Jan. 1 Texas laws: What state and local officials need to act on
About three dozen new Texas laws take effect Jan. 1. The biennial session wrapped in early June, with more than 1,100 bills signed; many became effective in mid-June or Sept. 1, with roughly a dozen more on Dec. 4 after special sessions on congressional maps, the July 4 floods, and school assessments. Several measures also required voter approval in November.
This briefing highlights changes most relevant to public-sector leadership. It is not comprehensive; for full bill texts and status, consult Texas Legislature Online.
Disaster-related tax rate limits (HB 30)
HB 30 amends Tax Code Section 26.042 to narrow how cities and counties adjust tax rates after state- or federally-declared disasters. The 2021 flexibility to use voter-approved rates after a disaster remains, but new guardrails now apply.
- Local governments can choose between: (1) the voter-approved tax rate, or (2) a rate calculated using a federal standard tied to debris removal costs.
- A jurisdiction cannot reuse an older disaster declaration for tax adjustments if a more recent disaster was already used for that purpose.
- Disaster-adjusted rates face limits on how they roll into future rate calculations.
Supporters said the goal is to ensure disaster adjustments fund actual recovery needs without becoming a backdoor tax increase. Expect closer scrutiny of documentation and disclosures tied to disaster-related expenditures.
- Action for city/county finance: Map all disaster declarations since 2021 and identify which have been used for tax adjustments.
- Document debris removal and recovery costs that support any rate calculations; align with federal standards.
- Coordinate early with the auditor, attorney, and communications team on required notices and public explanations.
- Update models so disaster-related rates don't overstate future rate baselines.
Guardrails on AI in government (HB 149)
HB 149 establishes a seven-member Texas Artificial Intelligence Council to monitor state government AI use, flag high-risk systems, and recommend policy. The council will also review whether state or local AI rules could unnecessarily restrict innovation and report back to the legislature.
- Agencies must disclose when Texans are interacting with an AI system on a government website.
- Disclosure is also required when AI is used in health care treatments and services.
- Government entities are barred from using AI to capture biometric data (e.g., fingerprints, facial scans) without consent.
- Companies are prohibited from building AI that manipulates human behavior, discriminates, or creates sexual/deepfake content involving children.
Federal activity continues to push for a unified national approach to AI oversight, including directives for the U.S. Department of Commerce and the Department of Justice. State and federal interplay could shift obligations over time-track attorney general guidance and council updates closely.
- Action for agencies: Inventory all AI and algorithmic systems in use (public-facing and internal). Note purpose, data inputs, disclosures, and human oversight.
- Add clear AI notices to applicable web pages and service workflows; verify accessibility and translation.
- Review consent processes for any biometric collection; stop any AI-enabled capture lacking explicit consent.
- Embed procurement standards requiring vendors to meet HB 149 prohibitions and provide auditability.
- Assign an AI point of contact; schedule periodic risk reviews aligned to frameworks such as the NIST AI RMF.
If your team needs a quick way to build baseline AI literacy for policy, procurement, or oversight, here's a curated directory by role: Complete AI Training - Courses by Job.
Property tax exemptions: Businesses and surviving military spouses
Four new property tax exemptions begin Jan. 1 after voter approval in the Nov. 4 election. Appraisal districts and tax offices should update guidance, forms, and calendars so eligible entities and households receive the full benefit in the 2025 cycle.
- Action for appraisal districts: Publish eligibility criteria and deadlines; update internal checklists and staff training.
- Action for city/county finance: Refresh revenue projections to reflect the exemptions' impact on the tax base.
- Action for businesses: Review inventory accounting and ensure documentation matches the new exemption rules.
- Action for surviving military spouses: Verify eligibility and file any required applications promptly.
Key dates and quick checklist
- Jan. 1: Effective date for HB 30, HB 149, and the voter-approved property tax exemptions.
- Within 30 days: Update websites with AI interaction notices; brief customer service teams.
- Q1: Validate disaster-related tax rate calculations; maintain cost documentation tied to debris removal and recovery.
- Q1: Update procurement templates for AI disclosures, testing, and vendor compliance.
- Ongoing: Monitor council outputs, attorney general guidance, and any federal actions affecting AI or tax policy.
For full bill language and implementation details, see Texas Legislature Online. If your agency needs upskilling for staff evaluating AI systems, you can scan current options here: Latest AI Courses.
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