By Barrientos S.B. No. 1395
Substitute the following for S.B. No. 1395:
By Combs C.S.S.B. No. 1395
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to authorizing agreements affecting annexation between
1-3 certain political subdivisions of the state.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subchapter C, Chapter 42, Local Government Code,
1-6 is amended by adding Section 42.048 to read as follows:
1-7 Sec. 42.048. REGIONAL ECONOMIC DEVELOPMENT AGREEMENTS.
1-8 (a) The governing bodies of neighboring municipalities and
1-9 districts as defined in Section 43.0751 of this code may enter into
1-10 a regional economic development agreement for contiguous,
1-11 unincorporated territory that is partially within the
1-12 extraterritorial jurisdiction of each municipality that is a party
1-13 to the agreement. A regional economic development agreement may
1-14 provide for the following:
1-15 (1) the boundaries of the area covered by the
1-16 agreement;
1-17 (2) the duration of the agreement, and means for
1-18 renewing or terminating the agreement;
1-19 (3) apportionment of the area covered by the agreement
1-20 into service areas assigned to participating municipalities;
1-21 (4) a regional economic development board composed of
1-22 representatives of parties to an agreement to provide planning for
1-23 service delivery to the territory covered by the agreement;
1-24 (5) revenue sharing among participating municipalities
2-1 in order to reduce destructive competition for commercial and
2-2 industrial tax base; and
2-3 (6) such other lawful terms as the parties consider
2-4 appropriate.
2-5 (b) A municipality may annex for limited purposes a service
2-6 area assigned to that municipality by a regional economic
2-7 development agreement adopted under this section in order to
2-8 provide planning and zoning in the service area, notwithstanding
2-9 the limitations imposed by Section 43.121(a) of this code.
2-10 SECTION 2. Subchapter D, Chapter 43, Local Government Code,
2-11 is amended by adding Section 43.0751 and Section 43.0752 to read as
2-12 follows:
2-13 Sec. 43.0751 STRATEGIC PARTNERSHIPS FOR CONTINUATION OF
2-14 CERTAIN DISTRICTS. (a) In this section:
2-15 (1) "District" means a water control and improvement
2-16 district or a municipal utility district created or operating under
2-17 Chapter 51 or Chapter 54, Water Code.
2-18 (2) "Limited district" means a district that, pursuant
2-19 to a strategic partnership agreement, continues to exist after full
2-20 purpose annexation by a municipality in accordance with the terms
2-21 of a strategic partnership agreement.
2-22 (3) "Strategic partnership agreement" means a written
2-23 agreement between a municipality and district that provides terms
2-24 and conditions under which services will be provided and funded by
2-25 the parties to the agreement and under which the district will
2-26 continue to exist for an extended period of time if the land within
2-27 the district is annexed for limited or full purposes by the
3-1 municipality.
3-2 (b) The governing bodies of a municipality and a district
3-3 shall negotiate and may enter into a written strategic partnership
3-4 agreement for the district. The governing bodies of the
3-5 municipality and the district shall evidence their intention to
3-6 negotiate such an agreement by resolution, each of which
3-7 resolutions shall specify an expiration date if the other governing
3-8 body fails to adopt a resolution under this section on or before
3-9 the specified date. The governing body of a municipality that has
3-10 evidenced its intention by unexpired resolution to enter into
3-11 negotiations with a district for an agreement under this section
3-12 may not initiate proceedings to annex the district under any other
3-13 section of this code prior to the expiration of two years after the
3-14 adoption date of the resolution unless the municipality has
3-15 previously instituted annexation proceedings in granting consent to
3-16 the creation of the district prior to January 1, 1995.
3-17 (c) A strategic partnership agreement shall not be effective
3-18 until adopted by the governing bodies of the municipality and the
3-19 district. The agreement shall be recorded in the deed records of
3-20 the county or counties in which the land included within the
3-21 district is located and shall bind each owner and each future owner
3-22 of land included within the district's boundaries on the date the
3-23 agreement becomes effective.
3-24 (d) Before the governing body of a municipality or a
3-25 district adopts a strategic partnership agreement, it shall conduct
3-26 two public hearings at which members of the public who wish to
3-27 present testimony or evidence regarding the proposed agreement
4-1 shall be given the opportunity to do so. Notice of public hearings
4-2 conducted by the governing body of a municipality under this
4-3 subsection shall be published in a newspaper of general circulation
4-4 in the municipality and in the district. The notice must be in the
4-5 format prescribed by Section 43.123(b) of this code, and must be
4-6 published at least once on or after the 20th day before each date.
4-7 Notice of public hearings conducted by the governing body of a
4-8 district under this subsection shall be given in accordance with
4-9 the district's notification procedures for other matters of public
4-10 importance. Any notice of a public hearing conducted under this
4-11 subsection shall contain a statement of the purpose of the hearing,
4-12 the date, time and place of the hearing, and the location where
4-13 copies of the proposed agreement may be obtained prior to the
4-14 hearing. The governing bodies of a municipality and a district may
4-15 conduct joint public hearings under this subsection, provided that
4-16 at least one public hearing is conducted within the district. A
4-17 municipality may combine the public hearings and notices required
4-18 by this subsection with the public hearings and notices required by
4-19 Section 43.124 of this code.
4-20 (e) The governing body of a municipality may not annex a
4-21 district for limited purposes under this section or under provision
4-22 of Subchapter F, Chapter 43 of this code until it has adopted a
4-23 strategic partnership agreement with the district. The governing
4-24 body of a municipality may not adopt a strategic partnership
4-25 agreement before the agreement has been adopted by the governing
4-26 body of the affected district.
4-27 (f) A strategic partnership agreement may provide for the
5-1 following:
5-2 (1) limited purpose annexation of the district under
5-3 the provisions of Subchapter F, Chapter 43 of the Local Government
5-4 Code, provided that the district shall continue in existence during
5-5 the period of limited purpose annexation;
5-6 (2) such amendments to the timing requirements of
5-7 Sections 43.123(d)(2) and 43.127(b) of this code as may be
5-8 necessary or convenient to effectuate the purposes of the
5-9 agreement;
5-10 (3) payments by the municipality to the district for
5-11 services provided by the district;
5-12 (4) annexation of any commercial property in a
5-13 district for full purposes by the municipality, notwithstanding any
5-14 other provision of this code or the Water Code, except for the
5-15 obligation of the municipality to provide, directly or through
5-16 agreement with other units of government, full provision of
5-17 municipal services to annexed territory, in lieu of any annexation
5-18 of residential property or payment of any fee on residential
5-19 property in lieu of any annexation of residential property in the
5-20 district authorized by this subsection;
5-21 (5) a full-purpose annexation provision that specifies
5-22 the date on which the land included within the district's
5-23 boundaries shall be converted from the municipality's limited
5-24 purpose jurisdiction to its full-purpose jurisdiction, provided
5-25 that such date shall not be later than ten (10) years after the
5-26 effective date of the strategic partnership agreement; or
5-27 (6) (A) terms for payment of an annual fee to the
6-1 municipality by the district in lieu of full purpose annexation,
6-2 the form in which each such payment must be tendered, a method of
6-3 calculating the fee, and the date by which each such payment must
6-4 be made. Failure by a district to timely make an annual payment in
6-5 lieu of full purpose annexation in the amount and form required by
6-6 a strategic partnership agreement shall be the only grounds for
6-7 termination of the agreement with respect to annexation at the
6-8 option of the municipality.
6-9 (B) To determine a reasonable fee to be derived
6-10 from residential property in a district, the municipality or the
6-11 district may request a cost-of-service study by an independent
6-12 third party agreeable to both parties if cost-of-service data
6-13 prepared by the municipality is not acceptable. Both parties shall
6-14 be equally responsible for the cost of the study, which shall
6-15 include an evaluation of the estimated annual cost of providing
6-16 municipal services to the residential portion of the district over
6-17 the next ten years, and the estimated annual amount of ad valorem
6-18 taxes from residential property the city would receive when the
6-19 district is annexed for full purposes. The fee shall not exceed
6-20 the estimated annual amount of residential ad valorem taxes that
6-21 would be derived by full purpose annexation of the district, less
6-22 the estimated annual amount required to provide municipal services
6-23 to the residential property in the district if annexed for full
6-24 purposes. A fee determined through this methodology is subject to
6-25 renegotiation every ten years at the request of either party to the
6-26 agreement following the same procedure used to set the fee in the
6-27 original agreement. This methodology does not apply to fees from
7-1 commercial property. Any fee paid under Section 43.7051(f)(6)(a)
7-2 shall not exceed an amount equal to fifteen per cent of a sum
7-3 calculated by applying the municipality's tax rate to the assessed
7-4 value of real property within the district.
7-5 (7) conversion of the district to a limited district
7-6 including some or all of the land included within the boundaries of
7-7 the district, which conversion shall be effective on the
7-8 full-purpose annexation conversion date established under (5);
7-9 (8) agreements existing between districts and
7-10 governmental bodies and private providers of municipal services in
7-11 existence on the date a municipality evidences its intention by
7-12 adopting a resolution to negotiate for a strategic partnership
7-13 resolution with the district shall be continued and provision made
7-14 for modifications to such existing agreements; and
7-15 (9) such other lawful terms that the parties consider
7-16 appropriate.
7-17 (g) A strategic partnership agreement that provides for the
7-18 creation of a limited district under (f)(1) shall include
7-19 provisions setting forth the following:
7-20 (1) the boundaries of the limited districts;
7-21 (2) the functions of the limited district and the term
7-22 during which the limited district shall exist after full purpose
7-23 annexation, which term may be renewed successively by the governing
7-24 body of the municipality, provided that no such original or renewed
7-25 term shall exceed ten (10) years;
7-26 (3) the name by which the limited district shall be
7-27 known; and
8-1 (4) the procedure by which the limited district may be
8-2 dissolved prior to the expiration of any term established under
8-3 (g)(2).
8-4 (h) On the full-purpose annexation conversion date set forth
8-5 in the strategic partnership agreement pursuant to (f)(5) of this
8-6 section, the land included within the boundaries of the district
8-7 shall be deemed to be within the full-purpose boundary limits of
8-8 the municipality without the need for further action by the
8-9 governing body of the municipality. The full-purpose annexation
8-10 conversion date established by a strategic partnership agreement
8-11 may be altered only by mutual agreement of the district and the
8-12 municipality. However, nothing herein shall prevent the
8-13 municipality from terminating the agreement and instituting
8-14 proceeding to annex the district, upon request by the governing
8-15 body of the district, on any date prior to the full-purpose
8-16 annexation conversion date established by the strategic partnership
8-17 agreement. Land annexed for limited or full purposes under this
8-18 section shall not be included in calculations prescribed by Section
8-19 43.0555(a) of this code.
8-20 (i) Except as limited by this section or terms of as
8-21 strategic partnership agreement, a district that has been annexed
8-22 for limited purposes by a municipality and a limited district shall
8-23 have and may exercise all functions, powers and authority otherwise
8-24 vested in a district.
8-25 (j) A municipality that may annex a district for limited
8-26 purposes to implement a strategic partnership agreement under this
8-27 section shall not annex for full purposes any territory within a
9-1 district created pursuant to a consent agreement with that
9-2 municipality executed before August 27, 1979. The prohibition on
9-3 annexation established by this subsection shall expire on September
9-4 1, 1997, or on the date on or before which the municipality and any
9-5 district may have separately agreed that annexation would not take
9-6 place whichever is later.
9-7 Sec. 43.0752. ELECTIONS RELATING TO AGREEMENTS. (a) If a
9-8 proposed strategic partnership agreement is rejected by the
9-9 governing body of a district and approved by the governing body of
9-10 a municipality, the governing body of the district immediately
9-11 shall order an election to be held in the area of the district on
9-12 the issue of adopting the proposed agreement. The election shall
9-13 be held on the first uniform election date that is after the 30th
9-14 day after the date of the adoption of the plan by the governing
9-15 body of the municipality.
9-16 (b) The ballot shall provide for voting for or against the
9-17 proposed strategic partnership agreement. The ballot proposition
9-18 shall describe the proposed rates of services and taxes to be paid
9-19 to the municipality or the district under the agreement.
9-20 (c) If a strategic partnership agreement is approved by both
9-21 the governing bodies of the municipality and the district and if a
9-22 number of voters within the area of the district equal to 5 percent
9-23 of the eligible voters of the district who voted in the most recent
9-24 gubernatorial election petition the district board, an election
9-25 shall be held in the area of the district on the issue of adopting
9-26 the proposed agreement. The election shall be held on the first
9-27 uniform election date that is after the 30th day after the date the
10-1 governing body of the district certifies the validity of the
10-2 petition. The ballot language shall be printed in the same manner
10-3 as provided by Subsection (b) and must contain a comparison of the
10-4 property tax rates and rates for service offered by the district
10-5 and the municipality.
10-6 (d) The district shall bear the cost of an election under
10-7 Subsection (a) or (c).
10-8 (e) If, at any election held under Subsection (a) or (c), a
10-9 majority of the votes received are against the adoption of a
10-10 strategic partnership agreement, the agreement is terminated.
10-11 SECTION 3. The importance of this legislation and the
10-12 crowded condition of the calendars in both houses create an
10-13 emergency and an imperative public necessity that the
10-14 constitutional rule requiring bills to be read three several days
10-15 in each house be suspended, and this rule is hereby suspended.