Relating to the transfer of functions relating to certain veteran mental health programs and plans to the Texas Veterans Commission.
ModeratePlan for compliance
Medium Cost
Effective:2025-06-20
Enforcing Agencies
Texas Veterans Commission
01
Compliance Analysis
Key implementation requirements and action items for compliance with this legislation
Implementation Timeline
Effective Date: June 20, 2025 (Immediate effect due to supermajority vote).
Compliance Deadline: While legal authority transfers immediately, the fiscal and operational transition (billing/invoicing) aligns with the state fiscal year beginning September 1, 2025. Grant applicants must demonstrate compliance with new matching fund protocols immediately for any applications submitted after June 20, 2025.
Agency Rulemaking: TVC is required to adopt rules implementing the Matching Grant Program and Mental Health Program prior to the next grant cycle. There is currently a regulatory gap until TVC publishes these specific standards in the *Texas Register*.
Immediate Action Plan
Register: Ensure your organization is registered in the TVC grant portal immediately; do not wait for the next RFA.
Segregate Funds: Create specific ledger codes for "Non-State Matching Funds" to ensure you can pass a TVC audit during the application phase.
Archive: Download all historical grant data and communications from HHSC portals before September 1, 2025.
Notify: Inform your finance department to update vendor IDs for the Texas Veterans Commission to prevent payment delays in FY2026.
Review: Audit current subcontracts and prepare amendments to replace "HHSC" with "TVC" regarding compliance standards.
Operational Changes Required
Contracts
Existing contracts with HHSC for veteran mental health services are legally transferred to TVC via statutory novation (Sec. 4.02).
Action: You do not need to sign a new contract immediately, but you must anticipate a Notice of Assignment or contract amendment.
Subcontracts: Prime contractors must amend subcontracts to reference TVC standards rather than HHSC protocols to ensure flow-down compliance.
Hiring/Training
Peer Specialists: The law mandates TVC "solicit and ensure" specialized training for peer service coordinators and peers.
Requirement: If you employ peer specialists, verify their certifications align with forthcoming TVC rules. HHSC-approved training may not automatically satisfy TVC's new "technical assistance" standards.
Reporting & Record-Keeping
Invoicing: Effective September 1, 2025, update accounts receivable to bill TVC, not HHSC. Invoices sent to HHSC after this date will be rejected.
Matching Funds Audit: You must maintain auditable ledgers proving non-state matching funds at the time of grant application.
25% Match: Counties < 100,000 population.
50% Match: Counties 100,000 – 249,999.
100% Match: Counties > 250,000.
Data Migration: Download and archive all historical performance reports from HHSC portals immediately; do not rely on inter-agency data transfer.
Fees & Costs
Cost Impact: Medium. While there are no new filing fees, the strict codification of matching fund percentages (up to 100% for large counties) requires immediate capital segregation.
Insurance: Notify professional liability carriers of the change in oversight agency; this is a material fact for policies covering government contracting.
Strategic Ambiguities & Considerations
The "Harmonization" Clause: The bill includes a requirement to harmonize with S.B. 897. If S.B. 897 contains conflicting matching fund percentages, legal counsel must determine which statute prevails for the Q3/Q4 2025 grant cycle.
Scope of "Intervention": TVC has broad discretion to define "mental health intervention" and "peer-to-peer counseling." TVC may adopt a narrower definition than HHSC, potentially rendering previously reimbursable support activities ineligible. Watch the *Texas Register* closely for these definitions.
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Homeland Security, Public Safety & Veterans' Affairs
Committee Report (Unamended)
BACKGROUND AND PURPOSE
The bill author has informed the committee of the need for more effective oversight and administration of veterans' mental health services in Texas and that, while these programs are administered by the Health and Human Services Commission (HHSC), the Texas Veterans Commission (TVC) is better equipped to tailor mental health initiatives to veterans' unique needs. H.B. 114 seeks to address this issue by transferring oversight of veteran-focused mental health programs from HHSC to TVC in order to improve program efficiency, accessibility, and coordination with federal and local resources and by establishing a grant program to fund community-based mental health initiatives that requires grant recipients to secure matching funds based on county population size, ensuring equitable funding distribution and encouraging private and local investment in veteran mental health support.
CRIMINAL JUSTICE IMPACT
It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.
RULEMAKING AUTHORITY
It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.
ANALYSIS
Grant Program for Mental Health Services for Veterans and Their Families
H.B. 114 amends the Government Code to require the Texas Veterans Commission (TVC) to establish a grant program for the purpose of supporting community mental health programs providing services and treatment to veterans and their families, to the extent funds are appropriated to TVC for that purpose, and to ensure that each grant recipient obtains or secures contributions to match awarded grants in amounts of money or other consideration. The bill establishes the following:
·the money or other consideration obtained or secured by TVC may, as determined by the executive director of TVC, include cash or in-kind contributions from private contributors or local governments but may not include state or federal funds; and
·money appropriated to or obtained by TVC for the program must be disbursed directly to grant recipients by TVC, as authorized by the executive director.
H.B. 114 requires TVC to condition each grant, for services and treatment provided in a single county, on a potential grant recipient providing funds from non-state sources in a total amount at least equal to one of the following:
·25 percent of the grant amount if the community mental health program to be supported by the grant provides services and treatment in a county with a population of less than 100,000;
·50 percent of the grant amount if the community mental health program to be supported by the grant provides services and treatment in a county with a population of 100,000 or more but less than 250,000; or
·100 percent of the grant amount if the community mental health program to be supported by the grant provides services and treatment in a county with a population of 250,000 or more.
H.B. 114 requires TVC to condition each grant, for a community mental health program that provides services and treatment in more than one county, on a potential grant recipient providing funds from non-state sources in a total amount at least equal to one of the following:
·25 percent of the grant amount if the county with the largest population in which the community mental health program to be supported by the grant provides services and treatment has a population of less than 100,000;
·50 percent of the grant amount if the county with the largest population in which the community mental health program to be supported by the grant provides services and treatment has a population of 100,000 or more but less than 250,000; or
·100 percent of the grant amount if the county with the largest population in which the community mental health program to be supported by the grant provides services and treatment has a population of 250,000 or more.
H.B. 114 requires all grants awarded under the program to be used for the sole purpose of supporting community programs that provide mental health care services and treatment to veterans and their families and that coordinate such services with other transition support services. The bill requires TVC to select grant recipients based on the submission of applications or proposals by nonprofit and governmental entities and requires the executive director to develop evaluation criteria for those applications or proposals and the selection of grant recipients. The bill selection criteria must do the following:
·evaluate and score:
ofiscal controls for the project;
oproject effectiveness;
oproject cost; and
oan applicant's previous experience with grants and contracts;
·address the possibility of and method for making multiple awards; and
·include other factors that the executive director considers relevant.
The bill establishes that a reasonable amount not to exceed five percent of the money appropriated by the legislature for purposes of the grant program may be used by TVC to pay administrative costs of implementing the program.
Program Transition From DSHS to TVC
H.B. 114 repeals the Health and Safety Code provisions establishing the mental health intervention program for veterans developed under the Department of State Health Services (DSHS). Under current Government Code provisions, TVC coordinates with the Health and Human Services Commission (HHSC) to administer the program developed by DSHS, but the bill amends those Government Code provisions to transfer the program to TVC and remove the requirement for TVC and HHSC to coordinate to administer the program. The bill assigns to TVC, in addition to its current duties regarding the program, the same general powers and duties that are assigned to DSHS by the repealed Health and Safety Code provisions and transfers the same annual reporting requirement regarding the program from DSHS to TVC. The bill specifies that HHSC, instead of DSHS, jointly verifies with TVC that each state agency authorized to award a grant for the provision of mental health services to veterans or veterans' families has adopted policies to ensure compliance with the applicable program requirements.
Veteran Suicide Prevention Action Plan
H.B. 114 requires TVC to develop a comprehensive action plan to increase access to and availability of professional veteran health services to prevent veteran suicides in collaboration with the Texas Coordinating Council for Veterans Services, the U.S. Department of Veterans Affairs, the Service Members, Veterans, and their Families Technical Assistance Center Implementation Academy of the Substance Abuse and Mental Health Services Administration of the U.S. Department of Health and Human Services, veteran advocacy groups, medical providers, and any other organization or interested party TVC considers appropriate. The bill requires the action plan to do the following:
·identify opportunities for raising awareness of and providing resources for veteran suicide prevention;
·identify opportunities to increase access to veteran mental health services;
·identify funding resources to provide accessible, affordable veteran mental health services;
·provide measures to expand public-private partnerships to ensure access to quality, timely mental health services;
·provide for proactive outreach measures to reach veterans needing care;
·provide for peer-to-peer service coordination, including training, certification, recertification, and continuing education for peer coordinators; and
·address suicide prevention awareness, measures, and training regarding veterans involved in the justice system.
The bill requires TVC to make specific short-term and long-term statutory, administrative, and budget-related recommendations to the legislature and the governor regarding the policy initiatives and reforms necessary to implement the action plan and requires those initiatives and reforms to be fully implemented by September 1, 2027. These provisions expire September 1, 2027.
Repealed Provisions
H.B. 114 repeals the following provisions:
·Subchapter I, Chapter 1001, Health and Safety Code; and
·Sections 531.0925 and 531.0992, Government Code.
EFFECTIVE DATE
On passage, or, if the bill does not receive the necessary vote, September 1, 2025.
Honorable Cole Hefner, Chair, House Committee on Homeland Security, Public Safety & Veterans' Affairs
FROM:
Jerry McGinty, Director, Legislative Budget Board
IN RE:
HB114 by Cortez (Relating to the transition of certain veterans' mental health initiatives from the Texas Health and Human Services Commission to the Texas Veterans Commission.), As Introduced
No significant fiscal implication to the State is anticipated.
The bill would transfer the Mental Health Program for Veterans and the Texas Veterans Family Alliance Grant Program administered by the Health and Human Services Commission (HHSC) to the Texas Veterans Commission (TVC). It is assumed the transfer of funding and resources from HHSC to TVC would have no net cost to General Revenue.
This analysis assumes that $27,912,000 in General Revenue appropriated for HHSC for the affected programs in House Bill 1, as introduced, would transfer to the TVC. It is assumed the transfer from HHSC to TVC would take place beginning in fiscal year 2026, and include $3,956,000 in General Revenue for the Mental Health Program for Veterans and $10,000,000 in General Revenue for the Grant Program for Mental Health Services for Veterans and their Families in each fiscal year of the 2026-27 biennium.
This analysis assumes HHSC can implement all other functions of the bill with existing resources.
This analysis assumes costs associated with system changes to Clinical Management for Behavioral Health Services (CMBHS) to track veterans in transferring programs will be absorbed within existing resources.
The ongoing costs to TVC for this program would be $13,956,000 per fiscal year.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.
Source Agencies: b > td >
403 Veterans Commission, 529 Health and Human Services Commission
LBB Staff: b > td >
JMc, MGol, LCO, JKe
Related Legislation
Explore more bills from this author and on related topics
HB114 mandates the immediate transfer of jurisdiction for veteran mental health programs and the Texas Veterans + Family Alliance (TVFA) grant program from the Health and Human Services Commission (HHSC) to the Texas Veterans Commission (TVC). This shifts regulatory oversight, grant compliance, and reporting requirements for all nonprofits, local governments, and mental health providers currently contracting with the state for veteran services. Implementation Timeline Effective Date: June 20, 2025 (Immediate effect due to supermajority vote).
Q
Who authored HB114?
HB114 was authored by Texas Representative Philip Cortez during the Regular Session.
Q
When was HB114 signed into law?
HB114 was signed into law by Governor Greg Abbott on June 20, 2025.
Q
Which agencies enforce HB114?
HB114 is enforced by Texas Veterans Commission.
Q
How urgent is compliance with HB114?
The compliance urgency for HB114 is rated as "moderate". Businesses and organizations should review the requirements and timeline to ensure timely compliance.
Q
What is the cost impact of HB114?
The cost impact of HB114 is estimated as "medium". This may vary based on industry and implementation requirements.
Q
What topics does HB114 address?
HB114 addresses topics including mental health & substance abuse, military & veterans, state agencies, boards & commissions, state finances and state finances--management & control.
Legislative data provided by LegiScanLast updated: November 25, 2025
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