81R15987 AJA-D
By: Coleman H.B. No. 3709
Substitute the following for H.B. No. 3709:
By: Orr C.S.H.B. No. 3709
A BILL TO BE ENTITLED
AN ACT
relating to the exercise of eminent domain power by certain
charitable corporations.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 178 (S.B. 289), Acts of the 56th
Legislature, Regular Session, 1959 (Article 3183b-1, Vernon's
Texas Civil Statutes), is amended by adding Section 7 to read as
follows:
Sec. 7. (a) In this section:
(1) "Associated low-density multifamily residential
housing" means housing that is located in a residential
neighborhood or is shown to be an adjunct, section, or other
integral part of a residential neighborhood, including townhouses,
patio homes, triplexes, quadruplexes, or other low-rise housing of
no more than four stories.
(2) "Blockbusting activity" means an avoidable act or
omission by a medical center condemning entity or the entity's
members that is intended to cause, or foreseeably will cause, a
substantial reduction of residential-use property values in a
residential area, whether in anticipation of sale to the entity or
the entity's members or otherwise, including an act or omission:
(A) having the effect of increasing traffic,
noise, or light intrusion;
(B) involving demolition of improvements or
property; or
(C) allowing improved property to become
blighted.
(3) "Deed-restricted residential subdivision" means a
subdivision, including all of its sections, annexes, extensions, or
other additional associated parcels or tracts, that is governed by
deed restrictions that restrict the property to residential use and
consists of lots for single-family dwellings and associated
low-density multifamily residential housing within the
subdivision.
(4) "Medical center condemning entity" means:
(A) a charitable corporation having the power of
eminent domain under Section 1 of this Act; or
(B) an entity that has the authority to purchase,
lease, or otherwise use or occupy property acquired by a charitable
corporation having the power of eminent domain under Section 1 of
this Act.
(5) "Predominately single-family residential
subdivision or generally recognized residential area" means an area
consisting predominately of single-family dwellings and associated
low-density multifamily residential housing, without regard to
whether the subdivision or area is governed by deed restrictions.
(6) "Property owners' association" means a property
owners' association as defined by Section 202.001, Property Code,
or described by Section 204.004, Property Code.
(7) "Residential litigant" means:
(A) a property owners' association representing
a residential neighborhood affected by acts or omissions regulated
under this section or a residential neighborhood bordering an
affected residential neighborhood;
(B) a special district in which more than 50
percent of the landowners reside in single-family dwellings in the
district; or
(C) any affected residential landowner.
(8) "Residential neighborhood" means:
(A) a deed-restricted residential subdivision;
(B) a predominately single-family residential
subdivision or generally recognized residential area; or
(C) a combination of those subdivisions or areas.
(9) "Single-family dwelling" means:
(A) a lot containing one building designed for
and containing not more than two separate units with facilities for
living, sleeping, cooking, and eating;
(B) a lot on which is located a freestanding
building containing one dwelling unit and a detached secondary
dwelling unit of not more than 900 square feet; or
(C) a building that contains one dwelling unit on
one lot that is connected by a party wall to another building
containing one dwelling unit on an adjacent lot.
(b) A charitable corporation subject to this Act may not:
(1) exercise the power of eminent domain and
condemnation to acquire property in any residential neighborhood;
(2) otherwise acquire property in a residential
neighborhood, directly or through an agent or trustee, for future
use; or
(3) acquire residential property if the value of the
property has been materially diminished by blockbusting activity.
(c) Within a reasonable time on or before September 1, 2010,
a medical center condemning entity that, on September 1, 2009,
holds any property acquired in a residential neighborhood for
future use shall sell the property. Property sold under this
subsection must be made subject to a deed restriction requiring the
property to be restored to the property's former status as a bona
fide single-family dwelling or, if applicable, reintegrated into
its original deed-restricted residential subdivision.
(d) For the purposes of Subsections (b)(2) and (c), property
is acquired for future use if the charitable corporation or a member
of the corporation does not have a plan for the specific, immediate
use of the property. For property acquired on or after September 1,
2009, if substantial construction of permanent medical facilities
designed to deliver health care for the use and benefit of the
public, excluding surface parking not related to the medical
facilities, has not commenced on the property before the second
anniversary of the property's acquisition, the property is
considered to be property acquired for future use. For property
acquired before September 1, 2009, if substantial construction of
permanent medical facilities designed to deliver health care for
the use and benefit of the public, excluding surface parking not
related to the medical facilities, has not commenced on the
property before September 1, 2010, the property is considered to be
property acquired for future use.
(e) A medical center condemning entity or the entity's
members may not purchase property, by private contract or
otherwise, in a residential neighborhood if the property values in
the neighborhood have been substantially diminished by
blockbusting activity.
(f) A medical center condemning entity shall remediate the
effects of parking facilities constructed on property owned by the
entity that was acquired in a residential neighborhood after
January 1, 2004, and that is located within a residential
neighborhood or directly adjacent to a residential neighborhood.
Remediation required by this subsection includes:
(1) the installation of louvers, screens, panels, or
other permanent fixtures that reduce the level of light emitted
from the parking garages to the same level of light emitted from the
windows of offices or hospital facilities of the entity or its
members that were constructed after January 1, 2004;
(2) landscaping with large evergreen trees and
evergreen plants to mitigate, to the maximum practical extent, the
adverse property value impact of the parking facilities on the
adjoining residential neighborhood; and
(3) sound reduction measures to mitigate, to the
maximum practical extent, the noise emitted from the parking
facilities, as well as the noise generated by mechanical systems
erected in conjunction with the parking facilities, on formerly
residential property.
(g) A medical center condemning entity may not challenge the
validity of a deed restriction in a condemnation proceeding or in
contemplation of condemnation.
(h) This section does not limit any right expressly granted
in a residential deed restriction that authorizes an express
waiver, amendment, or variance with respect to the restrictions, as
determined by the relevant property owners' association.
(i) In an action under this section, a court shall:
(1) award litigation costs, including reasonable
attorney's fees, witness fees, court costs, and other reasonable
related expenses, to a residential litigant who:
(A) prevails in a suit seeking relief under this
section, including money damages or equitable, declaratory, or
other relief;
(B) brings an action under this section that
causes or contributes to, directly or indirectly, a beneficial
result to a residential neighborhood or to the public interest,
notwithstanding which party may have prevailed on the merits; or
(C) is required to defend against claims arising
out of actions or communications related to the provisions or
purposes of this section; and
(2) periodically during the pendency of the
litigation, on a showing of hardship, award interim costs of
litigation to residential litigants who are claimants in the
action.
(j) An award of interim litigation costs under Subsection
(i)(2) is final and not subject to repayment.
(k) A court may not award litigation costs against a
residential litigant who asserts a claim relating to or arising
under this section or engages in actions or communications related
to a right created by this section.
(l) Except as provided by Subsection (m), in addition to any
other defense or immunity conferred by law, a residential litigant
is not liable for money damages or subject to injunctive or
declaratory relief based on:
(1) a decision by the residential litigant as an agent
or representative of a property owners' association or a special
district; or
(2) a communication by the residential litigant to a
governmental agency, a public official, or the public information
media relating to a matter reasonably of concern to a governmental
agency or public official, any other person, or the public.
(m) Subsection (l) does not apply if the claimant
establishes by clear and convincing evidence that the decision or
communication of the residential litigant was not made in good
faith.
(n) This section shall be liberally construed to effect its
purposes, which are to:
(1) prevent the abuse of the power of eminent domain by
a charitable corporation subject to this Act;
(2) protect single-family residential neighborhoods;
(3) shield advocates of neighborhood integrity from
economic coercion; and
(4) correct and remediate the effects of the abuse of
condemnation authority used by a charitable corporation under this
Act on or after January 1, 2004.
SECTION 2. This Act takes effect September 1, 2009.