Bill Text: TX SB968 | 2013-2014 | 83rd Legislature | Introduced

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Bill Title: Relating to public improvement districts designated by a municipality or county; authorizing assessments.

Sponsorship: Partisan Bill (Democrat 1)

Status: (Introduced - Dead) 2013-03-12 - Referred to Intergovernmental Relations [SB968 Detail]

Download: Texas-2013-SB968-Introduced.html

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83R8555 PAM-F
By: West S.B. No. 968

A BILL TO BE ENTITLED
AN ACT
relating to public improvement districts designated by a
municipality or county; authorizing assessments.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 372.0015, Local Government Code, is
amended to read as follows:
Sec. 372.0015. DEFINITIONS [DEFINITION]. In this
subchapter:
(1) "Costs" means costs and expenses paid or incurred
before, during, or after the establishment of a public improvement
district and in connection with or related to the undertaking and
funding of a public improvement project authorized under this
subchapter.
(2) "Extraterritorial[, "extraterritorial]
jurisdiction" means extraterritorial jurisdiction as determined
under Chapter 42.
SECTION 2. Subchapter A, Chapter 372, Local Government
Code, is amended by adding Section 372.0025 to read as follows:
Sec. 372.0025. PUBLIC IMPROVEMENT DISTRICT. A public
improvement district is an area, the boundaries of which are
designated by the governing body of a municipality or county under
this subchapter, that may include two or more noncontiguous areas
separated by:
(1) a right-of-way or other land dedicated to or
owned, leased, licensed, or used by a political subdivision or
other governmental entity, tax-exempt entity, charitable
organization, public or private utility, or railroad; or
(2) not more than 2,500 feet, as measured in a straight
line, between the nearest points on the property lines of the
closest situated noncontiguous areas.
SECTION 3. Section 372.003, Local Government Code, is
amended by amending Subsections (a), (b), (b-1), and (c) and adding
Subsections (b-2) and (e) to read as follows:
(a) If the governing body of a municipality or county finds
that it promotes the interests of the municipality or county, the
governing body may undertake an improvement project that confers a
special benefit on a definable part of the municipality or county or
the municipality's extraterritorial jurisdiction. A project may be
undertaken in the municipality or county or the municipality's
extraterritorial jurisdiction. A project may be undertaken inside
or outside a public improvement district if the project confers a
special benefit on property in the district.
(b) A public improvement project may include:
(1) landscaping;
(2) erection of fountains, distinctive lighting, and
signs;
(3) acquiring, constructing, improving, widening,
narrowing, closing, or rerouting of sidewalks or of streets, any
other roadways, or their rights-of-way;
(4) construction or improvement of pedestrian malls;
(5) acquisition and installation of pieces of art;
(6) acquisition, construction, or improvement of
libraries;
(7) acquisition, construction, or improvement of
off-street parking facilities;
(8) acquisition, construction, improvement, or
rerouting of mass transportation or rail facilities;
(9) acquisition, construction, or improvement of
water, wastewater, or drainage facilities or improvements;
(10) the right to receive water, wastewater, or
drainage services, the right to acquire a certificate of
convenience and necessity to provide those services, and the
obligation to pay service-related costs and expenses, including tap
fees, connection fees, and impact fees authorized by law, including
impact fees authorized by Chapter 395;
(11) the establishment or improvement of parks, open
spaces, and recreation facilities;
(12) facilities or equipment for firefighters,
police, sheriffs, and emergency service providers;
(13) [(11)] projects similar to those listed in
Subdivisions (1)-(11) [(1)-(10)];
(14) [(12)] acquisition, by purchase or otherwise, of
real property in connection with an authorized improvement;
(15) [(13)] special supplemental services for
improvement and promotion of the district, including services
relating to:
(A) advertising;
(B) [,] promotion;
(C) [,] health and sanitation;
(D) [,] water and wastewater;
(E) firefighters, police, sheriffs, emergency
service providers, and other public safety and[,] security
personnel;
(F) [,] business recruitment;
(G) [,] development;
(H) [,] recreation;[,] and
(I) cultural enhancement;
(16) [(14)] payment of expenses incurred in the
establishment, administration, and operation of the district; and
(17) [(15)] the development, rehabilitation, or
expansion of affordable housing.
(b-1) Payment of expenses under Subsection (b)(16)
[(b)(14)] may also include expenses related to the operation and
maintenance of mass transportation or rail facilities.
(b-2) A special supplemental service under Subsection
(b)(15) includes services provided by another entity under contract
with that entity.
(c) A public improvement project may be limited to the
provision of the services described by Subsection (b)(15)
[(b)(13)].
(e) A public improvement project may be dedicated,
conveyed, leased, or otherwise provided to or for the benefit of:
(1) a municipality or county;
(2) a political subdivision or other entity exercising
the powers granted under this subchapter as authorized by other
law; or
(3) an entity that:
(A) is approved by the governing body of an
entity described by Subdivision (1) or (2); and
(B) is authorized by order, ordinance,
resolution, or other official action to act for an entity described
by Subdivision (1) or (2).
SECTION 4. Subchapter A, Chapter 372, Local Government
Code, is amended by adding Section 372.0031 to read as follows:
Sec. 372.0031. AUTHORIZED HIGHER EDUCATION FACILITIES;
LEASE TO INSTITUTION OF HIGHER EDUCATION. (a) In this section,
"institution of higher education" has the meaning assigned by
Section 61.003, Education Code.
(b) A public improvement project under Section 372.003 may
include the acquisition, construction, maintenance, or improvement
of buildings and other facilities commonly used for:
(1) teaching, research, or the preservation of
knowledge by an institution of higher education; or
(2) an auxiliary purpose of an institution of higher
education, including the provision of administrative services,
student services, student housing, athletics, performing arts, and
alumni support.
(c) The governing body of a municipality or county that
establishes a public improvement district to finance a public
improvement project described by Subsection (b) may enter into a
memorandum of understanding with an institution of higher education
that provides educational services in the municipality or county
under which the municipality or county leases the public
improvement project to the institution, at a nominal rate, for use
by the institution in providing teaching, research, public service,
or auxiliary enterprise activities to students of the institution.
SECTION 5. Section 372.009, Local Government Code, is
amended by amending Subsections (b) and (d) and adding Subsection
(c-1) to read as follows:
(b) The hearing may be adjourned and reconvened from time to
time until the governing body makes findings by resolution as to:
(1) the advisability of the improvement;
(2) the nature of the improvement;
(3) the estimated cost of the improvement;
(4) the boundaries of the public improvement district;
(5) the method of assessment; and
(6) the apportionment of costs between the district
and the municipality or county as a whole.
(c-1) For purposes of Subsection (c)(4), the boundaries of
the proposed assessment district may be described in the notice by
reference to existing streets, roads, and other landmarks with a
statement providing the location where the metes and bounds
description of the boundaries of the proposed district are on file
and available for public inspection.
(d) Written notice containing the information required by
Subsection (c) must be mailed before the 15th day before the date of
the hearing. The notice may [must] be addressed to "Property Owner"
and sent by regular mail [mailed] to the current address of the
owner, as reflected on tax rolls, of property subject to assessment
under the proposed public improvement district. The failure of the
property owner to receive the notice does not invalidate the
proceedings under this subchapter.
SECTION 6. Section 372.010, Local Government Code, is
amended by amending Subsections (b) and (c) and adding Subsections
(d) and (e) to read as follows:
(b) An authorization takes effect when a substantial copy of
the resolution or a caption of the resolution [it] has been
published one time in a newspaper of general circulation in the
municipality or county. If any part of the improvement district is
located in the municipality's extraterritorial jurisdiction or if
any part of the improvements is to be undertaken in the
municipality's extraterritorial jurisdiction, the authorization
does not take effect until the notice is also given one time in a
newspaper of general circulation in the part of the
extraterritorial jurisdiction in which the district is located or
in which the improvements are to be undertaken.
(c) Actual construction of an improvement may not begin, or
the acquisition of an existing improvement may not occur, until
after the 20th day after the date the authorization takes effect.
[and] Construction may not begin, or the acquisition may not occur,
if during that 20-day period written protests signed by at least
two-thirds of the owners of record of property within the
improvement district or by the owners of record of property
comprising at least two-thirds of the total area of the district are
filed with the municipal secretary or county clerk [secretary] or
other officer performing the duties of the municipal secretary or
county clerk [secretary]. A person whose name appears on a protest
may withdraw the name from the protest at any time before the
governing body of the municipality or county convenes to determine
the sufficiency of the protest.
(d) If construction of an improvement begins before the
expiration of the 20-day period provided by Subsection (c) or
before the district is authorized, the improvement is considered an
existing improvement and must be acquired as an existing
improvement after construction is completed unless the 20-day
period is waived as provided by Subsection (e).
(e) The 20-day waiting period provided by Subsection (c) may
be waived at any time if a written waiver is filed with the
municipal secretary or county clerk signed by at least two-thirds
of the owners of record of property within the improvement district
or by the owners of record of property comprising at least
two-thirds of the total area of the district.
SECTION 7. Section 372.011, Local Government Code, is
amended to read as follows:
Sec. 372.011. DISSOLUTION. (a) A public hearing may be
called and held in the same manner as a hearing under Section
372.009 for the purpose of dissolving a district if a petition
requesting dissolution is filed and the petition contains the
signatures of at least enough property owners in the district to
make a petition sufficient under Section 372.005(b). If the
district is dissolved, the district nonetheless shall remain in
effect for the purpose of meeting obligations of indebtedness for
improvements.
(b) A district may be dissolved by resolution or order
approved by two-thirds of all the members of the governing body of
the municipality or county that established the district without a
petition requesting dissolution under Subsection (a) if:
(1) assessments have not been levied before the fifth
anniversary of the date the district was established; or
(2) levied assessments are paid in full and the
district has no other outstanding obligations.
(c) Before a district may be dissolved as provided by
Subsection (b):
(1) a public hearing must be called and held in the
same manner as a hearing under Section 372.009; and
(2) notice of dissolution must be mailed to each owner
of property within the district.
SECTION 8. Section 372.012, Local Government Code, is
amended to read as follows:
Sec. 372.012. AREA OF DISTRICT. (a) The area of a public
improvement district to be assessed according to the findings of
the governing body of the municipality or county may be less than
the area described in the proposed boundaries stated by the notice
under Section 372.009. Except as provided by this section, the
[The] area to be assessed may not include property not described by
the notice as being within the proposed boundaries of the district
unless a hearing is held to include the property and notice for the
hearing is given in the same manner as notice under Section 372.009.
(b) After the district is authorized and before the levy of
assessments, the governing body of a municipality or county may
exclude all or any portion of an owner's property from the district
if the governing body:
(1) receives a petition from the owner of property in
the district;
(2) publishes notice and holds a public hearing in the
manner provided by Section 372.009; and
(3) finds by resolution or order that no public
improvement project to be undertaken confers a special benefit on
the property.
(c) After the district is authorized and before the levy of
assessments, an owner of property outside the district may petition
the governing body of the municipality or county to include the
owner's property in the district. The governing body may:
(1) include the owner's property in the district if the
governing body:
(A) publishes notice and holds a public hearing
in the manner provided by Section 372.009; and
(B) finds by resolution or order that a public
improvement project to be undertaken will confer a special benefit
on the property; and
(2) by ordinance or order, levy assessments against
the owner's property when assessments in the district are levied
after the governing body publishes notice and holds a public
hearing in the manner provided by Sections 372.016 and 372.017.
(d) After the district is authorized and after the levy of
assessments, an owner of property outside the district may petition
the governing body of the municipality or county to include the
owner's property in the district and to levy assessments against
the owner's property. The governing body may:
(1) include the owner's property in the district if the
governing body:
(A) publishes notice and holds a public hearing
as provided by Section 372.009; and
(B) finds by resolution or order that a public
improvement project to be undertaken will confer a special benefit
on the property;
(2) by ordinance or order, levy assessments against
the owner's property after the governing body publishes notice and
holds a public hearing in the manner provided by Sections 372.016
and 372.017; and
(3) by ordinance or order, reduce assessments against
the other property in the district to reflect a reallocation of
costs by the addition of property to the district after the
governing body publishes notice and holds a public hearing in the
manner provided by Sections 372.016 and 372.017.
(e) For purposes of a hearing to exclude or include property
in a district under Subsection (b), (c), or (d), the governing body
of a municipality or county shall mail notice to each owner of
property in the district that is liable for assessment.
(f) For purposes of Subsections (c) and (d), a commissioners
court of a county may include in a district an owner's property that
is located in a home-rule municipality's corporate limits or
extraterritorial jurisdiction unless within 30 days of the
commissioners court's action to include the owner's property the
home-rule municipality objects to the inclusion of the owner's
property in the district.
SECTION 9. Section 372.014, Local Government Code, is
amended by amending Subsection (b) and adding Subsection (c) to
read as follows:
(b) The municipality or county is responsible for payment of
assessments against exempt municipal or county property in the
district only if payment is expressly authorized by the governing
body of the municipality or county. Payment of assessments by other
exempt jurisdictions must be established by contract. An
assessment paid by the municipality or county under this subsection
is considered to have been paid by special assessment for the
purposes of Subsection (a).
(c) The assessment plan is intended to be flexible to
provide for various development scenarios, including:
(1) assessments against all property in the district
to pay the costs of improvements that benefit all the property in
the district and additional assessments levied against portions of
the property in the district to pay the costs of additional
improvements that benefit those portions of the property; or
(2) assessments levied to pay the costs for all
improvements contemplated for one or more phases of development of
the property with different dates for accrual of interest and for
payment and collection for the different phases as determined by
events established by the plan, including events related to the
future phased development of the property.
SECTION 10. Section 372.015, Local Government Code, is
amended by adding Subsections (e) through (h) to read as follows:
(e) The periodic installment of an assessment payable in
installments, including principal, interest, administrative costs,
collection costs, and delinquency charges and penalties, may be
increased or decreased by the governing body of the municipality or
county following an annual review of the service plan.
(f) If a parcel is subdivided, the assessment against the
parcel before the parcel was subdivided may be reallocated among
the subdivided parcels by the governing body of the municipality or
county as reflected in the updated annual service plan and the
corresponding updated assessment roll.
(g) If two or more parcels are consolidated, the assessments
against each parcel may be reallocated to the consolidated parcel
by the governing body of the municipality or county as reflected in
the updated annual service plan and the corresponding updated
assessment roll.
(h) If a proposed use of an undeveloped parcel changes after
an assessment is levied against a parcel:
(1) the change in use does not affect the amount or
validity of the assessment against the parcel; and
(2) the aggregate amount of assessments levied against
multiple undeveloped parcels for which the proposed use has changed
may be reallocated among the undeveloped parcels by the governing
body of the municipality or county following an annual review of the
service plan.
SECTION 11. Section 372.016, Local Government Code, is
amended by adding Subsections (b-1) and (d) and amending Subsection
(c) to read as follows:
(b-1) For purposes of Subsection (b)(4), the boundaries of
the assessment district may be described in the notice by reference
to existing streets, roads, and other landmarks with a statement
providing the location where the metes and bounds description of
the boundaries of the district are on file and available for public
inspection.
(c) When the assessment roll is filed under Subsection (b),
the municipal secretary or other officer shall mail to the owners of
property liable for assessment a notice of the hearing. The notice
must contain the information required by Subsection (b). The
notice may be addressed to "Property Owner" and mailed by regular
mail. The notice must be mailed before the 10th day before the date
of the hearing to the current [and the secretary or other officer
shall mail the notice to the last known] address of the [property]
owner, as reflected on the tax rolls. The failure of a property
owner to receive notice does not invalidate the proceeding.
(d) The public hearing required by this section may be
adjourned and reconvened from time to time.
SECTION 12. Section 372.017, Local Government Code, is
amended by adding Subsection (c) to read as follows:
(c) An assessment levied under this section may vary from
the proposed service plan, proposed assessment plan, or proposed
assessment roll filed and made available for public inspection in
accordance with Section 372.016. The total cost of an assessment
levied under this section may not exceed the cost of improvements
provided in the notice as required under Section 372.016(b)(3) and
mailed to the owners as provided by Section 372.016(c).
SECTION 13. Section 372.018, Local Government Code, is
amended by amending Subsections (a) and (f) and adding Subsection
(g) to read as follows:
(a) An assessment bears interest at the rate specified by
the governing body of the municipality or county beginning at the
time or times or on the occurrence of one or more events specified
by the governing body. If general obligation bonds, revenue bonds,
installment sales contracts, reimbursement agreements, time
warrants, or temporary notes are issued or entered into to finance
or pay for the improvement for which the assessment is assessed, the
interest rate for that assessment may not exceed a rate that is
one-half of one percent higher than the actual interest rate paid on
the debt. [Interest on the assessment between the effective date of
the ordinance or order levying the assessment and the date the first
installment is payable shall be added to the first installment.]
The interest on any delinquent installment shall be added to each
subsequent installment until all delinquent installments are paid.
The added interest may be used to pay administrative costs, costs of
improvements, and costs of financing, including reserves for debt
service and prepayment of assessments.
(f) Delinquent installments of the assessment shall incur
interest, penalties, and attorney's fees in the same manner as
delinquent ad valorem taxes.
(g) The owner of assessed property may pay at any time all or
any part of the assessment, with interest that:
(1) has accrued on the assessment; and
(2) will accrue on the assessment until the next
scheduled prepayment or redemption date on the bonds, installment
sales contract, reimbursement agreement, time warrant, or
temporary note issued or entered into to finance or pay for the
improvements [, on any lot or parcel].
SECTION 14. Section 372.024, Local Government Code, is
amended to read as follows:
Sec. 372.024. GENERAL OBLIGATION AND REVENUE BONDS;
CERTIFICATES OF OBLIGATION. (a) The governing body of a
municipality or county may issue:
(1) general [General] obligation bonds [issued to pay
costs under Section 372.023(d) must be issued] under [the
provisions of] Subtitles A and C, Title 9, Government Code;
(2) certificates of obligation under Subchapter C,
Chapter 271; and
(3) revenue[. Revenue] bonds, issued [to pay costs
under that subsection may be issued from time to time] in one or
more series [and are to be payable from and secured by liens on all
or part of the revenue derived from improvements authorized under
this subchapter, including revenue derived from installment
payments of special assessments].
(b) The bond or obligation may:
(1) be issued to pay costs;
(2) be issued to refund any obligations entered into
or issued under this subchapter, including installment sales
contracts, reimbursement agreements, time warrants, or temporary
notes; and
(3) be payable from and secured by special
assessments.
(c) If the bond or obligation is issued for the purpose
described by Subsection (b)(2) and is secured wholly or partly by a
special assessment, the lien created by the originally levied
special assessment continues uninterrupted for the term of the bond
or obligation to secure payment of the bond or obligation.
(d) The bond or obligation must be issued or entered into
under the terms determined by the governing body of the
municipality or county.
SECTION 15. Section 372.026, Local Government Code, is
amended by adding Subsection (g) to read as follows:
(g) The governing body of a municipality or county may
pledge all or any part of the revenue collected from assessments as
security for and to pay all or any part of one or more obligations on
the terms determined by the governing body, including the priority
of payment and allocation of assessment revenue among the
obligations. If an assessment is collected and applied to pay an
amount due under an installment sales contract, reimbursement
agreement, time warrant, or temporary note, the governing body of a
municipality or county may pledge all or any part of the revenue
collected as security for and to pay general obligation bonds,
certificates of obligation, or revenue bonds issued to refund those
obligations. The pledge authorized by this subsection does not:
(1) affect the lien of that assessment; or
(2) constitute a reassessment or a new assessment.
SECTION 16. Subchapter A, Chapter 372, Local Government
Code, is amended by adding Section 372.031 to read as follows:
Sec. 372.031. LIABILITY FOR PAYMENT. An assessment levied
by the governing body of a municipality or county under this
chapter, or an obligation issued or agreement or contract entered
into by the governing body of a municipality or county under this
chapter and payable from and secured, wholly or partly, by that
assessment, does not constitute a debt or pledge of the full faith
and credit of the municipality or county, this state, or any other
political corporation, subdivision, or agency of this state.
SECTION 17. 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, 2013.