HOUSTON – The COVID-19 pandemic devastated Texas’ restaurant industry — and for many, the recovery has been painfully slow.
In Houston, some eateries were forced to close permanently. Those that survived say they’re still struggling with reduced profit margins, ongoing staffing shortages, and rising operational costs.
“Since the pandemic, restaurants took a hit in the gut,” said Tracy Vaught, president of H-Town Restaurant Group, which operates five restaurants in the Houston area. “What I’m seeing is a much lower profit picture for us — and I believe it’s the same across the industry.”
According to Vaught, nearly 40% of Texas restaurants were not profitable in 2024.
The turning point: A push for legislative relief
As profitability plummeted, restaurant owners across Texas joined forces with the Texas Restaurant Association, pushing for change at the state level. Their voices were heard.
This year, during the latest legislative session in Austin, industry leaders testified before lawmakers about the urgent need for relief — and they came away with 18 key policy wins.
What’s changing for restaurants
Kelsey Erickson Streufert, Chief Public Affairs Officer for the Texas Restaurant Association, called the legislation “a game changer” — especially in terms of consistent regulations and financial relief.
Some of the most impactful changes include:
- Property tax exemption increased from $2,500 to $125,000
- Streamlined permitting processes that save time and money
- A database while childcare resources
“These are significant differences,” said Vaught. “Some of these changes will really help.”
When the changes take effect
- Most of the new laws go into effect this September
- Some tax benefits — including further property tax relief — are set to take effect in 2026, pending voter approval in November
What still needs to change
Despite the progress, restaurant owners say one major issue remains unresolved: credit card swipe fees.
“We were not successful this year,” Vaught admitted. “Last year alone, I paid $903,000 in credit card fees. That’s a huge hit.”
The Texas Restaurant Association plans to continue pushing for swipe fee reform in the next legislative session.
The bigger picture: Profitability, staffing & service
The ultimate goal? Increased profitability that leads to:
- Better customer service
- Improved staff retention
- More hiring capacity
“We’re also hoping to secure more child care resources,” the Association added — another factor that could help bring workers back to the industry.
A step in the right direction
With 18 new legislative wins, Texas restaurants are cautiously optimistic. While challenges like credit card fees and labor shortages remain, many believe these changes will offer much-needed relief — and a chance to finally get back on track after years of uncertainty.
