By Hilbert H.B. No. 2365
75R8555 CAG-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to strategic partnership agreements between certain
1-3 municipalities.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Sections 43.0751(b), (d), (e), and (f), Local
1-6 Government Code, are amended to read as follows:
1-7 (b) The governing bodies of a municipality with a population
1-8 of 225,000 or more and a district shall negotiate and shall [may]
1-9 enter into a written strategic partnership agreement for the
1-10 district having a term of five or more years. The governing body
1-11 of a municipality must make a written determination of the need
1-12 for full purpose annexation and must have entered into a strategic
1-13 partnership agreement with a district for 10 or more years before
1-14 the date the municipality annexes any portion of the district for
1-15 full purposes. The governing bodies of the municipality and the
1-16 district shall evidence their intention to negotiate such an
1-17 agreement by resolution, each of which resolutions shall specify an
1-18 expiration date if the other governing body fails to adopt a
1-19 resolution under this section on or before the specified date. The
1-20 governing body of a municipality that has evidenced its intention
1-21 by unexpired resolution to enter into negotiations with a district
1-22 for an agreement under this section may not initiate proceedings to
1-23 annex the district under any other section of this code prior to
1-24 the expiration of five [two] years after the adoption date of the
2-1 resolution unless the municipality has previously instituted
2-2 annexation proceedings in granting consent to the creation of the
2-3 district prior to January 1, 1995.
2-4 (d) Before the governing body of a municipality or a
2-5 district adopts a strategic partnership agreement, it shall conduct
2-6 three [two] public hearings at which members of the public who wish
2-7 to present testimony or evidence regarding the proposed agreement
2-8 shall be given the opportunity to do so. The hearings shall be
2-9 conducted by a visiting state judge jointly selected by the
2-10 municipality and the district. Notice of public hearings conducted
2-11 by the governing body of a municipality under this subsection shall
2-12 be published in a newspaper of general circulation in the
2-13 municipality and in the district. The notice must be in the format
2-14 prescribed by Section 43.123(b) and must be published at least once
2-15 on or after the 20th day before each date. Notice of public
2-16 hearings conducted by the governing body of a district under this
2-17 subsection shall be given in accordance with the district's
2-18 notification procedures for other matters of public importance.
2-19 Any notice of a public hearing conducted under this subsection
2-20 shall contain a statement of the purpose of the hearing, the date,
2-21 time, and place of the hearing, and the location where copies of
2-22 the proposed agreement may be obtained prior to the hearing. The
2-23 governing bodies of a municipality and a district may conduct joint
2-24 public hearings under this subsection, provided that at least one
2-25 public hearing is conducted within the district. A municipality
2-26 may combine the public hearings and notices required by this
2-27 subsection with the public hearings and notices required by Section
3-1 43.124.
3-2 (e) The governing body of a municipality may not annex a
3-3 district for full or limited purposes under this chapter [section
3-4 or under the provisions of Subchapter F] until it has adopted a
3-5 strategic partnership agreement with the district. The governing
3-6 body of a municipality may not adopt a strategic partnership
3-7 agreement before the agreement has been adopted by the governing
3-8 body of the affected district.
3-9 (f) A strategic partnership agreement may provide for the
3-10 following:
3-11 (1) limited-purpose annexation of the district under
3-12 the provisions of Subchapter F provided that the district shall
3-13 continue in existence during the period of limited-purpose
3-14 annexation;
3-15 (2) such amendments to the timing requirements of
3-16 Sections 43.123(d)(2) and 43.127(b) as may be necessary or
3-17 convenient to effectuate the purposes of the agreement;
3-18 (3) payments by the municipality to the district for
3-19 services provided by the district;
3-20 (4) annexation of any commercial property in a
3-21 district for full purposes by the municipality, notwithstanding any
3-22 other provision of this code or the Water Code, except for the
3-23 obligation of the municipality to provide, directly or through
3-24 agreement with other units of government, full provision of
3-25 municipal services to annexed territory, in lieu of any annexation
3-26 of residential property or payment of any fee on residential
3-27 property in lieu of annexation of residential property in the
4-1 district authorized by this subsection;
4-2 (5) a full-purpose annexation provision that specifies
4-3 one of the following:
4-4 (A) the date on which the land included within
4-5 the district's boundaries shall be converted from the
4-6 municipality's limited-purpose jurisdiction to its full-purpose
4-7 jurisdiction, provided that such date shall not be later than 10
4-8 years after the effective date of the strategic partnership
4-9 agreement; or
4-10 (B)(i) terms for payment of an annual fee to the
4-11 municipality by the district in lieu of full-purpose annexation,
4-12 the form in which each such payment must be tendered, a method of
4-13 calculating the fee, and the date by which each such payment must
4-14 be made; failure by a district to timely make an annual payment in
4-15 lieu of full-purpose annexation in the amount and form required by
4-16 a strategic partnership agreement shall be the only ground for
4-17 termination of the agreement with respect to annexation at the
4-18 option of the municipality;
4-19 (ii) to determine a reasonable fee to be
4-20 derived from residential property in a district, the municipality
4-21 or the district may request a cost-of-service study by an
4-22 independent third party agreeable to both parties if
4-23 cost-of-service data prepared by the municipality is not
4-24 acceptable. The municipality is [Both parties shall be equally]
4-25 responsible for the cost of the study, which shall include an
4-26 evaluation of the estimated annual cost of providing municipal
4-27 services to the residential portion of the district over the next
5-1 10 years and the estimated annual amount of ad valorem taxes from
5-2 residential property the city would receive on full-purpose
5-3 annexation of the district over the next 10 years. The governing
5-4 board of a district may contribute to the cost of any study. The
5-5 fee shall not exceed the estimated annual amount of residential ad
5-6 valorem taxes that would be derived by full-purpose annexation of
5-7 the district, less the estimated annual amount required to provide
5-8 municipal services to the residential property in the district if
5-9 annexed for full purposes. A fee determined through this
5-10 methodology is subject to renegotiation every 10 years at the
5-11 request of either party to the agreement, or every five years if
5-12 agreed to by all parties to the agreement, following the same
5-13 procedure used to set the fee in the original agreement. This
5-14 methodology does not apply to fees from commercial property;
5-15 (6) conversion of the district to a limited district
5-16 including some or all of the land included within the boundaries of
5-17 the district, which conversion shall be effective on the
5-18 full-purpose annexation conversion date established under
5-19 Subdivision (5)(A);
5-20 (7) agreements existing between districts and
5-21 governmental bodies and private providers of municipal services in
5-22 existence on the date a municipality evidences its intention by
5-23 adopting a resolution to negotiate for a strategic partnership
5-24 agreement with the district shall be continued and provision made
5-25 for modifications to such existing agreements; [and]
5-26 (8) such other lawful terms that the parties consider
5-27 appropriate; and
6-1 (9) the addition of other political subdivisions to
6-2 the agreement to allow the provision of the highest quality of
6-3 services at the lowest fee to residents of the district.
6-4 SECTION 2. The importance of this legislation and the
6-5 crowded condition of the calendars in both houses create an
6-6 emergency and an imperative public necessity that the
6-7 constitutional rule requiring bills to be read on three several
6-8 days in each house be suspended, and this rule is hereby suspended,
6-9 and that this Act take effect and be in force from and after its
6-10 passage, and it is so enacted.