Federal funds that go directly to Texas’ political subdivisions affect the Texas economy as a whole. But regulation of Texas’ economy is, under the U.S. Constitution, a power that belongs to the state government, not the federal government. The Texas state government needs to take a full reckoning of federal grants sent directly to local governments, because these funds are never “free”—they come with federal requirements that build spending requirements into the system.
Taxes & Spending
Just the Facts: Local Government Spending
Despite billions in property tax relief provided by recent state legislatures, Texans’ property tax bills continue to increase due to unrestricted spending at the local level. Key points: City and county government spending continues to outstrip increases in both population and inflation. While the state government has constitutional and statutory spending limits, local governments do...
August 10, 2026