Texas Sun is Setting on the 89th Legislative Session: What You Need to Know
As the 89th Texas Legislature reaches its final stretch, lawmakers are wrapping up decisions that will shape the state’s business environment for years to come. From tax policy to workforce development to voting access, the final days of the session offer clarity—and raise key questions.
Here’s what you need to know.
State Budget Deal: Big Wins for Business Stability
Lawmakers have reached a final agreement on a $337 billion state budget. This record-setting package includes targeted relief and long-term investments with direct impact on employers:
$55 billion in property tax relief, including:
Homestead exemption increase to $125,000
Rate compression that benefits small business owners
$1.2 billion in infrastructure investments, such as:
Modernization of border facilities
Electric grid upgrades
Water system improvements
The Bottom Line: Reduced fixed costs and stronger infrastructure support long-term business growth, especially in logistics, manufacturing, and real estate development.
Election Legislation: Final Debates with Workplace Implications
Two bills nearing passage may significantly affect voter access in major metro areas:
SB 2328 would expand the Attorney General’s powers in election enforcement
HB 4271 would limit the use of countywide polling locations in large cities
The Bottom Line: These changes could affect early voting access for large urban workforces. Employer coalitions and civic organizations are tracking how these policies intersect with workplace-based voter engagement.
Education and Workforce Alignment: A Talent Pipeline Shift
Texas is advancing several measures designed to support workforce readiness:
School voucher legislation has been signed into law
$200 million in workforce training grants secured in the budget
HB 3114, a bill to fast-track tech credentialing, awaits a final vote
Career and Technical Education (CTE) programs expanded from 20 to 35 school districts
Teacher pay increases in high-need areas like STEM and bilingual education
The Bottom Line: These developments indicate a stronger alignment between education policy and business needs. Employers may benefit from deeper partnerships with local school districts and community colleges.
Property Tax Reform: Relief and Long-Term Planning
Final tax reform components include:
Homestead exemption increase to $125,000
Commercial property appraisal cap to help stabilize costs for small businesses
Creation of a tax study commission to explore broader reforms
The Bottom Line: These updates provide near-term relief and signal longer-term efforts to modernize Texas’s property tax framework.
What to Watch Through Sine Die (Final Day of Session)
As the Legislature concludes business, several issues remain in play:
Final floor votes on key workforce bills
Reconciliation on DEI-related education policy
Last-minute changes to permitting, local governance, and tax administration
Important Timing:
Tuesday, May 27: Both chambers convene at 10:00 AM for final passage of budget and remaining conference committee reports. Hearings may be called for technical clean-up or emergency implementation timelines.
For Employers:
Now is the time for final engagement. Business leaders should:
Maintain contact with key legislative offices
Monitor for amendments in real-time
Prepare for post-session implementation guidance
IGC Institute will issue a full post-Sine Die analysis to break down what passed, what stalled, and what it means for your business.
In the News: Context for Texas Business
Texas Cities Face Tech and Livability Shifts
While some reports suggest Austin’s tech growth is cooling, others highlight strong GDP performance and ongoing startup resilience. Suburban communities like Leander and Pflugerville are gaining in affordability and livability rankings.
Federal Policy Ripples Reaching Texas
Recent analysis from the Federal Reserve notes rising consumer prices from new tariffs and potential slowdowns in spending power. This trend could impact retail, logistics, and procurement for businesses across the state.
Energy Transition Tensions
Despite vocal criticism from national figures, wind energy remains a point of interest for rural Texas lawmakers. Legislation under consideration may limit new solar and wind projects, potentially impacting investment in clean energy.
Looking Ahead
The 89th Session has delivered landmark outcomes, but the full impact will unfold over the months ahead. IGC Institute will continue to serve as a trusted resource for nonpartisan analysis and business-relevant civic insight.
Stay connected at igcinstitute.org to receive our full Sine Die Wrap-Up and future executive briefings.