89S20041 SCL-F     By: Bell of Montgomery H.B. No. 72       A BILL TO BE ENTITLED   AN ACT   relating to state preemption of certain municipal and county   regulation.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  The legislature finds that:                (1)  the state has historically been the exclusive   regulator of many aspects of commerce, trade, elections, and   criminal justice in this state;                (2)  in recent years, several local jurisdictions have   sought to establish their own regulations of commerce, trade,   elections, and criminal justice that are different than the state's   regulations; and                (3)  the local regulations have led to a patchwork of   regulations that apply inconsistently across this state.          SECTION 2.  The purpose of this Act is to provide additional   statewide consistency by returning sovereign regulatory authority   powers to the state where those powers belong in accordance with the   Texas Constitution, including Section 5, Article XI, of that   constitution.          SECTION 3.  This Act:                (1)  may not be construed to prohibit a municipality or   county from building or maintaining a road, imposing a tax, or   carrying out any authority expressly authorized by statute;                (2)  may not be construed to prohibit a home-rule   municipality from providing the same services and imposing the same   regulations that a general-law municipality is authorized to   provide or impose;                (3)  does not affect the authority of a municipality or   county to conduct a public awareness campaign; and                (4)  does not affect the authority of a municipality or   county to repeal or amend an existing ordinance, order, or rule that   violates the provisions of this Act for the limited purpose of   bringing that ordinance, order, or rule in compliance with this   Act.          SECTION 4.  Chapter 102A, Civil Practice and Remedies Code,   is amended by adding Subchapter A, and a heading is added to that   subchapter to read as follows:   SUBCHAPTER A. PRIVATE ACTION          SECTION 5.  Section 102A.001, Civil Practice and Remedies   Code, is transferred to Subchapter A, Chapter 102A, Civil Practice   and Remedies Code, as added by this Act, and amended to read as   follows:          Sec. 102A.001.  DEFINITION.  In this subchapter [chapter],   "person" means an individual, corporation, business trust, estate,   trust, partnership, limited liability company, association, joint   venture, agency or instrumentality, public corporation, any legal   or commercial entity, or protected or registered series of a   for-profit entity.          SECTION 6.  Section 102A.0015, Civil Practice and Remedies   Code, as added by S.B. 1008, Acts of the 89th Legislature, Regular   Session, 2025, as effective September 1, 2025, and Section   102A.002, Civil Practice and Remedies Code, as amended by S.B.   1008, Acts of the 89th Legislature, Regular Session, 2025, as   effective September 1, 2025, are transferred to Subchapter A,   Chapter 102A, Civil Practice and Remedies Code, as added by this   Act, reenacted, and amended to read as follows:          Sec. 102A.0015.  APPLICABILITY OF CHAPTER. In this chapter,   a reference to a municipality or county includes a public health   district created by one or more municipalities or counties.          Sec. 102A.002.  LIABILITY FOR CERTAIN REGULATION. (a)  Any   person who has sustained an injury in fact, actual or threatened,   from a municipal or county ordinance, order, or rule adopted or   enforced by a municipality or county in violation of any of the   following provisions or a trade association representing the person   has standing to bring and may bring an action against the   municipality or county:                (1)  Section 1.004, Agriculture Code;                (2)  Section 1.109, Business & Commerce Code;                (3)  Section 1.023, Election Code;                (4)  Section 1.004, Finance Code;                (5)  Section 1.007 or [(3-a)]  Chapter 437, 437A, or   438, Health and Safety Code;                (6) [(4)]  Section 30.005, Insurance Code;                (7) [(5)]  Section 1.005, Labor Code;                (8) [(6)]  Section 229.901, Local Government Code;                (9) [(7)]  Section 1.003, Natural Resources Code;                (10) [(8)]  Section 1.004, Occupations Code;                (11)  Section 1.08(b), Penal Code; or                (12) [(9)]  Section 1.004, Property Code.          (b)  A person who has sustained an actual or threatened   injury in fact from a municipal or county ordinance, order, or rule   adopted or enforced in violation of Section 40.001 or 250A.001,   Local Government Code, or a nonprofit organization or trade   association representing the person, has standing to bring an   action against the municipality or county.          SECTION 7.  Sections 102A.003, 102A.004, 102A.005, and   102A.006, Civil Practice and Remedies Code, are transferred to   Subchapter A, Chapter 102A, Civil Practice and Remedies Code, as   added by this Act, and amended to read as follows:          Sec. 102A.003.  REMEDIES.  (a)  A claimant is entitled to   recover in an action brought under this subchapter [chapter]:                (1)  declaratory and injunctive relief; and                (2)  costs and reasonable attorney's fees.          (b)  A municipality or county is entitled to recover in an   action brought under this subchapter [chapter] costs and reasonable   attorney's fees if the court finds the action to be frivolous.          Sec. 102A.004.  IMMUNITY WAIVER.  Governmental immunity of a   municipality or county to suit and from liability is waived to the   extent of liability created by this subchapter [chapter].          Sec. 102A.005.  NOTICE.  A municipality or county is   entitled to receive notice of a claim against it under this   subchapter [chapter] not later than three months before the date a   claimant files an action under this subchapter [chapter].  The   notice must reasonably describe:                (1)  the injury claimed; and                (2)  the ordinance, order, or rule that is the cause of   the injury.          Sec. 102A.006.  VENUE.  (a)  Notwithstanding any other law,   including Chapter 15, a claimant may bring an action under this   subchapter [chapter] in:                (1)  the county in which all or a substantial part of   the events giving rise to the cause of action occurred; or                (2)  if the defendant is a municipality, a county in   which the municipality is located.          (b)  If the action is brought in a venue authorized by this   section, the action may not be transferred to a different venue   without the written consent of all parties.          SECTION 8.  Chapter 102A, Civil Practice and Remedies Code,   is amended by adding Subchapter B to read as follows:   SUBCHAPTER B. ATTORNEY GENERAL ENFORCEMENT          Sec. 102A.051.  DEFINITION. In this subchapter,   "no-new-revenue tax rate" means the no-new-revenue tax rate   calculated under Chapter 26, Tax Code.          Sec. 102A.052.  ATTORNEY GENERAL INVESTIGATION AND ACTION.   (a)  The attorney general may investigate an alleged violation of a   law described by Section 102A.002 by a municipality or county.          (b)  The attorney general may bring an action for injunctive,   declaratory, or mandamus relief against a municipality or county if   the attorney general determines after conducting an investigation   under Subsection (a) that the municipality or county violated a law   described by Section 102A.002.          (c)  Notwithstanding any other law, including Chapter 15,   the attorney general may bring an action under this section in:                (1)  the county in which all or a substantial part of   the events giving rise to the cause of action occurred; or                (2)  if the defendant is a municipality, a county in   which the municipality is located.          Sec. 102A.053.  EFFECTS OF PENDENCY OF ACTION. (a)  During   the pendency of an action brought under Section 102A.052, with   respect to a municipality or county defending the action:                (1)  the comptroller shall withhold payment of any   money due to the municipality or county under Section 321.502 or   323.502, Tax Code;                (2)  the municipality or county may not adopt an ad   valorem tax rate that exceeds the municipality's or county's   no-new-revenue tax rate;                (3)  the municipality or county may not adopt a budget   that exceeds the total expenditures of the budget under which the   municipality or county is operating at the time the attorney   general brings the action under Section 102A.052; and                (4)  the municipality or county may not receive state   grant funds and any pending application for such funds shall be   denied.          (b)  Section 109.004(a)(1), Local Government Code, does not   apply to a municipality if the comptroller is withholding payments   from the municipality in accordance with Subsection (a)(1) of this   section.          (c)  Notwithstanding Section 120.002, Local Government Code,   a county may not hold an election under that section if the   comptroller is withholding payments from the county in accordance   with Subsection (a)(1) of this section.          (d)  Notwithstanding Subsection (a)(4), a municipality or   county may receive state grant funds for grants provided for the   purpose of:                (1)  responding to a disaster declared under Chapter   418, Government Code, if:                      (A)  for a municipality, the municipality is   located in a county or a county adjacent to a county that includes   an area specified in the disaster declaration; and                      (B)  for a county, the county or a county adjacent   to the county includes an area specified in the disaster   declaration; or                (2)  providing financial assistance to a municipal   police department, sheriff's department, constable's office,   district or county attorney's office, fire department, municipal or   county jail, or other municipal or county department providing law   enforcement or emergency response services.          Sec. 102A.054.  ACTION PROCEDURES. (a) A municipality or   county defending an action brought under Section 102A.052 has the   burden of proof to establish that the municipality or county   complied with the law that is the subject of the action.          (b)  The trial court shall set an action brought under   Section 102A.052:                (1)  for an initial hearing not later than the 30th day   after the date the municipality or county defending the action was   served with process for the action; and                (2)  for a trial on the merits not later than the 90th   day after the date the municipality or county defending the action   was served with process for the action, unless:                      (A)  the municipality or county and the attorney   general agree to a later date; and                      (B)  the court determines that holding trial at a   later date is in the interest of justice.          Sec. 102A.055.  APPELLATE JURISDICTION; EXPEDITED APPEAL.     (a) The Fifteenth Court of Appeals has exclusive intermediate   appellate jurisdiction of an action brought under Section 102A.052.   A party must appeal the action not later than the 30th day after the   date the judgment is signed.          (b)  An appellate court shall expedite an appeal of an action   brought under Section 102A.052.          Sec. 102A.056.  RESOLUTION OF ACTION IN FAVOR OF ATTORNEY   GENERAL. (a)  If the attorney general prevails in an action brought   under Section 102A.052:                (1)  the municipality or county defending the action   may not, during the five fiscal years following the year in which   the judgment becomes final:                      (A)  adopt an ad valorem tax rate that exceeds the   municipality's or county's no-new-revenue tax rate; or                      (B)  receive state grant funds; and                (2)  the court issuing the final judgment resolving the   action shall provide in the judgment that the state is entitled to   recover from the municipality or county defending the action a   penalty equal to the balance of the suspense account maintained for   the municipality or county under Section 321.501 or 323.501, Tax   Code, as applicable, that exists on the date the judgment is signed,   less the amount the comptroller may retain under Subsection (b) of   this section.          (b)  Except as provided by this subsection, the comptroller   shall, on receipt of a copy of the final judgment in an action   brought under Section 102A.052, deposit the balance of the suspense   account maintained for the municipality or county defending the   action under Section 321.501 or 323.501, Tax Code, as applicable,   as of the date the judgment is signed to the credit of the general   revenue fund. The comptroller may retain in the suspense account   maintained for the municipality or county an amount not to exceed   five percent of the balance of the suspense account as of the date   the judgment is signed for the purpose of making refunds for   overpayments to the suspense account or redeeming dishonored checks   and drafts deposited to the credit of the suspense account. Not   later than the fourth anniversary of the date the comptroller   retains an amount in a suspense account under this subsection, the   comptroller shall deposit the balance of that retained amount, if   any, to the credit of the general revenue fund.          (c)  Section 109.004(a)(1), Local Government Code, does not   apply to a municipality subject to a final judgment in an action   brought under Section 102A.052 for six state fiscal years following   the date the judgment is signed.          (d)  Notwithstanding Section 120.002, Local Government Code,   a county may not hold an election under that section if the county   has been the subject of an adverse final judgment in an action   brought under Section 102A.052 before the sixth anniversary of the   date the judgment is signed.          Sec. 102A.057.  RESOLUTION OF ACTION IN FAVOR OF   MUNICIPALITY OR COUNTY. If a municipality or county prevails in an   action brought under Section 102A.052, the comptroller shall   immediately send to the municipality or county any balance of the   suspense account maintained for the municipality or county under   Section 321.501 or 323.501, Tax Code, as applicable, being held   under Section 102A.053(a)(1) as of the date the final judgment   resolving the action is signed, including any interest that accrued   on the balance of the suspense account during the period the balance   was withheld.          SECTION 9.  Chapter 1, Election Code, is amended by adding   Section 1.023 to read as follows:          Sec. 1.023.  PREEMPTION. Unless expressly authorized by   another statute, a municipality or county may not adopt, enforce,   or maintain an ordinance, order, or rule regulating conduct in a   field of regulation that is occupied by a provision of this code.   An ordinance, order, or rule that violates this section is void,   unenforceable, and inconsistent with this code.          SECTION 10.  Chapter 1, Health and Safety Code, is amended by   adding Section 1.007 to read as follows:          Sec. 1.007.  PREEMPTION. Unless expressly authorized by   another statute, a municipality or county may not adopt, enforce,   or maintain an ordinance, order, or rule regulating conduct in a   field of regulation that is occupied by a provision of this code.   An ordinance, order, or rule that violates this section is void,   unenforceable, and inconsistent with this code.          SECTION 11.  Subtitle C, Title 2, Local Government Code, is   amended by adding Chapter 40 to read as follows:   CHAPTER 40.  PREEMPTION          Sec. 40.001.  PREEMPTION. Unless expressly authorized by   another statute, a municipality may not adopt, enforce, or maintain   an ordinance or rule regulating conduct in a field of regulation   that is occupied by a provision of this subtitle. An ordinance or   rule that violates this section is void, unenforceable, and   inconsistent with this subtitle.          SECTION 12.  Subtitle C, Title 7, Local Government Code, is   amended by adding Chapter 250A to read as follows:   CHAPTER 250A.  PREEMPTION          Sec. 250A.001.  PREEMPTION. Unless expressly authorized by   another statute, a municipality or county may not adopt, enforce,   or maintain an ordinance, order, or rule regulating conduct in a   field of regulation that is occupied by a provision of this title.   An ordinance, order, or rule that violates this section is void,   unenforceable, and inconsistent with this title.          SECTION 13.  Section 1.08, Penal Code, is amended to read as   follows:          Sec. 1.08.  PREEMPTION.  (a) No governmental subdivision or   agency may enact or enforce a law that makes any conduct covered by   this code an offense subject to a criminal penalty. This subsection   [section] shall apply only as long as the law governing the conduct   proscribed by this code is legally enforceable.          (b)  Unless expressly authorized by another statute, a   municipality or county may not adopt, enforce, or maintain an   ordinance, order, or rule regulating conduct that is otherwise   prohibited by a provision of this code. An ordinance, order, or   rule that violates this subsection is void, unenforceable, and   inconsistent with this code.          SECTION 14.  Subchapter B, Chapter 102A, Civil Practice and   Remedies Code, as added by this Act, applies only to a cause of   action that accrues on or after the effective date of this Act.          SECTION 15.  Every provision, section, subsection,   sentence, clause, phrase, or word in this Act, and every   application of the provisions in this Act to every person, group of   persons, or circumstances, are severable from each other. If any   application of any provision in this Act to any person, group of   persons, or circumstances is found by a court to be invalid,   preempted, or unconstitutional, for any reason whatsoever, then the   remaining applications of the Act to all other persons and   circumstances shall be severed and preserved and shall remain in   effect. All constitutionally valid applications of the provisions   in this Act shall be severed from any applications that a court   finds to be invalid, preempted, or unconstitutional, because it is   the legislature's intent and priority that every single valid   application of every statutory provision be allowed to stand alone.   The legislature further declares that it would have enacted this   Act, and each provision, section, subsection, sentence, clause,   phrase, or word, and all constitutional applications of the   provisions of this Act, irrespective of the fact that any   provision, section, subsection, sentence, clause, phrase, or word,   or applications of this chapter were to be declared invalid,   preempted, or unconstitutional.          SECTION 16.  The Texas Supreme Court has exclusive and   original jurisdiction over a challenge to the constitutionality of   this Act or any part of this Act and may issue injunctive or   declaratory relief in connection with the challenge.          SECTION 17.  This Act takes effect on the 91st day after the   last day of the legislative session.