Senate Local Government Panel to Review 2025 Housing Laws, Weigh Audits of Local Fees

The Texas Senate Committee on Local Government will gavel in at 9 a.m. Sept. 2 to hear invited testimony on whether the housing laws the Legislature passed last year are working, and on whether the fees Texas cities and counties collect get enough scrutiny. The panel is taking invited witnesses only — there is no public testimony slot and the Senate runs no online comment portal — and anyone filing written testimony must supply 20 copies to the committee clerk and email a digital copy, according to the hearing notice.

Sen. Paul Bettencourt, R–Houston, chairs the seven-member committee — four Republicans and three Democrats — with Sen. Bryan Hughes, R–Mineola, as vice chair, according to Texas Legislature Online. It is the panel’s second sitting in two days; members met the afternoon of Sept. 1 on homestead exemptions and appraisal district budgets. The housing charge lands one day after the first anniversary of the laws it examines, all three of which took effect Sept. 1, 2025.

The first charge, Removing Barriers to Housing Affordability, asks for a report on the implementation of three bills from the 89th Legislature — Senate Bill 15, Senate Bill 840 and Senate Bill 2477 — plus Senate Bill 2038 from the 88th, and for recommendations to strengthen property rights as what the charge calls the cornerstone of Texas housing affordability.

The three 2025 bills work the same lever from different angles. SB 15 bars covered cities from requiring residential lots larger than 3,000 square feet in new subdivisions, applying to unplatted tracts of five acres or more. SB 840 requires those cities to allow multifamily and mixed-use residential projects by right on land zoned for commercial, office, retail, warehouse or mixed use, approving qualifying projects administratively instead of through a rezoning hearing. SB 2477 extends the same treatment to office-to-residential conversions and bars cities from demanding traffic studies, traffic mitigation fees or additional parking for them. All three reach only municipalities above 150,000 residents that sit in counties above 300,000 — fewer than 20 cities, by one law firm’s count.

Whether that has produced housing is contested. The Texas Dispatch reported July 20 that the House Land and Resource Management Committee spent a day on the same question and heard cities say they had complied with SB 840 while witnesses described the resulting local ordinances as a checklist built to kill housing. The same committee examined local fees and permitting speed that day, and took separate testimony on whether third-party plan review is speeding permits or routing builders around city hall. The Senate panel now runs the audit from the other chamber.

Senate Bill 2038 is the outlier in the group. The 2023 law lets landowners and residents petition out of a city’s extraterritorial jurisdiction, and cities have pressed since to narrow it — Fort Worth planned a legislative push to amend the statute ahead of the 2025 session, arguing releases strand it with infrastructure obligations it can no longer plan around. Its inclusion signals the committee reads ETJ authority as a housing-cost question rather than a boundary dispute.

The second charge, Holding Local Government Fees Accountable, is broader than its plumbing suggests. Members are directed to examine the collection, use and oversight of fees local governments impose — utility connection charges, permit and inspection fees, and drainage or stormwater improvement fees are named, and the notice says the list is not exhaustive — to evaluate whether those fees carry adequate financial transparency requirements, whether independent audits should be required, and whether the revenue goes solely to its stated purpose. Fee income sits outside the property tax rate limits the Legislature has spent a decade tightening, which is what makes the charge consequential.

Because this is an interim hearing, the committee will take no votes and no legislation is before it. Testimony will shape the panel’s interim report and the housing and local finance bills filed for the 90th Legislature, which convenes in January 2027.

Meeting at a glance

Committee members

• Sen. Paul Bettencourt, R–Houston (SD-7) — Chair
• Sen. Bryan Hughes, R–Mineola (SD-1) — Vice Chair
• Sen. Molly Cook, D–Houston (SD-15)
• Sen. Roland Gutierrez, D–San Antonio (SD-19)
• Sen. Phil King, R–Weatherford (SD-10)
• Sen. Angela Paxton, R–McKinney (SD-8)
• Sen. Royce West, D–Dallas (SD-23)