This past Texas legislative session was a tough one for Texas cities. A series of bills passed by the lege made it a lot more difficult for municipalities in Texas to generate revenue. The state banned red light cameras and fees charged to telecommunications companies for using the public right of way. But the biggest hit to city budgets was a bill that limits cities’ ability to grow property tax revenue without holding a “roll back” election. Dallas can expect to have $7 million less in its budget this season, but it’s the cumulative effect of the bills that will have the largest impact. As Matt reported back in July, a Moody’s analysis of the bill found that “the cap would generate ‘minimal’ homeowner savings but would ‘hurt local governments substantially.’”
Texas is not alone when it comes to state governments meddling in their cities’ business. The recent attempts in the state legislature to limit municipal power—which went far-beyond the bills that passed and included a large number of failed bills that would have installed all sorts of preempted legislation—are part of a growing national trend. A new report by the Local Solutions Support Center and the State Innovations Exchange has found that since 2011 state governments have stepped up their efforts to pass broader and more punitive preemption laws that limit cities, towns, and counties own legislative autonomy. The effort, the report argues, is being driven by special interests, and the new bills filed in state legislatures throughout the county tend to gravitate toward laws that limit local governments’ ability to regulate businesses and protect civil rights.
The full report is available here, but let’s drill into what it found in Texas.
According to the report, the Center for Public Policy Priorities in Texas identified 62 preemption bills filed in Austin that covered a wide range of issues. For example, Texas SB 1978, which did pass, “prohibits a governmental entity from taking any adverse action against a person/entity based in whole or part on membership in, affiliation with, or contribution, donation, or other support provided to a religious organization.” As the report puts it, “This bill basically protects people and organizations that discriminate.”
The new law with the most potential impact on municipal budgets was the one requiring a property tax “roll back” election. But other successful bills limit local election authority, preempt local taxing authority, eliminate local contracting authority, and limit local zoning, housing, and land use authority. These include new laws that prohibit municipalities from requiring the disclosure of information related to the value of, or cost of, construction or improving a residential dwelling as a condition of obtaining a building permit. Another bill limited local regulation of building products, materials, or methods of construction. Yet another prohibited cities from using taxpayer money to fund transactions with abortion providers and their affiliates (read: Planned Parenthood), regardless of whether the affiliate provides abortion services.
Some of the bills that did not pass this year’s session are interesting in the way the illuminate a broader ethos that is guiding this effort by state governments to step in and regulate city governments. These include bills that would have prohibited cities from using tax revenue to pay for lobbyists, nullified the paid sick leave ordinances passed in Dallas, and blocked local governments from adopting or enforcing regulation on private sector businesses related to employment terms or standards.
One failed bill in Texas attempted to prohibit local governments from adopting or enforcing ordinances relating to employment benefits, including health, disability, retirement, profit-sharing, death, and group accidental death and dismemberment benefit. One would have banned local employment scheduling ordinances or “fair scheduling” laws. Others would have banned local communities from adopting or passing any ordinances related to employment leave, including paid sick days, paid days for holidays, vacation, and personal necessity; and banned local “fair chance” hiring ordinances limiting employer’s ability to request, consider, or take employment action based on the criminal history record information of an applicant or employee.
With regard to these kinds of business protections, Texas is a leader in the movement:
Conservative lawmakers in several states have repeatedly introduced bills that would effectively eliminate local government regulation of business. Texas Governor Greg Abbott’s intention “to reduce, restrict and prohibit local regulations” is shared with conservative lawmakers in other states. All of the bills below – except for Pennsylvania’s HB 331 – failed this session. But in terms of trends, there was an increase in the number of bills introduced this session with the goal of wiping out most or all of local government’s ability to oversee business operations and standards.
On a level, this all might seem counter-intuitive. Conservatism tends to argue that the best decisions about government are made at the most local level, and it resists large, bureaucratic governmental bodies stepping and limiting that local authority. But the trend is indicative of a deepening political divide that is increasingly manifested as a geographical shift—a left-right, blue-red split between cities and rural communities. Against the backdrop of this geographical ideological split, state legislatures become a bulwark against urban-led progressive policies.
While the report found that this trend is spreading throughout the country, it also reports that local advocacy organizations are becoming more active in identifying and opposing legislation aimed at stripping local governments of their autonomy:
“[T]he 2019 legislative sessions also saw the introduction and passage of an unprecedented number of preemption repeal bills, successful LOCAL efforts by cross issue coalitions to kill and weaken proposed state interference laws, and the emergence of vocal local and state lawmakers championing local control and the ability of local governments to address their own unique problems and act on the need and values of their residents. The 2019 session may mark the start of the turning of the tide.