According to the Legislative Budget Board (LBB), HB 30 is not expected to have a significant fiscal impact on the State of Texas. The legislation primarily affects local taxing units by modifying how they calculate their voter-approved tax rates in the wake of a declared disaster. The bill repeals prior authority that allowed taxing units to exceed the voter-approval rate without voter approval following a disaster, and instead introduces a structured adjustment mechanism based on documented debris removal costs.

The primary fiscal effect will be felt at the local government level. Taxing units situated in federally or state-declared disaster areas will now have a statutory mechanism to increase their tax rate modestly by incorporating a “disaster debris rate.” This calculation is based on a specific formula tied to federally estimated cleanup costs, thus linking any tax adjustment directly to actual recovery needs. The reform offers predictability and transparency while preventing ad hoc or excessive tax increases.

From a broader fiscal perspective, the bill is designed to be revenue-neutral or minimally impactful to taxpayers over time. It includes provisions that sunset the adjustment authority after three years or upon full property value recovery, whichever comes first. This ensures that temporary rate increases used for recovery purposes do not permanently affect the local tax base or future tax rate ceilings.

HB 30 represents a departure from the bill's original intent. The originally filed version proposed a full repeal of what is commonly referred to as the "disaster loophole"—a provision in current law that allows local taxing units to exceed the voter-approval tax rate without an election in the year following a declared disaster. This practice has been criticized for enabling tax increases without direct democratic consent, even in cases where local governments incurred minimal or no actual disaster-related costs.

The substitute version, while repealing the broad exemption, effectively replaces it with a more narrowly defined exemption: the “disaster debris rate.” This new component allows taxing units in federally or state-declared disaster areas to add a calculated rate to their voter-approval tax rate, based on debris removal cost estimates under federal law (42 U.S.C. § 5173). Critically, this new adjusted rate, though limited in scope, is still exempt from voter approval. Taxing entities may adopt it for up to three years following a disaster or until local taxable property values recover.

While the substitute bill imposes clearer limits, formula-based thresholds, and documentation requirements, these safeguards do not change the essential feature of the loophole that many fiscal accountability advocates find objectionable: the ability of unelected taxing entities to raise property taxes beyond statutory caps without voter consent. The creation of the disaster debris rate, though more disciplined in structure, continues the practice of granting taxing units unilateral authority to raise rates under exceptional conditions. For those who believe that any increase in the tax burden should be subjected to voter approval, regardless of the circumstance, this bill fails that test.

Moreover, by retaining an exception to the voter-approval requirement, the bill arguably undermines the voter empowerment objectives of the 2019 Property Tax Reform and Transparency Act (SB 2), which established the 3.5% voter-approval rate threshold as a key taxpayer protection. Preserving even a narrowed exemption could open the door for future expansions, mission creep, or unintentional exploitation, particularly during frequent or loosely defined emergency declarations.

In summary, while the Committee Substitute is a technical improvement over current law, it fails to uphold the core principle of taxpayer control over property tax increases. It renames and reframes the disaster loophole rather than eliminating it. For those committed to strict limits on government taxation authority and unambiguous voter oversight, Texas Policy Research encourages lawmakers to vote NO on HB 30, or at the very least support an amendment that reverts HB 30 back to the same version as it was filed.

• Individual Liberty: Individual liberty is inherently tied to the principle of taxation with representation. The bill allows local taxing units to increase property tax rates above the voter-approval threshold without securing explicit voter consent if certain disaster-related cost conditions are met. Although this is narrower than the existing “disaster loophole,” it still authorizes unilateral government action affecting individuals’ financial obligations without their approval. This diminishes citizen control over government taxation decisions and erodes a key safeguard of liberty.
• Personal Responsibility: The bill’s formula-based approach may encourage more responsible budgeting by tying tax increases to actual, federally estimated disaster cleanup costs. However, it still exempts taxing units from seeking public approval, which weakens the incentive for local officials to prioritize budgetary discipline or seek efficiencies. A truly responsible framework would require local governments to justify tax increases directly to voters, encouraging prudent planning and transparent governance.
• Free Enterprise: In theory, a stable and responsive local revenue system that enables quick recovery after disasters can benefit businesses by speeding up cleanup and infrastructure restoration. However, higher property taxes—imposed without voter approval—can burden commercial property owners, particularly small businesses that operate on thin margins. This type of tax authority, if used too liberally or without sufficient checks, may stifle private sector investment in disaster-prone communities.
• Private Property Rights: By allowing local governments to increase the tax burden on private property owners without voter approval, the bill infringes on property owners’ financial autonomy. Property rights are not just about the use and enjoyment of land, but also about predictable and just taxation. Even though federally estimated costs bound the increase, the lack of direct voter input increases the risk of tax overreach, especially in politically sensitive post-disaster periods when public scrutiny is reduced.
• Limited Government: This is where the bill most clearly conflicts with liberty principles. Though it repeals the broader post-disaster taxing authority currently in law, it replaces it with a new form of technocratic discretion. Limited government requires firm boundaries on taxing power, especially in extraordinary circumstances where public emotion may be high. By allowing even a “narrowed” exception to voter approval, the bill preserves executive and bureaucratic flexibility at the expense of democratic accountability.

• HB 1131 (Same As)
• HB 763 (Same As)
• SB 1449 (Same As)