The Legislative Budget Board (LBB) fiscal note for SB 765 concludes that the bill would have no significant fiscal impact on the state or local governments. The analysis assumes that any potential costs or savings associated with implementing the bill would be insignificant.

SB 765 establishes confidentiality provisions for fraud detection and deterrence measures within government agencies. While this could marginally reduce administrative costs related to responding to public information requests, such savings are not expected to be substantial. Conversely, any additional costs incurred for ensuring compliance with the new confidentiality standards—such as training employees on restricted disclosures—are anticipated to be minimal and manageable within existing agency budgets.

Regarding local government entities, the bill is not expected to impose any significant financial burden. Since most fraud detection and deterrence measures are already conducted internally and involve limited public disclosure, the exemption from open records laws is not projected to substantially alter operational costs at the local level.

The fiscal note cites multiple state agencies, including the Texas Comptroller of Public Accounts, Texas Workforce Commission, Health and Human Services Commission, and Texas Medical Board, as sources. None of these agencies anticipate meaningful cost increases or revenue changes resulting from the legislation.

In summary, SB 765 is fiscally neutral, with neither major costs nor savings expected for state or local governments. The bill primarily serves a policy function rather than a budgetary one, focusing on information confidentiality rather than financial implications.

SB 765 addresses a legitimate concern by preventing bad actors from accessing government fraud detection methods through open records requests. By making such information confidential, the bill closes a loophole that could otherwise be exploited to commit fraud against state agencies. Additionally, the committee substitute clarifies that agencies may still share this information with law enforcement and other governmental bodies for fraud prevention purposes.

However, broad exemptions from public disclosure laws raise transparency concerns. While fraud prevention is critical, limiting public access entirely could reduce government accountability and hinder legitimate oversight of fraud investigations. The bill should be amended to allow for limited transparency, such as summary reports or redacted disclosures, while still safeguarding sensitive fraud prevention methods. Additionally, a review process should be included to ensure the exemption is not misused.

For these reasons, SB 765 should be amended to balance security and transparency, ensuring fraud detection remains effective while maintaining government accountability.

• HB 4952 (Same As)