According to the Legislative Budget Board (LBB), HB 12 is estimated to have a negative impact of approximately $2.81 million on General Revenue-related funds over the 2026–2027 biennium. This cost stems from the increased responsibilities imposed on the Sunset Advisory Commission to implement the bill’s requirements for expanded public participation, agency performance evaluations, and reviews of regulatory agency rulemaking.

To meet these obligations, the Sunset Advisory Commission would need to hire eight additional full-time employees—seven attorneys and one data analyst. The attorneys would focus on analyzing the necessity and effectiveness of regulatory rules, while the data analyst would support the review and evaluation of agency performance metrics. The estimated cost of these positions is $1.43 million in the fiscal year 2026 and about $1.39 million per year in subsequent fiscal years.

Although the original version of the bill required additional efficiency audits by the State Auditor’s Office, the fiscal note assumes that any related administrative costs to the State Auditor or audited agencies could be absorbed with existing resources. Importantly, the bill does not appropriate funds directly but establishes the legal framework that could support future appropriations.

Finally, the fiscal note confirms that there would be no significant financial impact on local governments, as the bill’s mandates are confined to state-level agencies and operations.

HB 12 represents a thoughtful recalibration of how Texas oversees its regulatory agencies and measures government performance. The bill bolsters the state’s Sunset review process by mandating increased transparency, public engagement, and performance evaluation—principles deeply aligned with accountable and limited government. It ensures that agencies notify the public and regulated entities during the review process, solicit feedback, and undergo thorough analysis of their performance targets as listed in the General Appropriations Act. This responsiveness to the public fosters a more participatory and transparent state government.

Though the original version of the bill included broader provisions—such as mandatory efficiency audits of all state agencies and rulemaking reviews for regulatory entities—the Committee Substitute narrows this scope. Importantly, the bill retains essential transparency and performance reporting reforms while avoiding the heavier financial and administrative burdens that full-scale audits would have imposed. This shift ensures the reform is achievable and cost-conscious, even as it advances good governance.

The fiscal impact of the bill is modest in the context of state operations—projected at approximately $2.8 million over the 2026–2027 biennium—primarily due to the addition of eight staff members at the Sunset Advisory Commission. These personnel are critical for carrying out the bill’s analytic and outreach mandates, particularly in assessing agency rules and performance. This investment is justified when weighed against the potential long-term benefits of more effective, efficient, and transparent state agency operations.

In sum, HB 12 promotes a culture of continuous oversight, clear accountability, and improved public trust in state regulatory processes. It supports the principles of limited government, free enterprise, and individual liberty by ensuring that agencies operate transparently, measure success rigorously, and remain responsive to the people they serve. Therefore, Texas Policy Research recommends that lawmakers vote YES on HB 12.

• Individual Liberty: The bill enhances individual liberty by requiring state regulatory agencies to notify the public and regulated individuals about Sunset review processes and invite their input. This creates more opportunities for Texans to engage with government oversight and have a say in how regulatory power is wielded. By giving individuals a platform to voice concerns or support, the bill supports transparency and citizen involvement, fundamental to a free society.
• Personal Responsibility: While the bill increases public access to the review process, it does not explicitly assign new duties or expectations to individuals. However, by facilitating participation and awareness, it encourages citizens to take more responsibility in monitoring government actions. Still, since the behavior is optional rather than mandated, the impact on this principle remains neutral.
• Free Enterprise: The bill supports free enterprise by increasing scrutiny of regulatory agencies that often influence market conditions through licensing, rulemaking, and enforcement. By focusing Sunset reviews on the necessity and effectiveness of these regulations, the bill may lead to the repeal of outdated or unnecessary rules, reducing burdens on businesses and entrepreneurs. Evaluating performance measures also pushes agencies to operate in ways that do not hinder economic freedom unnecessarily.
• Private Property Rights: While the bill does not directly address private property, its emphasis on regulatory accountability may reduce regulatory overreach, which can indirectly benefit property owners. For example, more efficient and targeted regulations could limit unnecessary intrusions or restrictions on the use of property.
• Limited Government: The core of the bill is aimed at making government more efficient, accountable, and responsive. By strengthening performance evaluations, encouraging rulemaking transparency, and reinforcing legislative oversight through the Sunset Advisory Commission, the bill reinforces the idea that government should be limited, effective, and checked regularly. It avoids expanding government authority and instead fine-tunes existing oversight mechanisms.

• SB 1943 (Same As)