Dallas, Texas, January 2, 2026
Texas voters have made a significant decision by approving Proposition 4, which allocates up to $1 billion annually from state sales tax revenue to tackle the state’s critical water infrastructure needs. This constitutional amendment aims to address an estimated $154 billion in water infrastructure improvement costs over the next 50 years, impacting both rural and urban communities by providing much-needed funds for various water-related projects.
Texas Voters Approve Historic Water Infrastructure Funding
Dallas, Texas – In a landmark decision, Texas voters have approved Proposition 4, dedicating up to $1 billion annually from state sales tax revenue to the Texas Water Fund for the next 20 years. This constitutional amendment aims to address the state’s pressing water infrastructure needs, totaling an estimated $154 billion over the next five decades.
Details of Proposition 4
Proposition 4 mandates that, starting in 2027, the first $1 billion of state sales tax revenue exceeding $46.5 billion each fiscal year be allocated to the Texas Water Fund. This fund will finance water, wastewater, and flood infrastructure projects, including the development of new water sources, repair of aging systems, and flood protection initiatives.
Implementation Timeline
The allocation of funds is contingent upon the state’s sales tax collections surpassing $46.5 billion in a given fiscal year. Once this threshold is met, the Texas Comptroller of Public Accounts will transfer the designated funds to the Texas Water Fund. The Texas Water Development Board (TWDB) will then oversee the distribution of these funds to various water infrastructure projects across the state.
Background and Legislative Support
The passage of Proposition 4 follows the enactment of Senate Bill 7 (SB7) in June 2025, which established the legal framework for a dedicated, long-term financing mechanism for water infrastructure. Together, Proposition 4 and SB7 provide a sustainable financial foundation to meet Texas’ projected $200 billion in water infrastructure needs over the next 50 years.
Implications for Texas Communities
The approval of Proposition 4 is expected to significantly impact both rural and urban communities. Rural areas, in particular, stand to benefit from the funding, as it will support projects aimed at repairing and upgrading water systems that are often outdated and underfunded. This investment is crucial for ensuring reliable access to clean water and promoting economic development statewide.
Looking Ahead
As the implementation of Proposition 4 progresses, stakeholders will monitor the allocation and utilization of funds to ensure they effectively address the state’s water infrastructure challenges. Continued collaboration between state agencies, local governments, and communities will be essential in maximizing the benefits of this historic investment.
Frequently Asked Questions (FAQ)
What is Proposition 4?
Proposition 4 is a constitutional amendment approved by Texas voters that dedicates up to $1 billion annually from state sales tax revenue to the Texas Water Fund for the next 20 years. This fund will finance water, wastewater, and flood infrastructure projects across the state.
How will the funds be allocated?
The funds will be allocated to the Texas Water Fund, which will finance water, wastewater, and flood infrastructure projects, including the development of new water sources, repair of aging systems, and flood protection initiatives.
When will the funding begin?
The funding is set to begin in 2027, contingent upon the state’s sales tax collections exceeding $46.5 billion in a given fiscal year. Once this threshold is met, the Texas Comptroller of Public Accounts will transfer the designated funds to the Texas Water Fund.
What is the total amount allocated over the 20 years?
The total amount allocated over the 20 years is up to $20 billion, with $1 billion dedicated annually from state sales tax revenue.
How will this impact rural communities?
Rural communities are expected to benefit significantly from the funding, as it will support projects aimed at repairing and upgrading water systems that are often outdated and underfunded. This investment is crucial for ensuring reliable access to clean water and promoting economic development in these areas.
| Feature | Description |
|---|---|
| Annual Allocation | Up to $1 billion from state sales tax revenue dedicated to the Texas Water Fund each fiscal year. |
| Duration | 20 years, starting in 2027. |
| Funding Threshold | Funds are allocated when state sales tax collections exceed $46.5 billion in a fiscal year. |
| Fund Management | The Texas Water Development Board oversees the distribution of funds to water infrastructure projects. |
| Targeted Projects | Development of new water sources, repair of aging systems, and flood protection initiatives. |
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