The saga of Housing Finance Corporations (HFCs) in Texas, a system ripe with cronyism, tax exemptions, and insider deals, has taken another troubling turn. Following our last report, the legislative maneuvering has continued with new developments exposing the entrenched interests thwarting genuine reform. Texans for Fiscal Responsibility remains committed to shining a light on these schemes, holding elected officials accountable, and advocating for a government that prioritizes taxpayers over special interests.

In our previous article, we detailed how State Rep. Rafael Anchía (D-Dallas) and Committee Chairman Cecil Bell (R-Magnolia) appeared to orchestrate a legislative two-step with HB 2937 and HB 1585, two bills purportedly aimed at reining in HFCs but suspiciously crafted to protect existing players like Anchía’s Civitas Capital Group. These entities exploit HFCs to secure property tax exemptions for nearly a century, siphoning millions in potential revenue from schools and infrastructure while everyday Texans bear the burden. 

Despite opposition from conservative Republican Reps. Shelley Luther, David Lowe, and Terri Leo-Wilson, HB 1585 passed out of committee with the support of leadership-aligned Republicans and Democrats, revealing the cozy alliances between some Republicans and Democrats in the Texas House.

Recent exchanges on X between Chairman Bell and State Sen. Mayes Middleton (R-Galveston) signal the fight over HFCs is far from over, and the stakes are rising. 

On April 3, 2025, Bell defended HB 1585, pointing followers to its text and claiming it mirrors Sen. Middleton’s SB 2976, suggesting a unified front. Middleton, a TFR Taxpayer Champion and steadfast advocate for ending taxpayer-funded loopholes, responded by urging Bell to support broader reforms in SB 867 by State Sen. Paul Bettencourt and HB 21 by State Rep. Gary Gates, bills aimed at curbing government overreach and placing spending caps on local entities like HFCs. 

Middleton’s call-out underscores a growing divide: while Bell clings to his bill as reform, conservatives like Middleton see it as insufficient, potentially even a shield for the status quo.

This back-and-forth highlights a critical question: is Bell genuinely pushing for fiscal responsibility, or is he shielding the same insider deals we’ve warned about? HB 1585, as we noted, grandfather’s existing HFC projects, conveniently protecting firms like Anchia’s Civitas, while doing little to dismantle the system draining taxpayer dollars. 

Meanwhile, SB 867 and HB 21 represent the bolder, more comprehensive reforms. 

The Texas House remains a battleground where cronyism often defeats principle. Bell’s fast-tracking of HB 1585, with Texas House Speaker Dustin Burrows’ blessing, continues to suggest a deal that benefits a select few at the expense of many. Taxpayers deserve better, they deserve the elimination of property taxes, not their redirection into private pockets. 

As Middleton and others press for real change, we urge Texans to demand transparency and reject half-measures. The sunlight of public scrutiny must expose these schemes, ensuring our elected officials serve constituents, not cronies.

Texans for Fiscal Responsibility relies on the support of private donors across the Lone Star State in order to promote fiscal responsibility and pro-taxpayer government in Texas. Please consider supporting our efforts! Thank you!

Get The Fiscal Note, our free weekly roll-up on all the current events that could impact your wallet. Subscribe today!