The 89th Texas Legislature adjourned last week after approving a record-breaking $338 billion two-year budget, funded in part by a $24 billion surplus. While lawmakers advanced several high-profile measures, including a new school choice program and energy safety regulations, critics noted that the session left many conservative priorities on the table—particularly in the Texas House.
The budget includes over $50 billion in new spending while allocating only $6.5 billion to property tax relief. Conservatives argue this is a missed opportunity, considering the size of the surplus and recent large increases in property taxes.
Texans for Fiscal Responsibility pointed to these increases as signs that structural reforms are still lacking, noting that local governments “continue to grow, regardless of state efforts to slow them.”
One of the most prominent outcomes of the session was the passage of Senate Bill 2, which established a new education savings account (ESA) program. The plan allows eligible private school students to receive up to $10,000 per year, while homeschoolers may receive up to $2,000. The program is capped at about 300,000 participants and will be funded at approximately $1 billion annually. Supporters hailed the bill as a historic victory for educational freedom. Lt. Gov. Dan Patrick called it “the largest school-choice program in American history.”
However, critics note that the school choice initiative was tied to a $5 to $6 billion annual increase in public education funding. Participation in the ESA program is also contingent upon future appropriations from the Legislature. The program requires comptroller pre-approval for participating vendors and mandates test score reporting, which some say could lead to increasing regulation over time.
Legislators also addressed energy infrastructure and safety by passing HB 3824 and HB 3809, which introduce statewide fire safety and decommissioning standards for large battery energy storage systems (BESS). These measures take effect in 2027 and are designed to ensure public safety as the state’s energy grid continues to rely on new technologies. Despite these advances, broader reforms addressing the concerns of property owners about the rapid growth in BESS failed to move forward. Bills requiring BESS permitting, siting coordination, and local input—such as HB 1343, HB 4363, and HB 1378—died in committee or were never heard.
Efforts to rein in renewable energy subsidies also faltered. Proposals to remove property tax abatements for renewable generation and to make renewable producers pay for the reliability costs they impose on the grid were passed by the Senate but failed to advance in the House. Critics argue that without such reforms, market distortions caused by government subsidies will continue to undermine the grid’s long-term reliability.
Another conservative priority—banning taxpayer-funded lobbying—once again failed to gain traction. SB 19 and several related House bills were either denied hearings or killed in committee. Texas Scorecard reports that taxpayers will fund approximately $94.5 million in lobbying costs in 2025. State Rep. Brent Money (R–Greenville) said the bill was blocked by House State Affairs Chairman Ken King. Texans for Fiscal Responsibility described taxpayer-funded lobbying as “the rotten core of a system that uses our own tax dollars against us,” citing polling that shows 88 percent of Texans oppose the practice.
Corporate welfare also returned to the spotlight with the passage of SB 22, which allocates $1.5 billion in taxpayer funds to a film industry incentive program operating outside the traditional appropriations process.
Although the Legislature advanced some conservative-backed reforms—including parental rights in public schools, bans on foreign ownership of real estate, and abortion travel funding restrictions—many conservative proposals cleared the Senate but stalled in the House. Analysts continue to point to internal divisions among House Republicans as a barrier to policy change. Of the chamber’s 82 Republican members, roughly one-third are considered reliably conservative, with the rest split between swing votes and establishment figures who often side with Democrats. As a result, even with a Republican majority in the House, it is the Democrats who often determine whether or not a bill passes.
With little change expected in the executive branch or the Senate ahead of the next session, observers say the Texas House will remain the key battleground for future reform efforts. Conservative groups are signaling that they plan to focus their attention on leadership decisions and internal House dynamics heading into the 2026 election cycle.
