JH H.B. 3603 75(R)    BILL ANALYSIS


URBAN AFFAIRS
H.B. 3603
By: Craddick
5-7-97
Committee Report (Unamended)



BACKGROUND 

The City of Midland, and cities similarly situated, who have not 
adopted impact fees, face 
difficult decisions when considering the funding of needed 
capital improvements to encourage 
growth and development in and around its municipal boundaries.  
Municipalities typically have 
subdivision ordinances requiring developer participation for 
capital improvements directly 
related to a given development.  However, the enactment of impact 
fee legislation several years 
ago, left municipalities who were unable to approve or adopt 
impact fees, for whatever reason, 
very limited options.  The municipality is left with either 
financing the entire cost of the 
improvements or having the developer front the costs and collect 
pro-rata as other landowners or 
developers connect to the capital improvements.  Current 
legislation does not provide for pro-rata 
collection when a municipality finances the cost up front.

PURPOSE

The proposed legislation would allow certain municipalities who 
have not adopted impact fees 
the ability to participate in the orderly growth and development 
of their city and expand their tax 
base by encouraging residential and commercial development.  
Specifically, the legislation would 
permit a municipality who has not adopted an impact fee to 
construct needed capital 
improvements (including water and sewer lines, street and roadway 
facilities, and drainage 
improvements) within or outside its boundaries and to collect a 
proportional share of the cost of 
the capital improvement from a landowner or developer desiring to 
connect to the capital 
improvements.  The proposed legislation would allow a 
municipality to treat a landowner whose 
land adjoins or is within a specified distance from the capital 
improvement in a fair and 
consistent manner.


RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly 
grant any additional rulemaking 
authority to a state officer, department, agency or institution.

SECTION BY SECTION ANALYSIS

SECTION 1. Section 395.081(a)  This section applies to 
municipalities with a population of 
  105,000 or less that constitutes more than three-fourths of the 
population of the 
  county in which the majority of the area of the municipality is 
located.

  Section 395.081(b) This section applies to a municipality which 
has not 
  adopted an impact fee and is constructing or participating 
financially in the 
  construction of a capital improvement.  The discretion lies 
solely with the  
  municipality as to whether or not the capital improvement is to 
be constructed, the 
  area to be served by the capital improvement, and the amount to 
be charged the 
  landowner or developer.  The landowner or developer will pay a 
cost reasonably 
  proportional to the total cost of the capital improvement.  
Capital improvement is 
  defined as a public improvement including, but not limited to, 
sewer and water 
  lines and related appurtenances, street and roadway facilities, 
and drainage 
  improvements.  This section does not affect a Public Improvement 
District as 
  authorized by Chapter 372 of the Texas Local Government Code.

  Section 395.081 (c)  The determination by the municipality shall 
include a finding 
  that the municipality will benefit from the improvement and the 
benefit shall be 
  specifically described.  The determination and description or 
benefits made by the 
  municipality are discretionary and final.

  Section 395.081 (d)  A municipality and its officers or employees 
are granted 
  absolute immunity as to any action, decision or determination 
made pursuant to 
  this Section.