According to the Legislative Budget Board (LBB), SB 1383 would have no significant fiscal implications for the State. The legislation adds referral agencies to the list of entities exempt from the offense of soliciting patients under existing law, but does not impose substantial new enforcement, regulatory, or administrative costs on state agencies. While the bill creates new requirements for private referral agencies, it does not assign new oversight responsibilities to state agencies that would demand additional funding.

Similarly, the fiscal note projects no significant fiscal impact on local governments. Any costs associated with enforcement, prosecution, supervision, or confinement related to violations of the bill’s provisions are assumed to be minimal and manageable within existing resources.

Thus, overall, the bill is expected to be fiscally neutral, neither requiring additional appropriations at the state or local level nor creating material financial burdens on public resources.

While the stated intent of SB 1383 — protecting elderly consumers seeking senior living arrangements — is laudable, the bill imposes a substantial new regulatory framework on referral agencies, many of which are small businesses. It creates a number of mandatory operational requirements, including mandatory disclosures, employee background checks, liability insurance, facility license audits, and restrictions on fee collection practices​.

This legislation significantly expands the government's regulatory reach into a sector that was previously self-regulated without evidence of widespread systemic harm. Although the bill does not create a new agency or require significant taxpayer funding​, it burdens private businesses with costly compliance mandates that could disproportionately affect small and local agencies, while favoring larger corporate players who can more easily absorb compliance costs.

Critically, the bill duplicates protections that already exist through the licensing and oversight of senior living facilities themselves and does not include strong new enforcement mechanisms. As a result, it risks reducing market competition, raising barriers to entry, and limiting consumer choice — all of which conflict with the liberty principles of Free Enterprise and Limited Government.

Therefore, Texas Policy Research recommends that lawmakers vote NO on SB 1383 unless amended as described below:

• Scale or exempt compliance obligations for small businesses based on size or volume.
• Narrow the required duties to disclosures only, rather than audits, insurance mandates, and background checks.
• Focus on preventing fraudulent referrals rather than regulating all operational practices.

If such amendments were adopted, the legislation would better align with liberty principles.

• Individual Liberty: The bill has a mixed but slightly positive impact on Individual Liberty. The bill aims to empower consumers, particularly vulnerable seniors, by ensuring they receive clear, written disclosures about referral services, who pays fees, and their right to stop using a referral agency at any time. This transparency enhances the consumer’s ability to make informed, independent decisions about their housing options. However, the bill also places restrictions on the freedom of businesses to operate as they choose, slightly constraining the liberty of individuals who run or work for referral agencies.
• Personal Responsibility: On one hand, requiring referral agencies to provide better information encourages seniors and their families to take greater responsibility for their living arrangements. It arms them with the knowledge needed to make better choices without relying solely on blind trust. On the other hand, by mandating that referral agencies conduct audits and verify licensing of senior living communities, the bill shifts a degree of personal due diligence away from consumers and onto businesses, potentially weakening the expectation that individuals bear responsibility for their own decisions.
• Free Enterprise: The bill introduces a heavy regulatory burden on a sector that has operated without direct regulation, requiring referral agencies to comply with background checks, liability insurance mandates, disclosure protocols, facility license audits, and detailed contract terms. These costly requirements could discourage small operators, reduce competition, and create barriers to entry for new businesses. In effect, the bill risks protecting consumers by limiting consumer choice, as only larger, well-capitalized agencies would be able to survive in a highly regulated environment.
• Private Property Rights: The bill has a mostly neutral but somewhat concerning impact on Private Property Rights. It does not directly affect property ownership or physical use of property. However, by dictating how referral agencies must structure their operations, interactions, and financial relationships, it indirectly restricts how business owners may use and derive benefit from their own private property — namely, their business assets and contracts. The intrusion is indirect but represents a trend of greater regulatory control over lawful private activities.
• Limited Government: Although it does not create new agencies or require significant new taxpayer funding, the bill extends state oversight into a previously unregulated sector. It imposes specific and detailed mandates on private business operations without clear evidence of widespread consumer harm necessitating such intervention. The bill grows the government’s regulatory footprint and shifts more private-sector decision-making under state rules, running counter to the ideal that government should interfere minimally and only when absolutely necessary.

• HB 2667 (Same As)