According to the Legislative Budget Board (LBB), HB 1395 is not expected to have a significant fiscal impact on the state. The proposal’s requirements—primarily mandating pro-rated refunds of damage waiver charges under certain conditions—are not anticipated to result in material costs to state agencies or to generate significant new revenue streams. The bill does not create new state programs, administrative structures, or enforcement obligations, thereby minimizing any fiscal burden on state resources.

Additionally, no significant fiscal implications are expected for local governments. The bill does not impose duties on cities, counties, or other local entities, nor does it affect local tax structures or administrative responsibilities. Rental companies subject to the refund requirement operate within the private sector, and the financial adjustments mandated by the bill (e.g., refunding unearned damage waiver fees) fall entirely on those businesses, not governmental entities.

The Texas Attorney General’s Office and the Comptroller of Public Accounts—agencies potentially involved in interpreting or overseeing compliance—do not foresee a substantial workload increase or budgetary strain as a result of the bill’s provisions. As a result, the fiscal note confirms that any associated costs or revenue impacts would be minimal and manageable within existing resources.

HB 1395 proposes amendments to the Texas Business & Commerce Code, specifically Sections 91.001(6) and (7), to extend the definition of a "rental agreement" and "rental company" from 30 days to 180 days. It also adds a new provision (Sec. 91.057) requiring rental companies to refund any damage waiver fees for periods beyond when the waiver was in effect, such as when a vehicle is returned early or the waiver is canceled.

The Legislative Budget Board’s fiscal note for HB 1395 states that the bill is not expected to have a significant fiscal impact on the state. The proposal’s requirements—primarily mandating pro-rated refunds of damage waiver charges under certain conditions—are not anticipated to result in material costs to state agencies or to generate significant new revenue streams. The bill does not create new state programs, administrative structures, or enforcement obligations, thereby minimizing any fiscal burden on state resources.

Additionally, no significant fiscal implications are expected for local governments. The bill does not impose duties on cities, counties, or other local entities, nor does it affect local tax structures or administrative responsibilities. Rental companies subject to the refund requirement operate within the private sector, and the financial adjustments mandated by the bill (e.g., refunding unearned damage waiver fees) fall entirely on those businesses, not governmental entities.

The Texas Attorney General’s Office and the Comptroller of Public Accounts—agencies potentially involved in interpreting or overseeing compliance—do not foresee a substantial workload increase or budgetary strain as a result of the bill’s provisions. As a result, the fiscal note confirms that any associated costs or revenue impacts would be minimal and manageable within existing resources.

HB 1395 addresses a clear statutory gap with minimal economic disruption while advancing consistency, fairness, and contractual accountability. Texas Policy Research recommends that lawmakers vote YES on HB 1395.

• Individual Liberty: The bill enhances individual liberty by protecting consumers from being charged for damage waiver coverage they no longer use or need. It ensures renters are only billed for the actual period a waiver is in effect, whether due to early vehicle return or cancellation of the waiver, thus affirming the principle that individuals should not be obligated to pay for services not received. It also allows for longer rental periods under a single agreement (up to 180 days), increasing contractual freedom.
• Personal Responsibility: By making renters responsible for deciding whether to cancel a damage waiver or return a vehicle early (and acknowledging the consequences if damage occurred), the bill reinforces personal accountability. It places responsibility on both parties—the renter to make informed choices, and the company to act in good faith and refund charges when appropriate.
• Free Enterprise: The bill promotes fair play within the market without distorting it. It does not cap prices, dictate terms of business, or introduce licensing burdens. Instead, it removes an outdated regulatory constraint (the 30-day rental cap) and introduces a fair and predictable refund practice. These changes reduce legal inconsistency and foster a better-functioning private rental market.
• Private Property Rights: The bill respects private property rights by not interfering with a rental company’s control over its vehicles or pricing. Rental companies retain full autonomy in how they structure rentals and damage waiver offerings. The only requirement is to refund fees when the agreed service (waiver coverage) is not in effect, essentially upholding the integrity of voluntary contracts.
• Limited Government: The bill is a clear example of limited government in practice. It does not create new agencies, expand enforcement authority, or impose reporting mandates. It introduces a narrowly tailored regulation to correct an inconsistency in the statute and prevent unjust enrichment, without growing the size or scope of government. The fiscal note confirms no significant state or local cost, and the enforcement relies on existing legal frameworks and contractual obligations.

• SB 72 (Same As)