Texas House Bill HB294

Texas 2025 - 89th 1st C.S.

• Filed: 8/8/25

Caption

Relating to the authority of the attorney general to investigate violations of law by certain local governments and to take action against those local governments to enforce the law.

Impact

The bill represents a significant shift in the power dynamics between state and local authorities in Texas. By allowing the attorney general to investigate and potentially penalize local governments for violations of law, the state is asserting a more dominant role in governance and oversight. Importantly, during the pendency of such legal actions, local governments would face restrictions, including limitations on adopting tax rates and receiving state grant funds. This could substantially affect local budgets and governance, particularly for municipalities that rely heavily on state funding and tax revenues.

Summary

House Bill 294 aims to empower the Texas attorney general with enhanced authority to investigate and take legal action against local governments that violate state laws. This legislation introduces a new subchapter to Chapter 402 of the Government Code, detailing the processes through which the attorney general can initiate investigations into purported violations by municipalities and counties. If the attorney general finds sufficient grounds following an investigation, they are authorized to file actions against the local government in state court, thereby enforcing compliance with applicable laws.

Contention

There are concerns surrounding the implications of HB 294, particularly regarding local autonomy. Opponents may argue that this bill undermines home rule, restricting local governments' ability to enact regulations that address specific community needs. Critics suggest that placing such authority in the hands of the state attorney general could create a chilling effect on local governments, leading to hesitance in making policy changes or addressing issues due to the fear of potential legal repercussions from the state. Additionally, the burden of proof falls on local governments to demonstrate compliance with laws if they are challenged, increasing their accountability but also placing an added strain on their resources.

Texas Constitutional Statutes Affected

Government Code

• Chapter 402. Attorney General
  • Section: New Section

Tax Code

• Chapter 321. Municipal Sales And Use Tax Act
  • Section: 502
  • Section: 501

• Chapter 323. County Sales And Use Tax Act
  • Section: 502
  • Section: 501