Texas 2013 - 83rd Regular

Texas Senate Bill SB619 Compare Versions

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1	1	By: Taylor S.B. No. 619
2	2	(In the Senate - Filed February 18, 2013; February 25, 2013,
3	3	read first time and referred to Committee on Natural Resources;
4	4	May 3, 2013, reported adversely, with favorable Committee
5	5	Substitute by the following vote: Yeas 8, Nays 0; May 3, 2013,
6	6	sent to printer.)
7	7	COMMITTEE SUBSTITUTE FOR S.B. No. 619 By: Estes
8	8
9	9
10	10	A BILL TO BE ENTITLED
11	11	AN ACT
12	12	relating to exclusion of land from certain water districts that
13	13	fail to provide service to the land; clarifying and limiting the
14	14	authority of those districts with outstanding bonds payable from ad
15	15	valorem taxes to impose taxes on excluded land; providing for a
16	16	financial review.
17	17	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
18	18	SECTION 1. Section 49.3076, Water Code, is amended by
19	19	amending Subsections (a), (b), (c), (d), and (f) and adding
20	20	Subsections (c-1) and (g-1) to read as follows:
21	21	(a) The board of a district that has a total area of more
22	22	than 10,000 [5,000] acres shall call a hearing on the exclusion of
23	23	land from the district on or before the 60th day after receiving a
24	24	written petition filed with the secretary of the board by one or
25	25	more owners of [a landowner whose] land more than half the acreage
26	26	of which has been for more than 20 years included in and taxable by
27	27	the district [for more than 28 years] if any bonds issued by the
28	28	district payable in whole or in part from taxes of the district are
29	29	outstanding and the petition:
30	30	(1) is [includes a] signed by [petition evidencing the
31	31	consent of] the owners of a majority of the acreage proposed to be
32	32	excluded, as reflected by the most recent certified tax roll of the
33	33	district;
34	34	(2) includes a claim that the district does [has] not
35	35	provide [provided] the land with retail utility services;
36	36	(3) describes the property to be excluded; and
37	37	(4) provides facts necessary for the board to make the
38	38	findings required by Subsection (b)[; and
39	39	[(5) is filed before August 31, 2007].
40	40	(b) The board of a district shall [may] exclude land under
41	41	this section if [only on finding that]:
42	42	(1) the district does not provide [has never provided]
43	43	retail utility service [services] to the land described by the
44	44	petition;
45	45	(2) the district has imposed a tax on more than half
46	46	the acreage of the land for at least 20 years [more than:
47	47	[(A) 28 years if the board calls a hearing under
48	48	Subsection (a); or
49	49	[(B) 40 years if the board calls a hearing under
50	50	Subsection (a-1)]; and
51	51	(3) all taxes the district has levied and assessed
52	52	against the land and all fees and assessments the district has
53	53	imposed against the land or the owner that are due and payable on or
54	54	before the date of the petition are fully paid.
55	55	(c) Subject to Subsection (c-1), unless [Unless] the
56	56	district presents evidence at the hearing that conclusively
57	57	demonstrates that the requirements and grounds for exclusion
58	58	described by Subsection (a) [or (a-1), as appropriate, and
59	59	Subsection (b)] have not been met, the board shall enter an order
60	60	excluding the land from the district and shall redefine in the order
61	61	the boundaries of the district to embrace all land not excluded.
62	62	(c-1) If on or before the date of the exclusion hearing
63	63	required by Subsection (a) the district and the owner or owners
64	64	enter into an agreement for utility service to the land proposed to
65	65	be excluded, the district is not required to enter an order
66	66	excluding the land from the district. An owner of all or part of the
67	67	land is not required to enter into a utility agreement that as of
68	68	the date of the petition:
69	69	(1) is not comparable economically or in the level of
70	70	service provided to the land to the owner's current source of
71	71	utility service, as may be determined by the owner; or
72	72	(2) does not include all utility services required to
73	73	serve the land.
74	74	(d) A copy of an order excluding land and redefining the
75	75	boundaries of the district shall be filed in the deed records of
76	76	each county in which the district is located and with the
77	77	commission.
78	78	(f) After any land is excluded under this section, the
79	79	district may issue any unissued additional debt approved by the
80	80	voters of the district before exclusion of the land under this
81	81	section without holding a new election. Additional debt issued
82	82	after land is excluded from the district may not be payable from
83	83	taxes levied against and does not create a lien against the taxable
84	84	value of the excluded land.
85	85	(g-1) This section does not apply to a district:
86	86	(1) whose primary activity is the wholesale supply of
87	87	raw water; and
88	88	(2) that has fewer than 500 retail customers.
89	89	SECTION 2. Section 49.3077, Water Code, is amended to read
90	90	as follows:
91	91	Sec. 49.3077. TAX LIABILITY OF EXCLUDED LAND; BONDS
92	92	OUTSTANDING. (a) In this section:
93	93	(1) "Adjusted gross value" means the gross assessed
94	94	value of property, as of January 1, including land, improvements,
95	95	and personal property, as determined by the appraisal district for
96	96	the tax year in which the determination is made, reduced by any
97	97	state-mandated exemptions but not reduced for any exemptions from
98	98	taxation that are within the discretion of the governing body of the
99	99	district.
100	100	(2) "Carry costs" means interest calculated at an
101	101	annual rate equal to the weighted average interest rate of the
102	102	district debt that accrues on the excluded land's share of the
103	103	district debt, with reductions for prior payments, from the later
104	104	of the exclusion date or the last interest payment date for district
105	105	debt for which district taxes have been levied and collected to the
106	106	earlier of:
107	107	(A) the date of the final interest payment on
108	108	district debt before the next delinquency for the district's tax
109	109	collection; or
110	110	(B) the earliest dates on which an aggregate
111	111	amount of district obligations equal to the district debt may be
112	112	paid at maturity or redeemed at the option of the district, provided
113	113	the amount is paid in advance of any future district tax levy, using
114	114	the redemption dates available for the district's outstanding
115	115	obligations as of the exclusion date.
116	116	(3) "District debt" means the principal outstanding
117	117	from time to time of the tax-supported debt of the district
118	118	outstanding on the exclusion date, including debt used to refund
119	119	district debt outstanding on the exclusion date.
120	120	(4) "Excluded land" means land that is excluded from a
121	121	district under Section 49.3076.
122	122	(5) "Excluded land payment" means, with respect to
123	123	excluded land, the sum of the excluded land's share of district debt
124	124	plus the carry costs, less any taxes collected by the district under
125	125	Subsection (b).
126	126	(6) "Excluded land's share of district debt" means the
127	127	portion of the district debt that is calculated by multiplying the
128	128	district debt by a fraction the numerator of which is the adjusted
129	129	gross value of the excluded land on the exclusion date and the
130	130	denominator of which is the adjusted gross value of all property in
131	131	the district on the exclusion date.
132	132	(7) "Exclusion date" means the date that the owner
133	133	files the petition requesting that the excluded land be excluded
134	134	from the district with the district secretary.
135	135	(8) "Termination date" means the earlier of:
136	136	(A) the date on which the amount of taxes
137	137	collected from the excluded land equals the excluded land payment;
138	138	or
139	139	(B) the date on which the excluded land payment
140	140	is made in full.
141	141	(b) Excluded land that has been pledged as security for any
142	142	outstanding debt of the district remains pledged for the excluded
143	143	land's share of district debt until the excluded land payment is
144	144	paid. A district is entitled to continue to levy and collect debt
145	145	service taxes on the excluded land until the termination date at the
146	146	same rate those taxes are levied on the land remaining in the
147	147	district. From the exclusion date to the termination date, the
148	148	excluded land remains in the district for the limited purpose of
149	149	assessment and collection of such taxes. After the termination
150	150	date, the excluded land is excluded from the district for all
151	151	purposes, and the district may not levy any further tax on the
152	152	excluded land.
153	153	(c) The district shall apply the taxes collected on the
154	154	excluded land only to payment of the excluded land payment, which
155	155	shall be reduced by the amount of taxes collected.
156	156	(d) A person is entitled to pay to the district the excluded
157	157	land payment, in whole or in part, at any time on or after the
158	158	exclusion date by delivering payment to the district tax
159	159	assessor-collector. If partial payment is made, the payment is
160	160	credited first against all carry costs due and owing, and any
161	161	remainder is credited against the excluded land's share of district
162	162	debt. After a partial payment, carry costs must be calculated and
163	163	assessed and collected only on the remaining excluded land's share
164	164	of district debt. [Land excluded from a district under Section
165	165	49.3076 that is pledged as security for any outstanding debt of the
166	166	district remains pledged for its pro rata share of the debt until
167	167	final payment is made. The district shall continue to levy and
168	168	collect taxes on the excluded land at the same rate levied on land
169	169	remaining in the district until the amount of taxes collected from
170	170	the excluded land equals the land's pro rata share of the district's
171	171	debt outstanding at the time the land was excluded from the
172	172	district.
173	173	[(b) The district shall apply the taxes collected on the
174	174	excluded land only to the payment of the excluded land's pro rata
175	175	share of the debt.
176	176	[(c) The owner of any part of the excluded land may pay in
177	177	full the owner's share of the pro rata share of the district's debt
178	178	outstanding at the time the land is excluded.]
179	179	SECTION 3. Subchapter J, Chapter 49, Water Code, is amended
180	180	by adding Section 49.3078 to read as follows:
181	181	Sec. 49.3078. PETITION FOR EXCLUSION: ADDITIONAL DUTIES.
182	182	A landowner who signs a petition for the exclusion of land that is
183	183	filed with a district under Section 49.3076 must submit a copy of
184	184	the petition to the commission. On receipt of a copy of a petition,
185	185	the executive director shall review the most recent financial
186	186	information for the applicable district, including current debt
187	187	requirements, debt service cash flow, and proposed debt
188	188	obligations, to confirm that an exclusion of land conducted in
189	189	accordance with Sections 49.3076 and 49.3077 does not adversely
190	190	affect the interests of district bondholders. The executive
191	191	director shall notify the landowner and the district when the
192	192	review is complete.
193	193	SECTION 4. Subsections (a) and (c), Section 49.312, Water
194	194	Code, are amended to read as follows:
195	195	(a) Except as provided by Section 49.3077, on [Upon]
196	196	issuance of an order excluding property, that property is no longer
197	197	a part of the district and is not entitled to water service from the
198	198	district.
199	199	(c) Except as provided by Section 49.3077, once land is
200	200	[Once] excluded, the landowner has no further liability to the
201	201	district for future taxes, assessments, or other charges of the
202	202	district.
203	203	SECTION 5. Subsection (a-1), Section 49.3076, Water Code,
204	204	is repealed.
205	205	SECTION 6. Section 49.3076, Water Code, as amended by this
206	206	Act, applies only to a petition for exclusion of land that is filed
207	207	with a district on or after the effective date of this Act. A
208	208	petition filed before the effective date of this Act is governed by
209	209	the law in effect on the date the petition is filed, and that law
210	210	continues in effect for that purpose.
211	211	SECTION 7. This Act takes effect September 1, 2013.
212	212	* * * * *