According to the Legislative Budget Board (LBB), HB 5246 would have a positive fiscal impact on the state’s General Revenue Fund. The bill provides for the abolition of the Spaceport Trust Fund (Account 0806) effective September 1, 2025, and mandates the transfer of its remaining balance to the General Revenue Fund. As of the most recent estimate, the Trust Fund holds approximately $7.18 million. Consequently, this transfer would result in a one-time revenue gain of $7.18 million to the state’s General Revenue in fiscal year 2026​.

While the bill does not make a direct appropriation, it creates a legal framework that could allow future appropriations in support of the restructured Texas Space Commission and the newly administered Texas Aerospace Research and Space Economy Consortium (TARSEC). Notably, TARSEC would shift administrative oversight from the Office of the Governor to the Texas A&M Engineering Experiment Station, which may carry administrative costs, though none are projected to have a significant fiscal effect at this time.

Importantly, the Legislative Budget Board projects no ongoing fiscal impact beyond the initial transfer. The bill does not anticipate recurring expenditures or revenue beyond FY 2026, and no significant fiscal impact is expected for local governments​. Additionally, no technology-related costs or savings are associated with the bill’s implementation.

In summary, HB 5246 results in a one-time fiscal gain for the state through consolidation of unused trust fund balances into general revenue, while restructuring aerospace governance and planning systems in a cost-neutral manner.

HB 5246 restructures the state’s aerospace governance framework by refining the administrative roles and powers of the Texas Space Commission, the Texas Aerospace Research and Space Economy Consortium (TARSEC), and the Aerospace and Aviation Office. The bill repeals the Spaceport Trust Fund—previously used to support commercial spaceport development—and reallocates the remaining funds to the General Revenue Fund, generating a one-time fiscal benefit of $7.18 million. While this appears to align with fiscal restraint, the bill introduces a broader state-led model for economic planning in the aerospace sector that raises several concerns from a limited-government perspective.

The most substantial issue is that HB 5246 expands the size and scope of government. It assigns additional responsibilities to state entities such as TARSEC and the Space Commission, including grant-making authority, programmatic partnerships with higher education, and new layers of interagency collaboration. These additions increase the role of state government in shaping, directing, and financing aerospace development—functions more appropriately driven by private market forces. The Commission is also authorized to establish nonprofit affiliates, charter state aircraft for official travel, and contract with public institutions, reflecting a further drift from core governmental functions into quasi-commercial activities.

Moreover, while the bill does not increase taxes or impose new regulations on individuals or businesses, it codifies a centralized economic development strategy. This assumes that the government should play an active role in guiding a high-tech sector’s direction, rather than simply enabling private innovation through clear legal frameworks, deregulation, and infrastructure access. Even though the Spaceport Trust Fund is repealed, the bill substitutes that programmatic incentive with broader, potentially open-ended grant authority under a different guise, keeping government in the business of picking economic winners and losers.

For advocates of limited government, personal responsibility, and free enterprise, this approach is problematic. A more appropriate reform would not reassign or expand these functions but would sunset or limit them, reducing state entanglement in economic sectors and returning to a model that enables private investment through the elimination of bureaucratic hurdles. Additionally, the bill’s shift of TARSEC oversight to the Texas A&M Engineering Experiment Station—while logistically efficient—further embeds higher education institutions into state economic planning, which may distort market-based outcomes.

In summary, while HB 5246 aims to streamline and modernize aerospace policy, it ultimately consolidates and expands state power in a way that conflicts with the principles of limited government. The bill should be amended to eliminate or significantly constrain the new grantmaking and administrative powers it creates, clarify the scope of permissible government functions in aerospace development, and ensure the state’s role is limited to facilitating—not directing—market activity. Until such amendments are made, Texas Policy Research recommends that lawmakers vote NO; Amend on HB 5246.

• Individual Liberty: The bill does not impose new restrictions on personal freedoms or civil liberties. It does not create new criminal offenses, increase penalties, or infringe on constitutional rights. By focusing on state-level coordination in aerospace research and workforce development, it largely avoids direct contact with individual liberties. If anything, to the extent that public research partnerships could promote educational opportunities or workforce training, there may be ancillary benefits to individual advancement. However, these are secondary and do not derive from a deregulatory posture.
• Personal Responsibility: HB 5246 neither incentivizes nor diminishes personal responsibility. It focuses on inter-agency coordination, state-sponsored grantmaking, and institutional governance. There are no provisions that shift responsibility from individuals to the state in a direct manner. That said, by expanding the state’s role in directing funding and research, it may inadvertently contribute to a broader culture where government is seen as the engine of innovation and investment, rather than the private sector—an indirect challenge to the ethic of individual and entrepreneurial responsibility.
• Free Enterprise: This bill raises significant concerns for the principle of free enterprise. While it repeals the Spaceport Trust Fund—a move away from targeted state subsidies—it substitutes that mechanism with a broader, less-defined grant program for aerospace and spaceflight initiatives. The Texas Space Commission and TARSEC are empowered to award grants, solicit proposals, and coordinate with higher education institutions in ways that could direct state resources toward select entities in the space economy. These provisions risk distorting market signals and enabling the government to pick winners and losers in a competitive, innovation-driven sector. Furthermore, the bill removes statutory language promoting spaceport development—potentially disadvantaging private spaceport operators in Texas—and fails to reduce regulatory or legal barriers that might otherwise encourage private investment. Rather than stepping back and allowing the free market to lead development in aerospace, the state is repositioning itself as a central planner.
• Private Property Rights: The bill does not directly affect private property rights. It neither authorizes new takings nor imposes land use restrictions. The removal of statutory support for spaceport development might reduce opportunities for landowners or local authorities seeking to lease or develop land for private aerospace facilities, but this is more of a missed opportunity than an infringement on property rights. No explicit protections or violations are introduced.
• Limited Government: This is perhaps the area of greatest concern. HB 5246 expands the functional reach of several state entities, notably the Texas Space Commission, which is granted the authority to solicit donations, operate nonprofit affiliates, charter aircraft, and disburse public funds through grants. TARSEC is moved from the Office of the Governor to a university-based research entity (Texas A&M Engineering Experiment Station), embedding state-run higher education further into economic strategy. These expansions in scope and function move the state beyond infrastructure and regulatory roles into economic planning and funding. The bill creates no new taxes and has no long-term cost forecasted in the fiscal note, but the institutional expansions it authorizes set the stage for ongoing state involvement in the aerospace economy—contrary to the principle that government should be minimal and primarily focused on ensuring a stable legal environment for free actors to flourish.