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 with voter approval 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 budget amounts across various categories and providing a taxpayer impact statement.

The provisions outlined in Sections 140.014 and 140.015 will only apply to fiscal years beginning on or after December 1, 2025, ensuring that local governments have time to adjust to these new requirements. The bill aims to enhance fiscal responsibility and transparency in local government budgeting processes, ultimately benefiting taxpayers by providing clearer insights into how public funds are allocated and spent. The act will take effect 91 days after the conclusion of the legislative session.

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