Texas 2009 - 81st Regular

Texas Senate Bill SB2124 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	81R2690 NC-F
2	2	By: West S.B. No. 2124
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to public improvement districts designated by a county or
8	8	municipality.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 372.017(b), Local Government Code, is
11	11	amended to read as follows:
12	12	(b) After all objections have been heard and the governing
13	13	body has passed on the objections, the governing body by ordinance
14	14	or order shall levy the assessment as a special assessment on the
15	15	property. The governing body by ordinance or order shall specify
16	16	the method of payment of the assessment. The governing body may
17	17	provide that assessments be paid in periodic installments, at an
18	18	interest rate and for a period approved by the governing body. The
19	19	provision that assessments be paid in periodic installments may,
20	20	but is not required to, result in level annual installment
21	21	payments. The installments must be in amounts necessary to meet
22	22	annual costs for improvements and must continue for:
23	23	(1) the [a] period necessary to retire the
24	24	indebtedness on the improvements; or
25	25	(2) the period approved by the governing body for the
26	26	payment of the installments.
27	27	SECTION 2. Section 372.018, Local Government Code, is
28	28	amended to read as follows:
29	29	Sec. 372.018. INTEREST ON ASSESSMENT; LIEN. (a) An
30	30	assessment bears interest at the rate specified by the governing
31	31	body of the municipality or county beginning at the time or times or
32	32	on the occurrence of one or more events specified by the governing
33	33	body. If general obligation bonds, revenue bonds, time warrants,
34	34	or temporary notes are issued to finance the improvement for which
35	35	the assessment is assessed, the interest rate for that assessment
36	36	[, but] may not exceed a rate that is one-half of one percent higher
37	37	than the actual interest rate paid on the [public] debt [used to
38	38	finance the improvement]. Interest on the assessment between the
39	39	effective date of the ordinance or order levying the assessment and
40	40	the date the first installment is payable shall be added to the
41	41	first installment. The interest on any delinquent installment
42	42	shall be added to each subsequent installment until all delinquent
43	43	installments are paid.
44	44	(b) An assessment or reassessment, with interest, the
45	45	expense of collection, and reasonable attorney's fees, if incurred,
46	46	is:
47	47	(1) a first and prior lien against the property
48	48	assessed;
49	49	(2)[,] superior to all other liens and claims except
50	50	liens or claims for state, county, school district, or municipality
51	51	ad valorem taxes;[,] and
52	52	(3) [is] a personal liability of and charge against the
53	53	owners of the property regardless of whether the owners are named.
54	54	(c) The lien is effective from the date of the ordinance or
55	55	order levying the assessment until the assessment is paid.
56	56	(d) The lien runs with the land and that portion of an
57	57	assessment payment that has not yet come due is not eliminated by
58	58	foreclosure of an ad valorem tax lien.
59	59	(e) The assessment lien [and] may be enforced by the
60	60	governing body in the same manner that an ad valorem tax lien
61	61	against real property may be enforced by the governing body.
62	62	Foreclosure of accrued installments does not eliminate the
63	63	outstanding principal balance of the assessment. Any purchaser of
64	64	the property in foreclosure takes the property subject to the
65	65	assessment lien and any associated obligations.
66	66	(f) Delinquent installments of the assessment shall incur
67	67	interest, penalties, and attorney's fees in the same manner as
68	68	delinquent ad valorem taxes. The owner of assessed property may pay
69	69	at any time all or any part of the [entire] assessment, with
70	70	interest that has accrued on the assessment, on any lot or parcel.
71	71	SECTION 3. Section 372.022, Local Government Code, is
72	72	amended to read as follows:
73	73	Sec. 372.022. SEPARATE FUNDS. A separate public
74	74	improvement district fund may [shall] be created in the municipal
75	75	or county treasury for each district. Proceeds from the sale of
76	76	bonds, temporary notes, and time warrants, and other sums
77	77	appropriated to the fund by the governing body of the municipality
78	78	or county shall be credited to the fund. The fund may be used solely
79	79	to pay costs incurred in making an improvement. When an improvement
80	80	is completed, the balance of the part of the assessment that is for
81	81	improvements shall be transferred to the fund established for the
82	82	retirement of bonds.
83	83	SECTION 4. Section 372.023, Local Government Code, is
84	84	amended by amending Subsections (d), (e), (f), and (g) and adding
85	85	Subsection (h) to read as follows:
86	86	(d) A cost payable from a special assessment that is to be
87	87	paid in installments and a cost payable by the municipality or
88	88	county as a whole but not payable from available general funds or
89	89	other available general improvement funds shall be paid:
90	90	(1) under an installment sale contract or a
91	91	reimbursement agreement with the person who contracts to install or
92	92	construct the improvement for which the costs apply;
93	93	(2) as provided by a temporary note or time warrant
94	94	issued by the municipality or county to reimburse a person for money
95	95	advanced or work performed in connection with an improvement; or
96	96	(3) by the issuance and sale of revenue or general
97	97	obligation bonds.
98	98	(e) The net effective interest rate, as computed for a
99	99	public security under Section 1204.005, Government Code, on money
100	100	owed or paid under Subsection (d) may not exceed one-half of one
101	101	percent above the highest average interest rate reported by a
102	102	newspaper in a weekly bond index in the month before the date of the
103	103	contract or agreement or the issuance of the bond, temporary note,
104	104	or time warrant. The newspaper must specialize in bonds and be
105	105	acceptable as a reliable source for bond interest rates to the
106	106	governing body of the municipality or county that enters into the
107	107	contract or agreement or that issues the bond, temporary note, or
108	108	time warrant.
109	109	(f) [(e)] While an improvement is in progress, the governing
110	110	body of the municipality or county, to pay the costs of the
111	111	improvement, may issue temporary notes for money advanced or time
112	112	warrants to pay for work performed in connection with [the costs of]
113	113	the improvement and, on completion of the improvement, issue
114	114	revenue or general obligation bonds. The bond proceeds may be used
115	115	to repay the obligations incurred under this subsection.
116	116	(g) [(f)] The cost of more than one improvement may be paid:
117	117	(1) from a single issue and sale of bonds without other
118	118	consolidation proceedings before the bond issue; or
119	119	(2) under an agreement with a person who contracts to
120	120	install or construct the improvement and who sells the improvement
121	121	to the municipality or county.
122	122	(h) [(g)] The costs of any improvement include interest
123	123	payable on a temporary note or time warrant and all costs incurred
124	124	in connection with the issuance of bonds under Section 372.024 and
125	125	may be included in the assessments against the property in the
126	126	improvement district as provided by this subchapter.
127	127	SECTION 5. Section 372.026, Local Government Code, is
128	128	amended to read as follows:
129	129	Sec. 372.026. PLEDGES. (a) In this section, "obligation"
130	130	means bonds, temporary notes, time warrants, or an obligation under
131	131	an installment sale contract or reimbursement agreement.
132	132	(b) For the payment of obligations [bonds] issued or agreed
133	133	to under this subchapter and the payment of principal, interest,
134	134	and any other amounts required or permitted in connection with the
135	135	obligations [bonds], the governing body of the municipality or
136	136	county may pledge all or part of the income from improvements
137	137	financed under this subchapter, including income received in
138	138	installment payments under Section 372.023.
139	139	(c) [(b)] Pledged income must be fixed and collected in
140	140	amounts sufficient, with other pledged resources, to pay principal,
141	141	interest, and other expenses related to the obligations [bonds],
142	142	and to the extent required by the ordinance, [or] order, or
143	143	agreement authorizing the obligations [bonds], to pay for the
144	144	operation, maintenance, and other expenses related to improvements
145	145	authorized by this subchapter.
146	146	(d) [(c)] The obligations [bonds] may also be secured by
147	147	mortgages or deeds of trust on any real property related to the
148	148	facilities authorized under this subchapter that are owned or are
149	149	to be acquired by the municipality or county and by chattel
150	150	mortgages, liens, or security interests on any personal property
151	151	appurtenant to that real property. The governing body may
152	152	authorize the execution of trust indentures, mortgages, deeds of
153	153	trust, or other forms of encumbrance [encumbrances] as evidence of
154	154	the indebtedness.
155	155	(e) [(d)] The governing body may pledge to the payment of
156	156	obligations [bonds] all or part of a grant, donation, revenue, or
157	157	income received or to be received from the government of the United
158	158	States or any other public or private source, whether or not it is
159	159	received pursuant to an agreement or otherwise.
160	160	(f) The governing body may enter into an agreement with a
161	161	corporation created by the municipality or county under the Texas
162	162	Constitution or other law that provides for payment of amounts
163	163	pledged under this section to the corporation to secure
164	164	indebtedness issued by the corporation to finance an improvement
165	165	project, including indebtedness to pay capitalized interest and a
166	166	reserve fund permitted by this subchapter for revenue or general
167	167	obligation bonds issued under this subchapter and indebtedness
168	168	issued to pay the corporation's costs of issuance. In addition, the
169	169	agreement may provide that:
170	170	(1) the corporation is responsible for managing the
171	171	district; or
172	172	(2) title to one or more improvements will be held by
173	173	the corporation.
174	174	SECTION 6. (a) All acts and proceedings related to the
175	175	authorization of any taxes or bonds, including acts and proceedings
176	176	related to an election, by a district created under Subchapter C,
177	177	Chapter 372, Local Government Code, before the effective date of
178	178	this Act are validated, ratified, and confirmed in all respects as
179	179	if the acts and proceedings occurred as authorized by law.
180	180	(b) This section does not apply to any matter that on the
181	181	effective date of this Act:
182	182	(1) is involved in litigation if the litigation
183	183	ultimately results in the matter being held invalid by a final court
184	184	judgment; or
185	185	(2) has been held invalid by a final court judgment.
186	186	SECTION 7. (a) An installment sales contract made or
187	187	attempted to be made by a county or municipality with the party
188	188	constructing an improvement relating to an improvement district is
189	189	validated as of the date the contract was made or attempted to be
190	190	made if the contract:
191	191	(1) was made or attempted to be made before the
192	192	effective date of this Act; and
193	193	(2) complies with Section 372.023, Local Government
194	194	Code, as amended by this Act.
195	195	(b) This section does not apply to any matter that on the
196	196	effective date of this Act:
197	197	(1) is involved in litigation if the litigation
198	198	ultimately results in the matter being held invalid by a final court
199	199	judgment; or
200	200	(2) has been held invalid by a final court judgment.
201	201	SECTION 8. This Act takes effect immediately if it receives
202	202	a vote of two-thirds of all the members elected to each house, as
203	203	provided by Section 39, Article III, Texas Constitution. If this
204	204	Act does not receive the vote necessary for immediate effect, this
205	205	Act takes effect September 1, 2009.