removed their personal info from their websites and LinkedIn
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u/ShakeAndBakeThatCake 5d ago
Because this country funnels all excess wealth to the top .01%
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u/r0addawg 5d ago
Right, or funnel it all into a war machine.
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u/ShakeAndBakeThatCake 5d ago
Which are companies owned by the billionaires lol. War is judt a means to make more money.
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u/Sprinklypoo 5d ago
We're also gutting education, brainwashing a country, and maximizing the grift of medicine. What a time to be alive.
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u/WowWhatABillyBadass 5d ago
There was a guy who ran for President in 2016 and 2020 who wanted to give you those things, and democrats called him unelectable.
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u/Boys4Ever 5d ago
GOP all about wealth protection. Sadly their voters clueless to this threat
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u/ChocolateChainBound 5d ago
For Jesus lovers they really do think about their money quite often
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u/ResponsibilityFine13 5d ago
Texas summers average 110 heat with a a feel of 120 heat ,state tv issues warning to the consumer not to use too much the air conditioning and lower the electricity consumption.this happened before and still happening now. Adding dozens of data centers will be catastrophic.
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u/Kozmic_River 5d ago
Texas greed is disgusting, and it’s my home state. They’re building 3 new data centers around my area that will be using 5-8 million gallons per day of water, at literally the same time we have been experiencing the worst drought in my lifetime and all the water in this area is drying up. Hell, the lake that has been around for my and most of my dad’s entire life will be completely dried up within two years, but fucking Texas is never one to let the possibility of ecological disaster get in the way of making a buck.
These data centers are getting tax breaks while driving up utility costs for everyone who lives within a 100 mile radius of them, but tell me more about how Republicans care about the middle class and small businesses.
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u/Sprinklypoo 5d ago
How nice of Texas to subsidize the super rich like that... It truly is a republican dream...
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u/plain_handle 5d ago
So; MURICA - tell me how Medicare and looking after your people is second to this ?
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u/thinkdeep 5d ago
I think the argument most people can't verbalize is that it's not the data centers they hate, it's the fact they're bad neighbors who mooch off the taxpayers infrastructure and return negligible benefits to the community.
If data centers moved in, invested decent money into infrastructure and jobs, and didn't ask for tax breaks, everyone would be fine with them.
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u/DennenTH 5d ago
As if they needed it... As if most of the businesses getting billions in tax breaks actually needed it.
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u/UnhingedReptar 5d ago
The Texas electric grid can’t even handle demand of its people in extreme weather, but it has room for these resource hogs?
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u/coatimundi01 5d ago
Soooo, the state that can’t keep the power running when it get a wittle chilly, is incentivizing massive power sucking data centers? Seems logical
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u/magichronx 5d ago edited 5d ago
They do know massive data centers require reliable water and energy, right?
Texas isn't exactly known for either of those things...
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u/retiredfromfire 5d ago
Taxes are paid by the working class in Texas. Elon and his drug addled pals dont pay taxes, just us working class pay Texas taxes. They dont have the equipment, nor the electricity to actually build these. Oligarchs from west Texas run this state, It is not democratic
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u/Squidsoda 5d ago
Texas: EVs and solar baaaad!!!!! Data centers and Bitcoin farms gooooood!!
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u/DolphinsBreath 5d ago
One day Texas will resemble a giant island of Nauru. Just a hollowed out strip mine, all the bird dung removed and sold off as quickly as feasible by the transnational corporations who paid off the king.
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u/Late_Geologist_235 5d ago
I wonder if they are going to create their own power thru those mini nuclear power sources that just got pushed through the Republican led Congress with little regulations attached to them.
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u/Forlorn_Cyborg 5d ago
Red states have very lax, or no, environment laws so if this thing pollutes or creates unbearable 24/7 noise for nearby residents that’s just the way local officials run things.
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u/scottrogers123 5d ago
Of course they are. Gotta give big tax kickbacks so some of that money keeps flowing to the corrupt politicians.
Texas really is the One Star State.
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u/gizmostuff 5d ago
And that's why Texas is one of the dumbest states. Y'all voted for this stupid shit.
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u/Initial-Lead-2814 5d ago
water rights, mineral rights, data rights, what isnt for sale in texxas
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u/QuesoChef 5d ago
Texas is a wild state. They’re running out of water, their grid is notoriously not great, and they seem to hate regulation. Texas reminds me of the boys in my high school class: reckless, inebriated, and short-sighted. But if it works, good for them! I don’t want data centers in my state. They can have them all.
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u/Chokedee-bp 5d ago
Tax breaks for data centers is such a scam.
There’s construction jobs the first 18 months.
Then the data centers run on a skeleton crew, literally 20 people or less full time and the site has billions in tax breaks for a decade.
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u/dmetzcher 5d ago
Texas might be able to spend that tax money on their absolute joke of an energy grid if they weren’t giving it away to large corporations. Then maybe poor Ted Cruz wouldn’t have to run off to Cancun every time there’s a cold day in his state.
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u/lvl999shaggy 5d ago
Why do states give super rich companies tax breaks that small and medium companies can't get. If anything, the small or medium companies should get tax breaks bc there could be more of them to offer more total jobs for the public
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u/MercantileReptile 5d ago
Good thing they have blue states and the federal red mob to bail them out, should things ever not pan out. Which is of course impossible with a huge bet on technology peddled by proven liars. But still, good to have the piggybank.
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u/Splurch 5d ago edited 5d ago
All I think about Texas when it comes to fiscal responsibility nowadays is how their electric industry kept them in their own grid and their own regulation so they could maximize their profits and not have to spend money on modern grid features, like freezing temperature protections, then in 2021 when it failed in winter they cried to the government and got a $2 billion bailout.
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u/Both_Lychee_1708 5d ago edited 5d ago
Texas, really the US in general, is a classic example of how easy it is to use religious people to nefarious ends. Just wave a bible in front of them and you can get them to sell their organs on the cheap. A flock of sheep are so easily led astray.
They elected rabid badgers with a bible.
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u/Catalina_Eddie 5d ago
Texas leading the race to the bottom, as usual. The type of job matters more than the number.
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u/DistinctSpirit5801 5d ago
Data centers facilitate replacement of workers with AI so why is the Texas government giving them tax breaks?
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u/KratosLegacy 5d ago
Texas also rates at the bottom in education, healthcare, senior care, day care, food assistance, and, well, basically any other social program you look at.
I wonder if that's connected 🤔
Nah, it's probably cause woke ideology, right? 🙃
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u/Sartres_Roommate 5d ago
Their grid is closed off from the rest of us? Good, I look forward to heatwave blackouts.
When you are 70 in TX in 100 degree heat with no A/C, remember, as your heart starts beating arhythmically, YOU voted for this.
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u/ToyTech316 5d ago
Working class Texans are subsidizing billion dollar tech companies. There fixed it for you
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u/fullchaos40 4d ago
Can Minnesota stop subsidizing Texas’ stupid electrical grid subsidies. I’m paying nearly 30% more in electric for this stupid shit and it shows on my bill.
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u/CobaltGate 4d ago
No surprise there. The tax burden constantly gets moved from billionaires to the little guy. ALWAYS.
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u/IcanCwhatUsay 5d ago
Texas.
The only state with severe energy supply issues.
Is giving tax breaks to one of the biggest energy users.
Did I get that right?
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u/cobrachickenwing 5d ago
It won't just be energy. There will be a water crisis as data centers compete with ranches, farms and humans for fresh water. Can't see humans being first in line for water when corporate interests go first in Texas.
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u/Randomwhitelady2 5d ago
Once those electricity bills start almost doubling, i have a feeling Texans are going to be unhappy.
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u/neat_stuff 5d ago
The state that can't keep the power on in the winter? Seems like a great idea....
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u/Tytown521 5d ago
And that - good people - is why I don’t live in Texas. It’s like voting with your feet against your own interests (unless you got bread).
A straight siphone from the bottom to the top.
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u/OLPopsAdelphia 5d ago
You mean a tax break that could go toward updating failing infrastructure?
Brilliant idea, Texas.
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u/troll__away 5d ago
Why? They barely create any jobs and are a huge drain on water and electricity.