Houston assesses impact from Texas legislative session

Houston emerged from the Texas Legislature’s 2023 session with mixed results as one new law could erode its home-rule powers, while another will help it finance a convention center expansion. 

Mayor Sylvester Turner’s office released a report Monday on bills passed by the Republican-controlled legislature affecting the state’s largest city, calling the session that concluded May 29 “one of the most direct and sustained attacks on local authority and city services.” 

House Bill 2127, which Gov. Greg Abbott signed June 14, seeks to preempt local regulations under certain state codes, including those governing labor and finance.

“The bill expressly attempts to convert home-rule into general law cities for matters associated with these codes,” the report said, pointing to a need for clarity.

It added, “the long-standing, carefully constructed, constitutional balance between the regulatory authority of the state of Texas and that of home-rules cities will collapse under this uncertainty.”

The law, which takes effect Sept. 1, could potentially have a significant impact on home-rule city authority, according to the Texas Municipal League. 

“Still, the full scope of this impact is unclear and must be determined by the courts,” the group said in a legislative update.

Houston is reportedly heading to court to challenge the constitutionality of another new law that forces the city into arbitration with its firefighters’ union.

The law, which took effect June 2 with Abbott’s signature, addresses a five-year contract impasse by having the city and union appoint one arbitrator each and agree on a neutral party to complete the panel.

The city, which has been addressing its unfunded liabilities for pensions and other post-employment benefits, said the law will lead to higher costs for a new contract, which would come on top of an 18% pay raise firefighters are getting over a three-year period.

While Houston is not against using arbitration as part of the collective bargaining process, it opposes mandated arbitration “without explicit and reasonable parameters,” the city’s report said. 

On the positive side, Senate Bill 1057, which takes effect Sept. 1, gives Houston the ability to tap incremental growth in certain state taxes collected in a city project financing zone to fund an expansion of its convention center.

George R. Brown Convention Center is in the running to host the 2028 Republican National Convention and an expansion will enhance Houston’s bid, the report said.

Previously, only two cities were afforded this financing ability — Dallas, which is replacing its convention center, and Fort Worth, which constructed a multi-purpose arena.

Another new law will help Houston and Dallas offset costs related to their hosting of World Cup Soccer matches in 2026 by making both cities eligible to apply for reimbursements for expenses like infrastructure and security from the state’s Major Events Reimbursement Program.