A few years ago, Gov. Greg Abbott called on the Texas Legislature to more aggressively tackle the problem of local government overregulation, saying:
As opposed to the state having to take multiple rifle-shot approaches at overriding local regulations, I think a broad-based law by the state of Texas that says across the board, the state is going to pre-empt local regulations, is a superior approach.
With the introduction and advancement of Senate Bills 2485, 2486, 2487, and 2488, the Legislature seems to have responded favorably to the governor’s call—at least in part.
Of the four bills now making their way through the process, SB 2485 is unique in that it’s the broadest of the bunch. The Senate engrossed version would prohibit local regulation of “a private employer’s terms of employment relating to employment benefits, including health, disability, retirement, profit-sharing, death, and group accidental death and dismemberment benefits.”
The reason that it needs to be so wide-ranging, according to recent testimony given by the Foundation’s Shelby Sterling, is simple: Texas’ economic prosperity is at stake.
Mandating an employer to provide employment incentives such as health insurance or retirement funds is not only burdensome on the business but will have unintended consequences on the employees and consumers as well.
One-size-fits-all mandates hurt employers by forcing them to absorb higher costs without an increase in output, as well as loading them down with time-consuming recordkeeping requirements. With a costly policy change and no increased profit, employers are forced to shift existing benefit dollars away from employees just to comply with the new regulations. Such mandates also harm employees by depriving them of benefit options, wage gains, and more work hours available. Lastly, consumers are inevitably made to pay higher prices for goods and services and left with fewer business options when some close due to the cost of new requirements.
Keeping meddlesome municipalities out of the labor market—and focused on what they should be doing instead—is a surefire way to ensure Texas’ continued economic dominance.