Texas 2011 - 82nd Regular

Texas House Bill HB563 Compare Versions

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1	1	By: Pickett, et al. (Senate Sponsor - Nichols) H.B. No. 563
2	2	(In the Senate - Received from the House April 4, 2011;
3	3	April 14, 2011, read first time and referred to Committee on
4	4	Transportation and Homeland Security; May 9, 2011, reported
5	5	adversely, with favorable Committee Substitute by the following
6	6	vote: Yeas 9, Nays 0; May 9, 2011, sent to printer.)
7	7	COMMITTEE SUBSTITUTE FOR H.B. No. 563 By: Nichols
8	8
9	9
10	10	A BILL TO BE ENTITLED
11	11	AN ACT
12	12	relating to the purposes and designation of a transportation
13	13	reinvestment zone.
14	14	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
15	15	SECTION 1. Section 222.105, Transportation Code, is amended
16	16	to read as follows:
17	17	Sec. 222.105. PURPOSES. The purposes of Sections 222.106
18	18	and 222.107 are to:
19	19	(1) promote public safety;
20	20	(2) facilitate the improvement, development, or
21	21	redevelopment of property;
22	22	(3) facilitate the movement of traffic; and
23	23	(4) enhance a local entity's ability to sponsor a
24	24	transportation project authorized under Section 222.104.
25	25	SECTION 2. Section 222.106, Transportation Code, is amended
26	26	by amending Subsections (b), (c), (g), (h), (i), (j), (k), and (l)
27	27	and adding Subsections (i-1) and (i-2) to read as follows:
28	28	(b) This section applies only to a municipality in which a
29	29	transportation project is to be developed [the governing body of
30	30	which intends to enter into an agreement with the department] under
31	31	Section 222.104.
32	32	(c) If the governing body determines an area to be
33	33	unproductive and underdeveloped and that action under this section
34	34	will further the purposes stated in Section 222.105, the governing
35	35	body of the municipality by ordinance may designate a contiguous
36	36	geographic area in the jurisdiction of the municipality to be a
37	37	transportation reinvestment zone to promote a transportation
38	38	project [described by Section 222.104 that cultivates development
39	39	or redevelopment of the area].
40	40	(g) The ordinance designating an area as a transportation
41	41	reinvestment zone must:
42	42	(1) describe the boundaries of the zone with
43	43	sufficient definiteness to identify with ordinary and reasonable
44	44	certainty the territory included in the zone;
45	45	(2) provide that the zone takes effect immediately on
46	46	passage of the ordinance and that the base year shall be the year of
47	47	passage of the ordinance or some year in the future;
48	48	(3) assign a name to the zone for identification, with
49	49	the first zone designated by a municipality designated as
50	50	"Transportation Reinvestment Zone Number One, (City or Town, as
51	51	applicable) of (name of municipality)," and subsequently
52	52	designated zones assigned names in the same form, numbered
53	53	consecutively in the order of their designation;
54	54	(4) designate the base year for purposes of
55	55	establishing the tax increment base of the municipality;
56	56	(5) establish a [an ad valorem] tax increment account
57	57	for the zone; and
58	58	(6) [(5)] contain findings that promotion of the
59	59	transportation project will cultivate the improvement,
60	60	development, or redevelopment of the zone.
61	61	(h) From taxes collected on property in a zone, the
62	62	municipality shall pay into the tax increment account for the zone
63	63	[an amount equal to] the tax increment produced by the
64	64	municipality, less any amount allocated under previous agreements,
65	65	including agreements under Chapter 380, Local Government Code, or
66	66	Chapter 311, Tax Code.
67	67	(i) All or the portion specified by the municipality of the
68	68	money deposited to a tax increment account must be used to fund the
69	69	transportation project for which the zone was designated, as well
70	70	as aesthetic improvements within the zone. Any remaining money
71	71	deposited to the tax increment account may be used for other
72	72	purposes as determined by the municipality [Money deposited to a
73	73	tax increment account must be used to fund projects authorized
74	74	under Section 222.104, including the repayment of amounts owed
75	75	under an agreement entered into under that section].
76	76	(i-1) The governing body of a municipality may contract with
77	77	a public or private entity to develop, redevelop, or improve a
78	78	transportation project in a transportation reinvestment zone and
79	79	may pledge and assign all or a specified amount of money in the tax
80	80	increment account to that entity. After a pledge or assignment is
81	81	made, if the entity that received the pledge or assignment has
82	82	itself pledged or assigned that amount to secure bonds or other
83	83	obligations issued to obtain funding for the transportation
84	84	project, the governing body of the municipality may not rescind its
85	85	pledge or assignment until the bonds or other obligations secured
86	86	by the pledge or assignment have been paid or discharged.
87	87	(i-2) To accommodate changes in the limits of the project
88	88	for which a reinvestment zone was designated, the boundaries of a
89	89	zone may be amended at any time, except that property may not be
90	90	removed or excluded from a designated zone if any part of the tax
91	91	increment account has been assigned or pledged directly by the
92	92	municipality or through another entity to secure bonds or other
93	93	obligations issued to obtain funding of the project, and property
94	94	may not be added to a designated zone unless the governing body of
95	95	the municipality complies with Subsections (e) and (g).
96	96	(j) Except as provided by Subsections (i-1) and
97	97	[Subsection] (k), a transportation reinvestment zone terminates on
98	98	December 31 of the year in which the municipality completes
99	99	[complies with] a contractual requirement, if any, that included
100	100	the pledge or assignment of all or a portion of money deposited to a
101	101	tax increment account or the repayment of money owed under an [the]
102	102	agreement for development, redevelopment, or improvement of the
103	103	project for [under Section 222.104 in connection with] which the
104	104	zone was designated.
105	105	(k) A transportation reinvestment zone terminates on
106	106	December 31 of the 10th year after the year the zone was designated,
107	107	if before that date the municipality has not entered into a contract
108	108	described in Subsection (i-1) or otherwise not used the zone for the
109	109	purpose for which it was designated.
110	110	(l) Any surplus remaining in a tax increment account on
111	111	termination of a zone may be used for other purposes as determined
112	112	by [transportation projects of] the municipality [in or outside of
113	113	the zone].
114	114	SECTION 3. The heading to Section 222.107, Transportation
115	115	Code, is amended to read as follows:
116	116	Sec. 222.107. COUNTY TRANSPORTATION REINVESTMENT ZONES[;
117	117	TAX ABATEMENTS; ROAD UTILITY DISTRICTS].
118	118	SECTION 4. Section 222.107, Transportation Code, is amended
119	119	by amending Subsections (b), (c), (e), (f), (h), (i), (k), and (l)
120	120	and adding Subsections (h-1) and (k-1) to read as follows:
121	121	(b) This section applies only to a county in which a
122	122	transportation project is to be developed [the commissioners court
123	123	of which intends to enter into a pass-through toll agreement with
124	124	the department] under Section 222.104.
125	125	(c) The commissioners court of the county, after
126	126	determining that an area is unproductive and underdeveloped and
127	127	that action under this section would further the purposes described
128	128	by Section 222.105, by order or resolution may designate a
129	129	contiguous geographic area in the jurisdiction of the county to be a
130	130	transportation reinvestment zone to promote a transportation
131	131	project [described by Section 222.104 that cultivates development
132	132	or redevelopment of the area] and for the purpose of abating ad
133	133	valorem taxes or granting other relief from taxes imposed by the
134	134	county on real property located in the zone.
135	135	(e) Not later than the 30th day before the date the
136	136	commissioners court proposes to designate an area as a
137	137	transportation reinvestment zone under this section, the
138	138	commissioners court must hold a public hearing on the creation of
139	139	the zone, its benefits to the county and to property in the proposed
140	140	zone, and the abatement of ad valorem taxes or the grant of other
141	141	relief from ad valorem taxes imposed by the county on real property
142	142	located in the zone. At the hearing an interested person may speak
143	143	for or against the designation of the zone, its boundaries, or the
144	144	abatement of or the relief from county taxes on real property in the
145	145	zone. Not later than the seventh day before the date of the
146	146	hearing, notice of the hearing and the intent to create a zone must
147	147	be published in a newspaper having general circulation in the
148	148	county.
149	149	(f) The order or resolution designating an area as a
150	150	transportation reinvestment zone must:
151	151	(1) describe the boundaries of the zone with
152	152	sufficient definiteness to identify with ordinary and reasonable
153	153	certainty the territory included in the zone;
154	154	(2) provide that the zone takes effect immediately on
155	155	adoption of the order or resolution and that the base year shall be
156	156	the year of passage of the order or resolution or some year in the
157	157	future; [and]
158	158	(3) assign a name to the zone for identification, with
159	159	the first zone designated by a county designated as "Transportation
160	160	Reinvestment Zone Number One, County of (name of county)," and
161	161	subsequently designated zones assigned names in the same form
162	162	numbered consecutively in the order of their designation; and
163	163	(4) designate the base year for purposes of
164	164	establishing the tax increment base of the county.
165	165	(h) The commissioners court by order or resolution may enter
166	166	into an agreement with the owner of any real property located in the
167	167	transportation reinvestment zone to abate all or a portion of the ad
168	168	valorem taxes or to grant other relief from the taxes imposed by the
169	169	county on the owner's property in an amount not to exceed the amount
170	170	calculated under Subsection (a)(1) for that year. All abatements
171	171	or other relief granted by the commissioners court in a
172	172	transportation reinvestment zone must be equal in rate. In the
173	173	alternative, the commissioners court by order or resolution may
174	174	elect to abate a portion of the ad valorem taxes or otherwise grant
175	175	relief from the taxes imposed by the county on all real property
176	176	located in the zone. In any ad valorem tax year, the total amount of
177	177	the taxes abated or the total amount of relief granted under this
178	178	section may not exceed the amount calculated under Subsection
179	179	(a)(1) for that year, less any amounts allocated under previous
180	180	agreements, including agreements under Chapter 381, Local
181	181	Government Code, or Chapter 312, Tax Code.
182	182	(h-1) To further the development of the transportation
183	183	project for which the transportation reinvestment zone was
184	184	designated, a county may assess all or part of the cost of the
185	185	transportation project against property within the zone. The
186	186	assessment against each property in the zone may be levied and
187	187	payable in installments in the same manner as provided by Sections
188	188	372.016-372.018, Local Government Code, provided that the
189	189	installments do not exceed the total amount of the tax abatement or
190	190	other relief granted under Subsection (h). The county may elect to
191	191	adopt and apply the provisions of Sections 372.015-372.020 and
192	192	372.023, Local Government Code, to the assessment of costs and
193	193	Sections 372.024-372.030, Local Government Code, to the issuance of
194	194	bonds by the county to pay the cost of a transportation project.
195	195	The commissioners court of the county may contract with a public or
196	196	private entity to develop, redevelop, or improve a transportation
197	197	project in the transportation reinvestment zone, including
198	198	aesthetic improvements, and may pledge and assign to that entity
199	199	all or a specified amount of the revenue the county receives from
200	200	installment payments of the assessments for the payment of the
201	201	costs of that transportation project. After a pledge or assignment
202	202	is made, if the entity that received the pledge or assignment has
203	203	itself pledged or assigned that amount to secure bonds or other
204	204	obligations issued to obtain funding for the transportation
205	205	project, the commissioners court of the county may not rescind its
206	206	pledge or assignment until the bonds or other obligations secured
207	207	by the pledge or assignment have been paid or discharged. Any
208	208	amount received from installment payments of the assessments not
209	209	pledged or assigned in connection with the transportation project
210	210	may be used for other purposes associated with the transportation
211	211	project or in the zone.
212	212	(i) In the alternative, to [To] assist the county in
213	213	developing a transportation project [authorized under Section
214	214	222.104], if authorized by the commission under Chapter 441, a road
215	215	utility district may be formed under that chapter that has the same
216	216	boundaries as a transportation reinvestment zone created under this
217	217	section.
218	218	(k) A road utility district formed as provided by Subsection
219	219	(i) may enter into an agreement [with the county to assume the
220	220	obligation, if any, of the county] to fund development of a project
221	221	[under Section 222.104] or to repay funds owed to the department
222	222	[under Section 222.104]. Any amount paid for this purpose is
223	223	considered to be an operating expense of the district. Any taxes
224	224	collected by the district that are not paid for this purpose may be
225	225	used for any district purpose.
226	226	(k-1) To accommodate changes in the limits of the project
227	227	for which a reinvestment zone was designated, the boundaries of a
228	228	zone may be amended at any time, except that property may not be
229	229	removed or excluded from a designated zone if any part of the
230	230	assessment has been assigned or pledged directly by the county or
231	231	through another entity to secure bonds or other obligations issued
232	232	to obtain funding of the project, and property may not be added to a
233	233	designated zone unless the commissioners court of the county
234	234	complies with Subsections (e) and (f).
235	235	(l) Except as provided by Subsection (m), a tax abatement
236	236	agreement entered into under Subsection (h), or an order or
237	237	resolution on the abatement of taxes or the grant of relief from
238	238	taxes under that subsection, terminates on December 31 of the year
239	239	in which the county completes any contractual requirement that
240	240	included the pledge or assignment of assessments [of money]
241	241	collected under this section.
242	242	SECTION 5. Subchapter E, Chapter 222, Transportation Code,
243	243	is amended by adding Sections 222.108, 222.109, and 222.110 to read
244	244	as follows:
245	245	Sec. 222.108. TRANSPORTATION REINVESTMENT ZONES FOR OTHER
246	246	TRANSPORTATION PROJECTS. (a) Notwithstanding the requirement in
247	247	Sections 222.106(b) and 222.107(b) that a transportation
248	248	reinvestment zone be established in connection with a project under
249	249	Section 222.104, a municipality or county may establish a
250	250	transportation reinvestment zone for any transportation project.
251	251	If all or part of the transportation project is subject to oversight
252	252	by the department, at the option of the governing body of the
253	253	municipality or county, the department, to the extent permitted by
254	254	law, shall delegate full responsibility for the development,
255	255	design, letting of bids, and construction of the project, including
256	256	project inspection, to the municipality or county. After assuming
257	257	responsibility for a project under this subsection, a municipality
258	258	or county shall enter into an agreement with the department that
259	259	prescribes:
260	260	(1) the development process;
261	261	(2) the roles and responsibilities of the parties; and
262	262	(3) the timelines for any required reviews or
263	263	approvals.
264	264	(b) Any portion of a transportation project developed under
265	265	Subsection (a) that is on the state highway system or is located in
266	266	the state highway right-of-way must comply with applicable state
267	267	and federal requirements and criteria for project development,
268	268	design, and construction, unless the department grants an exception
269	269	to the municipality or county.
270	270	(c) The development, design, and construction plans and
271	271	specifications for the portions of a project described by
272	272	Subsection (b) must be reviewed and approved by the department
273	273	under the agreement entered into under Subsection (a).
274	274	(d) In this section, "transportation project" has the
275	275	meaning assigned by Section 370.003.
276	276	Sec. 222.109. REDUCTION PROHIBITED. (a) A municipality or
277	277	county may not be penalized with a reduction in traditional
278	278	transportation funding because of the designation and use of a
279	279	transportation reinvestment zone under this chapter. Any funding
280	280	from the department committed to a project before the date that a
281	281	transportation reinvestment zone is designated may not be reduced
282	282	because the transportation reinvestment zone is designated in
283	283	connection with that project.
284	284	(b) The department may not reduce any allocation of
285	285	traditional transportation funding to any of its districts because
286	286	a district contains a municipality or county that contains a
287	287	transportation reinvestment zone designated under this chapter.
288	288	Sec. 222.110. SALES TAX INCREMENT. (a) In this section,
289	289	"sales tax base" for a transportation reinvestment zone means the
290	290	amount of sales and use taxes imposed by a municipality under
291	291	Section 321.101(a), Tax Code, or by a county under Chapter 323, Tax
292	292	Code, as applicable, attributable to the zone for the year in which
293	293	the zone was designated under this chapter.
294	294	(b) The governing body of a municipality or county may
295	295	determine, in an ordinance or order designating an area as a
296	296	transportation reinvestment zone or in an ordinance or order
297	297	adopted subsequent to the designation of a zone, the portion or
298	298	amount of tax increment generated from the sales and use taxes
299	299	imposed by a municipality under Section 321.101(a), Tax Code, or by
300	300	a county under Chapter 323, Tax Code, attributable to the zone,
301	301	above the sales tax base, to be used as provided by Subsection (e).
302	302	Nothing in this section requires a municipality or county to
303	303	contribute sales tax increment under this subsection.
304	304	(c) A county that designates a portion or amount of sales
305	305	tax increment under Subsection (b) must establish a tax increment
306	306	account. A municipality or county shall deposit the designated
307	307	portion or amount of tax increment under Subsection (b) to the
308	308	entity's respective tax increment account.
309	309	(d) Before pledging or otherwise committing money in the tax
310	310	increment account under Subsection (c), the governing body of a
311	311	municipality or county may enter into an agreement, under
312	312	Subchapter E, Chapter 271, Local Government Code, to authorize and
313	313	direct the comptroller to:
314	314	(1) withhold from any payment to which the
315	315	municipality or county may be entitled the amount of the payment
316	316	into the tax increment account under Subsection (b);
317	317	(2) deposit that amount into the tax increment
318	318	account; and
319	319	(3) continue withholding and making additional
320	320	payments into the tax increment account until an amount sufficient
321	321	to satisfy the amount due has been met.
322	322	(e) The sales and use taxes to be deposited into the tax
323	323	increment account under this section may be disbursed from the
324	324	account only to:
325	325	(1) pay for projects authorized under Section 222.104,
326	326	including the repayment of amounts owed under an agreement entered
327	327	into under that section; and
328	328	(2) notwithstanding Sections 321.506 and 323.505, Tax
329	329	Code, satisfy claims of holders of tax increment bonds, notes, or
330	330	other obligations issued or incurred for projects authorized under
331	331	Section 222.104.
332	332	(f) The amount deposited by a county to a tax increment
333	333	account under this section is not considered to be sales and use tax
334	334	revenue for the purpose of property tax reduction and computation
335	335	of the county tax rate under Section 26.041, Tax Code.
336	336	SECTION 6. Sections 222.106(h), (i), (j), (k), and (l) and
337	337	222.107(h), (i), (k), and (l), Transportation Code, as amended by
338	338	this Act, and Sections 222.106(i-1) and (i-2), 222.107(h-1) and
339	339	(k-1), 222.108, and 222.109, Transportation Code, as added by this
340	340	Act, apply to a transportation reinvestment zone that is governed
341	341	by those sections designated before the effective date of this Act.
342	342	SECTION 7. This Act takes effect September 1, 2011.
343	343	* * * * *