Texas Interim Charges: What You Should Know

Originally published on Substack. 

Texas just got its new round of Senate interim charges and House interim charges, which means we now have an early look at the arguments, fights, and bad habits likely headed for 2027.

As Texas Policy Research (where I’m a board member) put it, the Senate charges are a roadmap to the next session. The same is true for the House, especially with new select committees signaling where leadership wants to spend political capital.

From a classical liberal perspective, there is good here. There is bad here. And there is some ugly here, too.
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The Good

Some of the best parts of these charges show lawmakers understand, at least in places, that Texas works best when government protects property rights, improves transparency, and lets markets work.

The Senate’s Business and Commerce Committee was told to evaluate whether ERCOT remains a “robust energy-only market,” review how 765-kv transmission lines affect landowners, and study how data-center growth is affecting the grid, water, and communities.

The House also has useful oversight angles, including government transparency, public information, and accountability through its new Governmental Oversight Committee.

Those are real opportunities to defend property rights and demand better signals from government.

There is also real promise in the Senate’s attention to financial technology, blockchain, cryptocurrency, AI, and autonomous systems. Texas should want to be the place where innovation is built and scaled, not preemptively strangled by fear.

And on health care, both chambers are at least asking better questions than usual. The Senate’s Health and Human Services Committee specifically mentions Health Savings Accounts and more flexible plan offerings, while the House’s Health Care Affordability Committee is looking at cost drivers, financing models, competition, transparency, and barriers facing employers. That points in the direction of my Empower Patients approach: more control for patients, more flexibility, more price visibility, and less bureaucratic command-and-control.

The Bad

The bad is where Texas keeps falling back into the same political trap: targeted relief instead of neutral reform without mention of eliminating property taxes.

The Senate’s Local Government Committee is examining bigger homestead exemptions, lowering the age for the senior tax ceiling, and reducing taxes for new homeowners.

The House’s Ways and Means Committee is likewise studying how to build on prior property-tax relief through more compression and bigger homestead exemptions.

Compression is the right path. Homestead carveouts are not.

Texas should keep compressing school district tax rates with surpluses until those rates go to zero. That is the broad, neutral way to provide relief.

By contrast, homestead exemptions pick winners and losers. They reward one class of property owner, shift burdens onto others, and make the tax code less neutral and less honest. I’ve argued before that these carveouts are distortions, not reforms. The state should not pretend selective relief is the same thing as fixing the system.

A classical liberal tax policy treats people equally. It does not hand out special treatment to politically favored categories and call that fairness.

The same issue shows up in education. The Senate deserves credit for calling school choice a success and for noting the enormous demand, with more than 250,000 applications tied to the rollout of Senate Bill 2.

Good. Expand it. But do not turn around and use declining district enrollment as an excuse to keep feeding the government-school monopoly with more money, more staffing layers, and more “right-sizing” theater while school choice inches forward at the margins.

Texas needs more students funded in the schools or learning models that work for them, not another round of backfilling a monopoly that is already losing families.

The Ugly

The ugly is where the state still wants to allocate capital, absorb federal dependency, and wander into areas it should approach with much more humility.

The House Appropriations Committee is monitoring major spending tied to homestead and business personal property exemptions, cyber command, and nuclear offices.

Elsewhere, House committees are studying how to maximize federal funding for rural health transformation and aviation infrastructure. That may sound pragmatic, but Texas should be moving away from dependence on an increasingly insolvent federal government, not building a budget model that assumes more Washington money will always be there.

If federal funds prop up too much of the state budget, then Texas is importing federal fiscal dysfunction into its own house. That is backward.

Texas should reduce government spending then pass a strong state and local spending limit. The real budget problem is not that taxpayers are undertaxed. It is that government overspends.

My work on Responsible State Budgets Across the U.S. makes the point clearly: spending growth should be capped at population growth plus inflation and treated as a ceiling, not a target. That would discipline the state, pressure local governments to live within a sustainable path, and create the fiscal space to keep compressing property tax rates downward over time.

And Texas should stay out of trying to become a digital parent. The House Public Health Committee is studying social media’s impact on youth well-being.

Fine. Study it. But Texas should be very careful before converting concern into government micromanagement of parenting, online behavior, or speech. Parents need tools, transparency, and authority. They do not need the state acting like the internet’s hall monitor.

One more point: Texas should consider its excessive lawsuit environment. The House is studying governmental immunity and the Texas Tort Claims Act, and that is worth reviewing carefully. But the larger priority should be neutral rules, transparent government, and real accountability, not another round of using legal reform as a substitute for broader structural reform.

What Texas Should Do

Texas should take the good and build on it. Protect property rights. Keep innovation open. Empower patients. Expand school choice substantially. Demand transparency from government. Reduce dependence on federal money. And put a real state and local spending limit in place.

It should reject the bad and the ugly. No more picking winners and losers through homestead exemptions and other carveouts. No more pretending selective favors are neutral policy. No more feeding a school monopoly while choice grows too slowly. No more drifting into federal dependency. And no more state temptation to regulate parenting by proxy.

Texas can lead. But only if it remembers that prosperity comes from neutral rules, strong property rights, patient choice, educational freedom, and disciplined government — not from political favoritism dressed up as reform.

Three Takeaways for Policymakers

1. Overspending is the core state-and-local problem.
Adopt a real spending limit tied to population growth plus inflation and treat it as a ceiling, not a target.

2. Compression beats carveouts.
Use surpluses to keep compressing school district tax rates toward zero, instead of expanding homestead exemptions that pick winners and losers.

3. Freedom beats favoritism.
Expand school choice meaningfully, empower patients, reduce dependence on federal funds, and resist the urge to micromanage families or allocate benefits to favored industries.