Texas Public Bid Threshold

Texas Competitive Procurement Threshold Update (Effective September 1, 2025)

Texas Procurement Threshold Increases to $100,000:

Effective September 1, 2025, Texas local governments—including cities, counties, and school districts—are operating under a new procurement landscape. Thanks to Senate Bill 1173, the competitive procurement threshold has officially doubled, increasing from $50,000 to $100,000. This is a significant shift in how public entities handle purchasing, and it carries both opportunities and responsibilities for administrators, vendors, and procurement professionals.

What Changed?

Previously, any purchase of goods or services valued at $50,000 or more triggered the formal competitive procurement process—requiring sealed bids, requests for proposals (RFPs), or other structured bidding procedures.

As of September 1, that threshold is now $100,000. Purchases below $100,000 no longer require a formal competitive process, though local policies and best practices should still be applied.

Why It Matters

The increase reflects both inflationary pressures and the need for more efficiency in day-to-day government operations. For many entities, $50,000 no longer represented a “major” expenditure in the way it once did.

Key benefits include:

• Reduced administrative burden – Less time and paperwork spent on formal procurement for smaller transactions.

• Faster turnaround – Local governments can move more quickly on routine purchases and services.

• Operational flexibility – Departments gain more discretion to meet immediate needs without lengthy bidding cycles.

  
  

What Stays the Same

While the threshold has increased, accountability and transparency remain at the core of Texas procurement law. Purchases over $100,000 must still go through a formal competitive process to ensure fairness, oversight, and best value for taxpayers.

Entities may also choose to apply stricter local policies if they wish to maintain a lower threshold internally.

Implications for Vendors

For businesses providing goods or services to local governments, this change may create new opportunities:

• Smaller contracts may move faster since fewer layers of procurement are required.

• Vendors could see an increase in direct purchase activity for routine or mid-range services.

• Strong relationships and visibility at the local level will become even more valuable.

Final Thoughts

Senate Bill 1173 represents a modernization of Texas procurement rules—balancing efficiency with accountability. By raising the threshold to $100,000, the legislature has given cities, counties, and school districts more flexibility to manage resources while reserving formal bidding for larger, higher-impact expenditures.

For procurement professionals, understanding where this new line is drawn will be essential in ensuring compliance while taking advantage of the efficiency gains.