By Lucio                                              S.B. No. 1170
       74R1550 DRH-D
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to the authority of a coastal municipality to undertake
    1-3  projects affecting beaches, dunes, bays, and similar natural
    1-4  resources, to issue bonds, and to impose an ad valorem tax.
    1-5        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-6        SECTION 1.  Subtitle A, Title 10, Local Government Code, is
    1-7  amended by adding Chapter 309 to read as follows:
    1-8          CHAPTER 309.  COASTAL MANAGEMENT BY MUNICIPALITIES
    1-9                   SUBCHAPTER A.  GENERAL PROVISIONS
   1-10        Sec. 309.001.  APPLICATION.  This chapter applies only to a
   1-11  municipality that borders the Gulf of Mexico or is located on a
   1-12  channel, bay, or inlet connected to the Gulf of Mexico.
   1-13        Sec. 309.002.  ACQUISITION OF PROPERTY.    (a)  A
   1-14  municipality may acquire an interest in real property, including
   1-15  improvements, to create, maintain, or further develop:
   1-16              (1)  a public beach, sand dune, artificial reef, or
   1-17  other natural or artificial feature used to preserve or enhance the
   1-18  shoreline; or
   1-19              (2)  a channel, bay, harbor, boat basin, or other
   1-20  natural or artificial coastal waterway used for navigation or
   1-21  recreation.
   1-22        (b)  Real property acquired under Subsection (a) must be:
   1-23              (1)  in the municipality; or
   1-24              (2)  in a county in which the municipality is located,
    2-1  but not more than five miles offshore.
    2-2        Sec. 309.003.  USE OF PROPERTY; LOCATION OF IMPROVEMENTS.
    2-3  (a)  A municipality may use any property acquired under Section
    2-4  309.002 or undertake any project for any public purpose necessary
    2-5  for coastal management.
    2-6        (b)  A municipality may construct an improvement on property
    2-7  that is held in trust by the state for the public's right of access
    2-8  to the Gulf of Mexico or any public waterway leading to the Gulf of
    2-9  Mexico.
   2-10        Sec. 309.004.  FUNDING.  A municipality may use any source of
   2-11  available funds to carry out the purposes of this chapter including
   2-12  revenue derived from:
   2-13              (1)  a sales and use tax under Chapter 321, Tax Code;
   2-14              (2)  a hotel occupancy tax under Chapter 351, Tax Code;
   2-15  or
   2-16              (3)  an ad valorem tax on property.
   2-17        Sec. 309.005.  GIFTS.  A municipality may accept gifts or
   2-18  grants of money or property from any source to accomplish the
   2-19  purposes of this chapter.
   2-20        Sec. 309.006.  CONTRACTS WITH OTHER GOVERNMENT ENTITIES.  A
   2-21  municipality may contract with the United States or an agency of
   2-22  this state or a political subdivision of this state to accomplish
   2-23  the purposes of this chapter.
   2-24        Sec. 309.007.  LOANS.  A municipality may borrow money from
   2-25  any person to accomplish the purposes of this chapter.
   2-26        Sec. 309.008.  EMINENT DOMAIN.  A municipality may acquire
   2-27  land, easements, or other property to carry out the purposes of
    3-1  this chapter by condemnation under Chapter 21, Property Code.  The
    3-2  municipality may condemn the fee simple title.
    3-3        Sec. 309.009.  EXEMPTION FROM TAXATION.  A municipality is
    3-4  exempt from a tax imposed by this state or political subdivision of
    3-5  this state on an activity or improvement authorized by this
    3-6  chapter.
    3-7        Sec. 309.010.  COOPERATION WITH CORPORATION CREATED BY
    3-8  MUNICIPALITY.  A municipality may contract with a corporation
    3-9  created under Section 4A, Development Corporation Act of 1979
   3-10  (Article 5190.6, Vernon's Texas Civil Statutes), to perform any of
   3-11  the activities authorized under this chapter.  The corporation may
   3-12  use a sales and use tax that the municipality collects for the
   3-13  corporation's benefit to pay for any cost incurred under this
   3-14  chapter, including the costs of paying off bonds issued under
   3-15  Subchapter B.
   3-16           (Sections 309.011-309.020 reserved for expansion
   3-17                       SUBCHAPTER B.  BONDS AND TAXES
   3-18        Sec. 309.021.  APPLICATION TO BONDS ISSUED UNDER SUBCHAPTER;
   3-19  DEFINITION.  (a)  This subchapter applies only to bonds issued by a
   3-20  municipality under this chapter.
   3-21        (b)  In this subchapter, "bonds" includes other similar
   3-22  evidences of indebtedness.
   3-23        Sec. 309.022.  ISSUANCE OF BONDS.  (a)  A municipality may
   3-24  issue bonds that are secured by any source of revenue described by
   3-25  Section 309.004.  A source of revenue other than an ad valorem tax
   3-26  may be used without calling an election.  Bonds that do not require
   3-27  an election for their issuance:
    4-1              (1)  are not a debt or obligation of the municipality
    4-2  but are only a charge against the revenues or property pledged for
    4-3  their payment; and
    4-4              (2)  are not included in any limitations imposed by law
    4-5  on the power of a municipality to issue bonds.
    4-6        (b)  Bonds that are payable in whole or in part by the
    4-7  proceeds of an ad valorem tax may not be issued unless the issuance
    4-8  is approved at an election called by the municipality for that
    4-9  purpose.
   4-10        (c)  An election under Subsection (b) is held in the same
   4-11  manner as other bond elections in the municipality.  The bonds may
   4-12  be issued only if a majority of those voting at the election favor
   4-13  the issuance of the bonds.
   4-14        Sec. 309.023.  TERMS OF BONDS.  (a)  Bonds may mature
   4-15  serially or otherwise not more than 40 years from their date of
   4-16  issuance.
   4-17        (b)  The municipality may:
   4-18              (1)  issue the bonds on any terms it finds desirable;
   4-19  and
   4-20              (2)  provide in the ordinance, order, or resolution
   4-21  authorizing the issuance of the bonds for:
   4-22                    (A)  the deposit and accounting of funds;
   4-23                    (B)  the establishment and maintenance of an
   4-24  interest and sinking fund; and
   4-25                    (C)  any additional covenants regarding the
   4-26  bonds, or revenues or properties that are pledged to the bonds.
   4-27        Sec. 309.024.  AD VALOREM TAXES.  A municipality may impose
    5-1  an ad valorem tax in the same manner as other ad valorem taxes in
    5-2  the municipality to pay for bonds the issuance of which is
    5-3  authorized at an election.
    5-4        Sec. 309.025.  PROCEEDS OF BONDS.  The proceeds of bonds may
    5-5  be used to accomplish the purposes of this chapter, including the
    5-6  payment of fees for professional services and costs related to
    5-7  issuing the bonds.
    5-8        Sec. 309.026.  TAX STATUS OF BONDS.  Bonds, any transaction
    5-9  relating to the bonds, and profits made in the sale of the bonds
   5-10  are free from taxation by this state or a political subdivision of
   5-11  this state.
   5-12        SECTION 2.  (a)  An election that is held before the
   5-13  effective date of this Act to authorize the issuance of bonds as
   5-14  required by Subchapter B, Chapter 309, as added by Section 1 of
   5-15  this Act, is validated as of the date of the election.  All actions
   5-16  relating to the election are also validated.
   5-17        (b)  This section does not apply to any matter that on the
   5-18  effective date of this Act:
   5-19              (1)  is involved in litigation if the litigation
   5-20  ultimately results in the matter being held invalid by a final
   5-21  judgment of a court of competent jurisdiction; or
   5-22              (2)  has been held invalid by a final judgment of a
   5-23  court of competent jurisdiction.
   5-24        SECTION 3.  The importance of this legislation and the
   5-25  crowded condition of the calendars in both houses create an
   5-26  emergency and an imperative public necessity that the
   5-27  constitutional rule requiring bills to be read on three several
    6-1  days in each house be suspended, and this rule is hereby suspended,
    6-2  and that this Act take effect and be in force from and after its
    6-3  passage, and it is so enacted.