BILL ANALYSIS


                                                     C.S.H.B. 546
                                              By: Brimer (Harris)
                                                Natural Resources
                                                         05-17-95
                            Senate Committee Report (Substituted)
BACKGROUND

Currently, there are no provisions in state law authorizing a
property owner to petition for property exclusion from a water or
reclamation district's tax roll if the district does not provide
services.

PURPOSE

As proposed, C.S.H.B. 546 authorizes a property owner in a water or
reclamation district to petition the district for exclusion of the
property from the district's property tax roll if the district does
not provide services.

RULEMAKING AUTHORITY

It is the committee's opinion that rulemaking authority is granted
to the Texas Natural Resource Conservation Commission under SECTION
1 (Section 50.504(j), Water Code) of this bill.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter 50, Water Code, by adding Subchapter N,
as follows:

      SUBCHAPTER N.  EXCLUSION OF CERTAIN UNSERVED PROPERTY

     Sec.  50.501.  APPLICABILITY.  Makes this subchapter
     applicable to certain districts or authorities created by
     Article III, Section 52, or Article XVI, Section 59, Texas
     Constitution (district) that provides potable or treated water
     supply services or wastewater services; and imposes a tax on
     property in the district at a rate that does not exceed $1.20
     per $100 assessed valuation; and does not impose a standby
     fee, as defined by Section 50.056.
     
     Sec.  50.502.  PETITION FOR EXCLUSION OF UNSERVED PROPERTY. 
     (a) Authorizes the owner of property in a district on which
     the district has imposed a tax but to which the district does
     not provide services to petition the governing body of the
     district (board) to exclude the property from the district if
     certain criteria is met.
     
     (b) Requires the owner to send the petition to the
       district's main office by certified mail.
       
       Sec.  50.503.  CONTENT OF PETITION.  Sets forth information
     required to be contained in the petitition for exclusion
     (petition).
     
     Sec.  50.504.  ACTION ON PETITION; ENFORCEMENT.  (a) Requires
     the board to consider a petition as an application for
     services.  
     
     (b) Requires the board, by the 35th day after receiving the
       petition, to decide whether to provide services to the
       property; or decide not to provide services and decide to
       request approval from the executive director of the Texas
       Natural Resource Conservation Commission (executive
       director) to exclude the property.
     (c) Requires the board, if it decides not to provide the
       services, to make the request under Subsection (b)(2) by the
       35th day after receiving the petition.
       
       (d) Requires the executive director to approve or disapprove
       the request before the 61st day after the request is
       received.  Requires the executive director to approve the
       property exclusion if the executive director makes certain
       findings.
       
       (e) Requires the board, if the executive director approves
       the exclusion, to grant the petition and issue an order
       excluding the property if the board decides not to approve
       the services.  Provides that the order takes effect
       immediately.  Sets forth information required to be in an
       order to exclude property.
       
       (f) Requires the board to file for record a certified copy
       of the order in the real property records of the county
       where the property is located.
       
       (g) Requires the board, by the 35th day after receiving the
       petition, to prepare and present to the petitioner a plan
       and schedule for providing service to the property if the
       board decides to provide the services in lieu of exclusion. 
       Requires the district to begin operations to carry out the
       plan by the 90th day after the date the plan is presented.
       
       (h) Authorizes the petitioner to petition the Texas Natural
       Resource Conservation Commission (commission) to order the
       board to exclude the property or carry out the plan for
       providing service to the property if the board fails to meet
       the deadline in Subsection (b), (c), (d), or (g).  Requires
       the petition to be filed by the 30th day after the deadline
       that was not met.
       
       (i) Authorizes the petitioner to appeal the board's decision
       to provide service to the property by filing a petition
       requesting the commission to order the board to exclude the
       property from the district.  Requires the petition to be
       filed by the 30th day after the board provides the plan for
       providing service to the property.  Authorizes the board to
       suspend preparations or operations to carry out the plan
       pending hearing on the appeal.
       
       (j) Requires the commission to order a hearing on the
       petition to be held before the 61st day after receipt of a
       petition under Subsection (h) or (i).  Requires the
       commission to give notice of the hearing as provided by
       commission rule to all persons affected the hearing's
       outcome.  Authorizes the commission, by rule, to require a
       petitioner to include with the petition a deposit to pay the
       costs of the notice.
       
       (k) Requires the commission to order the board to exclude
       the property if it finds at a hearing for a petition filed
       under Subsection (h) that the board failed without cause to
       provide the petitioner with a plan for providing services or
       fails in the implementation of the plan.
       
       (l) Requires the commission to order the board to exclude
       the property if it finds at a hearing for a petition filed
       under Subsection (i) that the plan for providing services to
       the property is unreasonable or impracticable.
       
       (m) Authorizes a property owner who has filed a petition to
       bring suit in district court to order the board to provide
       services or issue an exclusion order in accordance with
       periods provided by this section if it appears that the
       board is not complying with this section.
       
       Sec.  50.505.  EFFECT OF ORDER. (a) Provides that an exclusion
     order removes the identified property from the jurisdiction of
     the district.  Provides that the exclusion of property does
     not diminish or impair the rights of holders of any
     outstanding or unpaid bonds, warrants, or other obligations of
     the district.
     
     (b) Provides that the excluded property is not released from
       payment of its pro rata share of the district's debt
       existing on the date of the exclusion order.  Requires the
       district to continue to levy taxes each year on the excluded
       property equal to the property's share of the debt. 
       Requires the taxes collected to be exclusively applied to
       the payment of that debt.  Authorizes the owner of the
       excluded property to pay the debt in full without penalty at
       any time.
       
       (c) Provides that the excluded property is not subject to
       any debt of the district incurred after the date of the
       exclusion order.
       
            Sec.  50.506.  EXPIRATION OF SUBCHAPTER.  Provides that this
     subchapter expires September 1, 1997.
SECTION 2. Effective date: September 1, 1995.

SECTION 3. Emergency clause.