BILL ANALYSIS S.B. 1261 By: Barrientos (Combs/Greenberg) May 11, 1995 Committee Report (Unamended) BACKGROUND The Maple Run Municipal Utility District (district) was created in 1983 by consent agreement with the City of Austin. Its developers issued bonds for an amount of infrastructure far in excess of the development which took place before the recession slowed down development. The development partnership broke up, and litigation ensued between residents and the developer, who left much of the district undeveloped without subdivision plats being filed. A recent development partnership trying to revive building in the district went bankrupt. The district services may cease to be provided if the district is not annexed. PURPOSE As proposed, the bill sets forth provisions relating to the annexation and the provision of services to certain districts by cities and the assessment of surcharges on the dissolution of those districts. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1 Amends Chapter 43, Local Government Code, by adding Section 43.082, as follows: Sec. 43.082. (a) Provides that this section applies to any district created in or after 1983 within the extraterritorial jurisdiction (ETJ) of a municipality with written consent by ordinance or resolution as required by Section 42.042, Local Government Code, and the district has issued not less than $17 million nor more than $21 million in bonds repayable in a manner authorized under Section 54.503(2), Water Code, before June 1, 1993; and constructed all of the facilities for which the bonds were issued prior to December 31, 1991. (b) Authorizes the board of directors of a district governed by this section to dissolve the district pursuant to this section by adopting a resolution at a regular meeting of a district. Requires the municipality within whose ETJ the district is located to provide full municipal services as defined by Section 43.056(c), Local Government Code, upon the dissolution of a district under this section. (c) Requires the district to be considered to be annexed to the municipality within whose ETJ the district is located after the adoption of a resolution by the municipality without providing notice or holding hearings otherwise required for annexation under this code, upon the dissolution of a district subject to this section. (d) Requires the municipality within whose ETJ the district is located to take ownership of the district's assets and assume the district's bonding liabilities, obligations and other debts, upon the dissolution of a district subject to this section. (e) Authorizes the municipality in which the ETJ the district is located to assess certain fees after the municipality takes ownership under Subsection (d). (f) Requires the municipality to have no responsibility to reimburse the developer of the district or a successor for more than $800,000 for engineering and construction costs to design and build certain water and wastewater facilities, whether temporary or permanent, installed after the effective date of this Act. Authorizes any obligation to reimburse the developer to be paid in installments over a three-year period. (g) Requires this section to expire December 31, 1996. SECTION 2 Severability clause. SECTION 3 Emergency clause. Effective upon passage. SUMMARY OF COMMITTEE ACTION S.B. 1261 was considered by the committee in a formal meeting on May 10, 1995. The bill was reported favorably without amendment, with the recommendation that it do pass and be printed and be sent to the Committee on Local and Consent Calendars, by a record vote of 7 ayes, 0 nays, 0 pnv, 2 absent.