According to the Legislative Budget Board (LBB), the fiscal implications of SB 823 are minimal at the state level. According to the Legislative Budget Board (LBB), the bill is not expected to have a significant fiscal impact on the state. Any implementation or administrative costs incurred by state agencies, such as the Health and Human Services Commission or the Department of State Health Services, are assumed to be manageable within existing agency resources.

However, the potential fiscal impact on local governments is less certain. While the bill authorizes local health authorities—including counties and municipalities—to enforce the new labeling requirements and impose administrative penalties, the fiscal note states that the implications for local entities "cannot be determined at this time." This uncertainty likely reflects variability in enforcement approaches across jurisdictions and the extent of local resources already dedicated to food labeling compliance.

In summary, SB 823 is designed to be implemented without requiring new appropriations or significant budget increases at the state level. While local governments may incur some costs related to enforcement and compliance monitoring, those impacts are speculative and dependent on local decisions regarding oversight and enforcement intensity.

SB 823, while well-intentioned in its goal to promote transparency and support Texas shrimpers, ultimately introduces a new layer of state regulation that raises significant concerns for proponents of free markets, limited government, and personal responsibility. The bill requires that all imported shrimp sold in Texas be labeled as such and prohibits restaurants from describing imported shrimp with terms like “Texas,” “Gulf,” “Domestic,” or “American.” While framed as a consumer protection measure, this legislation has the effect of using regulatory power to influence market behavior in favor of one industry.

The bill represents a clear expansion of the state’s regulatory role, assigning new enforcement responsibilities to local health departments and requiring the Health and Human Services Commission to adopt and administer new rules. Even though the fiscal note states that the state can absorb the costs using existing resources, this does not negate the reality that the bill increases the scope of government oversight and introduces new compliance requirements for private businesses—especially restaurants and food distributors. The creation of administrative penalties and the regulatory language surrounding labeling and marketing significantly expand state involvement in commercial speech and operations.

From a free enterprise perspective, SB 823 distorts market neutrality by creating a labeling environment that disadvantages foreign-sourced shrimp. The bill does not ban or restrict imported shrimp directly, but by regulating how it may be described and advertised, it introduces a protectionist dynamic under the guise of consumer transparency. This approach may be seen as an indirect subsidy to Texas shrimpers at the expense of free and open competition. Businesses that rely on diverse supply chains—including small restaurants and food vendors—may face increased administrative burdens and risks of noncompliance, even with the bill’s inclusion of a good faith defense.

Equally important, the bill underestimates the intelligence and agency of consumers. Individuals can already inquire about food sourcing and make informed choices based on personal values, price, or preference. Numerous voluntary labeling programs and certification standards exist in the marketplace. A state mandate presumes that consumers need government oversight to distinguish between local and imported products, thereby eroding the principle that individuals are best equipped to make their own decisions in a free market.

Finally, SB 823 risks setting a precedent for further government involvement in labeling and marketing practices across other industries. While the current focus is on shrimp, the justification used here—labeling for consumer clarity and protection of Texas producers—could be applied broadly to many sectors, opening the door to incremental regulation and a departure from Texas’s strong tradition of economic liberty.

For these reasons—unnecessary regulatory expansion, market distortion, burdens on small business, and diminished consumer autonomy—SB 823 conflicts with foundational principles of limited government and free enterprise. Texas Policy Research recommends that lawmakers vote NO on SB 823 reflecting a commitment to trusting consumers, defending economic freedom, and restraining the reach of the state in private commercial relationships.

• Individual Liberty: The bill arguably infringes on the liberty of businesses to truthfully market and present their products as they see fit, within existing fraud and misrepresentation laws. By prohibiting the use of terms like “Texas” or “Gulf shrimp” for imported products—regardless of how broadly those terms might be understood in industry—the bill limits commercial speech beyond what may be necessary to prevent fraud. It substitutes government judgment for consumer interpretation and limits the choices that individuals and businesses can make about how to communicate value to their customers.
• Personal Responsibility: The bill assumes that consumers cannot or will not inquire or decide for themselves where their shrimp comes from. This undermines the principle of personal responsibility by removing the incentive for individuals to ask questions, read voluntarily provided labels, or reward businesses that are already transparent. Instead of encouraging a culture of informed choice, the bill adopts a top-down approach where the state mandates what information must be shown, implicitly signaling that government, not the consumer, is the final arbiter of informed decisions.
• Free Enterprise: This bill impacts free enterprise by placing state-imposed constraints on how certain products may be marketed, even when no actual fraud occurs. It does not ban imported shrimp, but it disadvantages it through mandated disclosures and restrictions on language use, benefiting domestic producers in the name of fair competition. This tilts the playing field rather than allowing open competition to determine winners based on merit, price, and consumer preference. In effect, it uses regulatory power to engineer market outcomes rather than letting businesses compete freely.
• Private Property Rights: While the bill does not directly seize or impair physical property, it does interfere with how property—specifically, products and branding—can be used in commerce. A restaurant owner or distributor may no longer use certain descriptors for their own inventory, even if they acquired it lawfully and have a business interest in presenting it in a favorable light. This imposes a constraint on the use of private property for lawful commercial purposes.
• Limited Government: Perhaps most critically, the bill expands the regulatory footprint of the state. It directs a state agency to adopt new rules, authorizes enforcement by local health departments, and introduces penalties. This represents an enlargement of government authority into a domain that was previously unregulated. Even though the fiscal note claims costs can be absorbed, the scope and reach of government grows—a departure from the ideal that the state should only intervene when absolutely necessary to prevent harm or protect rights.

• HB 735 (Same As)