1-1  By:  Leedom                                            S.B. No. 646
    1-2        (In the Senate - Filed March 5, 1993; March 8, 1993, read
    1-3  first time and referred to Committee on State Affairs;
    1-4  April 26, 1993, reported adversely, with favorable Committee
    1-5  Substitute by the following vote:  Yeas 9, Nays 0; April 26, 1993,
    1-6  sent to printer.)
    1-7                            COMMITTEE VOTE
    1-8                          Yea     Nay      PNV      Absent 
    1-9        Harris of Dallas   x                               
   1-10        Rosson             x                               
   1-11        Carriker                                      x    
   1-12        Henderson          x                               
   1-13        Leedom             x                               
   1-14        Lucio              x                               
   1-15        Luna                                          x    
   1-16        Nelson             x                               
   1-17        Patterson          x                               
   1-18        Shelley            x                               
   1-19        Sibley             x                               
   1-20        West                                          x    
   1-21        Whitmire                                      x    
   1-22  COMMITTEE SUBSTITUTE FOR S.B. No. 646                   By:  Leedom
   1-23                         A BILL TO BE ENTITLED
   1-24                                AN ACT
   1-25  relating to notice requirements for actions affecting permanent
   1-26  school fund land and for transfers of real property abutting
   1-27  tidally influenced waters of the state, to the sale of state land
   1-28  acquired through tax foreclosure, to the sale or lease of and the
   1-29  granting of easements across permanent school fund lands, to funds
   1-30  associated with permanent school fund lands, to unauthorized
   1-31  structures on state-owned land, and to liens for penalty and
   1-32  removal costs.
   1-33        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
   1-34        SECTION 1.  Section 5.115, Water Code, is amended to read as
   1-35  follows:
   1-36        Sec. 5.115.  Notice of Application.  (a)  At the time an
   1-37  application for a permit or license under this code is filed with
   1-38  the executive director and is administratively complete, the
   1-39  commission shall give notice of the application to any person who
   1-40  may be affected by the granting of the permit or license.
   1-41        (b)  At the time an application for any formal action by the
   1-42  commission that will affect lands dedicated to the permanent school
   1-43  fund is filed with the executive director or the commission and is
   1-44  administratively complete, the commission shall give notice of the
   1-45  application to the School Land Board.  Notice shall be delivered by
   1-46  certified mail, return receipt requested, addressed to the deputy
   1-47  commissioner of the asset management division of the General Land
   1-48  Office.
   1-49        (c)  The commission shall adopt rules for the notice required
   1-50  by this section.
   1-51        (d) <(c)>  The notice must state:
   1-52              (1)  the identifying number given the application by
   1-53  the commission;
   1-54              (2)  the type of permit or license sought under the
   1-55  application;
   1-56              (3)  the name and address of the applicant;
   1-57              (4)  the date on which the application was submitted;
   1-58  and
   1-59              (5)  a brief summary of the information included in the
   1-60  permit application.
   1-61        (e)  The notice to the School Land Board under this section
   1-62  shall additionally:
   1-63              (1)  state the location of the permanent school fund
   1-64  land to be affected; and
   1-65              (2)  describe any foreseeable impact or effect of the
   1-66  commission's action on the permanent school fund land.
   1-67        (f)  A formal action or ruling by the commission on an
   1-68  application affecting permanent school fund land that is made
    2-1  without the notice required by this section is voidable by the
    2-2  School Land Board as to any permanent school fund lands affected by
    2-3  the action or ruling.
    2-4        SECTION 2.  Subchapter C, Chapter 43, Local Government Code,
    2-5  is amended by adding Section 43.0525 to read as follows:
    2-6        Sec. 43.0525.  NOTICE OF ANNEXATION OF PERMANENT SCHOOL FUND
    2-7  LANDS.  Notice of the intent of a municipality to annex any state
    2-8  land belonging to the permanent school fund shall be given to the
    2-9  School Land Board by certified mail, return receipt requested,
   2-10  addressed to the deputy commissioner of the asset management
   2-11  division of the General Land Office at least 30 days before the
   2-12  date of an annexation election or the issuance of an annexation
   2-13  ordinance relating to that land.  An annexation that is made
   2-14  without the notice required by this subsection is not effective as
   2-15  to the permanent school fund land sought to be annexed.
   2-16        SECTION 3.  Subchapter D, Chapter 11, Natural Resources Code,
   2-17  is amended by adding Section 11.082 to read as follows:
   2-18        Sec. 11.082.  Notice to School Land Board.  (a)  A state
   2-19  agency or political subdivision may not formally take any action
   2-20  that may affect state land dedicated to the permanent school fund
   2-21  without first giving notice of the action to the board.  Notice of
   2-22  the proposed action shall be delivered by certified mail, return
   2-23  receipt requested, addressed to the deputy commissioner of the
   2-24  asset management division of the General Land Office on or before
   2-25  the state agency's or political subdivision's formal initiation of
   2-26  the action.
   2-27        (b)  The notice must:
   2-28              (1)  describe the proposed action;
   2-29              (2)  state the location of the permanent school fund
   2-30  land to be affected; and
   2-31              (3)  describe any foreseeable impact or effect of the
   2-32  state agency's or political subdivision's action on the permanent
   2-33  school fund land.
   2-34        (c)  An action taken by a state agency or political
   2-35  subdivision without the notice required by Subsection (a) of this
   2-36  section that affects state land dedicated to the permanent school
   2-37  fund is not effective as to permanent school fund land affected by
   2-38  the action.
   2-39        (d)  In this section:
   2-40              (1)  "Action" means:
   2-41                    (A)  formal adoption of an agency or political
   2-42  subdivision policy;
   2-43                    (B)  final adoption of an administrative rule;
   2-44                    (C)  issuance of findings of fact or law;
   2-45                    (D)  issuance of an administrative order in an
   2-46  administrative hearing; or
   2-47                    (E)  adoption of a local ordinance or resolution.
   2-48              (2)  "Board" means the School Land Board.
   2-49              (3)  "Initiation" means the commencement of the first
   2-50  phase of public consideration of a formal policy, rule, or
   2-51  ordinance, or a hearing undertaken by a state agency or political
   2-52  subdivision that is intended to result in final adoption of a
   2-53  formal policy, rule, or ordinance.
   2-54              (4)  "Political subdivision" means a county,
   2-55  municipality, public school district, or special-purpose district
   2-56  or authority.
   2-57              (5)  "State agency" means:
   2-58                    (A)  a department, commission, board, office,
   2-59  bureau, council, or other agency in the executive branch of state
   2-60  government other than the Texas Department of Transportation and
   2-61  the Railroad Commission of Texas; or
   2-62                    (B)  a university system or an institution of
   2-63  higher education as defined in Section 61.003, Education Code.
   2-64        SECTION 4.  Section 32.112, Natural Resources Code, is
   2-65  amended to read as follows:
   2-66        Sec. 32.112.  SALE OF TAX FORECLOSURE PROPERTY.  (a)  All
   2-67  real property or any interest in real property placed in the name
   2-68  of the state as a result of a tax foreclosure sale may be sold or
   2-69  leased by the board in the same manner as provided for the sale or
   2-70  lease of land under Chapter 51 of this code <The board may sell by
    3-1  sealed bid all real property placed in the name of the state as a
    3-2  result of any tax foreclosure sale.  The sealed bid sales shall be
    3-3  conducted in the same manner as sealed bid sales for public school
    3-4  land>.
    3-5        (b)  The board may retain from the proceeds of a sale or
    3-6  lease conducted under this section the cost of conducting the
    3-7  transaction <sale>, including advertising, appraisal, and
    3-8  administrative costs.  The balance of the proceeds shall be
    3-9  deposited in the State Treasury to the credit of the Texas capital
   3-10  trust fund.
   3-11        SECTION 5.  Section 33.015, Natural Resources Code, is
   3-12  amended to read as follows:
   3-13        Sec. 33.015.  SPECIAL FUND.  (a)  A special fund is created,
   3-14  and money received by the board for the grant of permits under this
   3-15  chapter shall be deposited in the State Treasury to the credit of
   3-16  this special fund.
   3-17        (b)  Sections 403.094 and 403.095, Government Code, do not
   3-18  apply to the fund created under this section.
   3-19        SECTION 6.  Section 33.131, Natural Resources Code, is
   3-20  amended to read as follows:
   3-21        Sec. 33.131.  Structures as Property of the State.  A
   3-22  structure presently existing or to be constructed in the future for
   3-23  which a permit is required under Section 33.119 of this code
   3-24  <subchapter> is the property of the state.  Any construction,
   3-25  maintenance, or use of the structure other than as provided in this
   3-26  subchapter is declared to be a nuisance per se and is expressly
   3-27  prohibited.
   3-28        SECTION 7.  Subchapter D, Chapter 33, Natural Resources Code,
   3-29  is amended by adding Section 33.135 to read as follows:
   3-30        Sec. 33.135.  NOTICE TO PURCHASER OR GRANTEE OF COASTAL AREA
   3-31  PROPERTY.   (a)  A person who sells, transfers, or conveys an
   3-32  interest other than a mineral, leasehold, or security interest in
   3-33  real property adjoining and abutting the tidally influenced waters
   3-34  of the state must include the following notice as a part of a
   3-35  written executory contract for the sale, transfer, or conveyance:
   3-36                "NOTICE REGARDING COASTAL AREA PROPERTY
   3-37              "(1)  The real property described in and subject to
   3-38  this contract adjoins and shares a common boundary with the tidally
   3-39  influenced submerged lands of the state.  The boundary is subject
   3-40  to change and can be determined accurately only by a survey on the
   3-41  ground made by a licensed state land surveyor in accordance with
   3-42  the original grant from the sovereign.  The owner of the property
   3-43  described in this contract may gain or lose portions of the tract
   3-44  because of changes in the boundary.
   3-45              "(2)  The seller, transferor, or grantor has no
   3-46  knowledge of any prior fill as it relates to the property described
   3-47  in and subject to this contract.
   3-48              "(3)  State law prohibits the use, encumbrance,
   3-49  construction, or placing of any structure in, on, or over
   3-50  state-owned submerged lands below the applicable tide line, without
   3-51  proper permission.
   3-52              "(4)  The purchaser or grantee is hereby advised to
   3-53  seek the advice of an attorney or other qualified person as to the
   3-54  legal nature and effect of the facts set forth in this notice on
   3-55  the property described in and subject to this contract.
   3-56  Information regarding the location of the applicable tide line as
   3-57  to the property described in and subject to this contract may be
   3-58  obtained from the surveying division of the General Land Office in
   3-59  Austin."
   3-60        (b)  If property described under Subsection (a) of this
   3-61  section is sold, transferred, or conveyed without an executory
   3-62  contract for conveyance, a written statement containing the notice
   3-63  prescribed by that subsection must be delivered to the grantee for
   3-64  execution and acknowledgement of receipt before the conveyance is
   3-65  recorded.
   3-66        (c)  Failure to include the prescribed notice in the written
   3-67  executory contract or to deliver a written statement of the notice
   3-68  for execution and acknowledgement by the grantee in the absence of
   3-69  a written executory contract:
   3-70              (1)  constitutes a legal right in the purchaser to
    4-1  terminate the contract or to renounce a sale, transfer, or
    4-2  conveyance;
    4-3              (2)  requires that any consideration, down payment, or
    4-4  deposit paid by the grantee be returned to the grantee, together
    4-5  with a cancellation of any promissory note or security instrument
    4-6  given in consideration for the sale, conveyance, or transfer; and
    4-7              (3)  constitutes a deceptive act under Section 17.46,
    4-8  Business & Commerce Code.
    4-9        (d)  This section or the action of any party subject to this
   4-10  section does not diminish or modify the beach access and use rights
   4-11  of the public as acquired by statute or under common law.
   4-12        SECTION 8.  Section 51.052, Natural Resources Code, is
   4-13  amended by amending Subsections (e) and (f) and adding Subsection
   4-14  (i) to read as follows:
   4-15        (e)  The owner of land that surrounds land in a tract of 700
   4-16  <320> acres or less shall have a preference right to purchase the
   4-17  tract before the land is made available for sale to any other
   4-18  person, provided the person having the preference right pays not
   4-19  less than the market value for the land as determined by the board.
   4-20        (f)  If the surrounding land is owned by more than one
   4-21  person, the owners of land with a common boundary with a tract of
   4-22  700 <320> acres or less that is for sale shall have a preference
   4-23  right to purchase the tract before it is made available to any
   4-24  other person, provided the person with the preference right pays
   4-25  not less than the market value of the land as determined by the
   4-26  board and the board finds use of the preference to be in the best
   4-27  interest of the state.   The board shall adopt rules to implement
   4-28  this preference right.
   4-29        (i)  If no bid meeting minimum requirements is received for a
   4-30  tract of land offered at a sealed bid sale under Subchapter D of
   4-31  Chapter 32 of this code, the asset management division of the land
   4-32  office may solicit proposals or negotiate a sale, exchange, or
   4-33  lease of the property to any person.  The sale price may not be
   4-34  less than the appraised value of the land as determined by the
   4-35  asset management division of the land office.  The board must
   4-36  approve any negotiated sale, exchange, or lease of any land under
   4-37  this section.
   4-38        SECTION 9.  Section 51.291, Natural Resources Code, is
   4-39  amended to read as follows:
   4-40        Sec. 51.291.  GRANTS OF EASEMENTS.  (a)  Except as provided
   4-41  by Subsection (b) of this section, the <The> commissioner may
   4-42  execute grants of easements for rights-of-way across, through, and
   4-43  under unsold public school land, the portion of the Gulf of Mexico
   4-44  within the jurisdiction of the state, the state-owned riverbeds and
   4-45  beds of navigable streams in the public domain, and all islands,
   4-46  saltwater lakes, bays, inlets, marshes, and reefs owned by the
   4-47  state within tidewater limits for:
   4-48              (1)  telephone, telegraph, electric transmission, and
   4-49  powerlines;
   4-50              (2)  oil pipelines, including pipelines connecting the
   4-51  onshore storage facilities with the offshore facilities of a
   4-52  deepwater port, as defined by the federal Deepwater Port Act of
   4-53  1974 (33 U.S.C.A. Section 1501 et seq.), gas pipelines, sulphur
   4-54  pipelines, and other electric lines and pipelines of any nature;
   4-55              (3)  irrigation canals, laterals, and water pipelines;
   4-56              (4)  roads; and
   4-57              (5)  any other purpose the commissioner considers to be
   4-58  in the best interest of the state.
   4-59        (b)  Consent to conduct an activity that would disturb or
   4-60  remove marl, sand, gravel, shell, or mudshell on or near the
   4-61  surface of a state-owned riverbed or the bed of a navigable stream
   4-62  in the public domain may be granted only under Chapter 86, Parks
   4-63  and Wildlife Code.
   4-64        (c)  Money received by the land office for the grants of
   4-65  easements through and under the state-owned riverbeds and beds of
   4-66  navigable streams in the public domain shall be deposited in a
   4-67  special fund account in the state treasury to be used for the
   4-68  removal or improvement of unauthorized structures on permanent
   4-69  school fund land.  This fund does not impose a duty or obligation
   4-70  on the state to accept ownership of, remove, or improve
    5-1  unauthorized structures on permanent school fund land.
    5-2        SECTION 10.  Section 51.302, Natural Resources Code, is
    5-3  amended to read as follows:
    5-4        Sec. 51.302.  Prohibition and Penalty.  (a)  No person may
    5-5  construct or maintain any facility or structure on land <of the
    5-6  facilities listed in Sections 51.291 through 51.293 of this code or
    5-7  any other facility on or across any section or part of a section of
    5-8  land of the character enumerated in Sections 51.291 through 51.293
    5-9  of this code and> owned by the state, nor may any person who has
   5-10  not acquired a proper easement, lease, permit, or other instrument
   5-11  from the state as required by this chapter or Chapter 33 of this
   5-12  code <provided in this subchapter> and who owns or possesses a <any
   5-13  of the facilities listed in Sections 51.291 through 51.293 of this
   5-14  code or any other> facility or structure that is now located on or
   5-15  across <any section or part of a section of land of the character
   5-16  enumerated in Sections 51.291 through 51.293 of this code and owned
   5-17  by the> state land continue in possession of the land unless he
   5-18  obtains from the commissioner, the board, or the board of regents
   5-19  an easement, lease, permit, <a grant of a right-of-way easement> or
   5-20  other instrument required by this chapter or Chapter 33   of this
   5-21  code <easement> for the land on which the facility or structure is
   5-22  to be constructed or is located.
   5-23        (b)  A person who constructs, maintains, owns, or possesses a
   5-24  facility or structure on state land without a proper easement or
   5-25  lease from the state under this chapter or under Chapter 33 <or 51>
   5-26  of this code is liable for a penalty of not less than $50 or more
   5-27  than $1,000 a day for each day that a violation occurs.  The
   5-28  penalty shall be recovered by the commissioner under Section
   5-29  51.3021 of this code or in a civil action by the attorney general.
   5-30        (c)  A person who owns, maintains,  or possesses an
   5-31  unauthorized <abandoned> facility or structure is, for purposes of
   5-32  this section, the person who last owned, maintained, or possessed
   5-33  the facility or structure <immediately before abandonment>.
   5-34        (d)  The commissioner or attorney general may also recover
   5-35  from a person who constructs, maintains, owns, or possesses a
   5-36  facility or structure on state land without the proper easement the
   5-37  costs to the state of removing that facility or structure under
   5-38  Section 51.3021 of this code.
   5-39        (e)  Penalties and costs recovered under this section shall
   5-40  be deposited in the special fund established under Sections 52.297
   5-41  and 53.155 of this code.
   5-42        (f)  This section is cumulative of all other applicable
   5-43  penalties or enforcement provisions of this code.
   5-44        (g)  In lieu of seeking administrative penalties or removal
   5-45  of a facility or structure under Section 51.3021 of this code, the
   5-46  commissioner may elect to accept ownership of the facility or
   5-47  structure as a fixture and may exercise the state's rights as owner
   5-48  of the facility or structure by filing notice of ownership in the
   5-49  real property records of the county in which the facility or
   5-50  structure is located.  For facilities or structures located on
   5-51  coastal public land, notice of ownership shall be filed in the
   5-52  county adjacent to the property on which the facility or structure
   5-53  is located.  A state agency fund or trust fund is not liable for
   5-54  the condition of any facility or structure as a result of acquiring
   5-55  an interest in the facility or structure under this section.
   5-56        SECTION 11.  Subsections (b), (g), and (h), Section 51.3021,
   5-57  Natural Resources Code, are amended to read as follows:
   5-58        (b)  Before the commissioner may remove a facility or
   5-59  structure under this section or impose a penalty under Section
   5-60  51.302 of this code, the commissioner must give written notice to a
   5-61  person who is constructing, maintains, owns, or possesses the
   5-62  facility or structure.  The notice must state:
   5-63              (1)  the specific facility or structure that is without
   5-64  proper easement or lease or that threatens public health, safety,
   5-65  or welfare;
   5-66              (2)  that the person who is constructing, maintains,
   5-67  owns, or possesses the facility or structure shall remove the
   5-68  facility or structure:
   5-69                    (A)  not later than the 30th day after the date
   5-70  on which the notice is served, if the facility or structure is on
    6-1  state land without a proper lease or easement; or
    6-2                    (B)  within a reasonable time specified by the
    6-3  commissioner if the facility or structure is an imminent and
    6-4  unreasonable threat to public health, safety, or welfare;
    6-5              (3)  that failure to remove the facility or structure
    6-6  may result in liability for a penalty under Section 51.302(b) of
    6-7  this code in an amount specified, removal by the commissioner and
    6-8  liability for the costs of removal, attachment of a lien to the
    6-9  adjacent littoral property to secure payment of the penalty and
   6-10  costs of removal, or any combination of those remedies <both>; and
   6-11              (4)  that the person who is constructing, maintains,
   6-12  owns, or possesses the facility or structure may submit, not later
   6-13  than the 30th day after the date on which the notice is served,
   6-14  written request for a hearing.
   6-15        (g)  The commissioner may contract for the removal and
   6-16  disposal of a facility or structure under this section and may pay
   6-17  the costs of removal from the special fund established under
   6-18  Sections 52.297 and 53.155 of this code or from funds appropriated
   6-19  by the legislature.
   6-20        (h)  If the person who is constructing, maintains, owns, or
   6-21  possesses the facility or structure does not pay assessed
   6-22  penalties, removal costs, and other assessed fees and expenses not
   6-23  later than the 60th day after the entry of the final order
   6-24  assessing the penalties, costs, fees, and expenses, the
   6-25  commissioner may:
   6-26              (1)  sell salvageable parts or attachments of the
   6-27  facility or structure to offset those costs;
   6-28              (2)  record a lien, in the total amount of the
   6-29  penalties, costs, and other fees and expenses assessed, against the
   6-30  adjacent littoral property;
   6-31              (3)  request the attorney general to institute civil
   6-32  proceedings to collect the penalties, costs of removal, and other
   6-33  fees and expenses remaining unpaid; or
   6-34              (4)  use any combination of the remedies prescribed by
   6-35  this subsection, or other remedies authorized by law, to collect
   6-36  the unpaid penalties, costs of removal, and other fees and expenses
   6-37  assessed on account of the unauthorized facility or structure on
   6-38  state land and its removal by the commissioner.
   6-39        (i) <(h)>  The decision to remove a facility or structure
   6-40  under this section is discretionary with the commissioner.  This
   6-41  section does not impose a duty on the state to remove a facility or
   6-42  structure or to remedy or warn of a hazardous condition on state
   6-43  land.
   6-44        SECTION 12.  Section 51.401, Natural Resources Code, is
   6-45  amended by adding Subsection (e) to read as follows:
   6-46        (e)  Sections 403.094 and 403.095, Government Code, do not
   6-47  apply to a fund account created under this section.
   6-48        SECTION 13.  (a)  The change in law made by Section 5.115,
   6-49  Water Code, as amended by this Act, applies only to an application
   6-50  filed with the Texas Water Commission or its successor on or after
   6-51  the effective date of this Act.
   6-52        (b)  The change in law made by Section 43.0525, Local
   6-53  Government Code, as added by this Act, applies only to an
   6-54  annexation the proceedings for which are initiated on or after the
   6-55  effective date of this Act.
   6-56        (c)  The change in law made by Section 11.082, Natural
   6-57  Resources Code, as added by this Act, applies to an action, as
   6-58  defined by that section, that is pending before a state agency or
   6-59  political subdivision, as defined by that section, on the effective
   6-60  date of this Act.
   6-61        (d)  The change in law made by Section 33.135, Natural
   6-62  Resources Code, as added by this Act, applies only to a transfer
   6-63  that occurs on or after the effective date of this Act.
   6-64        SECTION 14.  The importance of this legislation and the
   6-65  crowded condition of the calendars in both houses create an
   6-66  emergency and an imperative public necessity that the
   6-67  constitutional rule requiring bills to be read on three several
   6-68  days in each house be suspended, and this rule is hereby suspended.
   6-69                               * * * * *
   6-70                                                         Austin,
    7-1  Texas
    7-2                                                         April 26, 1993
    7-3  Hon. Bob Bullock
    7-4  President of the Senate
    7-5  Sir:
    7-6  We, your Committee on State Affairs to which was referred S.B. No.
    7-7  646, have had the same under consideration, and I am instructed to
    7-8  report it back to the Senate with the recommendation that it do not
    7-9  pass, but that the Committee Substitute adopted in lieu thereof do
   7-10  pass and be printed.
   7-11                                                         Harris of
   7-12  Dallas, Chairman
   7-13                               * * * * *
   7-14                               WITNESSES
   7-15                                                  FOR   AGAINST  ON
   7-16  ___________________________________________________________________
   7-17  Name:  Spencer Reid                                            x
   7-18  Representing:  Tx General Land Office
   7-19  City:  Austin
   7-20  -------------------------------------------------------------------