BILL ANALYSIS

C.S.S.B. 2370

By: Campbell

County Affairs

Committee Report (Substituted)

BACKGROUND AND PURPOSE

S.B. 2370 aims to amend the Special District Local Laws Code that created the Comal County

Water Improvement District No 3 (WID). The bill provides a way for voters in this district to

petition for a division of the emergency services district overlaying the WID, in order to create a

new emergency services district (ESD), after a public hearing and through an election. The

purpose of this bill is to remove the WID from ESD 7 while keeping ESD 7 whole with regard to

their property and sales tax collections, and to keep an agreement between the City of New

Braunfels and Southstar Communities, the current property owner, intact. The WID encompasses

land that was owned by the Texas General Land Office and sold to Southstar in 2021 for the

development of a significant project in Comal County on the I-35 corridor, with parkland, trail

connectivity, and housing. The purchase agreement required a development agreement with the

City of New Braunfels, which included a strategic partnership agreement (SPA) for the limited

annexation by the City and the sharing of sales tax collections for economic development.

However, ESD 7 held an election in November 2021, capturing all of the available local sales

tax, which undermined the SPA and the development agreement. S.B. 2370 provides the steps to

remove the WID from ESD 7 in order to bring the site back to the baseline of where it was when

the property was purchased and the agreement with the City was made.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

C.S.S.B. 2370 proposes to amend Subtitle F, Title 5 Special District Local Laws Code, Chapter 8489, to allow for the division of Comal County Water Improvement District No. 3 into a new

emergency services district by petition to the county judge of at least sixty percent of the

district's qualified voters. The bill also outlines the process for the commissioners court to approve the petition, order an election to confirm the division, and appoint a board for the new emergency services district.

C.S.S.B. 2370 amends Chapter 8489.253(a) to replace "emergency services districts" to "improvement districts" in order to allow the WID voters to deliver the petition for division to the county judge as it is The WID who is seeking the division.

C.S.S.B. 2370 removes the provision under 849.253 (b) (2) which would allow the petition for division to include (b) "the name of the county in which the new emergency services district will be located;"

C.S.S.B. 2370 creates a new provision, 8489.255 (g) in order to conform to the Texas Tax Code 321.102.

EFFECTIVE DATE

Upon passage, or, if the Act does not receive the necessary vote, the Act takes effect September 1, 2023.

COMPARISON OF ORIGINAL TO SUBSTITUTE

The following summarizes the substantial differences between the engrossed and committee substitute version of the bill.

The substitute includes a minor yet substantive change to the statute regarding who may provide the petition for division. Currently, the county judge must receive a petition for division of the ESD from at least 60 percent of the qualified voters of the emergency services district. The substitute would allow only qualified voters within the Comal County Water Improvement District No 3 to bring the county judge a petition for division rather than the Emergency Service District as stated in the original language.

The substitute removes the provision under 849.253 (b) (2) as it is not needed. The provision allows the petition for division to include (b) "the name of the county in which the new emergency services district will be located;" however, the bill only applies to Comal County Water Improvement District No. 3, a WID located in a single county.

The substitute includes a provision absent from the engrossed that includes a new provision  in order to conform to the Texas Tax Code. The county judge would be required to send by United States registered or certified mail to the comptroller a certified copy of the order that divides the existing emergency services district and shows the effective date of the boundary change. This order will be accompanied by a map clearly showing the detached territory. The sales and use tax collected by the existing emergency service district is inapplicable to the detached territory on the first day of the first calendar quarter after the comptroller receives the ordinance and map.