- A study by the Mercatus Center at George Mason University found that Texas is the fifth most regulated state in the nation
- HB 10 creates mechanisms used to increase transparency in administrative rulemaking and establishes an office within the Governor’s office to help state agencies eliminate unnecessary regulations
- HB 12 seeks to improve the Sunset review process by requiring reviews focused on an agency’s rulemaking and mandating third-party efficiency audits of state agencies
Two bills aimed at improving the regulatory framework in Texas are scheduled for consideration in the Texas House of Representatives today. House Bill 10, by State Representative Giovanni Capriglione, and House Bill 12, by State Representative Keith Bell, are priorities of Texas House Speaker Dustin Burrows.
While Texas has long been considered one of the best states in the nation for businesses and job creation, it has also been one of the most regulated. According to the Mercatus Center at George Mason University, Texas is the fifth most regulated state in the nation, with 274,469 regulatory restrictions on the books as of 2023.
A study released by the Mercatus Center in January examined the potential benefits to the Texas economy that regulatory reform would produce, finding that “even a meager 10 percent red-tape cut would make the economy $91.544 billion larger by the year 2037.”
The study also found that “by adopting a regulatory reduction target over the next three years, Texas can unlock billions of dollars in additional economic output and position itself as a leader in business innovation and economic dynamism.”
Experts with firsthand experience with the Texas regulatory system say the bills will accomplish much-needed reforms.
“Texas is the best state in the nation to do business, and it consistently leads in almost every economic indicator. Yet, Texas also has the 5th highest number of regulations in the country. House Bill 10 by Representative Giovanni Capriglione and House Bill 12 by Representative Keith Bell, would reduce the regulatory burden on Texans and provide greater transparency to the rulemaking and administrative process,” said Rod Bordelon of the Coalition for Regulatory Efficiency and Reform. Bordelon, an eleven-term gubernatorial appointee, is an attorney with extensive regulatory experience.
Jeff Rose, the former Chief Justice of the Third Court of Appeals, penned an op-ed in February concerning the need for regulatory reform in Texas.
“As the former Chief Justice of Texas’ Third Court of Appeals, my docket was full of regulatory disputes that impacted businesses and professionals across industries — frequently entangling Texans in antiquated, conflicting or out-of-context regulations. By the time a case reached my desk, it had usually worked its way through a state agency, been the subject of a proceeding in the State Office of Administrative Hearings, and was then appealed to a district court. The written record on these cases reflected years of legal wrangling and sometimes filled a moving truck, evidence of the significant costs of regulation — state resources to administer, business resources to comply, and the often-extensive taxpayer cost to enforce,” wrote Rose.
“Reforming our regulatory system is one of the most impactful steps legislators can take to improve state government and ensure Texas continues to lead the nation. By fixing outdated regulations and removing unnecessary barriers, Texas can cement our status as a dominant economic force in the U.S. and around the world. I urge lawmakers to seize this chance to create a system that will protect consumers, empower businesses, fuel innovation and strengthen our state economy for many years to come.”
The key provisions of House Bill 10 include the creation of the Texas Regulatory Efficiency Office within the Governor’s office, which would assist state agencies with eliminating and improving state regulations. The bill also creates a user-friendly website that would allow users to identify regulations applicable to a particular business, requires that administrative rules be written in plain language, and clarifies that Texas courts are “not required to give deference to a state agency’s legal determination regarding the construction, validity, or applicability of the law or a rule adopted by the state agency responsible for the rule’s administration, implementation, or other enforcement.”
House Bill 12 would make improvements to the State’s Sunset review process. These reforms include mandating that state agencies undergo reviews focused on the agency’s rulemaking, including the “necessity and effectiveness of rules adopted by the agency.” The bill also requires that state agencies undergo third-party efficiency audits that would be overseen by the State Auditor’s office and the Legislative Budget Board.
