87R9991 TYPED
By: Goldman H.B. No. 1900
A BILL TO BE ENTITLED
AN ACT
relating to municipalities and counties that adopt budgets that
defund law enforcement agencies.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. DEFUNDING LOCAL GOVERNMENTS
SECTION 1.01. Chapter 140, Local Government Code, is
amended by adding Section 140.013 to read as follows:
Sec. 140.013. DEFUNDING LOCAL GOVERNMENT. (a) A defunding
local government is a municipality or county:
(1) that adopts a budget for a fiscal year that, in
comparison to the local government's preceding fiscal year,
reduces:
(A) the appropriation to the local government's
law enforcement agency;
(B) the number of peace officers the local
government's law enforcement agency is authorized to employ;
(C) funding for peace officer overtime
compensation for the local government's law enforcement agency; or
(D) funding for the recruitment and training of
new peace officers to fill each vacant peace officer position in the
local government's law enforcement agency; and
(2) for which the criminal justice division of the
governor's office issues a written determination finding that the
local government has taken an action described by Subdivision (1).
(a-1) In making a determination of whether a local
government is a defunding local government according to the budget
adopted for the first fiscal year beginning on or after September 1,
2021, the criminal justice division of the governor's office shall
compare the funding and personnel in that budget to the funding and
personnel in the budget of the preceding fiscal year or the second
preceding fiscal year, whichever is greater. This subsection
expires September 1, 2023.
(b) A local government is considered to be a defunding local
government until the criminal justice division of the governor's
office issues a written determination finding that the local
government has reversed the reductions, adjusted for inflation,
described in Subsection (a)(1).
(c) The criminal justice division of the governor's office
shall:
(1) compute the inflation rate used to make
determinations under Subsection (b) each state fiscal year using a
price index that accurately reports changes in the purchasing power
of the dollar for local governments in this state; and
(2) publish the inflation rate in the Texas Register.
ARTICLE 2. ANNEXATION BY AND DISANNEXATION FROM DEFUNDING
MUNICIPALITIES
SECTION 2.01. Subchapter Z, Chapter 42, Local Government
Code, is amended by adding Section 42.905 to read as follows:
Sec. 42.905. EFFECT OF DISANNEXATION FROM DEFUNDING
MUNICIPALITY. (a) For purposes of this section, a "defunding
municipality" means a home-rule municipality that is a defunding
local government under Section 140.013.
(b) If an area is disannexed from a defunding municipality
as a result of an election required to be held under Section
43.1465, the area is released from the defunding municipality's
extraterritorial jurisdiction and is not included in any other
municipality's extraterritorial jurisdiction.
(c) A resident in the area may file with a municipality that
is eligible to include the area in its extraterritorial
jurisdiction under this chapter a petition for the area to become a
part of the municipality's extraterritorial jurisdiction. The
petition must:
(1) comply with Chapter 277, Election Code;
(2) be signed by more than 50 percent of the registered
voters of the area described by the petition as of the preceding
uniform election date;
(3) satisfy the signature requirement described by
Subdivision (2) not later than the 180th day after the date the
first signature for the petition is obtained; and
(4) include a map of and describe the area.
(d) Except as provided by Subsection (e), on receipt of a
valid petition and if the area has not already been included in the
extraterritorial jurisdiction of another municipality, the
municipality may by ordinance include the area in its
extraterritorial jurisdiction.
(e) If the municipality receiving a petition under this
section is the defunding municipality that disannexed the area as
described by Subsection (b), the defunding municipality may include
the area in the defunding municipality's extraterritorial
jurisdiction under this section only if the inclusion is approved
by a majority of votes in an election on the issue held in the area.
(f) If the area is not included in a municipality's
extraterritorial jurisdiction on or after the second anniversary of
the date that the area was disannexed as described by Subsection
(b), a municipality, other than the defunding municipality that
disannexed the area, that is eligible to include the area in its
extraterritorial jurisdiction under this chapter may by ordinance
include the area in its extraterritorial jurisdiction without the
consent of the area.
SECTION 2.02. Subchapter A, Chapter 43, Local Government
Code, is amended by adding Section 43.004 to read as follows:
Sec. 43.004. ANNEXATION BY DEFUNDING MUNICIPALITY
PROHIBITED. (a) For purposes of this section, a "defunding
municipality" means a home-rule municipality that is a defunding
local government under Section 140.013.
(b) A defunding municipality may not annex an area during
the period beginning on the date that the criminal justice division
of the governor's office issues the written determination that the
municipality is a defunding local government and ending on the 10th
anniversary of the date on which the criminal justice division of
the governor's office issues a written determination in accordance
with Section 140.013(b) finding that the defunding municipality has
reversed the reductions described by Section 140.013(a)(1).
SECTION 2.03. Subchapter G, Chapter 43, Local Government
Code, is amended by adding Section 43.1465 to read as follows:
Sec. 43.1465. DISANNEXATION FROM DEFUNDING MUNICIPALITY.
(a) For purposes of this section, a "defunding municipality" means
a home-rule municipality that is a defunding local government under
Section 140.013.
(b) On the next uniform election date that occurs after the
date on which the criminal justice division of the governor's
office issues a written determination that a municipality is a
defunding local government and the time required by Section 3.005,
Election Code, the defunding municipality shall hold a separate
election in each area annexed in the preceding 30 years by the
defunding municipality on the question of disannexing the area.
(c) The defunding municipality shall immediately by
ordinance disannex an area for which a majority of the votes
received in the election held under Subsection (b) favor
disannexation.
(d) If an area is disannexed under Subsection (c), the
defunding municipality may not attempt to annex the area before the
10th anniversary of the date on which the criminal justice division
of the governor's office issues a written determination in
accordance with Section 140.013(b) finding that the defunding
municipality has reversed the reductions described by Section
140.013(a)(1).
(e) A defunding municipality holding an election under
Subsection (b) may not use public funds on informational campaigns
relating to the election.
ARTICLE 3. TAX REVENUE AND DEFUNDING LOCAL GOVERNMENTS
SECTION 3.01. Chapter 26, Tax Code, is amended by adding
Section 26.0501 to read as follows:
Sec. 26.0501. LIMITATION ON TAX RATE OF DEFUNDING TAXING
UNIT. (a) For purposes of this section, a "defunding taxing unit"
means a county or municipality that is a defunding local government
under Section 140.013, Local Government Code.
(b) Notwithstanding any other provision of this chapter or
other law, the governing body of a defunding taxing unit may not
adopt a tax rate for the current tax year that exceeds the lesser of
the defunding taxing unit's no-new-revenue tax rate or
voter-approval tax rate for that tax year.
(c) For purposes of making the calculation required under
Section 26.013, in a tax year in which a county or municipality is a
defunding taxing unit, the difference between the taxing unit's
actual tax rate and voter-approval tax rate is considered to be
zero.
(d) A county or municipality is no longer considered to be a
defunding taxing unit for purposes of this section in the first tax
year for which the criminal justice division of the governor's
office issues a written determination in accordance with Section
140.013(b), Local Government Code, finding that the county or
municipality has reversed the reductions described by Section
140.013(a)(1), Local Government Code.
SECTION 3.02. Subchapter F, Chapter 321, Tax Code, is
amended by adding Section 321.5025 to read as follows:
Sec. 321.5025. DISTRIBUTION OF TRUST FUNDS TO DEFUNDING
MUNICIPALITY. (a) For purposes of this section, a "defunding
municipality" means a municipality that is a defunding local
government under Section 140.013, Local Government Code.
(b) Notwithstanding Section 321.502, the comptroller may
not, before July 1 of each state fiscal year, send to a defunding
municipality its share of the taxes collected by the comptroller
under this chapter during the state fiscal year. Before sending the
defunding municipality its share of the taxes, the comptroller
shall deduct the amount reported to the comptroller for the
defunding municipality under Subsection (c) and credit that
deducted amount to the general revenue fund. Money credited to the
general revenue fund under this subsection may be appropriated only
to the Department of Public Safety.
(c) Not later than August 1 of each state fiscal year, the
criminal justice division of the governor's office shall report to
the comptroller for each defunding municipality the amount of money
the state spent in that state fiscal year to provide law enforcement
services in that defunding municipality.
(d) A municipality is no longer considered to be a defunding
municipality for purposes of this section when the criminal justice
division of the governor's office issues a written determination in
accordance with Section 140.013(b), Local Government Code, finding
that the municipality has reversed the reductions described by
Section 140.013(a)(1), Local Government Code.
ARTICLE 4. MUNICIPALLY OWNED UTILITIES IN DEFUNDING MUNICIPALITIES
SECTION 4.01. Subchapter B, Chapter 33, Utilities Code, is
amended by adding Section 33.0211 to read as follows:
Sec. 33.0211. RATES AND FEES CHARGED BY CERTAIN MUNICIPALLY
OWNED UTILITIES. (a) This section applies only to a municipally
owned utility that is located in a municipality that is a defunding
local government under Section 140.013, Local Government Code.
(b) The governing body of a municipally owned utility may
not charge a customer:
(1) at a rate higher than the rate the customer was
charged or would have been charged on January 1 of the year that the
municipality was determined to be a defunding local government;
(2) any customer fees in amounts higher than the
customer fees the customer was charged or would have been charged on
January 1 of the year that the municipality was determined to be a
defunding local government; or
(3) any types of customer fees that the customer was
not charged or would not have been charged on January 1 of the year
that the municipality was determined to be a defunding local
government.
ARTICLE 5. TRANSITION PROVISIONS; EFFECTIVE DATE
SECTION 5.01. Section 140.013, Local Government Code, as
added by this Act, applies only to the adoption of a budget by a
municipality or county for a fiscal year that begins on or after the
effective date of this Act.
SECTION 5.02. Section 26.0501, Tax Code, as added by this
Act, applies beginning with the 2021 tax year.
SECTION 5.03. Section 321.5025, Tax Code, as added by this
Act, applies only to a distribution of municipal sales and use tax
revenue to a municipality in a state fiscal year that begins on or
after the effective date of this Act.
SECTION 5.04. (a) Section 33.0211, Utilities Code, as
added by this Act, applies only to a proceeding for the
establishment of rates for which the governing body of a
municipally owned utility has not issued a final order or decision
before the effective date of this Act.
(b) A proceeding for which the governing body of a
municipally owned utility has issued a final order or decision
before the effective date of this Act is governed by the law in
effect immediately before that date, and that law is continued in
effect for that purpose.
SECTION 5.05. This Act takes effect September 1, 2021.