75R10441 CAG-F
By Turner of Coleman H.B. No. 1394
Substitute the following for H.B. No. 1394:
By Bosse C.S.H.B. No. 1394
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the provision of services to certain areas by a
1-3 municipality.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 43.056, Local Government Code, is amended
1-6 by amending Subsections (a), (c), (e), and (k) to read as follows:
1-7 (a) Before the publication of the notice of the first
1-8 hearing required under Section 43.052, the governing body of the
1-9 municipality proposing the annexation shall direct its planning
1-10 department or other appropriate municipal department to prepare a
1-11 service plan that provides for the extension of full municipal
1-12 services to the area to be annexed. The municipality shall provide
1-13 the services by any of the methods by which it extends the services
1-14 to any other area of the municipality. A municipality may not
1-15 require a landowner in the area to fund the capital improvements
1-16 necessary to provide municipal services in a manner inconsistent
1-17 with Chapter 395, unless otherwise agreed to by the landowner.
1-18 (c) For purposes of this section, "full municipal services"
1-19 means services funded in whole or in part by municipal taxation or
1-20 utility revenues and provided by the annexing municipality within
1-21 its full-purpose boundaries. A municipality with a population of
1-22 1.5 million or more may provide all or part of the municipal
1-23 services required under the service plan by contracting with
1-24 service providers. If the municipality owns a water and wastewater
2-1 utility, the municipality shall, subject to this section, extend
2-2 water and wastewater service to any annexed area not within the
2-3 service area of another water or wastewater utility. If the
2-4 municipality annexes territory included within the boundaries of a
2-5 municipal utility district or a water control and improvement
2-6 district, the municipality shall comply with applicable state law
2-7 relating to annexation of territory within a municipal utility
2-8 district or a water control and improvement district. The service
2-9 plan shall summarize the service extension policies of the
2-10 municipal water and wastewater utility.
2-11 (e) A service plan may not:
2-12 (1) require the creation of another political
2-13 subdivision;
2-14 (2) require a landowner in the area to fund the
2-15 capital improvements necessary to provide municipal services,
2-16 including water or wastewater service, in a manner inconsistent
2-17 with Chapter 395 unless otherwise agreed to by the landowner; or
2-18 (3) provide fewer services or lower levels of services
2-19 in the area:
2-20 (A) than were in existence in the area
2-21 immediately preceding the date of the annexation; or
2-22 (B) than are otherwise available in any other
2-23 parts of the municipality with land uses and population densities
2-24 similar to those reasonably contemplated or projected in the area.
2-25 (k) This section does not require that a uniform level of
2-26 full municipal services be provided to each area of the
2-27 municipality if different characteristics of topography, land use,
3-1 and population density are reasonably considered a sufficient basis
3-2 for providing different levels of service. A municipality may not
3-3 refuse to provide water or wastewater service to any property in
3-4 an annexed area if the municipality provides the service to other
3-5 parts of the municipality.
3-6 SECTION 2. Subchapter E, Chapter 43, Local Government Code,
3-7 is amended by adding Section 43.104 to read as follows:
3-8 Sec. 43.104. ANNEXATION OF CERTAIN WATER AND WASTEWATER
3-9 UTILITIES BY CERTAIN HOME-RULE MUNICIPALITIES. (a) A home-rule
3-10 municipality with a population of more than 450,000 may annex area
3-11 located in its extraterritorial jurisdiction that is also in the
3-12 certificated service area of a developer- or investor-owned water
3-13 or wastewater utility only under this section.
3-14 (b) Not later than the 180th day before the date proposed
3-15 for the adoption of an ordinance that annexes all or part of an
3-16 area located in the certificated service area of a developer- or
3-17 investor-owned water or wastewater utility, the annexing
3-18 municipality shall provide written notice to the owner of the
3-19 utility of the municipality's intent to annex the area and shall
3-20 provide a map showing the exact portion of the utility's
3-21 certificated service area that the municipality intends to annex.
3-22 (c) Not later than the 30th day after the date a utility
3-23 receives written notice under Subsection (b), the utility shall
3-24 provide notice to the municipality that the utility elects:
3-25 (1) to require the annexing municipality to assume all
3-26 assets and liabilities of the utility and to purchase the utility's
3-27 accounts for an amount to be indicated by the utility that is
4-1 established by a bona fide appraisal of the assets and accounts of
4-2 the utility; or
4-3 (2) to continue to operate as an independent utility
4-4 after annexation and not to require the assumption of assets and
4-5 liabilities of the utility by the annexing municipality.
4-6 (d) A utility's election under Subsection (c) is binding on
4-7 a municipality if the municipality proceeds with the annexation.
4-8 (e) If a utility elects to have the annexing municipality
4-9 assume the assets and liabilities of the utility and pay the owners
4-10 of the utility the fair market value of the utility's assets and
4-11 accounts and the municipality does not dispute the appraisal
4-12 provided by the utility, the municipality must complete a contract
4-13 for the purchase and assumption and make any payment not later than
4-14 the 60th day before the date proposed for the adoption of the
4-15 annexation ordinance.
4-16 (f) If the annexing municipality disputes the fair market
4-17 value of the accounts and assets established by the utility's
4-18 appraisal, the annexing municipality may conduct a separate
4-19 independent fair market value appraisal and may make a counteroffer
4-20 to the utility. If the counteroffer is acceptable to the utility,
4-21 the municipality must complete a contract for the purchase and
4-22 assumption and make any payment not later than the 30th day before
4-23 the date proposed for the adoption of the annexation ordinance.
4-24 (g) If an annexing municipality is unable to agree with the
4-25 utility on the purchase price of the utility's assets and accounts,
4-26 the annexing municipality may use its powers of condemnation for
4-27 the purpose of acquiring the utility. However, the annexation of
5-1 the area may not occur until after the condemnation proceedings
5-2 have resulted in ownership of the utility being transferred to the
5-3 annexing municipality. If condemnation proceedings are necessary,
5-4 the annexing municipality shall pay the reasonable and customary
5-5 court costs and attorney's fees incurred by the utility as a result
5-6 of the condemnation proceedings.
5-7 SECTION 3. This Act applies to a municipal annexation for
5-8 which any public hearing required under Chapter 43, Local
5-9 Government Code, is held after the effective date of this Act.
5-10 SECTION 4. This Act does not diminish or impair the rights
5-11 or remedies of any person or entity under a final judgment rendered
5-12 by, or in any pending litigation brought in, any court relating to
5-13 an interpretation of the provisions of Section 43.056, Local
5-14 Government Code.
5-15 SECTION 5. The importance of this legislation and the
5-16 crowded condition of the calendars in both houses create an
5-17 emergency and an imperative public necessity that the
5-18 constitutional rule requiring bills to be read on three several
5-19 days in each house be suspended, and this rule is hereby suspended,
5-20 and that this Act take effect and be in force from and after its
5-21 passage, and it is so enacted.