By:  Galloway                                          S.B. No. 731
                                 A BILL TO BE ENTITLED
                                        AN ACT
    1-1  relating to the authority to dissolve the Oak Ridge Municipal
    1-2  Utility District and the assumption of its assets and obligations
    1-3  by a municipality.
    1-4        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-5        SECTION 1.  Chapter 615, Acts of the 60th Legislature,
    1-6  Regular Session, 1967, is amended by adding Section 25 to read as
    1-7  follows:
    1-8        Sec. 25.  (a)  The district's board of directors may issue an
    1-9  order that dissolves the district after:
   1-10              (1)  the board calls and conducts an election to
   1-11  authorize dissolution of the district in the manner provided by
   1-12  Chapter 54, Water Code, for an election to approve issuance of
   1-13  bonds;
   1-14              (2)  a majority of the resident electors who vote in an
   1-15  election authorized by Subdivision (1) vote for the proposition:
   1-16  "The dissolution of the district";
   1-17              (3)  the board creates a special reserve fund
   1-18  consisting of a sum certain from money contained in the district's
   1-19  bond retirement fund; and
   1-20              (4)  a qualified municipality issues an ordinance by
   1-21  which, on a specified date after the dissolution of the district
   1-22  that is not later than the 90th day after the date an election is
   1-23  held under Subdivision (1), the municipality agrees to:
   1-24                    (A)  assume the district's debts, liabilities,
    2-1  and obligations;
    2-2                    (B)  assume ownership of the district's assets
    2-3  and facilities;
    2-4                    (C)  perform the district's functions and provide
    2-5  all services previously provided by the district; and
    2-6                    (D)  use the money in the district's special
    2-7  reserve fund created under Subdivision (3) only to retire debt
    2-8  incurred by the district, unless another purpose is approved by at
    2-9  least four members of the municipality's governing body.
   2-10        (b)  A municipality is qualified to assume the district's
   2-11  debts, liabilities, and obligations and assume ownership of the
   2-12  district's assets and facilities if:
   2-13              (1)  the municipality has, at the time of assumption, a
   2-14  "bbb" or better investment grade credit rating from Standard &
   2-15  Poor's Investor Services, Inc., on its outstanding bonds, if any;
   2-16  and
   2-17              (2)  the combined debt principal of the municipality
   2-18  and the district does not exceed 12 percent of the total assessed
   2-19  valuation of the municipality's property, as determined by the most
   2-20  recent valuation certified by the applicable county appraisal
   2-21  district.
   2-22        (c)  The municipality that assumes the district's debts,
   2-23  liabilities, and obligations and assumes ownership of the
   2-24  district's assets and facilities shall levy an ad valorem tax for
   2-25  bond debt service as authorized by the district at the time of the
   2-26  district's dissolution on all property formerly in the district,
   2-27  including property outside the municipality's boundaries, but the
    3-1  tax on the property outside the municipality's boundaries at the
    3-2  time of the district's dissolution may not exceed that area's pro
    3-3  rata share of the annual debt service obligations on the district's
    3-4  outstanding bonds.
    3-5        (d)  The municipality may not levy an ad valorem tax to pay
    3-6  annual debt service obligations on the district's outstanding bonds
    3-7  on property that, at the time the district is dissolved, is not
    3-8  within the district.
    3-9        (e)  The municipality may charge for water and sewer services
   3-10  to areas that, at the time the district is dissolved, are within
   3-11  the district but not within the municipality's boundaries rates not
   3-12  to exceed 125 percent of the rates charged to residents of the
   3-13  municipality as necessary to provide services to those areas.
   3-14        SECTION 2.  The importance of this legislation and the
   3-15  crowded condition of the calendars in both houses create an
   3-16  emergency and an imperative public necessity that the
   3-17  constitutional rule requiring bills to be read on three several
   3-18  days in each house be suspended, and this rule is hereby suspended,
   3-19  and that this Act take effect and be in force from and after its
   3-20  passage, and it is so enacted.