Budget & Taxes (State Budget)

HB 92 proposes replacing certain existing state and local taxes - including school district property taxes - with a new 6.72% state value added tax (VAT) on business transactions. The bill directly affects businesses selling goods or services in Texas, requiring them to pay tax on their sales (output tax) minus tax paid on their purchases (input tax), with exemptions for small businesses, government entities, and nonprofits. Key provisions include excluding financial services, intercompany transactions, and federally prohibited items from the tax, while directing all revenue to the state general fund. This reform aims to overhaul school finance by shifting revenue sources, though it does not specify how school funding will be adjusted.

HB 93 limits the rate at which state and local governments can increase spending by tying annual budget growth to population and inflation trends. It requires the Legislative Budget Board to calculate a spending growth cap each biennium using the prior three years' average population growth plus inflation (measured by the Consumer Price Index). If actual spending growth falls below this cap, the bill mandates reducing taxes to return over-collected revenue to taxpayers. This applies to all state/local government funding sources, including general revenue and dedicated accounts, and affects all Texas taxpayers through potential tax reductions.

HB 67 would require Texas to deposit half of any surplus state general revenue at the end of each biennium into a property tax relief fund. This fund would be used exclusively by the Texas Education Agency to reduce school district property taxes through adjustments to the state's "compression percentage" formula. The bill directly affects school districts and property taxpayers by creating a mechanism to lower maintenance and operations tax rates. It applies starting with the 2027-2029 state fiscal biennium and takes effect 91 days after the legislative session ends.

This concurrent resolution (HCR 10) urges the U.S. Congress to propose a constitutional amendment requiring a balanced federal budget. It does not create new law but expresses Texas's support for a constitutional change that would prevent federal deficit spending by mandating that annual government spending not exceed revenue. The resolution directs Texas officials to send copies to Congress and request its inclusion in the Congressional Record as a formal request. This is a symbolic action with no legal effect on federal budgeting.

HB 178 requires non-school district political subdivisions (like cities, counties, and special districts) that exceed the "no-new-revenue tax rate" for five consecutive tax years to conduct an independent efficiency audit. The audit examines fiscal management, resource use, and operational efficiency, with the political subdivision covering all costs. Exceptions apply for areas declared disaster zones under state law, allowing voter approval to bypass the audit during a two-year window. Results must be discussed in an open meeting and posted online within 30 days of the meeting, and audits must be completed within three months of hiring an auditor.

HB 79 reduces school district property taxes by using surplus state revenue to lower the "state compression percentage" that affects local tax rates. It creates a fund from excess state revenue (90% of general revenue over budget growth limits) to decrease this percentage, potentially eliminating a school district's ability to levy tier one maintenance and operations taxes. When the compression percentage reaches zero, districts cannot impose these taxes and automatically receive full state funding as if they had the maximum allowable tax rate. The bill directly affects all Texas public school districts by altering how state funding offsets local property tax burdens.