Texas Government Code - GOV'T § 418.021. Federal Aid for Local Government

(a) On the governor's determination that a local government of the state has suffered or will suffer a substantial loss of tax and other revenue from a major disaster and has demonstrated a need for financial assistance to perform its governmental functions, the governor may apply to the federal government on behalf of the local government for a loan and may receive and disburse the proceeds of an approved loan to the local government.

(b) The governor may determine the amount needed by a local government to restore or resume its governmental functions and certify that amount to the federal government.  The amount sought for the local government may not exceed 25 percent of the annual operating budget of the local government for the fiscal year in which the major disaster occurs.

(c) The governor may recommend to the federal government, based on the governor's review, the cancellation of all or part of repayment if in the first three full fiscal years following the major disaster the revenues of the local government are insufficient to meet its operating expenses, including additional disaster-related expenses of a municipal operation character.