Relating to the authority of a political subdivision to issue a public security if the debt-to-asset ratio of the political subdivision exceeds a certain percentage.

HB 4295 restricts local governments in Texas from issuing new bonds or similar debt instruments (called "public securities") if their debt-to-asset ratio reaches 20% or higher. It applies only to debt issued on or after September 1, 2025, and does not affect existing debt. The bill amends Texas Government Code Chapter 1253 to establish this 20% threshold for municipal bond issuances. This policy change directly affects cities, counties, and other local entities seeking to borrow money for projects or operations.