By: West S.B. No. 1234
A BILL TO BE ENTITLED
AN ACT
relating to municipal management districts.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subdivisions (3) and (4), Section 375.003, Local
Government Code, are amended to read as follows:
(3) "Commission" means the Texas Commission on
Environmental Quality [Natural Resource Conservation Commission].
(4) "Disadvantaged business" means:
(A) a corporation formed for the purpose of
making a profit and at least 51 percent of all classes of the shares
of stock or other equitable securities of which are owned by one or
more persons who are socially disadvantaged because of their
identification as members of certain groups that have suffered the
effects of discriminatory practices or similar insidious
circumstances over which they have no control, including black
Americans, Hispanic Americans, women, Asian Pacific Americans, and
American Indians;
(B) a sole proprietorship formed for the purpose
of making a profit that is owned, operated, and controlled
exclusively by one or more persons described by Paragraph (A);
(C) a partnership that is formed for the purpose
of making a profit, in which 51 percent of the assets and interest
in the partnership is owned by one or more persons described by
Paragraph (A), and in which minority or women partners have a
proportionate interest in the control, operation, and management of
the partnership affairs;
(D) a joint venture between minority and women's
group members formed for the purpose of making a profit and the
minority participation in which is based on the sharing of real
economic interest, including equally proportionate control over
management, interest in capital, and interest earnings, other than
a joint venture in which majority group members own or control debt
securities, leasehold interest, management contracts, or other
interests; [or]
(E) a supplier contract between persons
described in Paragraph (A) and a prime contractor in which the
disadvantaged business is directly involved for the manufacture or
distribution of the supplies or materials or otherwise for
warehousing and shipping the supplies; or
(F) a person certified as a disadvantaged
business by:
(i) this state;
(ii) a political subdivision of this state;
or
(iii) a regional planning commission,
council of governments, or similar regional planning agency created
under Chapter 391.
SECTION 2. Subsection (c), Section 375.022, Local
Government Code, is amended to read as follows:
(c) The petition must:
(1) describe the boundaries of the proposed district:
(A) by metes and bounds;
(B) by verifiable landmarks, including a road,
creek, or railroad line; or
(C)[,] if there is a recorded map or plat and
survey of the area, by lot and block number;
(2) state the specific purposes for which the district
will be created;
(3) state the general nature of the work, projects, or
services proposed to be provided, the necessity for those services,
and the costs as estimated by the persons filing the petition;
(4) include a name of the district, which must be
generally descriptive of the location of the district, followed by
"Management District" or "Improvement District";
(5) include a proposed list of initial directors that
includes the directors' experience and initial term of service; and
(6) include a resolution of the governing body of the
municipality in support of the creation of the district.
SECTION 3. Section 375.043, Local Government Code, is
amended to read as follows:
Sec. 375.043. ANNEXATION. A district may annex land as
provided by Section 49.301 and Chapter 54, Water Code, subject to
the approval of the governing body of the municipality.
SECTION 4. Subsection (b), Section 375.044, Local
Government Code, is amended to read as follows:
(b) The board shall call a hearing on the exclusion of land
or other property from the district if a signed petition evidencing
the consent of the owners of a majority of the acreage in the
district, according to the most recent certified tax roll of the
county, is filed [landowner or property owner in the district
files] with the secretary of the board [a written petition]
requesting the hearing before the issuance of bonds.
SECTION 5. Section 375.061, Local Government Code, is
amended to read as follows:
Sec. 375.061. NUMBER OF DIRECTORS; TERMS. A district is
governed by a board of at least five [nine] but not more than 30
directors who serve staggered four-year terms.
SECTION 6. Section 375.071, Local Government Code, is
amended to read as follows:
Sec. 375.071. QUORUM. One-half of the serving directors
constitutes a quorum, and a concurrence of a majority of a quorum of
directors is required for any official action of the district. The
written consent of at least two-thirds of the directors is required
to authorize the levy of assessments, the levy of taxes, the
imposition of impact fees, or the issuance of bonds.
SECTION 7. Section 375.091, Local Government Code, is
amended to read as follows:
Sec. 375.091. GENERAL POWERS OF DISTRICT. [(a)] A
district has the rights, powers, privileges, authority, and
functions conferred by the general law of this state applicable to
conservation and reclamation districts created under Article XVI,
Section 59, of the Texas Constitution, including those conferred by
Chapter 54, Water Code.
[(b) The district may contract and manage its affairs and
funds for any corporate purpose in accordance with Chapter 54,
Water Code.
[(c) The district has all the rights, powers, privileges,
authority, and functions of road districts and road utility
districts created pursuant to Article III, Section 52, of the Texas
Constitution, including the power to levy ad valorem taxes for the
construction, maintenance, and operation of macadamized, graveled,
or paved roads and turnpikes, or in aid thereof. This power
includes the power to levy ad valorem taxes to provide for mass
transit systems in the manner and subject to the limitations
provided in Article III, Section 52, and Article III, Section
52(a), of the Texas Constitution.
[(d) A district has those powers conferred by Chapters 365
and 441, Transportation Code, and the additional rights,
privileges, authority, and functions contained in those chapters.]
SECTION 8. Subchapter E, Chapter 375, Local Government
Code, is amended by adding Sections 375.0921 and 375.0922 to read as
follows:
Sec. 375.0921. AUTHORITY FOR ROAD PROJECTS. (a) Under
Section 52, Article III, Texas Constitution, a district may design,
acquire, construct, finance, issue bonds for, improve, operate,
maintain, and convey to this state, a county, or a municipality for
operation and maintenance macadamized, graveled, or paved roads, or
improvements, including storm drainage, in aid of those roads.
(b) The district may impose ad valorem taxes to provide for
mass transit systems in the manner and subject to the limitations
provided by Section 52, Article III, and Section 52-a, Article III,
Texas Constitution.
Sec. 375.0922. ROAD STANDARDS AND REQUIREMENTS. (a) A
road project must meet all applicable construction standards,
zoning and subdivision requirements, and regulations of each
municipality in whose corporate limits or extraterritorial
jurisdiction the road project is located.
(b) If a road project is not located in the corporate limits
or extraterritorial jurisdiction of a municipality, the road
project must meet all applicable construction standards,
subdivision requirements, and regulations of each county in which
the road project is located.
(c) If the state will maintain and operate the road, the
Texas Transportation Commission must approve the plans and
specifications of the road project.
SECTION 9. Subsection (a), Section 375.097, Local
Government Code, is amended to read as follows:
(a) The board may appoint a hearings examiner to conduct any
hearing called by the board, including a hearing required by
Chapter 395. The hearings examiner may be an employee or contractor
of the district, or a member of the district's board.
SECTION 10. Subchapter E, Chapter 375, Local Government
Code, is amended by adding Section 375.098 to read as follows:
Sec. 375.098. DISTRICT ACT OR PROCEEDING PRESUMED VALID.
(a) A governmental act or proceeding of a district is conclusively
presumed, as of the date it occurred, valid and to have occurred in
accordance with all applicable statutes and rules if:
(1) the third anniversary of the effective date of the
act or proceeding has expired; and
(2) a lawsuit to annul or invalidate the act or
proceeding has not been filed on or before that third anniversary.
(b) This section does not apply to:
(1) an act or proceeding that was void at the time it
occurred;
(2) an act or proceeding that, under a statute of this
state or the United States, was a misdemeanor or felony at the time
the act or proceeding occurred;
(3) a rule that, at the time it was passed, was
preempted by a statute of this state or the United States, including
Section 1.06 or 109.57, Alcoholic Beverage Code; or
(4) a matter that on the effective date of this
section:
(A) is involved in litigation if the litigation
ultimately results in the matter being held invalid by a final
judgment of a court; or
(B) has been held invalid by a final judgment of a
court.
SECTION 11. Section 375.114, Local Government Code, is
amended to read as follows:
Sec. 375.114. PETITION REQUIRED. The board may not finance
services and improvement projects under this chapter unless a
written petition has been filed with the board requesting those
improvements or services signed by:
(1) the owners of 50 percent or more of the assessed
value of the property in the district subject to assessment,
according to [as determined from] the most recent certified county
property tax rolls; or
(2) the owners of 50 percent or more of the surface
area of the district, excluding roads, streets, highways, and
utility rights-of-way, other public areas, and any other property
exempt from assessment under Section 375.162 or 375.163, according
to [as determined from] the most recent certified county property
tax rolls.
SECTION 12. Subsection (e), Section 375.202, Local
Government Code, is amended to read as follows:
(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 improvement 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, to pay costs associated with the issuance of
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.
SECTION 13. Subsection (a), Section 375.205, Local
Government Code, is amended to read as follows:
(a) The district shall submit bonds and the appropriate
proceedings authorizing their issuance to the attorney general for
examination. This subsection applies only to bonds that are public
securities, as that term is defined by Section 1202.001, Government
Code.
SECTION 14. Subchapter J, Chapter 375, Local Government
Code, is amended by adding Section 375.209 to read as follows:
Sec. 375.209. TAXES FOR BONDS. At the time the district
issues bonds payable wholly or partly from ad valorem taxes, the
board shall provide for the annual imposition of a continuing
direct annual ad valorem tax, without limit as to rate or amount,
while all or part of the bonds are outstanding as required and in
the manner provided by Sections 54.601 and 54.602, Water Code.
SECTION 15. Section 375.221, Local Government Code, is
amended to read as follows:
Sec. 375.221. APPLICABILITY OF WATER DISTRICTS LAW TO
COMPETITIVE BIDDING ON CERTAIN [PUBLIC WORKS] CONTRACTS.
(a) Except as provided by Subsection (b) of this section,
Subchapter I, Chapter 49, Water Code, applies to a district
contract for construction work, equipment, materials, or
machinery.
(b) [A contract, other than a contract for services, for
more than $50,000 for the construction of improvements or the
purchase of material, machinery, equipment, supplies, and other
property, except real property, may be entered into only after
competitive bids. Notice of the contract for the purpose of
soliciting bids shall be published once a week for two consecutive
weeks in a newspaper with general circulation in the area in which
the district is located. The first publication of notice must be
not later than the 14th day before the date set for receiving bids.]
The board may adopt rules governing receipt of bids and the award of
the contract and providing for the waiver of the competitive bid
requirement if:
(1) there is an emergency;
(2) the needed materials are available from only one
source;
(3) in a procurement requiring design by the supplier
competitive bidding would not be appropriate and competitive
negotiation, with proposals solicited from an adequate number of
qualified sources, would permit reasonable competition consistent
with the nature and requirements of the procurement; or
(4) after solicitation, it is ascertained that there
will be only one bidder.
[(b) If a proposed contract for works, plant improvements,
facilities other than land, or the purchase of equipment,
appliances, materials, or supplies is for an estimated amount of
more than $50,000 or for a duration of more than two years,
competitive sealed proposals shall be asked from at least three
persons.]
SECTION 16. Subsection (a), Section 375.263, Local
Government Code, is amended to read as follows:
(a) The [Except as limited by Section 375.264, the]
governing body of a municipality in which a district is wholly
located, by a vote of not less than two-thirds of its membership,
may adopt an ordinance dissolving the district.
SECTION 17. Section 375.264, Local Government Code, is
amended to read as follows:
Sec. 375.264. LIMITATION ON DISSOLUTION BY BOARD. A
district may not be dissolved by its board [or by a municipality] 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 18. Subchapter N, Chapter 375, Local Government
Code, is amended by adding Section 375.282 to read as follows:
Sec. 375.282. STRATEGIC PARTNERSHIP AGREEMENT. A district
with territory in the extraterritorial jurisdiction of a
municipality may negotiate and enter into a written strategic
partnership with the municipality under Section 43.0751.
SECTION 19. Sections 375.021 and 375.027 and Subsection
(f), Section 375.064, Local Government Code, are repealed.
SECTION 20. The change in law made by this Act to Section
375.221, Local Government Code, applies only to a contract awarded
on or after January 1, 2012. A contract awarded before January 1,
2012, is governed by the law in effect on the date the contract was
awarded, and that law is continued in effect for that purpose.
SECTION 21. This Act takes effect September 1, 2011.