HB 5419

relating to eliminating inefficiencies in the organization,
operation, powers, regulations, and management of the Texas
Education Agency to prioritize the provision of funding directly to
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  Section 7.004, Education Code, is amended by
amending Subsection (a) and adding Subsection (c) to read as
(a)  The Texas Education Agency is subject to Chapter 325,
Government Code (Texas Sunset Act).  Unless continued in existence
as provided by that chapter, the agency is abolished September 1,
(c)  In this subsection, "contract" includes an amendment,
modification, renewal, extension, a purchase order, or an
interagency contract and includes a contract that was paid with
federal funds or funds not appropriated by the General
Appropriations Act.  The Sunset Advisory Commission, with the
assistance of the State Auditor's Office, shall evaluate the
efficiency and effectiveness of the organization, operation,
powers, regulations, and management of the agency, including growth
in full-time equivalent staff at the agency and growth in grant
programs and grant conditions that result in hiring of additional
staff at public schools.  The evaluation shall include a review of
each contract that was entered into by the agency since 2016 and
that equals or exceeds $100,000, with a review of contracting
procedures used by the agency and total cost of all contracts for
each program area or activity.  The review also shall include, if
the contract is for a good or service used in public schools, an
annualized cost of each contract, annual number of students,
educators, or other users directly using a good or service under
each contract, the annualized cost per user under each contract,
and the amount of any implementation costs to public schools.  In
addition to its report required under Chapter 325, Government Code,
the commission shall present to the 90th Legislature a report on its
evaluation and recommendations under this subsection.  This
subsection expires September 1, 2027.
SECTION 2.  Subchapter B, Chapter 7, Education Code, is
amended by adding Sections 7.041 and 7.042 to read as follows:
Sec. 7.041.  STATE POLICY:  PRIORITIZE PUBLIC SCHOOLS.  (a)
It is the policy of this state that the agency shall be efficient in
its operations and that state funds be prioritized for the direct
support and maintenance of the public schools.
(b)  Notwithstanding any other law, the agency may not:
(1)  set aside or encumber funds, including a federal
block grant, that otherwise could go directly to public schools for
(2)  enlarge, or request legislation to enlarge, the
(3)  increase the number of full-time equivalent
employees beyond the level authorized by the 88th Legislature.
(c)  It is the policy of this state that funds for education
that are not obligated by constitution or statute be prioritized as
(1)  attaining and maintaining pay for classroom
teachers of at least the national average, with an adjustment
upwards for pay that is competitive with professionals in the
region who have similar levels of education and skill;
(2)  providing an increase to the school safety
allotment sufficient to meet the needs of public schools and to
cover the costs and requirements of statutes and rules regarding
(3)  providing funding for public schools sufficient to
meet the needs of students with disabilities and to cover the costs
and requirements of statutes and rules regarding special education.
(d)  It is the policy of the state that when, due to school
districts' property value growth, increase in attendance credits
under Chapter 49, or change in student enrollment or attendance,
state appropriations of general revenue to the Foundation School
Program maintenance and operations funds for a year are supplanted
as surplus, the agency identify the amount of that general revenue
surplus and submit a request to the office of the governor and the
Legislative Budget Board for an appropriation or budget execution
authority under Chapter 317, Government Code, to provide the
general revenue surplus back to the Foundation School Program for
the priorities under Subsection (c).  If in any year an
appropriation or budget execution authority does not provide the
surplus to the Foundation School Program or to school district
property tax relief, the next tax bill under Section 31.01, Tax
Code, shall inform each taxpayer of the diversion of the Foundation
Sec. 7.042.  ZERO-BASED BUDGET REQUIRED FOR TEXAS EDUCATION
AGENCY OPERATIONS; CONTENTS.  (a)  In this section, "agency
operations budget" means the budget for agency administration and
operations.  The term does not include any state aid or allotment
under this code that is received by school districts or
open-enrollment charter schools or, under Section 48.308, by the
higher education coordinating board.
(b)  In addition to the required annual budget under Section
7.055, the commissioner shall prepare, in plain language and an
easily readable and understandable format, a zero-based agency
operations budget every tenth fiscal year that contains:
(1)  a description of the discrete activities the
agency conducts or performs with:
(A)  a justification for each activity by
reference to the state constitution, statute, or rule; and
(B)  an external evaluation of the effectiveness
and efficiency of the agency's policies, management, fiscal
affairs, and operations in relation to each activity;
(2)  for each activity identified under Subdivision
(A)  a quantitative estimate of any adverse
effects that may reasonably be expected to result if the activity
were discontinued, with a description of the methods by which the
adverse effects were estimated;
(B)  an itemized account of expenditures required
to maintain the activity at any minimum level of service required by
law, with a concise statement of the quantity and quality of service
required at that minimum level; and
(C)  an itemized account of expenditures required
to maintain the activity at the current level of service, with a
concise statement of the quantity and quality of service provided
(3)  a ranking of activities identified under
Subdivision (1) that illustrates the relative importance of each
activity to the overall goals and purposes of the agency at current
(4)  recommendations to the legislative budget board
and office of the governor regarding whether the agency should
continue funding each activity identified under Subdivision (1)
(c)  The commissioner shall file a copy of the zero-based
budget with the legislative budget board and the office of the
governor on or before the date the proposed annual budget is filed,
and the zero-based budget shall be posted on the agency's Internet
SECTION 3.  Section 7.055(c), Education Code, is amended to
(c)  The budget the commissioner adopts under Subsection (b)
for operating the Foundation School Program must be in accordance
with legislative appropriations and provide minimal funds for the
administration and operation of the agency and any other necessary
expense required by statute.  The budget must designate any expense
of operating the agency or operating a program for which the board
has responsibility that is paid from the Foundation School Program.
The budget must designate program expenses that may be paid out of
the foundation school fund, other state funds, fees, federal funds,
or funds earned under interagency contract.  Before adopting the
budget, the commissioner must submit the budget to the board for
review and, after receiving any comments of the board, present the
operating budget to the governor and the Legislative Budget Board.
The commissioner shall provide appropriate information on proposed
budget expenditures to the comptroller to assure that all payments
are paid from the appropriate funds in a timely and efficient
SECTION 4.  Section 322.017, Government Code, is amended to
add Subsection (b-1) to read as follows:
(b-1)  The board shall review and analyze the effectiveness
and efficiency of the policies, management, fiscal affairs, and
operations of the Texas Education Agency and report its findings by
September 1, 2026, for consideration in connection with the
legislative appropriations process.  This subsection expires
SECTION 5.  (a)  The commissioner of education shall prepare
an initial zero-based budget as described by Section 7.042,
Education Code, as added by this Act, for the fiscal year beginning
SECTION 6.  This Act takes effect September 1, 2025.