S.B. No. 1777 aims to regulate group homes in Texas by prohibiting certain payments for referrals and establishing criminal penalties for violations. The bill redesignates Chapter 769 of the Health and Safety Code to Chapter 767 and introduces new definitions and requirements for group homes. It specifies that a "group home" provides lodging and certain services to three or more unrelated residents but does not offer personal care services. The bill also outlines exemptions for various facilities, including licensed establishments and certain community organizations.

Additionally, the bill mandates that owners or operators of group homes must obtain criminal history record information for all applicants and employees, prohibiting the hiring of individuals with specific criminal convictions. A new section is added to prohibit health care providers from accepting payments for referring potential residents to unlicensed group homes, with violations classified as a Class B misdemeanor. The act is set to take effect on September 1, 2025.