Keeping Texas School Construction Costs Down Act of 2023

This bill amends the federal tax code to create a "safe harbor" for certain Texas school trust funds. It specifies that these state-created funds - which hold nonfinancial assets (like land or buildings) and are used solely to support public schools or essential government functions - will not be classified as "investment property" under tax law. The provision applies to funds already meeting strict criteria as of 1986, ensuring their tax-exempt status remains intact. It directly affects existing Texas perpetual trust funds that support public elementary and secondary schools. The bill does not address new construction costs or funding mechanisms, but rather clarifies the tax treatment of pre-existing school funding structures.