Texas Gov. Greg Abbott is warning cities that stalling housing development could now cost them tax revenue, proposing legislation that would withhold sales tax revenue from any city or county found violating the state’s development laws. Abbott outlined the plan at a press event in Round Rock, Texas, as part of a statewide affordability tour.
“One thing that’s driving up the cost of housing are local government regulations,” Abbott said, accusing some cities of trying to “skirt the laws we’ve already passed.” Texas passed Senate Bills 15 and 840 last year, limiting some municipal zoning powers in a bid to boost housing construction statewide.
Pools, height limits and other add-on requirements
Abbott said some existing rules β setbacks, height limits, coverage restrictions β are legitimate, but argued cities are tacking on costly extras that stop projects from getting built. “It could be requiring eight stories for multifamily housing, it could be adding very large swimming pools, it could be adding dog walk parks in areas that are not demanding it,” Abbott said. “Whatever they can find to add on to it, they will drive up the cost of being able to build out the facility so that the project just will not be done.”
He cited, without naming them directly, a North Texas suburb’s requirement that new apartment complexes include an Olympic-size swimming pool. Recently adopted rules in Irving and Grand Prairie appear to be among his targets, and other Texas cities have adopted similar requirements since, according to the Texas Tribune. Abbott’s proposal has not yet been formally introduced in the state Legislature.
Part of a broader affordability push
The proposal follows Congress’s passage of the 21st Century ROAD to Housing Act, a federal package aimed at making it easier to build homes and encouraging states and localities to add housing supply. Most zoning and land-use authority still rests with local governments, and Texas was among the first states to restrict cities’ ability to block development through statewide preemption. Abbott, who is running for another term, has also proposed cutting property taxes and reducing homeowners and auto insurance costs tied to the state’s hurricane, wind and hail risk.
Abbott’s stance on development is not uniformly deregulatory: on data centers, he has voiced more caution. He announced this week that the Public Utility Commission of Texas and the Electric Reliability Council of Texas must audit all data center projects before any more move forward, and said Friday that data centers should offset their power and water impacts on communities and avoid building in residential neighborhoods. The contrast is notable given how directly the two issues intersect in fast-growing Texas metros, where homebuilders have separately complained that data center developers are outbidding them for land zoned for housing.
What it means
The verified facts: Abbott’s own public comments and a still-unintroduced legislative proposal to penalize cities financially for what his office calls law-skirting development mandates. Whether specific cities like Irving and Grand Prairie are his intended targets is inference from the Texas Tribune’s reporting on recent local ordinances, not a claim Abbott made by name. What to watch: whether the proposal is formally introduced when the Legislature reconvenes, and how it would interact with the state’s existing preemption laws. For related coverage, see RealtyWire’s reporting on the federal law tying housing grants to local construction, Seattle’s move to strip environmental appeals from zoning votes, and Texas’s data center grid audit.
