Overall Vote Recommendation

Principle Criteria

Free Enterprise

Property Rights

Personal Responsibility

Limited Government

Individual Liberty

Digest

HB 5499 would require political subdivisions that regulate nonconsent towing fees to conduct, or contract for, a towing fee study at least once every two years. Within 30 days of receiving the study results, the governing body would be required to publish both the study and its methodology on a publicly accessible website and establish or update allowable nonconsent towing fees at levels that reflect the fair value of towing services and are reasonably related to the financial information provided by towing companies.

For political subdivisions located in counties with populations of 750,000 or more, the bill would establish a default fee structure if the governing body fails to adopt or update towing fees after completing the required study. In those cases, allowable nonconsent towing fees would automatically revert to the statewide fee established by the Texas Department of Licensing and Regulation rule until another towing fee study is completed. The bill would also authorize political subdivisions to assess a separate administrative fee on each nonconsent tow to recover the costs of conducting the required fee studies. Those administrative fees would be deposited into a separate account and could be used only for expenses associated with performing or contracting for future towing fee studies.

Additionally, the bill would revise criminal enforcement provisions related to unauthorized towing fees by removing obsolete references to fee limitations that would no longer apply under the revised framework. It would also establish a defense to prosecution for towing companies that charge fees authorized under the new default statewide fee provision or the authorized administrative fee. The bill would apply prospectively to offenses committed on or after its September 1, 2025, effective date.

The Committee Substitute for HB 5499 retains the core framework of the originally filed bill by requiring political subdivisions that regulate nonconsent towing fees to conduct a towing fee study at least once every two years, establish or update allowable towing fees within 30 days of receiving the study, and default to the statewide towing fee established by Texas Department of Licensing and Regulation rule if the political subdivision fails to update its rates following the study. Both versions also revise criminal enforcement provisions related to unauthorized towing fees and make the changes effective September 1, 2025.

The Committee Substitute expands transparency requirements by requiring political subdivisions to publish both the results of each towing fee study and the methodology used to conduct the study on a publicly accessible website before establishing or amending allowable towing fees. The originally filed bill required only that the governing body adjust fees following the study and did not include any public disclosure requirement.

The substitute also broadens the bill's applicability by lowering the population threshold for the default-fee provision from counties with populations of one million or more to counties with populations of 750,000 or more, extending the bill's requirements to additional large counties.

Finally, the Committee Substitute authorizes political subdivisions to impose an administrative fee on each nonconsent tow to recover the costs of conducting required towing fee studies. It requires those fees to be deposited into a separate account and limits their use exclusively to expenses associated with conducting or contracting for future studies. Correspondingly, the substitute expands the defense to prosecution for unauthorized towing fees by protecting charges authorized under either the default statewide fee provision or the new administrative fee authority, whereas the originally filed bill recognized only the default statewide fee as a defense. These administrative fee provisions were not included in the originally filed version.

Author (1)

Marc LaHood

Contact the Author

Rep. Marc LaHood

Capitol Phone:

(512) 463-0686

Capitol Office:

EXT E2.804

E-Mail:

[email protected]

Visit Official Website

Fiscal Notes

According to the Legislative Budget Board (LBB), no significant fiscal implication to the state is anticipated as a result of HB 5499. The LBB assumes that any administrative costs associated with implementing the bill, including the revised towing fee study requirements and related administrative responsibilities, can be absorbed using existing agency resources, indicating that no additional state appropriations would be necessary.

The LBB also reports no significant fiscal implication for units of local government. Although the bill requires political subdivisions that regulate nonconsent towing fees to conduct recurring towing fee studies and authorizes the collection of an administrative fee to recover those costs, the LBB does not anticipate these requirements will create a significant net financial impact on local governments.

Overall, the fiscal note indicates that the bill is expected to have a neutral fiscal impact on both state and local governments, with implementation costs anticipated to be manageable within existing resources and available fee authority.

Vote Recommendation Notes

HB 5499 seeks to improve transparency and consistency in the regulation of nonconsent towing fees, but it does so by expanding statutory mandates on local governments and reinforcing an existing regulatory framework rather than reducing government involvement in the market. The bill requires recurring towing fee studies, mandates publication of study results and methodologies, imposes deadlines for updating regulated rates, and authorizes a new administrative fee to finance these activities. While these requirements may improve the administration of local towing regulations, they also increase the size and scope of government by creating ongoing compliance obligations and a permanent statutory process for government rate-setting.

The bill does not significantly increase taxpayer exposure, as the LBB concludes implementation costs can be absorbed within existing resources and authorizes political subdivisions to recover study costs through a dedicated administrative fee. Nevertheless, that fee represents a new government-imposed charge on regulated activity, and the bill expands local administrative responsibilities rather than reducing them. From a limited-government perspective, the preferred approach would be to reduce regulatory requirements and rely more heavily on market forces instead of requiring periodic government studies and continued government oversight of pricing.

The legislation also increases the regulatory burden by making government fee studies and regulated rate adjustments an ongoing statutory requirement. Although the bill provides greater transparency and predictability, it further institutionalizes government price regulation instead of moving toward deregulation or limiting government intervention in the towing market. Over time, this establishes a precedent for continued administrative oversight and recurring regulatory obligations. For lawmakers who prioritize limited government, free enterprise, and reducing regulatory burdens, these structural concerns outweigh the bill's procedural improvements, and as such, Texas Policy Research recommends that lawmakers vote NO.

Individual Liberty: The bill does not directly regulate individual conduct, create new criminal offenses, expand surveillance, or impose new mandates on citizens. It primarily governs how local governments regulate nonconsent towing fees and provides additional transparency in that process. While it expands administrative requirements for local governments, it has little direct effect on individual liberty.
Personal Responsibility: The bill neither shifts responsibility from individuals to government nor creates new subsidies or entitlement programs. It instead prescribes administrative procedures for local governments that regulate towing fees. As such, it has little meaningful effect on incentives for individual responsibility.
Free Enterprise: The bill reinforces government regulation of towing prices by requiring recurring fee studies, mandating rate adjustments, and maintaining government-established maximum towing fees. Although it improves transparency and predictability for towing companies, it further institutionalizes government price-setting rather than allowing greater market competition or reducing regulatory intervention.
Private Property Rights: The bill does not alter property ownership, eminent domain authority, land use restrictions, or the rights of property owners. Its provisions relate solely to the regulation of towing fees and administrative procedures.
Limited Government: The bill expands the scope of government by requiring recurring towing fee studies, mandating publication of study results, imposing statutory deadlines, authorizing a new administrative fee, and creating ongoing compliance responsibilities for local governments. While these provisions are intended to improve transparency and consistency, they represent additional government processes and reinforce an existing regulatory framework rather than reducing government involvement.

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