81R6901 E
By: Miklos H.B. No. 3341
A BILL TO BE ENTITLED
AN ACT
relating to the creation of a transportation development
corporation in certain municipalities; authorizing local option
elections for funding mass transit projects.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle C1, Title 12, Local Government Code, as
effective April 1, 2009, is amended by adding Chapter 508 to read as
follows:
CHAPTER 508. TRANSPORTATION DEVELOPMENT CORPORATIONS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 508.001. DEFINITIONS. In this chapter:
(1) "Authorizing municipality" means a municipality
that authorizes the creation of a transportation development
corporation.
(2) "Complementary transportation services" includes:
(A) special transportation services for a person
who is elderly or has a disability;
(B) medical transportation services;
(C) assistance in street modifications as
necessary to accommodate the public transportation system;
(D) construction of new general aviation
facilities or renovation or purchase of existing facilities not
served by certificated air carriers to relieve air traffic
congestion at existing facilities; and
(E) any other service that complements the public
transportation system, including providing parking garages.
(3) "Merged corporation" means a transportation
development corporation formed under Section 508.004 and governed
by this chapter.
(4) "Public transportation" means the conveyance of
passengers and hand-carried packages or baggage of a passenger by
any means of transit services made available to the public.
(5) "Public transportation system" means:
(A) all property owned or held by a
transportation development corporation for public transportation
or complementary transportation service purposes, including
vehicle parking areas and facilities and other facilities necessary
or convenient for the beneficial use of, and the access of persons
and vehicles to, public transportation;
(B) real property, facilities, and equipment for
the protection and environmental enhancement of all the facilities;
and
(C) property held:
(i) in accordance with a contract with the
owner making the property subject to the control of or regulation by
the corporation; and
(ii) for public transportation or
complementary transportation service purposes.
(6) "Transportation development corporation" means a
corporation governed by this chapter.
Sec. 508.002. APPLICABILITY OF CHAPTER. This chapter
applies only to a municipality that is located in a county:
(1) with a population of 1.4 million or more but less
than 3.4 million; or
(2) adjacent to a county with a population of 1.4
million or more but less than 3.4 million.
Sec. 508.003. AUTHORITY TO CREATE CORPORATION. (a) A
municipality may authorize the creation under this subtitle of a
transportation development corporation.
(b) A municipality may not authorize the creation of more
than one transportation development corporation in the
municipality.
Sec. 508.004. MERGER OF CORPORATIONS. (a) Two or more but
not more than nine transportation development corporations formed
under this chapter may merge and combine their assets, liabilities,
obligations, authority, and operations into one transportation
development corporation if:
(1) the board of directors of each corporation that is
a party to the merger adopts a plan of merger that states the terms
and conditions of the merger and includes the certificate of
formation of the corporation to be created by the plan of merger;
(2) the governing body of each authorizing
municipality approves the merger;
(3) the sales and use taxes imposed for the benefit of
each of the merging corporations are of an equal rate; and
(4) the merger would not impair the obligation of a
contract of a merging corporation that created debt for which the
proceeds of a sales and use tax imposed for the benefit of the
merging corporation were pledged wholly or partly for its payment.
(b) A merged corporation is a political subdivision solely
for purposes of imposing a sales and use tax for the benefit of the
merged corporation.
(c) When a merger takes effect, the separate existence of
each transportation development corporation that is a party to the
merger ceases.
Sec. 508.005. CONTENTS OF CERTIFICATE OF FORMATION. The
certificate of formation of a transportation development
corporation must state that the corporation is governed by this
chapter.
Sec. 508.006. CORPORATION NOT SUBJECT TO CERTAIN
PROVISIONS. Sections 501.203, 501.205, 501.251-501.254,
501.255(a) and (b), 501.256, and 501.257 do not apply to a
corporation under this chapter.
[Sections 508.007-508.050 reserved for expansion]
SUBCHAPTER B. GOVERNANCE OF CORPORATION
Sec. 508.051. BOARD OF DIRECTORS. (a) The board of
directors of a transportation development corporation created by a
single authorizing municipality consists of at least five
directors.
(b) A director is appointed by the governing body of the
authorizing municipality. A director serves at the pleasure of the
governing body that appointed the director and may be removed by
that governing body at any time without cause.
(c) The governing body of the authorizing municipality
shall determine the number of directors and the length of each
director's term.
(d) The governing bodies of the authorizing municipalities
of a merged corporation shall determine by written agreement the
number of directors, the apportionment of directors for each
municipality, and the length of each director's term. The board
shall consist of as many directors as necessary so that each
authorizing municipality is represented by at least one director.
(e) The length of a director's term may not exceed six
years.
Sec. 508.052. OFFICERS. The board of directors of a
transportation development corporation shall appoint:
(1) a president;
(2) a secretary; and
(3) other officers of the corporation that:
(A) the governing body of the authorizing
municipality considers necessary; or
(B) the governing bodies of the authorizing
municipalities of a merged corporation authorize by written
agreement.
Sec. 508.053. QUORUM. A majority of the entire membership
of the board of directors of a transportation development
corporation is a quorum.
Sec. 508.054. LOCATION OF BOARD MEETINGS. (a) The board of
directors of a transportation development corporation shall
conduct each board meeting within the boundaries of the authorizing
municipality.
(b) The board of directors of a merged corporation shall
conduct each board meeting within the combined boundaries of each
authorizing municipality of the merged corporation.
Sec. 508.055. RESTRICTIONS ON REGISTERED AGENT AND OFFICE.
(a) The registered agent of a transportation development
corporation must be an individual who is a resident of this state.
(b) The registered office of a transportation development
corporation must be located within the boundaries of the
authorizing municipality.
(c) The registered office of a merged corporation must be
located within the combined boundaries of each authorizing
municipality of the merged corporation.
[Sections 508.056-508.100 reserved for expansion]
SUBCHAPTER C. GENERAL POWERS AND DUTIES
Sec. 508.101. APPLICABILITY OF OTHER LAW; CONFLICTS. A
transportation development corporation has the powers and is
subject to the limitations of a corporation created under another
provision of this subtitle outside of this chapter. To the extent
of a conflict between this chapter and another provision of this
subtitle, this chapter prevails.
Sec. 508.102. AUTHORITY OF CORPORATION TO OPERATE PUBLIC
TRANSPORTATION SYSTEM. A transportation development corporation
has:
(1) the same authority as a municipality to operate a
public transportation system; and
(2) the powers provided to a regional transportation
authority under Chapter 452, Transportation Code.
Sec. 508.103. CONTRACTS. A transportation development
corporation may contract with any person to:
(1) carry out a transportation development project or
objective; or
(2) assist with the development or operation of a
transportation development project or objective consistent with
the purposes of and duties provided by this subtitle.
Sec. 508.104. LIMITATION ON USE OF REVENUES FOR PROMOTIONAL
PURPOSE. A transportation development corporation may spend not
more than 10 percent of the corporate revenues for promotional
purposes.
Sec. 508.105. BOND REPAYMENT. (a) Bonds or other
obligations that mature in 30 years or less and that are issued to
pay the costs of projects may be made payable from any source of
funds available to the transportation development corporation,
including the proceeds of a sales and use tax imposed under this
chapter.
(b) Bonds or other obligations that by their terms are
payable from the tax proceeds:
(1) may not be paid wholly or partly from any property
taxes imposed or to be imposed by an authorizing municipality; and
(2) are not a debt of and do not give rise to a claim
for payment against an authorizing municipality, except as to sales
and use tax revenue held by the municipality and required under this
chapter to be delivered to the transportation development
corporation.
Sec. 508.106. EMINENT DOMAIN. A transportation development
corporation may exercise the power of eminent domain inside and
outside the corporate limits of an authorizing municipality or
municipalities.
Sec. 508.107. LIABILITY. (a) The following are not liable
for damages arising from the performance of a governmental function
of a transportation development corporation or an authorizing
municipality:
(1) the corporation;
(2) a director of the corporation;
(3) the municipality;
(4) a member of the governing body of the
municipality; or
(5) an employee of the corporation or municipality.
(b) For purposes of Chapter 101, Civil Practice and Remedies
Code, a transportation development corporation is a governmental
unit and the corporation's actions are governmental functions.
Sec. 508.108. CALLING OF ELECTIONS. (a) The board of the
transportation development corporation may call an election on the
issue of authorizing a tax under Section 508.251 for one or more
public transportation system projects.
(b) The corporation shall call an election on the issue
described by Subsection (a) on receipt of a petition requesting
that the election be called signed by a number of registered voters
in one or more authorizing municipalities equal to at least 10
percent of the total number of votes cast in the municipality or
municipalities for all candidates for governor in the most recent
gubernatorial general election.
(c) The corporation may adopt an order under this section
only after holding a public hearing on the issue.
[Sections 508.109-508.150 reserved for expansion]
SUBCHAPTER D. AUTHORIZED PROJECTS
Sec. 508.151. AUTHORIZED PROJECTS. (a) In this chapter,
"project" means land, buildings, equipment, facilities,
expenditures, and improvements found by the board of directors to
be required or suitable for use for the acquisition, construction,
creation, operation, or maintenance of a public transportation
system.
(b) A corporation may finance and undertake one or more
projects.
Sec. 508.152. PUBLIC PURPOSE DESIGNATION; EXEMPTION FROM
TAXATION. (a) The legislature finds for all constitutional and
statutory purposes that:
(1) a project under this chapter is owned, used, and
held for a public purpose for and on behalf of an authorizing
municipality or municipalities or a merged corporation, as
appropriate; and
(2) except as otherwise provided by this section,
Section 501.160 of this subtitle and Section 25.07(a), Tax Code, do
not apply to a leasehold or other possessory interest granted by a
transportation development corporation during the period the
corporation owns projects on behalf of an authorizing municipality
or municipalities or a merged corporation, as appropriate.
(b) A project is exempt from ad valorem taxation under
Section 11.11, Tax Code, for the period described by Subsection
(a)(2) of this section.
(c) This subsection applies only if the voters of an
authorizing municipality of a transportation development
corporation or the authorizing municipalities of a merged
corporation have not approved the adoption of a sales and use tax
for the benefit of the corporation under Section 508.251. An
ownership, leasehold, or other possessory interest of a person
other than the corporation in real property constituting a project
of the corporation described by this section is subject to ad
valorem taxation under Section 25.07(a), Tax Code.
Sec. 508.153. HEARING REQUIRED TO UNDERTAKE PROJECT. A
transportation development corporation shall hold at least one
public hearing on a proposed project before spending money to
undertake the project.
[Sections 508.154-508.250 reserved for expansion]
SUBCHAPTER E. SALES AND USE TAX
Sec. 508.251. TAX AUTHORIZED. (a) An authorizing
municipality may adopt a sales and use tax for the benefit of a
transportation development corporation if the tax is approved by a
majority of the voters of the municipality voting at an election
held for that purpose.
(b) Except as provided by Subsection (c), a merged
corporation may adopt a sales and use tax under this subchapter only
if a majority of voters of each authorizing municipality approve
the tax in an election held in each municipality.
(c) If the imposition of a sales and use tax was previously
approved at an election held by the authorizing municipality of
each corporation included in a merged corporation, the previous
elections are considered as an election to approve the imposition
of the tax for use by the merged corporation and an additional
election under Subsection (b) is not required.
(d) Each authorizing municipality of a merged corporation
shall receive for the benefit of the corporation the revenue from
the tax imposed by the corporation within the municipality.
Sec. 508.252. SALES TAX. (a) If an authorizing
municipality or merged corporation adopts the tax under Section
508.251, a tax is imposed on the receipts from the sale at retail of
taxable items within the municipality or merged corporation at the
rate approved by the voters.
(b) The rate of the tax imposed under Subsection (a) must be
equal to one-eighth, one-fourth, three-eighths, one-half,
five-eighths, three-fourths, or seven-eighths of one percent or one
percent.
Sec. 508.253. USE TAX. (a) If an authorizing municipality
or merged corporation adopts the tax under Section 508.251, an
excise tax is imposed on the use, storage, or other consumption
within the municipality or corporation of taxable items purchased,
leased, or rented from a retailer during the period that the tax is
effective within the municipality or corporation.
(b) The rate of the excise tax is the same as the rate of the
sales tax portion of the sales and use tax and is applied to the
sales price of the taxable items.
Sec. 508.254. SALES AND USE TAXES NOT COUNTED IN COMBINED
LOCAL TAX RATE. Notwithstanding any other law, the rate of a sales
and use tax imposed by a municipality or merged corporation under
this chapter may not be considered in determining the combined or
overlapping rate of sales and use taxes imposed in the municipality
or corporation for any purpose other than as provided by Section
328.004, Tax Code.
Sec. 508.255. APPLICABILITY OF TAX CODE. (a) Chapter 321,
Tax Code, governs an election to approve the adoption of the sales
and use tax under this chapter and governs the imposition,
computation, administration, governance, use, and abolition of the
tax except as inconsistent with this chapter.
(b) Except as provided by this subsection, the tax imposed
under this chapter takes effect as provided by Section 321.102(a),
Tax Code. If an election is held under this chapter at the same
time an election is held to impose or change the rate of the
additional municipal sales and use tax, the tax under this chapter
and the imposition or change in rate of the additional municipal
sales and use tax take effect as provided by Section 321.102(b), Tax
Code.
(c) After the effective date of the taxes imposed under this
chapter, the adoption of a sales and use tax or the attempted
adoption of a sales and use tax by an authorizing municipality or a
merged corporation or another taxing jurisdiction having territory
in the municipality or corporation does not impair the taxes
imposed under this chapter.
Sec. 508.256. BALLOT. In an election to adopt the sales
and use tax under this chapter, the ballot shall be printed to
provide for voting for or against the proposition: "The adoption
of a sales and use tax for the acquisition, construction, creation,
operation, or maintenance of a public transportation system at the
rate of __________" (one-eighth, one-fourth, three-eighths,
one-half, five-eighths, three-fourths, or seven-eighths of one
percent or one percent to be inserted as appropriate).
Sec. 508.257. LIMITATION ON DURATION OF TAX. (a) At an
election held under Section 508.251, an authorizing municipality or
merged corporation may also allow the voters to vote on a ballot
proposition to limit the period for imposition of a sales and use
tax.
(b) An authorizing municipality or merged corporation that
has imposed a tax for a limited time under this section may extend
the period of the tax's imposition or reimpose the tax only if the
extension or reimposition is approved by a majority of the voters of
the municipality or corporation voting at an election held for that
purpose in the same manner as an election held under Section
504.257.
Sec. 508.258. LIMITED SALES AND USE TAX FOR SPECIFIC
PROJECT. (a) At an election held under Section 508.251, an
authorizing municipality or merged corporation may also allow the
voters to vote on a ballot proposition to limit the use of the sales
and use tax to a specific project.
(b) A transportation development corporation created to
perform a specific project as provided by this section may retain
its corporate existence and perform any other project approved by
the voters of an authorizing municipality or merged corporation at
an election held for that purpose in the same manner as Section
504.260 provides for an election held under Section 504.251.
Before spending money to undertake a project, a transportation
development corporation shall hold a public hearing as otherwise
provided by this chapter.
Sec. 508.259. ELECTIONS AFFECTING MERGED CORPORATIONS. (a)
A ballot proposition under Section 508.257 affecting a merged
corporation is approved only if a majority of the voters of each
authorizing municipality approves the same proposition at an
election held in each municipality for that purpose in the same
manner as an election held under Section 504.257.
(b) A ballot proposition under Section 508.258 affecting a
merged corporation is approved only if a majority of the voters of
each authorizing municipality approves the same proposition at an
election held in each municipality for that purpose in the same
manner as Section 504.260 provides for an election held under
Section 504.251.
Sec. 508.260. CESSATION OF COLLECTION OF TAXES. A sales
and use tax imposed under this chapter may not be collected after
the last day of the first calendar quarter that occurs after the
transportation development corporation notifies the comptroller
that:
(1) all bonds or other obligations of the corporation,
including any refunding bonds, payable wholly or partly from the
proceeds of the sales and use tax imposed under this chapter, have
been paid in full; or
(2) the total amount, exclusive of guaranteed
interest, necessary to pay in full the bonds and other obligations
has been set aside in a trust account dedicated to the payment of
the bonds and other obligations.
[Sections 508.261-508.300 reserved for expansion]
SUBCHAPTER F. USE OF TAX PROCEEDS
Sec. 508.301. DELIVERY OF TAX PROCEEDS. On an authorizing
municipality's receipt from the comptroller of the proceeds of the
sales and use tax imposed under this chapter, the municipality
shall deliver the proceeds to the transportation development
corporation.
Sec. 508.302. PAYMENT OF PROJECT COSTS, BONDS, OR OTHER
OBLIGATIONS. The proceeds of the sales and use tax imposed under
this chapter may be used to:
(1) pay the costs of projects authorized by Section
508.151; or
(2) pay the principal of, interest on, and other costs
relating to bonds or other obligations issued by the transportation
development corporation to:
(A) pay the costs of projects; or
(B) refund bonds or other obligations issued to
pay the costs of projects.
[Sections 508.303-508.350 reserved for expansion]
SUBCHAPTER G. WITHDRAWAL FROM MERGED CORPORATION
Sec. 508.351. WITHDRAWAL FROM MERGED CORPORATION. (a) A
municipality may withdraw from a merged corporation if all of the
municipality's obligations and entitlements relating to the merged
corporation have been properly settled.
(b) The municipality withdrawing from the merged
corporation may not receive any assets, including money or other
property, of the merged corporation until the existence of the
merged corporation is terminated as provided by Section 508.354.
Sec. 508.352. DISTRIBUTION OF NET EARNINGS. If the board
of directors of a merged corporation determines that sufficient
provisions have been made to pay the corporation's expenses, bonds,
and other obligations, any net earnings may be distributed among
the authorizing municipalities of the corporation as a percentage
of the per capita contributions made by each of the municipalities
during the corporation's existence, including sales and use tax
delivered to the corporation.
Sec. 508.353. EFFECT OF WITHDRAWAL OF MUNICIPALITY. A
merged corporation may not terminate its existence as a result of
the withdrawal of a municipality from the merged corporation if at
least two authorizing municipalities remain in the corporation.
Sec. 508.354. DISTRIBUTION OF ASSETS. (a) Subject to
Subsection (b), on termination of the existence of a merged
corporation, any assets of the corporation remaining after all the
corporation's obligations have been met shall be distributed among
the authorizing municipalities as a percentage of the per capita
contributions made by each of the municipalities during the
corporation's existence, including sales and use tax delivered to
the corporation.
(b) A municipality that withdraws from a merged corporation
is entitled to receive a distribution under Subsection (a) that is
reduced by one percent for each year the merged corporation
operated without the municipality's membership in the corporation.
[Sections 508.355-508.400 reserved for expansion]
SUBCHAPTER H. TERMINATION OF CORPORATION
Sec. 508.401. APPLICATION OF SUBCHAPTER. This subchapter
applies to a transportation development corporation or to a merged
corporation with one remaining authorizing municipality.
Sec. 508.402. ELECTION TO TERMINATE EXISTENCE OF
CORPORATION ON PETITION. (a) The governing body of an authorizing
municipality shall order an election on the termination of the
existence of the transportation development corporation on receipt
of a petition requesting the election that is signed by at least 10
percent of the registered voters of the municipality.
(b) The authorizing municipality shall hold the election on
the first available uniform election date that occurs after the
time required by Section 3.005, Election Code.
Sec. 508.403. BALLOT. The ballot for an election held
under Section 508.402 shall be printed to permit voting for or
against the proposition: "Termination of the __________ (name of
corporation)."
Sec. 508.404. TERMINATION OF EXISTENCE OF CORPORATION.
(a) If a majority of the votes cast at an election held under
Section 508.402 approve the termination, the transportation
development corporation shall:
(1) continue operations only as necessary to meet the
obligations the corporation incurred before the date of the
election, including paying the principal of and interest on the
corporation's bonds; and
(2) liquidate the corporation's assets and apply the
proceeds to satisfy the corporation's obligations, to the extent
practicable.
(b) After the transportation development corporation has
satisfied all of the corporation's obligations, any remaining
assets of the corporation shall be transferred to the authorizing
municipality, and the existence of the corporation is terminated.
(c) The authorizing municipality shall promptly notify the
comptroller and the secretary of state of the date the existence of
a transportation development corporation is terminated under this
subchapter.
(d) A tax imposed under this chapter may not be collected
after the last day of the first calendar quarter that begins after
the authorizing municipality provides notice under Subsection (c).
Sec. 508.405. ELECTION REJECTING TERMINATION. If less
than a majority of the votes cast at an election held under Section
508.402 approve the termination, Section 508.404 has no effect.
SECTION 2. Subtitle C, Title 3, Tax Code, is amended by
adding Chapter 328 to read as follows:
CHAPTER 328. SALES AND USE TAX FOR TRANSPORTATION IN CERTAIN
MUNICIPALITIES
Sec. 328.001. DEFINITIONS. In this chapter:
(1) "Transit development district" means the
territory of one or more authorizing municipalities of a
transportation development corporation created under Chapter 508,
Local Government Code.
(2) "Transit sales and use tax" means a sales and use
tax imposed for the support of a transit development district or for
the support of transportation services authorized under the
Transportation Code.
Sec. 328.002. APPLICABILITY OF CHAPTER. This chapter
applies only to a transit development district located in a county:
(1) with a population of 1.4 million or more but less
than 3.4 million; or
(2) adjacent to a county with a population of 1.4
million or more but less than 3.4 million.
Sec. 328.003. TRANSIT SALES AND USE TAX NOT COUNTED IN
COMBINED LOCAL TAX RATE. Notwithstanding any other law, the rate of
a transit sales and use tax imposed within the territory of a
transit development district to which this chapter applies or a
municipality that is included within the boundaries of a rapid
transit authority created under Chapter 451 or 452, Transportation
Code, may not be considered in determining the combined or
overlapping rate of local sales and use taxes in the district for
any purpose other than as provided in Section 328.004.
Sec. 328.004. LIMITATION FOR TRANSIT SALES AND USE TAXES.
Notwithstanding any other law, the rate of all transit sales and
use taxes imposed within the territory of a transportation
development district to which this chapter applies or a
municipality that is included within the boundaries of a rapid
transit authority created under Chapter 451 or 452, Transportation
Code, may not exceed one percent at any location in the district.
SECTION 3. Sections 321.101(b) and (e), Tax Code, are
amended to read as follows:
(b) A municipality that is not disqualified may, by a
majority vote of the qualified voters of the municipality voting at
an election held for that purpose, adopt an additional sales and use
tax for the benefit of the municipality in accordance with this
chapter. A municipality, other than a municipality included in a
transportation development district to which Chapter 328 applies,
is disqualified from adopting the additional sales and use tax if
the municipality:
(1) is included within the boundaries of a rapid
transit authority created under Chapter 451, Transportation Code;
(2) is included within the boundaries of a regional
transportation authority created under Chapter 452, Transportation
Code, by a principal municipality having a population of less than
800,000, unless the municipality has a population of 400,000 or
more and is located in more than one county;
(3) is wholly or partly located in a county that
contains territory within the boundaries of a regional
transportation authority created under Chapter 452, Transportation
Code, by a principal municipality having a population in excess of
800,000, unless:
(A) the municipality is a contiguous
municipality; or
(B) the municipality is not included within the
boundaries of the authority and is located wholly or partly in a
county in which fewer than 250 persons are residents of both the
county and the authority according to the most recent federal
census; or
(C) the municipality is not and on January 1,
1993, was not included within the boundaries of the authority; or
(4) imposes a tax authorized by Chapter 453,
Transportation Code.
(e) An authority created under Chapter 451 or 452,
Transportation Code, is prohibited from imposing the tax provided
for by those chapters if within the boundaries of the authority
there is a municipality, other than a municipality included in a
transportation development district to which Chapter 328 applies,
that has adopted the additional sales and use tax provided for by
this section.
SECTION 4. This Act takes effect October 1, 2009.