Recap from the 88th - State Preemption and the Death Star

City Lobbyists Call it the Death Star; but we call it Necessary Limits to Local Overreach

The most significant bill reigning in cities and local government through state preemption, possibly ever, was passed this session.

H.B. 2127, called the “Texas Regulatory Consistency Act,” is a massively important and influential bill that will reshape many aspects of not only local control, but the effective role of local governments. This law will rein in many important areas of local government, placing sole authority exclusively at the state level.

Perhaps an indication of just how significant this bill is, the name the city lobbyists who vigorously opposed HB 2127 gave the legislation was the “Death Star bill.”

With a few limited exceptions for local authority over building roads, imposing taxes, animal control, existing credit access business ordinances, local massage establishments, collective bargaining, or conducting a public awareness campaign; a city or county may, “not adopt, enforce, or maintain an ordinance, order, or rule regulating conduct in a field of regulation.”

The “field of regulation” is basically defined as the entirety of the following state codes:

Agriculture,

Business and Commerce,

Finance,

Insurance,

Labor,

Natural Resources,

Occupations and

Property Codes.

Years of litigation will be required to determine the ultimate reach and influence of this bill, but on its face the bill prevents a local government from having any local requirements for nearly all aspects of business aside from zoning preemption for new building construction which the legislature had no collective appetite to impact. There was a total of 70 bills impacting city zoning authority this session and not one passed.

And on the litigation front, the new law specifically includes other important aspects such as:

• waiver of cities’ or counties’ sovereign immunity from suit;
• granting a plaintiff suing a local government declaratory or injunctive relief along with court costs and attorney’s fees; and
• plaintiffs are specifically allowed under the law to include any “person,” which includes all forms of legal entities who suffers “actual or threatened” injury in violation of the new law.

In addition to a “person” being able to sue, the law also allows, “any trade association representing the person” to sue the city or county on the person’s behalf.

And, finally, for a city or county to be able to win their attorney’s fees and costs, a court must find that the action brought by the plaintiff was “frivolous,” which is a significantly high standard a defending city or county would have to prove in court.

This legislation has been worked on and tried for the past seven and a half years, previously dying in the process when facing such significant opposition by those representing and lobbying on behalf of cities and counties.

But this session, despite the harsh opposition, as well as multiple attacks to derail the bill on procedural grounds, the bill finally passed.

H.B. 2127 goes into effect on September 1, 2023.