Texas restaurants are full again, yet the industry continues to battle the rising costs of regulation, labor, and expenses. Kelsey Streufert, chief public affairs officer for the Texas Restaurant Association (TRA), says that while the industry has rebounded on paper, restaurateurs are still navigating this “rollercoaster” of policy shocks and cost spikes. Her effort at the legislature centers on reining in permit stacking, clarifying rules, and pressing solutions on labor, pricing pressure, and credit-card fees.
A licensed attorney and Texas Capitol veteran, Streufert joined the association five years ago when COVID spread and closed dining rooms. “I accepted the job when that is happening in China,” she says. “By the time I started, restaurants were prohibited from being open. We were in full lockdown mode and trying to figure out how to live in this new environment.”
The sector grew back fast. “We partnered with Governor Abbott to get restaurants to reopen safely very quickly,” she says. This session, Streufert says they “worked with the legislature on a host of bills” to continue addressing the continued challenges faced by the industry.
Senate Bill 1008, for example, was a priority for TRA. “There are about 200 different health departments across the state of Texas,” Streufert says. “They all do things slightly differently … permits, inspection protocols … the list goes on.” The new law introduces guardrails. “Can we bring some standardization, can we get rid of fees and permits that are being added on to these small businesses so that they can spend less time in the government bureaucracy and more time and money reinvesting in their business?”
According to Streufert, another issue is that local governments have been allowed to charge a local alcohol fee, “even though they don’t regulate alcohol,” she says. Instead, Streufert says restaurants should “pay [the state]. You’re done.” She also says redundant food-manager cards face the same fate. “If you are a state-certified food manager, you shouldn’t also have to turn around and pay the local government for a local food handler card.” But a centralized clearinghouse now offers transparency. “They’ve got a website where they’re going to post all these different fee schedules, local ordinances … one clearinghouse where we can keep up with all the local rules.”
The bill, which was led by Senator Mayes Middleton and Representative Cody Harris, passed both chambers and was signed into law by the Governor in September.
The economics of owning a Restaurant in Texas remains brutal. “The average restaurant is making about 5% profit pretax,” Streufert says. “Food prices have increased 35%, wages over 30%… credit card processing fees double in the past decade.” Menu prices have risen but trail input costs. “Menu prices increase about 30%.” Not fully making up the gap, but at least trying to survive.”
Rising Property taxes further amplify this, according to Streufert. “Texas being a low-tax state is not really true when you’re talking about businesses,” she says. “We’re sort of in the middle of the pack. “People are truly being squeezed out of their commercial property. At some point you’re priced out just purely based on the appraisal.”
Workforce shortages have pushed TRA into advancing childcare policy as well. “We do not have enough people working in restaurants to really keep up with the demand,” Streufert says. “Childcare is one of the biggest barriers to employment. Our industry tends younger, we tend to be more female.” New laws aim to expand access, she says. “We really weren’t hearing businesses talk about this as a workforce development issue. So we got together with the Texas Association of Business, a group called Early Matters and Texas 2036. We created the employers for Child Care Task Force before last session, and then we spent all of 2024 really developing some policy ideas and brought those to the Capitol for this most recent legislative session.”
The legislature passed a range of bills supported by TRA to help with childcare, including Senate Bill 1265, creating a childcare resource hub and Senate Bill 462, which gives childcare workers priority access to state childcare scholarships.
Immigration enforcement is scaring some communities, according to Streufert. “Anytime a raid happens anywhere in the country… that’s scaring a lot of people from coming to work and also just from coming out and eating at our restaurants,” she says. “We are actually seeing sales and traffic take a dip, especially in heavily Hispanic communities.” Temporary work permits would help. “President Trump himself has said over six times that we need temporary work permits for the food sector … we wholeheartedly agree,” she says, citing polling support among GOP voters. Prices connect to labor. “If we stick to our current immigration policy trajectory … the average American family is going to be spending over $2,000 more a year on basics like food,” she says. “Every segment of our food pipeline is understaffed.”
According to Streufert, the next fights will aim at swipe fees. “Visa and Mastercard control over 75% of the entire U.S. credit card market,” she says. Restaurant owners “have no ability to negotiate … even Whataburger doesn’t really have any negotiating power.” Competitive pressure, she argues, would curb an “inflation multiplier.”