According to the Legislative Budget Board (LBB), HJR 47 would create the Texas Severance Tax Revenue and Oil and Natural Gas (Texas STRONG) Defense Fund, reallocating a portion of severance tax revenue to support oil and gas-impacted communities. Over the 2026–2027 biennium, the measure is projected to result in a negative net impact of approximately $708.8 million to General Revenue-related funds. The majority of the fiscal impact occurs in 2027 when the reallocation of severance tax funds begins to shift resources away from the Economic Stabilization Fund (ESF) and into the newly created Texas STRONG Fund and other designated accounts.

The resolution adjusts current allocations by reducing the ESF share from 50% to 38%, redirecting the 12% difference as follows: 10% to the Texas STRONG Fund, 1% to the Oil and Gas Regulation and Cleanup Account, and 1% to the Texas Emissions Reduction Plan Fund. If annual allocations to Texas STRONG exceed $500 million, the excess would be diverted to the Property Tax Relief Fund. From fiscal year 2028 onward, the Texas STRONG Fund is estimated to receive $500 million annually, with increasing revenue gains projected for the Property Tax Relief Fund and other environmental accounts.

Although the resolution does not directly appropriate funds, it establishes the legal basis for future appropriations. It also creates or re-creates dedicated funds and revenue streams within the state treasury. Importantly, while this redirection affects general revenue collections, it maintains the total severance tax revenue within public use frameworks and is expected to support infrastructure, environmental, and workforce initiatives in energy-producing regions. The costs of implementation include a one-time publication cost of approximately $191,689 in FY 2026.

There are no significant fiscal implications anticipated for local governments. The enabling legislation, HB 188, complements the resolution by managing allocation changes and outlines a phase-out of the Texas STRONG Fund’s share after 2036, returning allocations to the ESF thereafter.

HJR 47 proposes a constitutional amendment to establish the Texas Severance Tax Revenue and Oil and Natural Gas (Texas STRONG) Defense Fund. While its stated intent is to support areas impacted by oil and gas production through targeted grants, the resolution raises several substantive concerns rooted in fiscal conservatism, constitutional integrity, and sound governance. Chief among them is the creation of a new, permanent fund within the state treasury at a time when surplus revenues from severance taxes could instead be returned to taxpayers, applied to debt reduction, or used to directly offset the cost of government through property tax relief.

Creating a new fund, even one housed within the treasury and subject to legislative appropriation, inherently expands the structure of government. Though it does not create a new agency, it does establish a new and ongoing commitment to earmark a portion of future revenues for specific expenditures. This approach reduces legislative flexibility, undermines transparency, and contributes to the fragmentation of public finance. The Legislature has long attempted to streamline and consolidate special funds to simplify budget oversight; HJR 47 moves in the opposite direction.

Furthermore, by diverting 12% of oil and gas tax revenues currently allocated to the Economic Stabilization Fund (ESF)—including 10% to the Texas STRONG Fund—it prioritizes new spending over returning surplus funds to taxpayers or strengthening the state’s financial position. While the measure includes a cap of $500 million annually and redirects excess amounts to the Property Tax Relief Fund, it still represents a missed opportunity to implement broader, more direct tax relief measures or to address unfunded liabilities.

Additionally, lawmakers may be concerned that the broad eligibility for grants—to state agencies, local governments, higher education institutions, and nonprofits—could lead to inefficient or politicized spending. Without strict criteria, oversight mechanisms, or measurable outcomes defined in the constitutional amendment itself, the fund risks becoming a vehicle for discretionary spending with limited accountability to taxpayers.

Finally, embedding this revenue dedication in the Texas Constitution makes it difficult to modify in the future, locking future legislatures into a spending structure that may not reflect changing fiscal conditions or public priorities. This kind of constitutional earmark can reduce long-term legislative responsiveness and hinder comprehensive budget reform.

In summary, while the desire to support energy-producing communities is understandable, the creation of a new fund enshrined in the state constitution represents an unnecessary expansion of state financial architecture and a departure from core fiscal discipline. Texas Policy Research recommends that lawmakers vote NO on HJR 47.

• Individual Liberty: The resolution does not directly impact individual freedoms, such as speech, religion, or movement. However, by keeping surplus state revenues within government-managed accounts rather than returning them to taxpayers, it arguably misses an opportunity to enhance individual economic liberty. Every dollar held by the state is one not returned to the individual for personal decision-making. While indirect support for community infrastructure may benefit individuals over time, those benefits are filtered through layers of government allocation and discretion, which dilutes direct liberty outcomes.
• Personal Responsibility: The bill takes a collective, government-driven approach to addressing localized challenges in oil and gas regions. While this may relieve overburdened communities, it could also inadvertently reduce incentives for local governments to plan responsibly or manage growth within their own means. By depending on constitutionally earmarked state funding, the measure undermines the principle that local challenges should be met through local solutions and governance. It also removes individual taxpayers from the equation, denying them the chance to choose how to use the revenue surplus.
• Free Enterprise: Supporters of the resolution argue that stabilizing infrastructure in oil and gas regions benefits the broader energy economy, which is a legitimate consideration. However, the mechanism for doing so—through a permanent state-managed fund—relies on public redistribution rather than market forces or competitive investment. There is a risk that grants from this fund will be awarded through bureaucratic processes that favor politically connected organizations over market-efficient outcomes. Additionally, the creation of a special fund may signal to private industry that the government will step in with tax revenues to solve operational burdens, potentially distorting incentives.
• Private Property Rights: To the extent that the bill directs funds to mitigate damage to infrastructure, health, and environment in oil-producing areas, it could help preserve property values and reduce risks for landowners. However, this support is not directly tied to protecting private property or restoring harms through legal or market-based remedies. The connection is indirect and should not be overstated. No explicit new protections for property rights are included in the resolution.
• Limited Government: This is where the resolution most clearly conflicts with liberty principles. By creating a new, constitutionally protected fund, the resolution expands the structure and reach of state government. It dedicates future revenues to specific purposes, reducing legislative flexibility and growing the footprint of public finance. It introduces a new vehicle for taxpayer-funded grants, which—even if capped—still represents a lasting obligation. For advocates of limited government, this type of earmarking and expansion of the treasury’s responsibilities is antithetical to the goal of a lean, responsive, and restrained public sector.

• HB 188 (Enabled by)
• SJR 48 (Same As)