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Signed Into Law
Signed June 12, 2025Effective 2025-06-12
HB346

Regular Session

Relating to the fee amounts prescribed by the secretary of state for expedited commercial and business record searches or filings and the exemption from the franchise tax and certain filing fees for veteran-owned businesses.

Government Affairs & Regulatory Compliance Analysis

HB346: Government Affairs Overview

Effective September 1, 2025, the Texas Secretary of State (SOS) is granted broad authority to set variable fees for expedited filings and record searches, removing the previous statutory caps of $15 and $25. Additionally, the legislation repeals the franchise tax and filing fee exemptions for veteran-owned businesses that were previously scheduled to take effect on January 1, 2026.

Rep. Caroline Harris Davila·House Bill·Regular Session

Moderate
Low Cost
Effective:2025-06-12
Enforcing Agencies

Secretary of State

Business Impact

Who HB346 Affects

This legislation has regulatory implications for the following Texas businesses and organizations:

Regulatory Priority: moderate

Notable regulatory updates (effective 2025-06-12). Consider how these changes may affect your operations.

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Manufacturing & Business

Affected business types:

  • Manufacturers
  • Industrial facilities
  • Supply chain companies
  • Logistics providers
View all manufacturing & business legislation

Key Operational Considerations

  • 1Legal Staff: Train paralegals and corporate secretaries to verify the specific fee for the specific entity type (LLC vs. Corp) prior to submission, as the SOS may implement tiered pricing.

Estimated Cost Impact

lowMinimal cost impact anticipated.

Enforcing Agencies

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HB346
Relating to the fee amounts prescribed by the secretary of state for expedited commercial and business record searches or filings and the exemption fr...
Moderate Urgency
Unanimous Passage
House Vote128 - 0
YEA
100% in favor128 voting
Senate Vote31 - 0
YEA
100% in favor31 voting
Cost Impact
Low
Effective
2025-06-12
Enforcing Agencies
Secretary of State
Primary Author: Rep. Caroline Harris Davila
89th Texas Legislature
jdkey.com
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Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

  • Effective Date: September 1, 2025.
  • Compliance Deadline: August 31, 2025. Internal billing systems and check-issuing protocols must be updated prior to the effective date to prevent filing rejections.
  • Agency Rulemaking: The Secretary of State must prescribe and publish the new fee amounts prior to implementation. Expect a publication of the new fee schedule in the Texas Register during Summer 2025.

Immediate Action Plan

  • 1. Audit Vendor Settings: Contact registered agents (e.g., CT Corp, CSC) to ensure their billing systems will auto-adjust to the new SOS fee schedule by September 2025.
  • 2. Update Closing Checklists: Remove hard-coded filing fee amounts from M&A and financing closing statements.
  • 3. Monitor Texas Register: Assign a compliance officer to watch for the SOS proposed fee schedule in mid-2025 to update internal budgets.
  • 4. Notify Veteran Clients: Inform veteran-owned business clients immediately that the 2026 franchise tax exemption is no longer viable, allowing them to adjust their tax forecasting.

Operational Changes Required

Contracts

  • Client Engagement Letters: Review and amend standard "administrative fee" language. Replace fixed estimates for government filings (e.g., "$25 expedited fee") with variable language such as "actual government fees incurred."
  • Lending & Security Agreements: Ensure borrower covenants regarding perfection costs cover "all filing fees prescribed by the Secretary of State" rather than specific dollar amounts, as UCC filing costs will fluctuate.

Hiring/Training

  • Accounts Payable: Instruct finance teams to stop issuing automatic flat-rate checks (e.g., $25) for expedited services effective 9/1/2025. Implement a verification step to check the current SOS fee schedule before payment.
  • Legal Staff: Train paralegals and corporate secretaries to verify the specific fee for the specific entity type (LLC vs. Corp) prior to submission, as the SOS may implement tiered pricing.

Reporting & Record-Keeping

  • Veteran Documentation: Cease preparation of tax exemption filings for veteran-owned entities for the 2026 tax year; these exemptions have been repealed. Maintain standard franchise tax reporting protocols.
  • Cost Sheets: Update internal "Cost of Doing Business" matrices to reflect that expedited fees are no longer fixed by statute.

Fees & Costs

  • Budget Impact: Anticipate an increase in transactional costs. Agencies rarely request authority to uncap fees to lower them.
  • Variable Pricing: Be prepared for differential pricing. The law authorizes the SOS to set different fees for different categories of documents or entities (e.g., an LLC filing may cost more than a nonprofit filing).

Strategic Ambiguities & Considerations

  • "Reasonable and Necessary": The statute allows the SOS to set fees "reasonable and necessary to cover costs." This is broad language. We must monitor if the SOS interprets this to include major IT infrastructure upgrades, which could result in significant fee hikes.
  • Service Level Guarantees: While the SOS sets the *price*, the statute does not define the *speed*. We must watch for rulemaking that defines what "expedited" legally guarantees (e.g., 2-hour vs. 24-hour turnaround) under the new pricing structure.

Need Compliance Guidance on This Legislation?

JD Key Consulting specializes in Texas regulatory compliance strategy. Work directly with James Dickey—former Chairman of the Republican Party of Texas—to understand this bill's impact on your operations and develop an actionable compliance plan.

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Information presented is for general knowledge only and is provided without warranty, express or implied. Consult qualified government affairs professionals and legal counsel before making compliance decisions.

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Legislative Timeline

This bill's path through the Texas Legislature

Filed
Nov 12, 2024
Passed House
May 10, 2025
Passed Senate
May 28, 2025
Signed
Jun 12, 2025
Effective
Jun 12, 2025
TopicsEconomic & Industrial DevelopmentEconomic & Industrial Development--generalPurchasingPurchasing--stateState Agencies, Boards & CommissionsFees & Other Nontax RevenueFees & Other Nontax Revenue--stateComptroller of Public AccountsEconomic Development & Tourism Office, TexasSecretary of StateWorkforce Commission, TexasLaborLabor--workforce DevelopmentBusiness & CommerceBusiness & Commerce--general
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House Authors

Rep. Caroline Harris DavilaRepublican · Primary Author
Joint Authors

Senate Sponsors

Cosponsors (1)

Bill Text(with markup)

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

Related Legislation

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More from Rep. Caroline Harris Davila

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Related by Topic

View more Economic & Industrial Development legislation
Quick Reference

Frequently Asked Questions

Common questions about HB346

Q

What does Texas HB346 do?

Effective September 1, 2025, the Texas Secretary of State (SOS) is granted broad authority to set variable fees for expedited filings and record searches, removing the previous statutory caps of $15 and $25. Additionally, the legislation repeals the franchise tax and filing fee exemptions for veteran-owned businesses that were previously scheduled to take effect on January 1, 2026.

Q

Who authored HB346?

HB346 was authored by Texas Representative Caroline Harris Davila during the Regular Session.

Q

When was HB346 signed into law?

HB346 was signed into law by Governor Greg Abbott on June 12, 2025.

Q

Which agencies enforce HB346?

HB346 is enforced by Secretary of State.

Q

How significant are the changes in HB346?

The regulatory priority for HB346 is rated as "moderate". Businesses and organizations should review the legislation to understand potential impacts.

Q

What is the cost impact of HB346?

The cost impact of HB346 is estimated as "low". This may vary based on industry and implementation requirements.

Q

What topics does HB346 address?

HB346 addresses topics including economic & industrial development, economic & industrial development--general, purchasing, purchasing--state and state agencies, boards & commissions.

Q

What are the key dates for HB346?

Key dates for HB346: Effective date is 2025-06-12. Rulemaking: Prescribe and publish on the agency website the new fee amounts and any varying fee schedules for expedited services. (Prior to fee implementation). Consult with legal counsel regarding applicability.

Q

Which Texas businesses are affected by HB346?

HB346 primarily affects employers and workforce development organizations, Texas businesses and commercial enterprises. These businesses should review the legislation with their legal and compliance teams to understand potential impacts.

Need Strategic Guidance on This Legislation?

JD Key Consulting is an Austin, Texas-based government affairs firm led by James Dickey, former Chairman of the Republican Party of Texas. We specialize in Texas regulatory compliance and legislative strategy for data centers, energy, banking, and manufacturing.

Legislative data provided by LegiScanLast updated: January 11, 2026