Ann Baddour, Director of the Fair Financial Services Project at Texas Appleseed, speaks to the Texas Senate State Affairs Committee March 15 (Photo by Screenshot via Texas Senate)

Typically when Republicans in the Texas Legislature get riled up over an ordinance city officials have passed aimed at improving the lives of their residents, lawmakers in the Lege have to pass a bill designed to undo that specific local ordinance.

Republicans have found success in their war on local control; in past Legislative Sessions, they have enacted laws that prohibit municipalities from reducing police budgets, increasing property taxes to fund services, and regulating rideshare companies beyond what the state allows.

But Republicans haven’t always prevailed over cities. For years, they have repeatedly failed at undoing two Austin ordinances despised by business interests – one that mandates rest breaks for construction workers and another that delays when employers can conduct criminal background checks on prospective hires. Instead of continuing to play the game as it has always been played – blue city adopts ordinance, red state lawmakers preempt it – Republicans are trying (as they did in the 87th Legislative Session) a more scattershot approach.

A pair of bills filed by Rep. Dustin Burrows, R-Lubbock, and Sen. Brandon Creighton, R-Conroe, would apply what the Texas Municipal League calls a “super preemption” approach. Rather than undo one city ordinance at a time, the Burrows and Creighton bills (House Bill 2127 and Senate Bill 814, respectively) would prevent municipalities from enacting ordinances that regulate labor and business practices, preservation of natural resources, and commerce more broadly, if they contradict existing state law. HB 2127 allows anyone to sue a city or its elected officials if they have been injured “in fact, actual or threatened,” by regulations imposed by a local ordinance. Neighboring city or county officials who don’t like an ordinance a bordering municipality has adopted could also sue, something that Williamson County Judge Bill Gravell has already done when the City of Austin bought a hotel to convert into housing for people exiting homelessness (the property is in the WilCo portion of Austin). If signed into law, the legislation would also have the effect of nullifying existing ordinances already on the books in cities, such as Austin’s rest break and fair chance hiring ordinances.

The Republican defense of these bills is familiar: Cities shouldn’t tell business owners how to regulate their businesses and local officials are often out-of-step with their constituents when they pass ordinances requiring construction workers to be provided regular rest breaks. At a March 15 hearing on HB 2127 held in the House State Affairs Committee, Burrows said that his bill was written in response to a recent “explosion” of local ordinances regulating labor and business practices. “What I am starting to see is a different category of ordinances that have emerged,” Burrows told the committee. Advocacy groups, stymied by the Legislature in their attempts to protect workers and prevent employment discrimination, take their agendas to “some of our cities – more progressive cities – and have those adopted” there.

Labor advocacy organizations and city officials fear that the legislation will have much more far reaching effect, whether or not lawmakers intend it to. “We are still analyzing the full impact of HB 2127,” a spokesperson for the City of Austin told the Chronicle. But, for now, the city anticipates the legislation would undo various non-discrimination ordinances Austin has adopted.

Local protections under threat include: • the Crown Act, which prevents employer discrimination against workers wearing “protective hairstyles” necessitated by, or resulting from, hair styles and textures commonly associated with race, national origin, ethnicity, or culture (e.g. afros, braids, cornrows, or locs, among others);
• the rest break ordinance, which mandates construction workers be provided a ten minute break every four hours;
• and the fair chance hiring ordinance, which does not allow employers to ask job applicants about criminal history until after an interview.

“It would also prohibit the City from offering protections against discrimination that are above and beyond what already exist in state and federal law in the future,” the spokesperson concluded.

At the committee hearing, advocacy groups opposing the bill raised concerns over impacts it could have on cities that regulate predatory payday lenders. Ann Baddour, Director of the Fair Financial Services Project at Texas Appleseed, told the committee that the threat to payday lending regulations was her organization’s “top line concern” with the bill. “Over the past decade [payday lenders] have drained more than $18 billion from the pockets of the most vulnerable Texans,” Baddour told the committee, adding that a 2022 report from The Perryman Group found that the lending practices damaged local economies more broadly. An analysis of the Austin-Round Rock Metropolitan Statistical Area found that from 2012-2022, consumers had an estimated $201.8 million less cash to spend because of fees and additional debt racked up through predatory loans.

In Austin, local regulations prohibit payday lenders from issuing loans that exceed 20% of a consumer’s gross monthly income, car loans that exceed 3% of the consumer’s annual income, and loans from being refinanced more than three times. But these types of regulations are far from unique to Austin; analysis from Texas Appleseed shows that 46 cities across the state – including more conservative cities like Amarillo and Midland – have enacted similar regulations on payday lenders. Burrows insisted that a second version of his bill, published the morning before the hearing, would protect payday lender regulations, but advocates remain skeptical.

The bill was left pending in the committee, with Chair Todd Hunter, R-Corpus Christi, asking that opponents of the bill share their concerns with Burrows’ office so that he can address them. The bill will be voted on at a later date.