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Signed Into Law
Signed June 20, 2025Effective 2025-09-01
HB223

Regular Session

Relating to competitive requirements for a procurement by a municipality for lobbying, government relations, or similar services.

Government Affairs & Regulatory Compliance Analysis

HB223: Government Affairs Overview

Effective September 1, 2025, Texas municipalities are statutorily prohibited from using the "professional services" exemption to hire lobbyists or government relations firms without a competitive process. All municipal contracts for services intended to directly or indirectly influence state or federal legislation that exceed statutory thresholds (typically $50,000) must now undergo formal competitive bidding (RFP/RFQ), ending the practice of direct appointment based solely on relationships.

Rep. Giovanni Capriglione·House Bill·Regular Session

Critical
Medium Cost
Effective:2025-09-01

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HB223
Relating to competitive requirements for a procurement by a municipality for lobbying, government relations, or similar services.
Critical Urgency
Heavily Contested
House Vote92 - 56
YEA
NAY
62% in favor148 voting
Senate Vote19 - 12
YEA
NAY
61% in favor31 voting
68
Total Opposition Votes
Cost Impact
Medium
Effective
2025-09-01
Primary Author: Rep. Giovanni Capriglione
89th Texas Legislature
jdkey.com
01

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

  • Effective Date: September 1, 2025
  • Compliance Deadline: September 1, 2025 (Strict liability for all new contracts or renewals executed on or after this date).
  • Agency Rulemaking: None. This is a direct amendment to the Local Government Code. Municipalities will immediately update local procurement policies to enforce this requirement without state-level guidance.

Immediate Action Plan

  • Audit Expirations: Identify all municipal client contracts expiring after September 1, 2025.
  • Execute Extensions: Where legally feasible, negotiate and sign multi-year extensions *before* August 31, 2025, to lock in current terms and delay bidding requirements.
  • Register as Vendor: Ensure your firm is registered as a formal vendor on the purchasing portals of every municipality you represent; you cannot be awarded a bid if you are not in the system.
  • Segregate Scopes: Redraft engagement letters to clearly distinguish between exempt legal counsel and non-exempt government relations work.

Operational Changes Required

Contracts

  • Unbundling Services: You must review Master Service Agreements (MSAs). "Legal representation" remains exempt from bidding; "legislative advocacy" does not. These scopes of work must be separated into distinct contracts to protect the exempt status of your legal work.
  • Renewals: Treat "evergreen" or automatic renewal clauses with extreme caution. A renewal triggered after September 1, 2025, constitutes a new contract. If it was not bid competitively, it is voidable.

Hiring/Training

  • Proposal Capabilities: Business development teams must shift focus from relationship management to technical proposal writing. You must allocate resources to respond to RFPs/RFQs, including technical scope drafting and compliance matrices.
  • Vendor Registration: Staff must monitor municipal procurement portals (e.g., CivCast, BidSync, IonWave) rather than relying on direct outreach to City Managers.

Reporting & Record-Keeping

  • Public Fee Disclosure: Unlike private retainers, fee structures and hourly rates submitted in sealed bids generally become public record upon bid opening. Prepare for your pricing to be visible to competitors.

Fees & Costs

  • Administrative Overhead: Anticipate increased non-billable hours dedicated to RFP responses.
  • Insurance Requirements: Municipal RFPs often mandate specific insurance limits (CGL, Professional Liability) that may differ from your current coverage; verify your limits against standard municipal vendor requirements.

Strategic Ambiguities & Considerations

The "Indirect Influence" Standard: The law applies to services intended to "indirectly influence" lawmakers. This creates regulatory risk for Public Affairs, PR, and Strategic Communications firms. It is currently undefined whether grassroots mobilization, bond election marketing, or community engagement campaigns fall under this mandate. Guidance: Until case law clarifies, treat *any* activity involving legislative outcomes as subject to competitive bidding to avoid contract invalidation.

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Information presented is for general knowledge only and is provided without warranty, express or implied. Consult qualified government affairs professionals and legal counsel before making compliance decisions.

02

Legislative Timeline

This bill's path through the Texas Legislature

Filed
Nov 12, 2024
Passed House
May 7, 2025
Passed Senate
May 28, 2025
Signed
Jun 20, 2025
Effective
Sep 1, 2025
TopicsPurchasingPurchasing--localCompetitive BiddingLobbyists & LobbyingCity GovernmentCity Government--general
03

House Authors

Rep. Giovanni CapriglioneRepublican · Primary Author
Joint Authors
Coauthors (1)

Senate Sponsors

Sen. Mayes MiddletonRepublican · Primary Sponsor
Cosponsors (2)

Bill Text(with markup)

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

Related Legislation

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More from Rep. Giovanni Capriglione

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Related by Topic

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Quick Reference

Frequently Asked Questions

Common questions about HB223

Q

What does Texas HB223 do?

Effective September 1, 2025, Texas municipalities are statutorily prohibited from using the "professional services" exemption to hire lobbyists or government relations firms without a competitive process. All municipal contracts for services intended to directly or indirectly influence state or federal legislation that exceed statutory thresholds (typically $50,000) must now undergo formal competitive bidding (RFP/RFQ), ending the practice of direct appointment based solely on relationships.

Q

Who authored HB223?

HB223 was authored by Texas Representative Giovanni Capriglione during the Regular Session.

Q

When was HB223 signed into law?

HB223 was signed into law by Governor Greg Abbott on June 20, 2025.

Q

How significant are the changes in HB223?

The regulatory priority for HB223 is rated as "critical". Businesses and organizations should review the legislation to understand potential impacts.

Q

What is the cost impact of HB223?

The cost impact of HB223 is estimated as "medium". This may vary based on industry and implementation requirements.

Q

What topics does HB223 address?

HB223 addresses topics including purchasing, purchasing--local, competitive bidding, lobbyists & lobbying and city government.

Q

What are the key dates for HB223?

Key dates for HB223: Effective date is 2025-09-01. Consult with legal counsel regarding applicability.

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JD Key Consulting is an Austin, Texas-based government affairs firm led by James Dickey, former Chairman of the Republican Party of Texas. We specialize in Texas regulatory compliance and legislative strategy for data centers, energy, banking, and manufacturing.

Legislative data provided by LegiScanLast updated: January 25, 2026