The fiscal implications of SB 1145 indicate that while there will be no direct impact on General Revenue-related funds through the biennium ending August 31, 2027, the bill will necessitate the establishment of a new permitting program under the Texas Commission on Environmental Quality (TCEQ). This transition from the Railroad Commission of Texas (RRC) to TCEQ will require 13 new full-time equivalent (FTE) positions to manage permit applications, conduct investigations, ensure compliance, and support enforcement-related activities. The anticipated costs for this program include an annual expenditure of approximately $1.1 million for salaries and wages, along with additional administrative, operational, and capital costs. TCEQ will also incur expenses related to laboratory accreditation, with an estimated cost of $95,452 in fiscal year 2026, declining slightly in subsequent years. To offset these costs, revenue is expected from permit fees and environmental testing laboratory accreditation, with projected revenue gains starting at $25,000 in 2027 and increasing to $162,500 by 2030. Additionally, the environmental testing accreditation program is expected to generate $464,000 annually.

The bill does not impose significant financial burdens on local governments.

SB 1145 represents a positive step toward regulatory efficiency and environmental responsibility by consolidating oversight of produced water land application under the Texas Commission on Environmental Quality (TCEQ). The bill supports free enterprise by providing clearer, more consistent regulatory pathways for businesses seeking to reuse treated wastewater from oil and gas operations, and it promotes personal responsibility through stronger standards for environmental protection. While the bill slightly expands the size and duties of TCEQ, it does so in a targeted way that aims to reduce confusion and streamline permitting, ultimately reflecting a limited government approach.

However, although the bill aligns with liberty principles overall, it would benefit from specific amendments to better protect private property rights, strengthen water quality standards, and ensure transparency and accountability. These recommended changes would clarify and enhance the bill’s positive impact without altering its core purpose.

Accordingly, Texas Policy Research recommends that lawmakers vote YES on SB 1145 and consider amending it as described above to strengthen it.

• Individual Liberty: The bill encourages beneficial reuse of produced water, helping protect the environment and thus indirectly supporting the right to a clean and safe living space. However, without explicit protections for landowners, there is some risk that individuals’ property rights could be infringed if treated water affects private lands without consent. Stronger notification and recourse rights would better safeguard individual liberty.
• Personal Responsibility: The bill promotes personal and corporate responsibility by requiring industries that generate produced water to treat and reuse it safely, rather than simply disposing of it or risking pollution. It incentivizes businesses to manage their environmental impact more proactively, rather than relying on government cleanup or intervention later.
• Free Enterprise: The bill promotes personal and corporate responsibility by requiring industries that generate produced water to treat and reuse it safely, rather than simply disposing of it or risking pollution. It incentivizes businesses to manage their environmental impact more proactively, rather than relying on government cleanup or intervention later.
• Private Property Rights: Currently, the bill does not explicitly address how landowners can protect themselves if the land application of treated produced water negatively impacts their property. Without amendments, this creates a vulnerability for private property rights. Adding requirements for landowner notification, consent, and compensation would better protect this fundamental principle.
• Limited Government: While the bill modestly expands TCEQ's authority (adding 13 new employees and new permitting responsibilities), it actually limits overall government complexity by streamlining regulation under a single agency. It reduces duplicative regulation and creates a clearer, more accountable system. A sunset review provision would further ensure that the expanded scope remains limited and efficient over time.

• HB 2584 (Same As)