New GOP proposed legislation would push to limit city ordinances more aggressively than ever.
The “Texas Regulatory Consistency Act” would prohibit cities from managing anything beyond what is already covered by state law. This will undermine regulations placed on local agriculture, insurance, labor, and natural resources codes, among others.
“The provisions of this code preclude municipalities or counties from adopting or enforcing an ordinance, order, rule, or policy in a field occupied by a provision of this code unless explicitly authorized by statute,” the bill notes.
Gov. Greg Abbott endorsed the legislation that would disable city-specific regulations. The third-term governor said that the state must rein in policies that are “hostile to businesses.”
Rep. Dustin Burrows (R-Lubbock) filed the bill in the house while Sen. Brandon Creighton (R-Conroe) filed an identical bill in the Senate. There was a House public hearing on March 15th. Whereas the Senate referred the bill to the Business and Commerce committee.
The crackdown on local authorities isn’t new, but the drastic measures of this year’s proposed bill has local officials worried.
City ordinances on tree removal, short-term rentals, paid sick leave and plastic bag banning have all been targeted in past legislative sessions. Having a pattern of filing bills to undermine local authority, in 2019, Creighton filed Senate Bill 15 to target paid sick leave.
The city of Houston would suffer the bill’s impact on several fronts but there remains uncertainty surrounding its full impact.
“While we are still analyzing the full impact of this bill, the consequences are far-reaching,” a memo from the Houston Mayor’s office said.
The bill would preempt Houston’s Pay or Play (POP) policy, as it is not expressly authorized in the state’s insurance code, which served over 32,000 uninsured residents in 2022, after disbursing $1,290,000 of POP dollars.
With this policy, a city of Houston contractor with a contract value at or above $100,000, and related subcontracts that are valued at or above $200,000, can choose to either “pay” or “play. If the contractors choose to “pay” then they agree to contribute a suggested amount of funds to the Contractors Responsibility Fund (CRF) for their uninsured employees. If the contractors choose to “play” they would provide their employees with a minimum level of health care coverage.
Under chapter 62 of the state labor code, the executive order managing minimum wage with airport contracts would also be preempted and voidable.
“What’s Vague about this bill is the numerous mentions within those codes where the state plays a regulatory role where I don’t know if we’re preempted or not,” said Bill Kelly, the Director of Government Relations at the Mayor’s office. “I mean it should be pretty clear and the legislature should not say, let’s just let the courts decide. That is putting taxpayer dollars and the financial situation of the city at risk for court decisions.”
The Texas Municipal League put out a memo that identifies at least 15 different kinds of ordinances at risk, ranging from regulations on insects and bees to predatory lending businesses.
Texas director for the National Federation of Independent Business, Annie Spilman, said that small businesses would benefit from the consistency of state-wide regulations.
“Our small business members don’t have the time or resources to navigate a confusing and contradictory patchwork of local ordinances that go above and beyond what the state requires,” Spilman said.
According to DMS, Sandlin still notes that, “cities should be able to respond to their own citizens’ unique concerns and that local officials have no interest in hurting the small-business owners that drive local economies.”
“It doesn’t make sense to me to say we need a consistent regulatory environment,” said Kelly. “Opening a restaurant on the Gulf Coast of Galveston is inherently different than working in a restaurant, operating in Lubbock, you’re going to have different aspects to it. And to deny that is to deny geography, reality and math.”