LEGISLATIVE BUDGET BOARD

Austin, Texas

FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION

April 11, 2025

TO:	Honorable Lacey Hull, Chair, House Committee on Human Services
FROM:	Jerry McGinty, Director, Legislative Budget Board
IN RE:	HB5243 by Gerdes (Relating to prohibiting the purchase of certain food and drink items under the supplemental nutrition assistance program.), As Introduced

Estimated Two-year Net Impact to General Revenue Related Funds for HB5243, As Introduced: a negative impact of ($764,750) through the biennium ending August 31, 2027.

The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.

General Revenue-Related Funds, Five- Year Impact:

Fiscal Year	Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2026	($764,750)
2027	$0
2028	$0
2029	$0
2030	$0

All Funds, Five-Year Impact:

Fiscal Year	Probable Savings/(Cost) from General Revenue Fund 1	Probable Savings/(Cost) from Federal Funds 555
2026	($764,750)	($778,470)
2027	$0	$0
2028	$0	$0
2029	$0	$0
2030	$0	$0

Fiscal Analysis

The bill would amend the Human Resources Code to prohibit the purchase of various items under the Supplemental Nutrition Assistance Program (SNAP). Items listed include energy drinks, sweetened/carbonated beverages, and various snack foods that do not require further preparation. The bill describes specific exemptions, such as milk-based products or those recommended for a client's use by a health professional. The bill directs the affected state agency to seek any necessary federal waivers to implement the restrictions as changes to eligible purchases are subject to federal approval. The bill would take effect Sept. 1, 2025.  

The Texas Health and Human Services Commission (HHSC) expects to incur one-time costs in Fiscal Year 2026 for communicating the changes to clients and retailers who accept EBT (Electronic Benefit Transfer) cards for SNAP purchases. The estimate for FY 2026 is $1,543,220 in All Funds. 

Methodology

The agency estimates costs related to sending notifications to SNAP EBT cardholders and to vendors who accept EBT cards to notify them of the changes in eligible purchases (mailing, communication and outreach). The agency estimates a General Revenue cost of $764,750 and a Federal Funds cost of $778,470 for an All Funds cost of $1,543,220 in FY 2026. 

Technology

No technology impact is anticipated as a result of implementing this bill. 

Local Government Impact

No significant fiscal implication to units of local government is anticipated.

Source Agencies:

529 Health and Human Services Commission

LBB Staff:

JMc, NPe, ER, NT, CMA