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Texas County Progress

Texas County Progress

The Official Publication of the County Judges and Commissioners Association of Texas

The Deadliest Duo: Unfunded Mandates and Revenue Caps

May 2, 2025 by Julie Anderson

By Jim Allison
CJCAT General Counsel

Our constitutional system creates three separate branches within the federal, state, and local governments. Each branch has duties and responsibilities. The legislative branch is responsible for adopting laws via the legislature and funding the government. The executive branch is responsible for administering the laws. The judicial branch interprets the laws and ensures that the laws are equally applied according to the constitution. When properly implemented, this system of “checks and balances” prevents abuses of governmental power and protect the rights and liberties of the citizens.

Under the U.S. Constitution, the rights and powers of the states are protected by the Tenth Amendment, creating a division of powers between the federal and state governments. Under the Texas Constitution, counties are created by the state, subject to the actions of the legislature and executive branch without any constitutional protection. However, until recent years, the state government generally supported local control and avoided dictating local policies, creating an informal division of powers between the state and its local governments. This restraint by state leadership encouraged local initiatives and enabled local voters to control county policies.

The ability to control and implement local policies is important to all county officials and especially to the county legislative branch, the Commissioners Court. The Commissioners Court is entrusted with the ultimate governmental power to tax and spend. Each year, the Commissioners Court must determine the funding to provide necessary services and collect the required revenue, primarily through property taxes.

When the legislature requires or expands mandatory services without state funding, the Commissioners Court must either 1) raise property taxes, or 2) reduce other services. If the legislature contemporarily limits the county ability to increase revenue, the Commissioners Court is forced to reduce other services provided to the citizens. Thus, the combination of unfunded mandates and revenue caps creates a state overreach and diminishes the ability of county officials to respond to the needs of local citizens. Ultimately, this will reduce the role of county officials to servants of the state legislature, subject to the whims of each legislative session.

The power to dictate county services and revenue creates a strong temptation in the legislature to supplant local decision-making with the priorities of powerful special interest groups and campaign contributors. A simple insertion of “shall” instead of “may” into legislation creates a mandated service, eliminating local discretion. An excessive revenue cap ensures that other services will be reduced to implement the mandate. The legislative program of the County Judges and Commissioners Association of Texas is committed to identifying proposed unfunded mandates and excessive revenue limitations and attempting to avoid their implementation.

Among the 9,000 bills introduced in the legislative session, hundreds will seek to either impose services or limit revenues. Some are indirect, such as requiring additional staff to meet shorter deadlines for plat review and juvenile proceedings or permitting overweight trucks on county roads. Underfunding state responsibilities, such as the courts, mental health facilities, indigent criminal defense, and child protection cases, are a favorite method of mandatory cost-shifting onto local taxpayers. Bills that exempt specific property from taxes reward special interest groups while forcing counties to either 1) shift the burden to other taxpayers, or 2) reduce services.

These negative bills can move quickly and with a lack of transparency through committee amendments and substitutes. Defensive efforts require careful attention and immediate responses. The overwhelming majority of legislation is adopted in the final weeks of the legislative session. The CJCAT provides informational analysis and updates through the Texas Association of Counties listservs. Stay tuned and thank you for your support.

Filed Under: From the General Counsel Tagged With: From the General Counsel, revenue caps, unfunded mandates

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