Texas SB 1173 Doubles Competitive Bidding Threshold
Earlier this year, the Texas Legislature passed Senate Bill 1173, raising the competitive bidding threshold for local governments from $50,000 to $100,000 effective September 1, 2025. This means cities, counties, school districts, and other local entities can now make purchases or enter into contracts up to $100,000 without having to go through a formal competitive bidding process. While this change has major implications for local procurement efficiency, it’s worth asking: is this increase even keeping pace with inflation?
To answer that, let’s compare the change in the threshold with the real-world cost increases of two grocery staples: eggs and milk.
The competitive bidding threshold was last raised in 2007, when it increased from $25,000 to $50,000. That threshold remained static for 18 years, despite steady, and sometimes dramatic, increases in the cost of goods and services. SB 1173, passed in 2025, doubled the threshold to $100,000, a move that supporters argue is long overdue.
The idea behind the competitive bidding threshold is to ensure transparency and cost-effectiveness in public spending. But if the threshold isn’t periodically adjusted to account for inflation, local governments may waste time and resources bidding out relatively routine projects or purchases that used to cost far less.
Eggs and Milk: The Grocery Store Litmus Test
Let’s examine how the cost of two basic groceries—eggs and milk—has changed between 2007 and 2025 and see how that compares to the 100% increase in the competitive bidding threshold.
Eggs
- 2007: $1.51 per dozen (U.S. average)
- 2025: $4.55 per dozen (U.S. average, following recent inflation and supply disruptions)
- Increase: +201%
Egg prices have more than tripled since 2007, due to factors like supply chain instability, avian flu outbreaks, and rising feed costs.
Milk
- 2007: $3.50 per gallon (U.S. average)
- 2025: $4.10 per gallon (U.S. average)
- Increase: +17%
Milk has seen more modest price growth, reflecting a more stable supply chain and production environment compared to eggs.
Competitive Bidding Threshold
- 2007: $50,000
- 2025: $100,000
- Increase: +100%
So how does the bidding threshold increase compare?
- It falls short of egg inflation (201% vs. 100%)
- It outpaces milk inflation (100% vs. 17%)
Why This Matters
Local governments spend public money on everything from IT equipment and construction materials to emergency response vehicles. Many of these expenses, like groceries, have not been immune to inflation. Construction costs alone have risen significantly over the last two decades.
Without an adjustment to the bidding threshold, even relatively routine purchases would continue to be slowed by time-consuming bidding processes. By doubling the threshold, SB 1173 gives local governments more flexibility, allowing them to respond to needs quickly and reduce administrative overhead. It doesn’t remove oversight entirely—internal controls, audits, and public transparency still apply—but it modernizes the rules to reflect economic reality.
Comparing public policy to grocery prices might seem like apples to oranges (or eggs to contracts) but it’s a helpful lens. Since 2007, eggs have tripled in cost, milk has gone up, and construction prices have surged. A 100% increase in the bidding threshold over 18 years isn’t just justified, it might even be modest.
Texas SB 1173 is not about loosening accountability; it’s about helping local governments keep up with the real world. And when a dozen eggs costs more than $4, it’s clear that holding onto 2007-era spending rules no longer makes fiscal or practical sense.
Please do not rely on this article as legal advice. We can tell you what the law is, but until we know the facts of your given situation, we cannot provide legal guidance. This website is for informational purposes and not for the purposes of providing legal advice.
