According to the Legislative Budget Board (LBB), the fiscal impact of HB 2091 cannot be determined at this time, primarily due to uncertainties surrounding the amount, frequency, and timing of grant applications and subsequent disbursements from the Water Supply Account (WSA) within the Texas Water Development Fund (DFund). While the bill itself does not appropriate any funds, it would establish the statutory basis for grant-making authority by the Texas Water Development Board (TWDB), thereby potentially enabling future appropriations from the Legislature or deposits into the fund.

The bill would allow the TWDB to administer grants from the WSA to political subdivisions for water supply and flood control projects. However, the WSA exists within the DFund, which, according to the Texas Comptroller of Public Accounts, was inactivated in 2012 when its balances and obligations were transferred to the Texas Water Development Fund II. For HB 2091 to have any practical fiscal effect, new funding would need to be deposited into the original DFund to reactivate the WSA. As a result, without a specific appropriation or deposit mechanism included in the bill, the fiscal effect remains contingent and speculative.

At the local level, political subdivisions (including drainage districts) that successfully apply for and receive grant funding could experience a positive fiscal impact, particularly through reduced reliance on debt issuance or local tax revenues for water infrastructure improvements. However, the magnitude and timing of such benefits are likewise indeterminate, as the number of eligible projects and competitive demand for funds has not yet been established​.

HB 2091 proposes to expand the Texas Water Development Board’s (TWDB) authority to issue grants to political subdivisions, including drainage districts, for water supply and flood control projects. While this may appear to address regional water challenges, particularly in areas like South Texas, the bill raises several structural and fiscal concerns that outweigh its potential benefits.

First, the bill significantly expands the scope of government without instituting adequate constraints. It authorizes a broader group of public entities to access state-issued grants, including those that have not traditionally qualified under existing statutory standards. Notably, drainage districts would become eligible for grants even if they lack retail service roles, historical water use data, or a certificate of convenience and necessity (CCN). While intended to be inclusive, this removal of baseline qualifications opens the program to entities with less transparency, oversight, or proven need. In practice, it delegates too much discretion to the TWDB without corresponding accountability.

Second, the bill allows for this expansion without imposing any new fiscal safeguards. It does not require cost-sharing, performance benchmarks, or outcome reporting from grant recipients. Nor does it limit the types of projects or create a prioritization framework based on regional water need, infrastructure gaps, or return on investment. These omissions increase the risk of inefficient or inequitable use of public funds and invite politicized decision-making in the grant award process.

Third, while HB 2091 does not appropriate funds directly, it lays the legal groundwork for future appropriations from the Water Supply Account (WSA) within the Texas Water Development Fund (DFund), a fund that has been inactive since 2012. This means any funding would need to be restored by future legislative action. In this way, the bill creates an open-ended fiscal liability for taxpayers, establishing a new entitlement without a defined cost, scope, or strategic plan. It creates pressure for future spending with no guarantee of value or effectiveness.

Fourth, the bill dilutes the original intent of the WSA, which was designed to support core water supply projects administered by regulated and experienced entities. By opening the door to drainage districts — entities that may operate with minimal regulatory scrutiny — HB 2091 shifts the fund's focus and could compromise the strategic integrity of the program. This kind of scope creep is a red flag for those who favor targeted, performance-based public investments.

Finally, while the bill empowers the TWDB to adopt rules for eligibility, it also explicitly removes the board’s ability to exclude applicants based on conventional qualification standards. This represents a policy contradiction: granting authority to regulate while also restricting that authority’s discretion. The result is a program that is simultaneously broader in reach and looser in oversight — a poor formula for effective governance.

For these reasons — the unchecked growth of government scope, the lack of fiscal and regulatory discipline, the risk of future taxpayer burden, and the weakening of program integrity — Texas Policy Research recommends that lawmakers vote NO on HB 2091.

• Individual Liberty: The bill could have a marginal positive impact on individual liberty in a narrow sense by supporting the development of water infrastructure and flood control projects that may protect communities from water scarcity or flood damage. These benefits could help individuals maintain their property and way of life in vulnerable regions like South Texas. However, these gains are indirect and speculative, and come at the cost of expanding government reach and fiscal risk.
• Personal Responsibility: HB 2091 undermines the principle of personal and local governmental responsibility by making grants (rather than loans or partnerships) more widely available, without requiring cost-sharing, financial risk, or performance accountability from the recipients. Drainage districts that do not operate retail water systems or demonstrate historical need would still qualify for state funding. This discourages self-reliance, reduces incentives for local planning or prioritization, and fosters dependency on the state for infrastructure development.
• Free Enterprise: By expanding access to state-funded grants, the bill potentially displaces private sector solutions and reduces incentives for innovation in water delivery and infrastructure services. Entities that receive grants for construction or improvement of water systems may rely on state dollars rather than exploring private financing, partnerships, or market-driven efficiencies. Furthermore, the bill allows entities without CCNs (certificates of convenience and necessity) to compete for funding, despite the fact that regulated private and public utilities must comply with higher standards. This undermines the principle of fair competition and creates an uneven playing field.
• Private Property Rights: To the extent that flood control and water supply projects funded under this bill reduce the risk of property damage or improve service reliability, there may be a protective benefit to private property rights. However, this benefit is not guaranteed by the bill itself — it depends entirely on how the Texas Water Development Board administers the grants, which is left vague and unstructured. The lack of prioritization or performance oversight diminishes the potential positive impact.
• Limited Government: HB 2091 is a clear departure from the principle of limited government. It: Expands the scope of a dormant state fund and authorizes new forms of financial assistance. Broadens eligibility to include less accountable entities. Removes standard qualification requirements, without adding new checks or controls. Invites future appropriations without setting spending caps or defining need-based criteria. This is government expansion by statute, without the corresponding legislative discipline or fiscal restraint needed to keep it limited and targeted.