81R3605 JTS-F
By: Strama H.B. No. 1391
A BILL TO BE ENTITLED
AN ACT
relating to the creation and authority of certain special districts
to promote the use of renewable energy systems and energy
efficiency improvements; authorizing the issuance of bonds.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 386.051(b), Health and Safety Code, is
amended to read as follows:
(b) Under the plan, the commission and the comptroller shall
provide grants or other funding for:
(1) the diesel emissions reduction incentive program
established under Subchapter C, including for infrastructure
projects established under that subchapter;
(2) the motor vehicle purchase or lease incentive
program established under Subchapter D;
(3) the new technology research and development
program established under Chapter 387; [and]
(4) the clean school bus program established under
Chapter 390; and
(5) emissions management districts under Chapter 391.
SECTION 2. Section 386.252(c), Health and Safety Code, is
amended to read as follows:
(c) Money in the fund may be allocated to the clean school
bus program and emissions management districts only if:
(1) the money is available for that purpose after
money is allocated for the other purposes of the fund as required by
the state implementation plan; or
(2) the amount of money deposited to the credit of the
fund in a state fiscal year exceeds the amount the comptroller's
biennial revenue estimate shows as the comptroller's estimated
amount to be deposited to the credit of the fund in that year.
SECTION 3. Subtitle C, Title 5, Health and Safety Code, is
amended by adding Chapter 391 to read as follows:
CHAPTER 391. EMISSIONS MANAGEMENT PROJECT FINANCING THROUGH
CONTRACTUAL ASSESSMENTS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 391.001. DEFINITIONS. In this chapter:
(1) "Board" means a district's board of directors.
(2) "Director" means a board member.
(3) "District" means an emissions management district
created under this chapter.
(4) "Emissions management project" means:
(A) a renewable energy system; or
(B) an energy efficiency improvement.
(5) "Energy efficiency improvement" means an
installation or modification that is designed to reduce energy
consumption in a residential or commercial building, including:
(A) insulation in walls, roofs, floors, and
foundations and in heating and cooling distribution systems;
(B) storm windows and doors, multiglazed windows
and doors, heat-absorbing or heat-reflective glazed and coated
window and door systems, additional glazing, reductions in glass
area, and other window and door system modifications that reduce
energy consumption;
(C) automatic energy control systems;
(D) heating, ventilating, or air conditioning
and distribution system modifications or replacements in a building
or central plant;
(E) caulking and weather-stripping;
(F) replacement or modification of lighting
fixtures to increase the energy efficiency of the system;
(G) energy recovery systems; and
(H) systems to increase the use of natural
daylight for interior lighting.
(6) "Local government" mean a municipality or a
county.
(7) "Renewable energy system" means a fixture,
product, device, or interacting group of fixtures, products, or
devices that produces or uses energy from renewable resources and
is capable of being installed for use in a commercial or residential
building, including a system designed to generate electricity for
use in the building and to be installed on the customer's side of
the electric utility meter. The term includes:
(A) a photovoltaic generating system;
(B) a solar thermal system;
(C) a small wind generation system;
(D) a biomass energy system; and
(E) a geothermal energy system.
[Sections 391.002-391.050 reserved for expansion]
SUBCHAPTER B. CREATION OF DISTRICT
Sec. 391.051. ORDINANCE OR ORDER CREATING DISTRICT. (a)
The governing body of a local government by ordinance or order may
establish a district under this chapter.
(b) The ordinance or order establishing the district must
designate:
(1) the district's territory as a defined area inside
the local government's boundaries in which property owners are
eligible to participate in contractual assessment agreements with
the district, which area may include all or any portion of the area
inside the local government's boundaries;
(2) five individuals to be the initial directors;
(3) the kinds of emissions management projects
eligible for financing by the district; and
(4) the date and time of a hearing on the creation of
the district.
Sec. 391.052. NATURE OF DISTRICT. A district is a special
district and a political subdivision of the state.
[Sections 391.053-391.100 reserved for expansion]
SUBCHAPTER C. GOVERNANCE
Sec. 391.101. BOARD OF DIRECTORS. The district is governed
by the board of five directors appointed by the governing body of
the local government.
Sec. 391.102. TERMS. Directors serve staggered two-year
terms, with two or three directors' terms expiring June 1 of each
year.
Sec. 391.103. QUALIFICATIONS OF DIRECTOR. To be qualified
to serve as a director, a person must be at least 18 years old and be
a resident of the district.
Sec. 391.104. VACANCIES; QUORUM. (a) A board vacancy is
filled in the same manner as the original appointment.
(b) A vacant board position is not counted for the purposes
of establishing a quorum of the board.
Sec. 391.105. CONFLICTS OF INTEREST. Chapter 171, Local
Government Code, governs conflicts of interest for directors.
Sec. 391.106. COMPENSATION. (a) For purposes of this
section, "performs the duties of a director" means substantial
performance of the management of the district's business, including
participation in board and committee meetings and other activities
involving the substantive deliberation of district business and in
pertinent educational programs, but does not include routine or
ministerial activities such as the execution of documents or
self-preparation for meetings.
(b) A local government is authorized to compensate a
director when the director performs the duties of a director. The
local government shall compensate a director not more than $50 a day
for each day the director performs the duties of a director.
Sec. 391.107. DIRECTOR'S BOND AND OATH. (a) As soon as
practicable after a director is appointed, the director shall
execute a $10,000 bond payable to the district and conditioned on
the faithful performance of the director's duties.
(b) Each director's bond must be approved by the board, and
each director shall take the oath of office prescribed by the
constitution for public officers.
(c) The bond and oath shall be filed with the district and
retained in its records.
Sec. 391.108. OFFICERS. After directors are appointed and
have qualified by executing a bond and taking the oath, they shall
organize by electing a president, a vice president, a secretary,
and any other officers the board considers necessary.
Sec. 391.109. RULES. The board may adopt rules to
administer and operate the district.
[Sections 391.110-391.150 reserved for expansion]
SUBCHAPTER D. POWERS AND DUTIES
Sec. 391.151. GENERAL POWERS AND DUTIES. A district may:
(1) guarantee or otherwise secure loans for the
purchase and installation of an emissions management project;
(2) enter into contractual assessment agreements
under Section 391.152 to finance the purchase and installation of
an emissions management project;
(3) make other innovative arrangements to finance the
purchase and installation of an emissions management project;
(4) lease equipment and materials for an emissions
management project to a property owner;
(5) issue bonds to finance district purposes under
Subchapter E; and
(6) apply for grants or other funding under the Texas
emissions reduction plan under Chapter 386.
Sec. 391.152. CONTRACTUAL ASSESSMENT AGREEMENTS. (a) A
district may enter into a contractual assessment agreement with an
owner of property in the area designated by the local government in
an order or ordinance under Section 391.051 to finance the purchase
and installation of an emissions management project for the owner's
property.
(b) The board by rule shall establish the terms of an
agreement under this chapter, including:
(1) the term of the assessments; and
(2) the rate of interest on the assessments.
(c) A contract under this section may allow the property
owner to directly:
(1) purchase the equipment and materials for the
installation of a renewable energy system or an energy efficiency
improvement; and
(2) contract for the installation of a renewable
energy system or energy efficiency improvement.
Sec. 391.153. ASSESSMENT ROLL. After the district and a
property owner enter into a contractual assessment agreement, the
board shall levy the assessments against the property. The board
shall have an assessment roll prepared showing the assessments
against each property. The assessment roll shall be filed with the
secretary of the board or other officer who performs the function of
secretary and be open for public inspection.
Sec. 391.154. INTEREST ON ASSESSMENTS; LIEN. (a)
Assessments bear interest at a rate specified by the board that may
not exceed the interest rate permitted under Chapter 1204,
Government Code.
(b) Interest on an assessment between the effective date of
the contract and the date the first installment and any related
penalty is payable shall be added to the first installment. The
interest or penalties on all unpaid installments shall be added to
each subsequent installment until paid.
(c) An assessment and any interest and penalties on that
assessment is a lien against the property until paid.
(d) The owner of any property assessed may at any time pay
the entire assessment against any lot or parcel with interest
accrued to the date of the payment.
Sec. 391.155. SUPPLEMENTAL ASSESSMENTS. After notice and
hearing in the manner required for original assessments, the board
may make supplemental assessments to correct an omission or mistake
in an assessment:
(1) relating to the total cost of the improvement
project or services; or
(2) covering delinquencies or costs of collection.
Sec. 391.156. NO EMINENT DOMAIN. A district may not
exercise the power of eminent domain.
[Sections 391.157-391.200 reserved for expansion]
SUBCHAPTER E. BONDS
Sec. 391.201. GENERAL OBLIGATION AND REVENUE BONDS. For
the payment of all or part of the costs of financing the purchase
and installation of emissions management projects, the board may
issue bonds in one or more series payable from and secured by
assessments, Texas emissions reduction plan grants or other
funding, revenues, grants, gifts, contracts, leases, or any
combination of those funds. Bonds may be liens on all or part of the
revenue derived from improvements authorized under this chapter,
including installment payments of special assessments, or from any
other source pledged to the payment of the bonds.
Sec. 391.202. TERMS AND CONDITIONS OF BONDS. (a) Bonds
may be issued to mature serially or otherwise not more than 40 years
from their date of issue. Provision may be made for the subsequent
issuance of additional parity bonds or subordinate lien bonds under
terms or conditions that may be stated in the order or resolution
authorizing the issuance of the bonds.
(b) The bonds are negotiable instruments within the meaning
and for purposes of the Business & Commerce Code.
(c) The bonds may be issued registrable as to principal
alone or as to both principal and interest, shall be executed, may
be made redeemable before maturity, may be issued in the form,
denominations, and manner and under the terms, conditions, and
details, may be sold in the manner, at the price, and under the
terms, and shall bear interest at the rates as determined and
provided in the order or resolution authorizing the issuance of the
bonds.
(d) Bonds may bear interest and may be issued in accordance
with Chapters 1201, 1204, and 1371, Government Code, and
Subchapters A-C, Chapter 1207, Government Code.
(e) If provided by the bond order or resolution, the
proceeds from the sale of bonds may be used to pay interest on the
bonds during and after the period of the acquisition or
construction of any emissions management project to be provided
through the issuance of the bonds, to pay administrative and
operation expenses to create a reserve fund for the payment of the
principal of and interest on the bonds, and to create any other
funds. The proceeds of the bonds may be placed on time deposit or
invested, until needed, in securities in the manner provided by the
bond order or resolution.
Sec. 391.203. PLEDGES. (a) The board may pledge all or
part of the income or assessments from emissions management
projects financed under this chapter or from any other source to the
payment of the bonds, including the payment of principal, interest,
and any other amounts required or permitted in connection with the
bonds. The pledged income shall be set and collected in amounts
that will be at least sufficient, with any other pledged resources,
to provide for all payments of principal, interest, and any other
amounts required in connection with the bonds and, to the extent
required by the order or resolution authorizing the issuance of the
bonds, to provide for the payment of expenses in connection with the
bonds and to pay operation, maintenance, and other expenses in
connection with the emissions management projects authorized under
this chapter.
(b) Bonds may be additionally secured by a mortgage or deed
of trust on real property relating to the emissions management
projects authorized under this chapter owned or to be acquired by
the district and by chattel mortgages, liens, or security interests
on personal property appurtenant to that real property. The board
may authorize the execution of trust indentures, mortgages, deeds
of trust, or other forms of encumbrance to evidence the
indebtedness.
(c) The board may pledge to the payment of the bonds all or
any part of any grant, donation, revenues, or income received or to
be received from the United States government or any other public or
private source.
Sec. 391.204. REFUNDING BONDS. (a) Bonds issued under this
chapter may be refunded or otherwise refinanced by the issuance of
refunding bonds under terms or conditions determined by order or
resolution of the board. Refunding bonds may be issued in amounts
necessary to pay the principal of and interest and redemption
premium, if any, on bonds to be refunded, at maturity or on any
redemption date, and to provide for the payment of costs incurred in
connection with the refunding.
(b) The refunding bonds shall be issued in the manner
provided by this chapter for other bonds.
Sec. 391.205. APPROVAL BY ATTORNEY GENERAL; REGISTRATION.
(a) The district shall submit bonds and the appropriate
proceedings authorizing their issuance to the attorney general for
examination.
(b) If the bonds recite that they are secured by a pledge of
assessments, revenues, or rentals from a contract or lease, the
district also shall submit to the attorney general a copy of the
pledge, contract, or lease and the proceedings relating to it.
(c) If the attorney general finds that the bonds have been
authorized and any assessment, contract, or lease has been made in
accordance with law, the attorney general shall approve the bonds
and the assessment, contract, or lease, and the bonds shall be
registered by the comptroller.
(d) After approval and registration, the bonds and any
assessment, contract, or lease relating to them are incontestable
in any court or other forum for any reason and are valid and binding
obligations for all purposes in accordance with their terms.
Sec. 391.206. AUTHORIZED INVESTMENTS; SECURITY. (a)
District bonds are legal and authorized investments for:
(1) banks, trust companies, and savings and loan
associations;
(2) insurance companies;
(3) fiduciaries, trustees, and guardians; and
(4) all interest and sinking funds and other public
funds of the state and agencies, subdivisions, and
instrumentalities of the state, including counties,
municipalities, towns, villages, school districts, and all other
kinds and types of districts, public agencies, and bodies politic.
(b) District bonds are eligible and lawful security for
deposits of counties, municipalities, towns, villages, school
districts, and all other kinds and types of districts, public
agencies, and bodies politic, to the extent of the market value of
the bonds, when accompanied by any unmatured interest coupons
appurtenant to the bonds.
Sec. 391.207. LOCAL GOVERNMENT APPROVAL. (a) A district
must obtain the approval of the governing body of the local
government in which it is located for bond issues for emissions
management projects.
(b) Except as provided by Section 391.253, a local
government is not obligated to pay any bonds, notes, or other
obligations of the district.
[Sections 391.208-391.250 reserved for expansion]
SUBCHAPTER F. DISSOLUTION
Sec. 391.251. DISSOLUTION BY BOARD VOTE. Except as limited
by Section 391.253, the board by majority vote may dissolve the
district at any time.
Sec. 391.252. DISSOLUTION BY LOCAL GOVERNMENT. (a) Except
as limited by Section 391.253, the governing body of a local
government that created the district, by a vote of not less than
two-thirds of its membership, may by official action dissolve the
district.
(b) On the adoption of the ordinance or order, the district
is dissolved, and the local government succeeds to the property and
assets of the district and assumes all bonds, debts, obligations,
and liabilities of the district.
Sec. 391.253. LIMITATION. A district may not be dissolved
by its board or by a local government if the district has any
outstanding bonded indebtedness until that bonded indebtedness has
been repaid or defeased in accordance with the order or resolution
authorizing the issuance of the bonds.
SECTION 4. Section 372.003(b), Local Government Code, is
amended to read as follows:
(b) A public improvement project may include:
(1) landscaping;
(2) erection of fountains, distinctive lighting, and
signs;
(3) acquiring, constructing, improving, widening,
narrowing, closing, or rerouting of sidewalks or of streets, any
other roadways, or their rights-of-way;
(4) construction or improvement of pedestrian malls;
(5) acquisition and installation of pieces of art;
(6) acquisition, construction, or improvement of
libraries;
(7) acquisition, construction, or improvement of
off-street parking facilities;
(8) acquisition, construction, improvement, or
rerouting of mass transportation facilities;
(9) acquisition, construction, or improvement of
water, wastewater, or drainage facilities or improvements;
(10) the establishment or improvement of parks;
(11) projects similar to those listed in Subdivisions
(1)-(10);
(12) acquisition, by purchase or otherwise, of real
property in connection with an authorized improvement;
(13) special supplemental services for improvement
and promotion of the district, including services relating to
advertising, promotion, health and sanitation, water and
wastewater, renewable energy and energy efficiency, public safety,
security, business recruitment, development, recreation, and
cultural enhancement; [and]
(14) payment of expenses incurred in the
establishment, administration, and operation of the district; and
(15) acquisition, installation, or improvement of
renewable energy and energy efficiency improvements.
SECTION 5. Section 375.112(a), Local Government Code, is
amended to read as follows:
(a) An improvement project or services provided by the
district may include the construction, acquisition, improvement,
relocation, operation, maintenance, or provision of:
(1) landscaping; lighting, banners, and signs;
streets and sidewalks; pedestrian skywalks, crosswalks, and
tunnels; seawalls; marinas; drainage and navigation
improvements; pedestrian malls; solid waste, water, sewer, and
power facilities, including electrical, gas, steam, cogeneration,
and chilled water facilities; renewable energy and energy
efficiency improvements; parks, plazas, lakes, rivers, bayous,
ponds, and recreation and scenic areas; historic areas;
fountains; works of art; off-street parking facilities, bus
terminals, heliports, and mass transit systems; and the cost of any
demolition in connection with providing any of the improvement
projects;
(2) other improvements similar to those described in
Subdivision (1);
(3) the acquisition of real property or any interest
in real property in connection with an improvement, project, or
services authorized by this chapter, Chapter 54, Water Code, or
Chapter 365 or 441, Transportation Code;
(4) special supplemental services for advertising,
economic development, promoting the area in the district, health
and sanitation, public safety, maintenance, security, business
recruitment, development, elimination or relief of traffic
congestion, recreation, and cultural enhancement; and
(5) expenses incurred in the establishment,
administration, maintenance, and operation of the district or any
of its improvements, projects, or services.
SECTION 6. This Act takes effect September 1, 2009.