HB 20 takes a targeted, preventative approach to addressing fraudulent charitable solicitations that often emerge during disasters, without imposing broad mandates or heavy-handed regulation. It establishes two main components: a voluntary state-run certification program for disaster relief organizations and a requirement that educational materials on identifying and avoiding fraudulent solicitations be published online by the Texas Division of Emergency Management (TDEM) and the Attorney General’s consumer protection division. The certification program, administered by the Attorney General in consultation with TDEM, is intended to help donors distinguish reputable organizations from potentially fraudulent ones, especially in high-pressure disaster contexts where bad actors can divert funds away from genuine relief.
The program is designed to be entirely voluntary, meaning no disaster relief organization is compelled to participate in order to operate or solicit donations. For those that opt in, the Attorney General will establish eligibility criteria, an application process, renewal and revocation procedures, and issue a state-recognized seal. Certified organizations will be listed in a public online registry, and state or local entities administering disaster-related grants must consider certification status when evaluating funding applications. These measures aim to incentivize transparency and accountability while preserving full operational freedom for organizations that choose not to participate.
From a fiscal and governmental scope perspective, the Legislative Budget Board anticipates no significant cost to the state or local governments, as the duties can be absorbed by existing resources. The bill does expand the scope of the Attorney General’s and TDEM’s work by creating a new, ongoing program and associated rulemaking, but it does not require new agencies, staff expansions, or substantial budget increases. Because participation is voluntary and the bill does not impose licensing or operational mandates on all charities, the regulatory burden on individuals and businesses is minimal. Non-certified organizations remain free to conduct fundraising exactly as before.
HB 20 is consistent with principles of limited government and free enterprise. It focuses on providing tools for informed decision-making rather than restricting market entry. By relying on voluntary participation, it promotes personal responsibility among both charitable organizations (to maintain credibility) and donors (to use available resources when deciding where to give). It also enhances transparency in the disaster relief sector without reducing the variety or number of organizations able to operate in Texas.
For these reasons, minimal taxpayer impact, respect for voluntary association, consumer protection benefits, and targeted fraud prevention without sweeping new regulation, Texas Policy Research recommends that lawmakers vote YES on HB 20. It strengthens public confidence in disaster-related charitable giving while maintaining the flexibility and openness of the existing charitable landscape.
- Individual Liberty: The bill does not restrict the rights of individuals or organizations to engage in charitable solicitation, even during a declared disaster. Certification is voluntary, so no one is compelled to seek government approval before fundraising. By publishing educational resources on how to identify and avoid fraudulent solicitations, the bill enhances individuals’ ability to make informed decisions about their charitable giving without limiting their choices.
- Personal Responsibility: The bill encourages organizations to voluntarily meet transparency and accountability standards if they want to gain the reputational benefits of certification. It also shifts part of the responsibility to donors by giving them the tools and information to vet organizations before donating, reinforcing the principle that individuals are accountable for their actions and decisions.
- Free Enterprise: The bill preserves open market competition among charitable organizations. Certified and non-certified organizations can operate side-by-side, with no legal or financial penalties for remaining uncertified. By making certification a market signal rather than a prerequisite, the bill allows donors to reward organizations that adopt higher standards while letting others operate freely, consistent with voluntary market dynamics.
- Private Property Rights: There is no infringement on property rights. The bill does not seize, restrict, or regulate the use of private property, nor does it impose conditions on donations beyond those that donors choose to apply themselves.
- Limited Government: While the bill creates a new program within the Office of the Attorney General, its scope is narrow, informational, and voluntary. There are no new enforcement powers, criminal penalties, or broad regulatory mandates. The Legislative Budget Board anticipates the work can be absorbed with existing resources, so there is no significant taxpayer burden. The government’s role is confined to facilitating transparency and public awareness rather than controlling the sector.
