HB 4283

relating to the penalties imposed on municipalities for violating
state law and the state constitution.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  Chapter 402, Government Code, is amended by
adding Subchapter D to read as follows:
SUBCHAPTER D.  REVIEW OF CERTAIN MUNICIPAL LAWS; PENALTIES
Sec. 402.101.  DEFINITION.  In this subchapter, "municipal
law" means an ordinance, rule, or similar measure adopted by the
governing body of a municipality.
Sec. 402.102.  REVIEW OF MUNICIPAL LAWS; REPORT.  (a)  The
attorney general may conduct an investigation to determine whether
a municipal law violates state law or the state constitution.
(b)  The attorney general shall conduct an investigation and
prepare a report on the findings of the investigation and, if the
attorney general determines that the municipal law that is the
subject of the investigation violates state law or the state
constitution, the attorney general shall include a statement to
that effect in the report.  The attorney general shall submit a copy
(2)  the governing body of the affected municipality.
(c)  If the report provided to a municipality under
Subsection (b) indicates that a municipal law adopted by the
municipality violates state law or the state constitution, the
attorney general must include with the report an additional notice
(1)  clearly and concisely explains the attorney
general's reasons for finding that the municipal law violates state
law or the state constitution; and
(2)  states that the municipality must resolve the
violation before the 30th day after the date the municipality
receives the report under Subsection (b) in order to avoid the
penalties described by Section 402.104.
Sec. 402.103.  EFFECT OF FINDING OF NO VIOLATION.  If the
report under Section 402.102(b) states that the attorney general
finds that the municipal law does not violate state law or the state
constitution, no further action is required of the attorney general
Sec. 402.104.  EFFECT OF FINDING OF VIOLATION.  (a)  If the
report under Section 402.102(b) states that the attorney general
finds that the municipal law violates state law or the state
constitution and the municipality that adopted the municipal law
does not resolve the violation within the period prescribed by
(1)  the municipality is liable to the state for a civil
penalty of not more than $3,000 for each day after the date the
municipality receives the report under Section 402.102(b);
(2)  until the attorney general determines that the
municipality has resolved the violation, the governing body of the
(A)  initiate an annexation procedure under
Chapter 43, Local Government Code; or
(B)  authorize the issuance of bonds; and
(3)  the attorney general shall submit written notice
to the comptroller instructing the comptroller to withhold any
money due to the municipality under Section 321.502, Tax Code,
until the attorney general notifies the comptroller that the
municipality has resolved the violation.
(b)  The attorney general must provide to the municipality a
copy of the notice submitted to the comptroller under Subsection
(c)  The attorney general may bring an action in a court of
competent jurisdiction to  recover the civil penalty imposed under
(d)  The attorney general shall consult with the governing
body of the municipality for purposes of determining whether the
municipality has resolved the violation identified in the report
under Section 402.102(b).  On the date the attorney general
determines the violation has been resolved, the attorney general
shall provide written notice of the resolution to the governing
body of the municipality and the comptroller.
(e)  The comptroller may not distribute any money to the
municipality under Section 321.502, Tax Code, during the period
beginning on the date the comptroller receives the notice under
Subsection (a) and ending on the date the comptroller receives the
notice described by Subsection (d).
SECTION 2.  Section 321.502, Tax Code, is amended to read as
Sec. 321.502.  DISTRIBUTION OF TRUST FUNDS.  Subject to
Section 402.104, Government Code, at [At] least twice during each
state fiscal year and at other times as often as feasible, the
comptroller shall send to the municipal treasurer or to the person
who performs the office of the municipal treasurer payable to the
municipality the municipality's share of the taxes collected by the
comptroller under this chapter.
SECTION 3.  This Act takes effect September 1, 2025.