Texas 2013 - 83rd Regular

Texas House Bill HB1912 Compare Versions

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1	1	83R22401 PAM-D
2	2	By: Elkins H.B. No. 1912
3	3	Substitute the following for H.B. No. 1912:
4	4	By: Thompson of Brazoria C.S.H.B. No. 1912
5	5
6	6
7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to public improvement districts designated by a
10	10	municipality or county; authorizing assessments.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. Section 372.0015, Local Government Code, is
13	13	amended to read as follows:
14	14	Sec. 372.0015. DEFINITIONS [DEFINITION]. In this
15	15	subchapter:
16	16	(1) "Costs" means costs and expenses paid or incurred
17	17	before, during, or after the establishment of a public improvement
18	18	district and in connection with or related to the undertaking and
19	19	funding of a public improvement project authorized under this
20	20	subchapter.
21	21	(2) "Extraterritorial[, "extraterritorial]
22	22	jurisdiction" means extraterritorial jurisdiction as determined
23	23	under Chapter 42.
24	24	SECTION 2. Subchapter A, Chapter 372, Local Government
25	25	Code, is amended by adding Section 372.0025 to read as follows:
26	26	Sec. 372.0025. PUBLIC IMPROVEMENT DISTRICT. A public
27	27	improvement district is an area, the boundaries of which are
28	28	designated by the governing body of a municipality or county under
29	29	this subchapter, that may include two or more noncontiguous areas
30	30	separated by:
31	31	(1) a right-of-way or other land dedicated to or
32	32	owned, leased, licensed, or used by a political subdivision or
33	33	other governmental entity, tax-exempt entity, charitable
34	34	organization, public or private utility, or railroad; or
35	35	(2) not more than 2,500 feet, as measured in a straight
36	36	line, between the nearest points on the property lines of the
37	37	closest situated noncontiguous areas.
38	38	SECTION 3. Section 372.003, Local Government Code, is
39	39	amended by amending Subsections (a), (b), (b-1), and (c) and adding
40	40	Subsections (b-2) and (e) to read as follows:
41	41	(a) If the governing body of a municipality or county finds
42	42	that it promotes the interests of the municipality or county, the
43	43	governing body may undertake an improvement project that confers a
44	44	special benefit on a definable part of the municipality or county or
45	45	the municipality's extraterritorial jurisdiction. A project may be
46	46	undertaken in the municipality or county or the municipality's
47	47	extraterritorial jurisdiction. A project may be undertaken inside
48	48	or outside a public improvement district if the project confers a
49	49	special benefit on property in the district.
50	50	(b) A public improvement project may include:
51	51	(1) landscaping;
52	52	(2) erection of fountains, distinctive lighting, and
53	53	signs;
54	54	(3) acquiring, constructing, improving, widening,
55	55	narrowing, closing, or rerouting of sidewalks or of streets, any
56	56	other roadways, or their rights-of-way;
57	57	(4) construction or improvement of pedestrian malls;
58	58	(5) acquisition and installation of pieces of art;
59	59	(6) acquisition, construction, or improvement of
60	60	libraries;
61	61	(7) acquisition, construction, or improvement of
62	62	off-street parking facilities;
63	63	(8) acquisition, construction, improvement, or
64	64	rerouting of mass transportation or rail facilities;
65	65	(9) acquisition, construction, or improvement of
66	66	water, wastewater, or drainage facilities or improvements;
67	67	(10) the right to receive water, wastewater, or
68	68	drainage services, the right to acquire a certificate of
69	69	convenience and necessity to provide those services, and the
70	70	obligation to pay service-related costs and expenses, including tap
71	71	fees, connection fees, and impact fees authorized by law, including
72	72	impact fees authorized by Chapter 395;
73	73	(11) the establishment or improvement of parks, open
74	74	spaces, and recreation facilities;
75	75	(12) facilities or equipment for firefighters,
76	76	police, sheriffs, and emergency service providers;
77	77	(13) [(11)] projects similar to those listed in
78	78	Subdivisions (1)-(11) [(1)-(10)];
79	79	(14) [(12)] acquisition, by purchase or otherwise, of
80	80	real property in connection with an authorized improvement;
81	81	(15) [(13)] special supplemental services for
82	82	improvement and promotion of the district, including services
83	83	relating to:
84	84	(A) advertising;
85	85	(B) [,] promotion;
86	86	(C) [,] health and sanitation;
87	87	(D) [,] water and wastewater;
88	88	(E) firefighters, police, sheriffs, emergency
89	89	service providers, and other public safety and[,] security
90	90	personnel;
91	91	(F) [,] business recruitment;
92	92	(G) [,] development;
93	93	(H) [,] recreation;[,] and
94	94	(I) cultural enhancement;
95	95	(16) [(14)] payment of expenses incurred in the
96	96	establishment, administration, and operation of the district; and
97	97	(17) [(15)] the development, rehabilitation, or
98	98	expansion of affordable housing.
99	99	(b-1) Payment of expenses under Subsection (b)(16)
100	100	[(b)(14)] may also include expenses related to the operation and
101	101	maintenance of mass transportation or rail facilities.
102	102	(b-2) A special supplemental service under Subsection
103	103	(b)(15) includes services provided by another entity under contract
104	104	with that entity.
105	105	(c) A public improvement project may be limited to the
106	106	provision of the services described by Subsection (b)(15)
107	107	[(b)(13)].
108	108	(e) A public improvement project may be dedicated,
109	109	conveyed, leased, or otherwise provided to or for the benefit of:
110	110	(1) a municipality or county;
111	111	(2) a political subdivision or other entity exercising
112	112	the powers granted under this subchapter as authorized by other
113	113	law; or
114	114	(3) an entity that:
115	115	(A) is approved by the governing body of an
116	116	entity described by Subdivision (1) or (2); and
117	117	(B) is authorized by order, ordinance,
118	118	resolution, or other official action to act for an entity described
119	119	by Subdivision (1) or (2).
120	120	SECTION 4. Section 372.009, Local Government Code, is
121	121	amended by amending Subsections (b) and (d) and adding Subsection
122	122	(c-1) to read as follows:
123	123	(b) The hearing may be adjourned and reconvened from time to
124	124	time until the governing body makes findings by resolution as to:
125	125	(1) the advisability of the improvement;
126	126	(2) the nature of the improvement;
127	127	(3) the estimated cost of the improvement;
128	128	(4) the boundaries of the public improvement district;
129	129	(5) the method of assessment; and
130	130	(6) the apportionment of costs between the district
131	131	and the municipality or county as a whole.
132	132	(c-1) For purposes of Subsection (c)(4), the boundaries of
133	133	the proposed assessment district may be described in the notice by
134	134	reference to existing streets, roads, and other landmarks with a
135	135	statement providing the location where the metes and bounds
136	136	description of the boundaries of the proposed district are on file
137	137	and available for public inspection.
138	138	(d) Written notice containing the information required by
139	139	Subsection (c) must be mailed before the 15th day before the date of
140	140	the hearing. The notice may [must] be addressed to "Property Owner"
141	141	and sent by regular mail [mailed] to the current address of the
142	142	owner, as reflected on tax rolls, of property subject to assessment
143	143	under the proposed public improvement district. The failure of the
144	144	property owner to receive the notice does not invalidate the
145	145	proceedings under this subchapter.
146	146	SECTION 5. Section 372.010, Local Government Code, is
147	147	amended by amending Subsections (b) and (c) and adding Subsections
148	148	(d) and (e) to read as follows:
149	149	(b) An authorization takes effect when a substantial copy of
150	150	the resolution or a caption of the resolution [it] has been
151	151	published one time in a newspaper of general circulation in the
152	152	municipality or county. If any part of the improvement district is
153	153	located in the municipality's extraterritorial jurisdiction or if
154	154	any part of the improvements is to be undertaken in the
155	155	municipality's extraterritorial jurisdiction, the authorization
156	156	does not take effect until the notice is also given one time in a
157	157	newspaper of general circulation in the part of the
158	158	extraterritorial jurisdiction in which the district is located or
159	159	in which the improvements are to be undertaken.
160	160	(c) Actual construction of an improvement may not begin, or
161	161	the acquisition of an existing improvement may not occur, until
162	162	after the 20th day after the date the authorization takes effect.
163	163	Construction [and] may not begin, or the acquisition may not occur,
164	164	if during that 20-day period written protests signed by at least
165	165	two-thirds of the owners of record of property within the
166	166	improvement district or by the owners of record of property
167	167	comprising at least two-thirds of the total area of the district are
168	168	filed with the municipal secretary or county clerk [secretary] or
169	169	other officer performing the duties of the municipal secretary or
170	170	county clerk [secretary]. A person whose name appears on a protest
171	171	may withdraw the name from the protest at any time before the
172	172	governing body of the municipality or county convenes to determine
173	173	the sufficiency of the protest.
174	174	(d) If construction of an improvement begins before the
175	175	expiration of the 20-day period provided by Subsection (c) or
176	176	before the district is authorized, the improvement is considered an
177	177	existing improvement and must be acquired as an existing
178	178	improvement after construction is completed unless the 20-day
179	179	period is waived as provided by Subsection (e).
180	180	(e) The 20-day waiting period provided by Subsection (c) may
181	181	be waived at any time if a written waiver is filed with the
182	182	municipal secretary or county clerk signed by at least two-thirds
183	183	of the owners of record of property within the improvement district
184	184	or by the owners of record of property comprising at least
185	185	two-thirds of the total area of the district.
186	186	SECTION 6. Section 372.011, Local Government Code, is
187	187	amended to read as follows:
188	188	Sec. 372.011. DISSOLUTION. (a) A public hearing may be
189	189	called and held in the same manner as a hearing under Section
190	190	372.009 for the purpose of dissolving a district if a petition
191	191	requesting dissolution is filed and the petition contains the
192	192	signatures of at least enough property owners in the district to
193	193	make a petition sufficient under Section 372.005(b). If the
194	194	district is dissolved, the district nonetheless shall remain in
195	195	effect for the purpose of meeting obligations of indebtedness for
196	196	improvements.
197	197	(b) A district may be dissolved by resolution or order
198	198	approved by two-thirds of all the members of the governing body of
199	199	the municipality or county that established the district without a
200	200	petition requesting dissolution under Subsection (a) if:
201	201	(1) assessments have not been levied before the fifth
202	202	anniversary of the date the district was established; or
203	203	(2) levied assessments are paid in full and the
204	204	district has no other outstanding obligations.
205	205	(c) Before a district may be dissolved as provided by
206	206	Subsection (b):
207	207	(1) a public hearing must be called and held in the
208	208	same manner as a hearing under Section 372.009; and
209	209	(2) notice of dissolution must be mailed to each owner
210	210	of property within the district.
211	211	SECTION 7. Section 372.012, Local Government Code, is
212	212	amended to read as follows:
213	213	Sec. 372.012. AREA OF DISTRICT. (a) The area of a public
214	214	improvement district to be assessed according to the findings of
215	215	the governing body of the municipality or county may be less than
216	216	the area described in the proposed boundaries stated by the notice
217	217	under Section 372.009. Except as provided by this section, the
218	218	[The] area to be assessed may not include property not described by
219	219	the notice as being within the proposed boundaries of the district
220	220	unless a hearing is held to include the property and notice for the
221	221	hearing is given in the same manner as notice under Section 372.009.
222	222	(b) After the district is authorized and before the levy of
223	223	assessments, the governing body of a municipality or county may
224	224	exclude all or any portion of an owner's property from the district
225	225	if the governing body:
226	226	(1) receives a petition from the owner of property in
227	227	the district;
228	228	(2) publishes notice and holds a public hearing in the
229	229	manner provided by Section 372.009; and
230	230	(3) finds by resolution or order that no public
231	231	improvement project to be undertaken confers a special benefit on
232	232	the property.
233	233	(c) After the district is authorized and before the levy of
234	234	assessments, an owner of property outside the district may petition
235	235	the governing body of the municipality or county to include the
236	236	owner's property in the district. The governing body may:
237	237	(1) include the owner's property in the district if the
238	238	governing body:
239	239	(A) publishes notice and holds a public hearing
240	240	in the manner provided by Section 372.009; and
241	241	(B) finds by resolution or order that a public
242	242	improvement project to be undertaken will confer a special benefit
243	243	on the property; and
244	244	(2) by ordinance or order, levy assessments against
245	245	the owner's property when assessments in the district are levied
246	246	after the governing body publishes notice and holds a public
247	247	hearing in the manner provided by Sections 372.016 and 372.017.
248	248	(d) After the district is authorized and after the levy of
249	249	assessments, an owner of property outside the district may petition
250	250	the governing body of the municipality or county to include the
251	251	owner's property in the district and to levy assessments against
252	252	the owner's property. The governing body may:
253	253	(1) include the owner's property in the district if the
254	254	governing body:
255	255	(A) publishes notice and holds a public hearing
256	256	as provided by Section 372.009; and
257	257	(B) finds by resolution or order that a public
258	258	improvement project to be undertaken will confer a special benefit
259	259	on the property;
260	260	(2) by ordinance or order, levy assessments against
261	261	the owner's property after the governing body publishes notice and
262	262	holds a public hearing in the manner provided by Sections 372.016
263	263	and 372.017; and
264	264	(3) by ordinance or order, reduce assessments against
265	265	the other property in the district to reflect a reallocation of
266	266	costs by the addition of property to the district after the
267	267	governing body publishes notice and holds a public hearing in the
268	268	manner provided by Sections 372.016 and 372.017.
269	269	(e) For purposes of a hearing to exclude or include property
270	270	in a district under Subsection (b), (c), or (d), the governing body
271	271	of a municipality or county shall mail notice to each owner of
272	272	property in the district that is liable for assessment.
273	273	(f) For purposes of Subsections (c) and (d), a commissioners
274	274	court of a county may include in a district an owner's property that
275	275	is located in a home-rule municipality's corporate limits or
276	276	extraterritorial jurisdiction unless within 30 days of the
277	277	commissioners court's action to include the owner's property the
278	278	home-rule municipality objects to the inclusion of the owner's
279	279	property in the district.
280	280	SECTION 8. Section 372.014, Local Government Code, is
281	281	amended by amending Subsection (b) and adding Subsection (c) to
282	282	read as follows:
283	283	(b) The municipality or county is responsible for payment of
284	284	assessments against exempt municipal or county property in the
285	285	district only if payment is expressly authorized by the governing
286	286	body of the municipality or county. Payment of assessments by other
287	287	exempt jurisdictions must be established by contract. An
288	288	assessment paid by the municipality or county under this subsection
289	289	is considered to have been paid by special assessment for the
290	290	purposes of Subsection (a).
291	291	(c) The assessment plan is intended to be flexible to
292	292	provide for various development scenarios, including:
293	293	(1) assessments against all property in the district
294	294	to pay the costs of improvements that benefit all the property in
295	295	the district and additional assessments levied against portions of
296	296	the property in the district to pay the costs of additional
297	297	improvements that benefit those portions of the property; or
298	298	(2) assessments levied to pay the costs for all
299	299	improvements contemplated for one or more phases of development of
300	300	the property with different dates for accrual of interest and for
301	301	payment and collection for the different phases as determined by
302	302	events established by the plan, including events related to the
303	303	future phased development of the property.
304	304	SECTION 9. Section 372.015, Local Government Code, is
305	305	amended by adding Subsections (e) through (h) to read as follows:
306	306	(e) The periodic installment of an assessment payable in
307	307	installments, including principal, interest, administrative costs,
308	308	collection costs, and delinquency charges and penalties, may be
309	309	increased or decreased by the governing body of the municipality or
310	310	county following an annual review of the service plan.
311	311	(f) If a parcel is subdivided, the assessment against the
312	312	parcel before the parcel was subdivided may be reallocated among
313	313	the subdivided parcels by the governing body of the municipality or
314	314	county as reflected in the updated annual service plan and the
315	315	corresponding updated assessment roll.
316	316	(g) If two or more parcels are consolidated, the assessments
317	317	against each parcel may be reallocated to the consolidated parcel
318	318	by the governing body of the municipality or county as reflected in
319	319	the updated annual service plan and the corresponding updated
320	320	assessment roll.
321	321	(h) If a proposed use of an undeveloped parcel changes after
322	322	an assessment is levied against a parcel:
323	323	(1) the change in use does not affect the amount or
324	324	validity of the assessment against the parcel; and
325	325	(2) the aggregate amount of assessments levied against
326	326	multiple undeveloped parcels for which the proposed use has changed
327	327	may be reallocated among the undeveloped parcels by the governing
328	328	body of the municipality or county following an annual review of the
329	329	service plan.
330	330	SECTION 10. Section 372.016, Local Government Code, is
331	331	amended by adding Subsections (b-1) and (d) and amending Subsection
332	332	(c) to read as follows:
333	333	(b-1) For purposes of Subsection (b)(4), the boundaries of
334	334	the assessment district may be described in the notice by reference
335	335	to existing streets, roads, and other landmarks with a statement
336	336	providing the location where the metes and bounds description of
337	337	the boundaries of the district are on file and available for public
338	338	inspection.
339	339	(c) When the assessment roll is filed under Subsection (b),
340	340	the municipal secretary or other officer shall mail to the owners of
341	341	property liable for assessment a notice of the hearing. The notice
342	342	must contain the information required by Subsection (b). The
343	343	notice may be addressed to "Property Owner" and mailed by regular
344	344	mail. The notice must be mailed before the 10th day before the date
345	345	of the hearing to the current [and the secretary or other officer
346	346	shall mail the notice to the last known] address of the [property]
347	347	owner, as reflected on the tax rolls. The failure of a property
348	348	owner to receive notice does not invalidate the proceeding.
349	349	(d) The public hearing required by this section may be
350	350	adjourned and reconvened from time to time.
351	351	SECTION 11. Section 372.017, Local Government Code, is
352	352	amended by adding Subsection (c) to read as follows:
353	353	(c) An assessment levied under this section may vary from
354	354	the proposed service plan, proposed assessment plan, or proposed
355	355	assessment roll filed and made available for public inspection in
356	356	accordance with Section 372.016. The total cost of an assessment
357	357	levied under this section may not exceed the cost of improvements
358	358	provided in the notice as required under Section 372.016(b)(3) and
359	359	mailed to the owners as provided by Section 372.016(c).
360	360	SECTION 12. Section 372.018, Local Government Code, is
361	361	amended by amending Subsections (a) and (f) and adding Subsection
362	362	(g) to read as follows:
363	363	(a) An assessment bears interest at the rate specified by
364	364	the governing body of the municipality or county beginning at the
365	365	time or times or on the occurrence of one or more events specified
366	366	by the governing body. If general obligation bonds, revenue bonds,
367	367	installment sales contracts, reimbursement agreements, time
368	368	warrants, or temporary notes are issued or entered into to finance
369	369	or pay for the improvement for which the assessment is assessed, the
370	370	interest rate for that assessment may not exceed a rate that is
371	371	one-half of one percent higher than the actual interest rate paid on
372	372	the debt. [Interest on the assessment between the effective date of
373	373	the ordinance or order levying the assessment and the date the first
374	374	installment is payable shall be added to the first installment.]
375	375	The interest on any delinquent installment shall be added to each
376	376	subsequent installment until all delinquent installments are paid.
377	377	The added interest may be used to pay administrative costs, costs of
378	378	improvements, and costs of financing, including reserves for debt
379	379	service and prepayment of assessments.
380	380	(f) Delinquent installments of the assessment shall incur
381	381	interest, penalties, and attorney's fees in the same manner as
382	382	delinquent ad valorem taxes.
383	383	(g) The owner of assessed property may pay at any time all or
384	384	any part of the assessment, with interest that:
385	385	(1) has accrued on the assessment; and
386	386	(2) will accrue on the assessment until the next
387	387	scheduled prepayment or redemption date on the bonds, installment
388	388	sales contract, reimbursement agreement, time warrant, or
389	389	temporary note issued or entered into to finance or pay for the
390	390	improvements [, on any lot or parcel].
391	391	SECTION 13. Section 372.024, Local Government Code, is
392	392	amended to read as follows:
393	393	Sec. 372.024. GENERAL OBLIGATION AND REVENUE BONDS;
394	394	CERTIFICATES OF OBLIGATION. (a) The governing body of a
395	395	municipality or county may issue:
396	396	(1) general [General] obligation bonds [issued to pay
397	397	costs under Section 372.023(d) must be issued] under [the
398	398	provisions of] Subtitles A and C, Title 9, Government Code;
399	399	(2) certificates of obligation under Subchapter C,
400	400	Chapter 271; and
401	401	(3) revenue[. Revenue] bonds, issued [to pay costs
402	402	under that subsection may be issued from time to time] in one or
403	403	more series [and are to be payable from and secured by liens on all
404	404	or part of the revenue derived from improvements authorized under
405	405	this subchapter, including revenue derived from installment
406	406	payments of special assessments].
407	407	(b) The bond or obligation may:
408	408	(1) be issued to pay costs;
409	409	(2) be issued to refund any obligations entered into
410	410	or issued under this subchapter, including installment sales
411	411	contracts, reimbursement agreements, time warrants, or temporary
412	412	notes; and
413	413	(3) be payable from and secured by special
414	414	assessments.
415	415	(c) If the bond or obligation is issued for the purpose
416	416	described by Subsection (b)(2) and is secured wholly or partly by a
417	417	special assessment, the lien created by the originally levied
418	418	special assessment continues uninterrupted for the term of the bond
419	419	or obligation to secure payment of the bond or obligation.
420	420	(d) The bond or obligation must be issued or entered into
421	421	under the terms determined by the governing body of the
422	422	municipality or county.
423	423	SECTION 14. Section 372.026, Local Government Code, is
424	424	amended by adding Subsection (g) to read as follows:
425	425	(g) The governing body of a municipality or county may
426	426	pledge all or any part of the revenue collected from assessments as
427	427	security for and to pay all or any part of one or more obligations on
428	428	the terms determined by the governing body, including the priority
429	429	of payment and allocation of assessment revenue among the
430	430	obligations. If an assessment is collected and applied to pay an
431	431	amount due under an installment sales contract, reimbursement
432	432	agreement, time warrant, or temporary note, the governing body of a
433	433	municipality or county may pledge all or any part of the revenue
434	434	collected as security for and to pay general obligation bonds,
435	435	certificates of obligation, or revenue bonds issued to refund those
436	436	obligations. The pledge authorized by this subsection does not:
437	437	(1) affect the lien of that assessment; or
438	438	(2) constitute a reassessment or a new assessment.
439	439	SECTION 15. Subchapter A, Chapter 372, Local Government
440	440	Code, is amended by adding Section 372.031 to read as follows:
441	441	Sec. 372.031. LIABILITY FOR PAYMENT. An assessment levied
442	442	by the governing body of a municipality or county under this
443	443	chapter, or an obligation issued or agreement or contract entered
444	444	into by the governing body of a municipality or county under this
445	445	chapter and payable from and secured, wholly or partly, by that
446	446	assessment, does not constitute a debt or pledge of the full faith
447	447	and credit of the municipality or county, this state, or any other
448	448	political corporation, subdivision, or agency of this state.
449	449	SECTION 16. This Act takes effect immediately if it
450	450	receives a vote of two-thirds of all the members elected to each
451	451	house, as provided by Section 39, Article III, Texas Constitution.
452	452	If this Act does not receive the vote necessary for immediate
453	453	effect, this Act takes effect September 1, 2013.