By: Bettencourt S.B. No. 2639
A BILL TO BE ENTITLED
AN ACT
relating to the designation of a property as a historic landmark and
the inclusion of a property in a historic district or similar
preservation district by certain municipalities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 211.0165(a) and (d), Local Government
Code, are amended to read as follows:
(a) Except as provided by Subsection (b) and subject to
Section 211.01651, a municipality that has established a process
for designating places or areas of historical, cultural, or
architectural importance and significance through the adoption of
zoning regulations or zoning district boundaries may not designate
a property as a local historic landmark or include a property within
the boundaries of a local historic district unless:
(1) the owner of the property consents to the
designation or inclusion; or
(2) if the owner does not consent, the designation or
inclusion of the owner's property is approved by a three-fourths
vote of:
(A) the governing body of the municipality; and
(B) the zoning, planning, or historical
commission of the municipality, if any.
(d) The historic designation impact statement must include
lists of the:
(1) regulations that may be applied to any structure
on the property after the designation;
(2) procedures for the designation;
(3) tax benefits that may be applied to the property
after the designation; [and]
(4) rehabilitation or repair programs that the
municipality offers for a property designated as historic;
(5) code violations that would be required to bring
the property into compliance if the property was designated as
historic or included in a local historic district;
(6) estimated cost to repair or restore the property
if designated as historic prepared by an independent appraiser,
adjustor, and/or construction expert; and
(7) an independent appraisal of the value of the
property immediately before and immediately after the designation.
SECTION 2. Subchapter A, Chapter 211, Local Government
Code, is amended by adding Section 211.01651 to read as follows:
Sec. 211.01651. DESIGNATION OF HISTORIC LANDMARK OR
DISTRICT IN CERTAIN MUNICIPALITIES. (a) This section applies only
to a property located in a municipality with a population of 950,000
or more.
(b) A municipality may not designate a property as a local
historic landmark or include a property within the boundaries of a
local historic district without the consent of the owner of the
property unless the municipality complies with:
(1) Section 211.0165; and
(2) the procedures in this section for assessing
damages and determining compensation to the property owner.
(c) If the governing body of a municipality approves the
designation of a property as a local historic landmark or inclusion
of the property within the boundaries of a local historic district
as provided by Section 211.0165(a) and the owner of the property
does not consent, the municipality must make a bona fide offer to
compensate the property owner for damages attributable to the
designation or inclusion. A municipality has made a bona fide offer
if the municipality:
(1) provides to the property owner in writing:
(A) an initial offer of compensation for damages
equal to or greater than the amount detailed in the historic
designation impact statement; and
(B) a final offer of compensation for damages,
equal to or greater than the amount detailed in the historic
designation impact statement, on or after the 30th day after the
date the municipality makes a written initial offer to the property
owner; and
(2) provides the property owner with at least 14 days
to respond to the final offer and the property owner does not agree
to the terms of the final offer within that period.
(d) If a municipality is unable to agree with a property
owner on the amount of damages under Subsection (c), the
municipality may bring an action to authorize the municipality to
designate a property as a local historic landmark or include a
property within the boundaries of a local historic district without
the consent of the property owner by filing in the proper court a
petition that includes:
(1) a description of the property;
(2) the name of the property owner if the owner is
known; and
(3) a statement:
(A) specifying the designation or inclusion that
the municipality seeks to authorize;
(B) that the municipality and the property owner
are unable to agree on the damages; and
(C) that the municipality made a bona fide offer
to compensate the property owner for damages as provided by
Subsection (c).
(e) A municipality that files a petition under Subsection
(d) shall provide a copy of the petition to the property owner by
certified mail, return receipt requested, and first class mail. If
the municipality has received written notice that the property
owner is represented by counsel, the municipality shall provide a
copy of the petition to the property owner's attorney by first class
mail, commercial delivery service, or e-mail.
(f) The court in which a petition is filed under this
section not later than the 30th day after the date the petition is
filed shall appoint three special commissioners, as provided by
Section 21.014, Property Code, to assess the damages of the owner of
the property that the municipality seeks to designate as a local
historic landmark or include within the boundaries of a local
historic district.
(g) The special commissioners appointed under Subsection
(f) shall:
(1) as soon as practicable but not later than the 20th
day after the date the special commissioners are appointed hold a
hearing to assess damages; and
(2) provide written notice of the hearing to the
municipality and the property owner as provided by Section 21.016,
Property Code.
(h) A municipality or property owner may:
(1) appeal the findings from the special commissioners
as provided by Section 21.018, Property Code; or
(2) move to dismiss the proceedings in an action filed
under Subsection (d), as provided by Section 21.019, Property Code.
(i) As the basis for assessing actual damages to a property
owner from a designation of a property as a local historic landmark
or inclusion of a property within the boundaries of a local historic
district, the special commissioners shall admit evidence on:
(1) the value of the property;
(2) the injury to the property owner;
(3) the benefit to the property owner's property;
(4) the use of the property for the purpose of the
designation or inclusion;
(5) the cost to repair the property; and
(6) any diminution in the value of the property due to
the designation or inclusion, including from restrictions on the
property owner's ability to demolish or develop the property.
(j) The special commissioners shall assess damages in a
proceeding under this section according to the evidence presented
at the hearing and as provided by Section 21.042, Property Code, as
applicable.
(k) The special commissioners in a proceeding under this
section shall adjudge the costs of the proceeding against a party as
follows:
(i) If the commissioners award greater damages than the
municipality offered to pay or a court on appeal awards greater
damages than the commissioners awarded, the municipality shall pay
all costs; including attorneys fees, expert fees, and costs of
court.
(ii) If the commissioners' award or the
court's determination of the damages is less than or equal to the
amount the municipality offered before proceedings began, the
property owner shall pay the costs of court.
(l) A municipality shall pay the initial cost of serving a
property owner with notice of a condemnation proceeding. If the
property owner is ordered to pay the costs of the proceeding, the
municipality may recover the expense of notice from the property
owner as part of the costs of court.
(m) If a court hearing a suit under this section determines
that a municipality did not make a bona fide offer to compensate the
property owner for damages as required by Subsection (c), the court
shall abate the suit, order the municipality to make a bona fide
offer, and order the municipality to pay:
(1) all costs as provided by Subsection (k); and
(2) any reasonable attorney's fees and other
professional fees incurred by the property owner that are directly
related to the violation.
(n) The special commissioners in a proceeding under this
section shall file with the court a written statement of damages and
costs as provided by Section 21.048, Property Code.
(o) The court in a proceeding under this section shall:
(1) send notice of a decision by the special
commissioners to the parties as provided by Section 21.049,
Property Code; and
(2) if no party files timely objections to the
findings of the special commissioners, adopt the commissioners'
findings as the judgment of the court, record the judgment in the
minutes of the court, and issue the process necessary to:
(A) enforce any judgment of damages awarded to
the property owner; and
(B) authorize the municipality to designate the
property owner's property as a local historic landmark or include
the property within the boundaries of a local historic district
under Section 211.0165.
SECTION 3. (a) Except as provided by Subsection (b) of this
section, the changes in law made by this Act apply only to a
designation of a property as a local historic landmark or inclusion
of a property within the boundaries of a local historic district
that is approved by the governing body of a municipality on or after
the effective date of this Act. A designation or inclusion approved
before the effective date of this Act is governed by the law as it
existed immediately before the effective date of this Act, and that
law is continued in effect for that purpose.
(b) If a property owner filed an action to challenge the
designation of the property owner's property as a local historic
landmark or the inclusion of the property within the boundaries of a
local historic district before the effective date of this Act and
the action is pending on the effective date of this Act, the
property owner may elect to dismiss the action and seek relief as
provided by Section 211.01651, Local Government Code, as added by
this Act.
SECTION 4. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2025.