House Bill No. 175 introduces new financial regulations for municipalities and counties in Texas by amending the Local Government Code. It adds two sections, 140.014 and 140.015, which establish limits on annual expenditures and require transparency in budget summaries. Specifically, Section 140.014 sets a cap on total expenditures for political subdivisions, allowing them to exceed this limit only if approved by voters or in the event of a declared disaster. The cap is determined by the greater of the previous year's expenditures or an adjusted amount based on population growth and inflation rates published annually by the Legislative Budget Board. Additionally, Section 140.015 mandates that municipalities and counties post summaries of their adopted and proposed budgets online, detailing total amounts and specific categories of expenditures, along with a taxpayer impact statement.

These new provisions will take effect for fiscal years beginning on or after December 1, 2025, and aim to enhance fiscal responsibility and transparency in local government budgeting processes. The bill emphasizes the importance of public awareness regarding local financial decisions and the impact on taxpayers, ensuring that residents are informed about how their tax dollars are being allocated.

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