1-1 By: Galloway S.B. No. 731 1-2 (In the Senate - Filed February 23, 1995; February 23, 1995, 1-3 read first time and referred to Committee on Intergovernmental 1-4 Relations; April 5, 1995, reported adversely, with favorable 1-5 Committee Substitute by the following vote: Yeas 10, Nays 0; 1-6 April 5, 1995, sent to printer.) 1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 731 By: Galloway 1-8 A BILL TO BE ENTITLED 1-9 AN ACT 1-10 relating to the authority to dissolve the Oak Ridge Municipal 1-11 Utility District and the assumption of its assets and obligations 1-12 by a municipality. 1-13 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-14 SECTION 1. Chapter 615, Acts of the 60th Legislature, 1-15 Regular Session, 1967, is amended by adding Section 25 to read as 1-16 follows: 1-17 Sec. 25. (a) The district's board of directors may issue an 1-18 order that dissolves the district after: 1-19 (1) the board calls and conducts an election to 1-20 authorize dissolution of the district in the manner provided by 1-21 Chapter 54, Water Code, for an election to approve issuance of 1-22 bonds; 1-23 (2) a majority of the resident electors who vote in an 1-24 election authorized by Subdivision (1) vote for the proposition: 1-25 "The dissolution of the district"; 1-26 (3) the board creates a special reserve fund 1-27 consisting of a sum certain from money contained in the district's 1-28 bond retirement fund; and 1-29 (4) a qualified municipality issues an ordinance by 1-30 which, on a specified date after the dissolution of the district 1-31 that is not later than the 90th day after the date an election is 1-32 held under Subdivision (1), the municipality agrees to: 1-33 (A) assume the district's debts, liabilities, 1-34 and obligations; 1-35 (B) assume ownership of the district's assets 1-36 and facilities; 1-37 (C) perform the district's functions and provide 1-38 all services previously provided by the district; and 1-39 (D) use the money in the district's special 1-40 reserve fund created under Subdivision (3) only to retire debt 1-41 incurred by the district, unless another purpose is approved by at 1-42 least four members of the municipality's governing body. 1-43 (b) A municipality is qualified to assume the district's 1-44 debts, liabilities, and obligations and assume ownership of the 1-45 district's assets and facilities if: 1-46 (1) the municipality has, at the time of assumption, a 1-47 "bbb" or better investment grade credit rating from Standard & 1-48 Poor's Investor Services, Inc., on its outstanding bonds, if any; 1-49 and 1-50 (2) the combined debt principal of the municipality 1-51 and the district does not exceed 12 percent of the total assessed 1-52 valuation of the municipality's property, as determined by the most 1-53 recent valuation certified by the applicable county appraisal 1-54 district. 1-55 (c) The municipality that assumes the district's debts, 1-56 liabilities, and obligations and assumes ownership of the 1-57 district's assets and facilities shall levy an ad valorem tax for 1-58 bond debt service as authorized by the district at the time of the 1-59 district's dissolution on all property formerly in the district, 1-60 including property outside the municipality's boundaries, but the 1-61 tax on the property outside the municipality's boundaries at the 1-62 time of the district's dissolution may not exceed that area's pro 1-63 rata share of the annual debt service obligations on the district's 1-64 outstanding bonds. 1-65 (d) The municipality may not levy an ad valorem tax to pay 1-66 annual debt service obligations on the district's outstanding bonds 1-67 on property that, at the time the district is dissolved, is not 1-68 within the district. 2-1 (e) The municipality may charge for water and sewer services 2-2 to areas that, at the time the district is dissolved, are within 2-3 the district but not within the municipality's boundaries rates not 2-4 to exceed 125 percent of the rates charged to residents of the 2-5 municipality as necessary to provide services to those areas. 2-6 SECTION 2. The importance of this legislation and the 2-7 crowded condition of the calendars in both houses create an 2-8 emergency and an imperative public necessity that the 2-9 constitutional rule requiring bills to be read on three several 2-10 days in each house be suspended, and this rule is hereby suspended, 2-11 and that this Act take effect and be in force from and after its 2-12 passage, and it is so enacted. 2-13 * * * * *