According to the Legislative Budget Board (LBB), HB 2 is projected to have a negative net impact of approximately $5.75 million to General Revenue–related funds over the 2026–27 biennium. Annual costs are expected to range from about $2.26 million to $3.48 million through fiscal year 2030. These estimates do not include any potential expenditures for grants issued under the bill’s grant program, since the funding source and volume of awards are unknown.

The Texas Division of Emergency Management (TDEM) would incur new personnel and operating costs to implement the Council’s strategic plan and manage program activities. This includes hiring 11.3 full-time equivalent staff: a Division Chief, Section Chief, Program Specialists, and Systems Support Specialists across TDEM’s regions. Annual salary and benefits costs are estimated at $1.5 million, with operating expenses of about $0.8 million. Additionally, $1.1 million in capital expenditures is anticipated in FY 2026 for development and implementation efforts.

The fiscal analysis assumes these expenses will be ongoing, covering administration, stakeholder engagement, and statewide coordination. There are no significant fiscal impacts expected for local governments from the bill’s provisions. However, the grant program itself, if funded, could channel resources to local jurisdictions without imposing additional local costs.

HB 2 responds to recent major disasters by creating the Texas Interoperability Council to develop and oversee a statewide strategic plan for interoperable emergency communications among first responders. It also establishes a state-run grant program to help local governments purchase equipment, build infrastructure, and conduct training to meet those interoperability goals. The policy goal, ensuring seamless communication in times of crisis, is important and broadly supported in testimony following the Panhandle wildfires and Hill Country floods. Coordination, technical standards, and clear lines of communication are all critical to effective disaster response.

However, the bill substantially grows the size and scope of state government. It creates a permanent, appointed council with rulemaking authority and staffing increases at the Texas Division of Emergency Management, projected at 11.3 full-time equivalent positions, dedicated to the program’s work. This represents a structural expansion of the bureaucracy with the power to set standards, manage contracts, and oversee grant administration. By design, such a body could easily expand its role over time beyond its original coordination mandate.

HB 2 also increases the burden on taxpayers. The Legislative Budget Board estimates a negative General Revenue impact of $5.75 million for the 2026–27 biennium to cover salaries, benefits, operations, and capital expenditures, not including any future appropriations for grants. The bill authorizes the council to use “any available funds,” which includes General Revenue, to operate its grant program. This effectively establishes a standing mechanism for state-to-local subsidies, potentially creating an ongoing fiscal obligation.

While HB 2 does not directly impose broad regulatory requirements on private individuals or most businesses, it increases the regulatory burden on local governments that receive grants by requiring compliance with council rules, performance-based contracts, standardized incident procedures, and training mandates. Those requirements could indirectly affect private vendors and contractors by narrowing technical specifications and limiting flexibility to council-approved standards.

In light of these factors, while the bill’s stated purpose, improving disaster communications, is sound, its approach conflicts with limited-government principles by expanding state structure, creating a permanent grant-making apparatus, and committing taxpayer resources to functions that could be managed locally or through voluntary interlocal agreements. These concerns are significant enough that Texas Policy Research recommends that lawmakers vote NO on HB 2 unless amended as described.

• Remove or strictly limit taxpayer-funded grant authority
• Place coordination responsibilities within existing agencies
• Sunset or otherwise limit the council’s duration to prevent long-term bureaucratic growth

• House Select Committee on Disaster Preparedness & Flooding: 7Y/0N (2 Absent)