Bill > HB3537

This bill establishes a new limit on annual expenditures for all political subdivisions in Texas, such as municipalities, counties, and special purpose districts. The bill requires that a political subdivision's total expenditures in a fiscal year cannot exceed either its previous year's total expenditures or a calculated amount based on population growth and inflation rates, as determined by the Legislative Budget Board (LBB). The calculation involves multiplying the previous year's expenditures by a rate composed of the sum of the population growth rate and inflation rate, which the LBB must publish annually by January 31st. Political subdivisions can exceed this limit only if voters approve additional expenditures through a special election held on a uniform election date. The bill specifically excludes certain revenue sources from this calculation, such as bond proceeds, grants, donations, and gifts. The new expenditure limits will apply to fiscal years beginning on or after December 1, 2025, and the bill will take effect immediately if it receives a two-thirds vote in the Texas Legislature, or on September 1, 2025, if it does not receive immediate approval.

Government Affairs

https://capitol.texas.gov/BillLookup/History.aspx?LegSess=89R&Bill=HB3537