Texas Attorney General Launches Investigation into Municipal Finances

Aerial view of various Texas cities involved in financial transparency investigations

Texas, December 10, 2025

Texas Attorney General Ken Paxton has initiated a statewide investigation targeting approximately 1,000 cities to ensure adherence to financial transparency laws. This includes major urban areas like Dallas and Houston as well as smaller municipalities. The investigation enforces Senate Bill 1851, which restricts property tax increases if cities fail to comply with financial audit requirements. Citizens are encouraged to report any suspected violations through an online form provided by the Attorney General’s Office.

Texas Attorney General Initiates Statewide Financial Transparency Investigations

Austin, Texas — Texas Attorney General Ken Paxton has launched a comprehensive investigation into nearly 1,000 cities across the state to ensure compliance with financial transparency laws and to prevent unlawful property tax increases. This initiative targets major urban centers, including Dallas, Fort Worth, Houston, and San Antonio, as well as smaller municipalities like La Marque, Odessa, Tom Bean, and Whitesboro. The investigation aims to enforce Senate Bill 1851, which prohibits cities from raising property taxes above the no-new-revenue rate if they fail to adhere to state-required financial audits and transparency standards. Cities that have received information requests from the Attorney General’s Office are expected to respond promptly to avoid potential legal consequences. Paxton emphasized the importance of municipal transparency and fiscal responsibility, stating that local officials must prioritize these principles to minimize the tax burden on residents and ensure accountability.

Background on Senate Bill 1851

Senate Bill 1851, enacted earlier this year, mandates that cities conduct annual financial audits and publish comprehensive financial statements within 180 days after the end of their fiscal year. The law stipulates that municipalities failing to comply with these requirements are prohibited from increasing property taxes beyond the no-new-revenue rate, which is the rate that would generate the same amount of revenue as the previous year. This legislation is part of a broader effort to enhance fiscal transparency and prevent excessive tax burdens on Texas residents.

Implications for Affected Cities

Municipalities under investigation are required to provide detailed financial documents and audit information to the Attorney General’s Office. Non-compliance with these requests may result in legal actions and restrictions on property tax increases. The initiative underscores the state’s commitment to enforcing financial transparency and holding local governments accountable for their fiscal practices.

Public Participation and Reporting

Residents who suspect that their local officials are violating the audit requirements can submit complaints through an online form provided by the Attorney General’s Office. This platform allows citizens to actively participate in promoting transparency and accountability within their communities.

Conclusion

Attorney General Paxton’s statewide investigation reflects a concerted effort to uphold financial transparency and prevent unlawful tax increases across Texas. By scrutinizing municipal financial practices, the state aims to ensure that local governments operate within the bounds of the law and maintain the trust of their constituents.

Frequently Asked Questions (FAQ)

What is the purpose of the investigation initiated by Attorney General Ken Paxton?

The investigation aims to ensure that nearly 1,000 Texas cities comply with financial transparency laws and to prevent unlawful property tax increases.

Which cities are included in the investigation?

The investigation includes major urban centers such as Dallas, Fort Worth, Houston, and San Antonio, as well as smaller municipalities like La Marque, Odessa, Tom Bean, and Whitesboro.

What is Senate Bill 1851?

Senate Bill 1851 is a state law that prohibits cities from raising property taxes above the no-new-revenue rate if they fail to adhere to state-required financial audits and transparency standards.

What are the consequences for cities that do not comply with the investigation?

Non-compliant cities may face legal actions and restrictions on property tax increases.

How can residents report suspected violations?

Residents can submit complaints through an online form provided by the Attorney General’s Office.

Key Features of the Investigation

Feature Description
Scope of Investigation Nearly 1,000 Texas cities, including major urban centers and smaller municipalities.
Targeted Law Senate Bill 1851, which mandates financial audits and transparency for property tax increases.
Consequences for Non-Compliance Potential legal actions and restrictions on property tax increases.
Public Participation Residents can report suspected violations through an online complaint form.

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