By Barrientos S.B. No. 657 75R163 DRH-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to the creation of intermunicipal commuter rail districts. 1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-4 SECTION 1. Chapter 13, Title 112, Revised Statutes, is 1-5 amended by adding Article 6550c-1 to read as follows: 1-6 Art. 6550c-1. INTERMUNICIPAL COMMUTER RAIL DISTRICTS 1-7 Sec. 1. DEFINITIONS. In this article: 1-8 (1) "Commuter rail facility" means any property 1-9 necessary for the transportation of passengers and baggage between 1-10 points in a district. The term includes rolling stock, 1-11 locomotives, stations, parking areas, and rail lines. 1-12 (2) "Creating municipality" means a municipality 1-13 described by Section 2(a) of this article. 1-14 (3) "Department" means the Texas Department of 1-15 Transportation. 1-16 (4) "District" means an intermunicipal commuter rail 1-17 district created under this article. 1-18 (5) "System" means all of the commuter rail facilities 1-19 owned or operated on behalf of a district created under this 1-20 article. 1-21 Sec. 2. CREATION OF DISTRICT. (a) A district may be 1-22 created to provide commuter rail service between two 1-23 municipalities: 1-24 (1) each of which has a population of more than 2-1 450,000; and 2-2 (2) that are located not farther than 100 miles apart 2-3 as determined by the department. 2-4 (b) A district is created on passage of a resolution 2-5 favoring the creation of the district by the governing body of each 2-6 creating municipality and the governing body of each county in 2-7 which a creating municipality is located. 2-8 (c) The following political subdivisions may become a part 2-9 of a district created under Subsection (b) of this section with the 2-10 approval of the governing body of the political subdivision: 2-11 (1) a county located adjacent to a county in which a 2-12 creating municipality is located; and 2-13 (2) a municipality with a population of more than 2-14 18,000 located in a county described by Subdivision (1) of this 2-15 subsection. 2-16 (d) For purposes of this article, a municipality is located 2-17 in a county only if 90 percent or more of the population of the 2-18 municipality resides in that county according to the most recent 2-19 federal census. 2-20 Sec. 3. BOARD. (a) A district is governed by a board of 2-21 directors. The board is responsible for the management, operation, 2-22 and control of the district. 2-23 (b) The board is composed of the following members: 2-24 (1) two members appointed by the department; 2-25 (2) one member appointed by each political subdivision 2-26 that has become a part of the district under Section 2 of this 2-27 article; 3-1 (3) one member appointed by each creating municipality 3-2 to represent the regional planning organization of which the 3-3 municipality is a part; 3-4 (4) one member appointed by each creating municipality 3-5 to represent the business community of the municipality; 3-6 (5) one member appointed by each authority created 3-7 under Chapter 451, Transportation Code, that serves a creating 3-8 municipality; 3-9 (6) one member appointed by each county in which a 3-10 creating municipality is located to represent transportation 3-11 providers that provide service to rural areas in the county; and 3-12 (7) one member appointed by all other board members to 3-13 represent all municipalities in the district that do not otherwise 3-14 have representation on the board. 3-15 (c) A vacancy on the board is filled in the same manner as 3-16 the original appointment. Each member serves a term of two years. 3-17 (d) The members of the board shall elect one member as 3-18 presiding officer. The presiding officer may select another member 3-19 to preside in the absence of the presiding officer. 3-20 (e) The presiding officer shall call at least one meeting of 3-21 the board a year and may hold other meetings as the presiding 3-22 officer determines are appropriate. 3-23 (f) A member of the board is not entitled to compensation 3-24 for serving as a member but is entitled to reimbursement for 3-25 reasonable expenses incurred while serving as a member. 3-26 (g) The board shall adopt rules for its proceedings and may 3-27 employ and compensate persons to carry out the powers and duties of 4-1 the district. 4-2 (h) Chapter 171, Local Government Code, applies to a board 4-3 member of a district. 4-4 Sec. 4. POWERS AND DUTIES OF DISTRICT. (a) A district 4-5 created under this article is a public body and a political 4-6 subdivision of the state exercising public and essential 4-7 governmental functions and has all the powers necessary or 4-8 convenient to carry out the purposes of this article. A district, 4-9 in the exercise of powers under this article, is performing only 4-10 governmental functions and is a governmental unit within the 4-11 meaning of Chapter 101, Civil Practice and Remedies Code. 4-12 (b) A district has perpetual succession. A district is 4-13 subject every 12th year to review under Chapter 325, Government 4-14 Code (Texas Sunset Act), but is not abolished under that chapter. 4-15 (c) A district may sue and be sued in all courts of 4-16 competent jurisdiction, may institute and prosecute suits without 4-17 giving security for costs, and may appeal from a judgment without 4-18 giving supersedeas or cost bond. An action at law or in equity 4-19 against the district must be brought in the county in which the 4-20 principal office of the district is located, except that in eminent 4-21 domain proceedings, suit must be brought in the county in which the 4-22 land is located. 4-23 (d) A district may acquire by grant, purchase, gift, devise, 4-24 lease, or otherwise and may hold, use, sell, lease, or dispose of 4-25 real and personal property, licenses, patents, rights, and 4-26 interests necessary, convenient, or useful for the full exercise of 4-27 any of its powers under this article. 5-1 (e) A district may acquire, construct, develop, own, 5-2 operate, and maintain commuter rail facilities inside, or connect 5-3 political subdivisions in, the district. For these purposes and 5-4 with the consent of any municipality, county, or other political 5-5 subdivision, the district may use streets, alleys, roads, highways, 5-6 and other public ways of any municipality, county, or other 5-7 political subdivision and may relocate, raise, reroute, change the 5-8 grade of, or alter, at the expense of the district, the 5-9 construction of any street, alley, highway, road, railroad, 5-10 electric lines and facilities, telegraph and telephone properties 5-11 and facilities, pipelines and facilities, conduits and facilities, 5-12 and other properties, whether publicly or privately owned, as 5-13 necessary or useful in the construction, reconstruction, repair, 5-14 maintenance, and operation of commuter rail facilities. A district 5-15 may at its discretion acquire by purchase any interest in real 5-16 property for the acquisition, construction, or operation of any 5-17 commuter rail facility on terms and at a price as agreed to between 5-18 the district and the owner. The governing body of any 5-19 municipality, county, other political subdivision, or public agency 5-20 may make conveyance of title or rights and easements to any 5-21 property needed by the district to effect its purposes in 5-22 connection with the acquisition, construction, or operation of 5-23 commuter rail facilities. 5-24 (f) A district has the right of eminent domain to acquire 5-25 lands in fee simple and any interest less than fee simple in, on, 5-26 under, or above lands, including easements, rights-of-way, and 5-27 rights of use of airspace or subsurface space. The district shall, 6-1 to the extent possible, use existing rail or intermodal 6-2 transportation corridors for the alignment of its railroad. 6-3 Proceedings for the exercise of the power of eminent domain are 6-4 begun by the adoption by the board of a resolution declaring the 6-5 public necessity for the acquisition by the district of the 6-6 property or interest described in the resolution and that the 6-7 acquisition is necessary and proper for the construction, 6-8 extension, improvement, or development of commuter rail facilities 6-9 and is in the public interest. The resolution of the district is 6-10 conclusive evidence of the public necessity of the proposed 6-11 acquisition and that the real or personal property or interest in 6-12 property is necessary for public use. 6-13 (g) A district may make agreements with any other public 6-14 utility, private utility, communication system, common carrier, or 6-15 transportation system for the joint use of its facilities, 6-16 installations, or properties within or outside the district and 6-17 establish through routes, joint fares, and, subject to approval of 6-18 any tariff-regulating body having jurisdiction, divisions of 6-19 tariffs. 6-20 (h) A district may adopt rules to govern the operation of 6-21 the district, its employees, the commuter rail facilities, service 6-22 provided by the district, and any other necessary matter concerning 6-23 its purposes, including rules regarding health, safety, alcohol or 6-24 beverage service, food service, and telephone and utility services, 6-25 to protect the health, safety, and general welfare of residents of 6-26 the district. 6-27 (i) A district may make joint ownership agreements with any 7-1 person. 7-2 (j) A district shall establish and maintain rates or other 7-3 compensation for the use of the facilities of the system acquired, 7-4 constructed, operated, regulated, or maintained by the district 7-5 that is reasonable and nondiscriminatory and, together with grants 7-6 received by the district, is sufficient to produce revenues 7-7 adequate: 7-8 (1) to pay all expenses necessary to the operation and 7-9 maintenance of the properties and facilities of the district; 7-10 (2) to pay the interest on and principal of all bonds 7-11 issued by the district under this article and payable in whole or 7-12 in part from the revenues, as they become due and payable; and 7-13 (3) to fulfill the terms of any agreements made with 7-14 the holders of bonds or with any person in their behalf. 7-15 (k) A district may make contracts, leases, and agreements 7-16 with, and accept grants and loans from, the United States of 7-17 America, its departments and agencies, the state, its agencies and 7-18 political subdivisions, and public or private corporations and 7-19 persons, and may generally perform all acts necessary for the full 7-20 exercise of the powers vested in it. A district may acquire 7-21 rolling stock or other property under conditional sales contracts, 7-22 leases, equipment trust certificates, or any other form of contract 7-23 or trust agreement. Any revenue bond indenture may provide 7-24 limitations on the exercise of the powers granted by this section, 7-25 and the limitations apply so long as any of the revenue bonds 7-26 issued pursuant to the indenture are outstanding and unpaid. 7-27 (l) A district by resolution may adopt rules governing the 8-1 use, operation, and maintenance of the system and shall determine 8-2 all routings and change them when the board considers it advisable. 8-3 (m) A district may lease the commuter rail facilities or any 8-4 part to, or contract for the use or operation of the commuter rail 8-5 facilities or any part by, any operator. A district shall 8-6 encourage to the maximum extent practicable the participation of 8-7 private enterprise in the operation of commuter rail facilities. 8-8 The term of an operating contract under this subsection may not 8-9 exceed 20 years. 8-10 (n) A district may contract with any county or other 8-11 political subdivision of the state for the district to provide 8-12 commuter rail transportation services to any area outside the 8-13 boundaries of the district on such terms and conditions as the 8-14 parties agree to. 8-15 (o) Before beginning the operation of commuter rail 8-16 facilities, the board of a district shall adopt an annual operating 8-17 budget specifying the anticipated revenues and expenses of the 8-18 district for the remainder of the fiscal year, and the district 8-19 shall adopt an operating budget for each succeeding fiscal year. 8-20 The fiscal year of the district ends September 30 unless changed by 8-21 the board. The board shall hold a public hearing before adopting 8-22 each budget except the initial budget. Notice of each hearing must 8-23 be published at least seven days before the date of the hearing in 8-24 a newspaper of general circulation in the district. A budget may 8-25 be amended at any time if notice of the proposed amendment is given 8-26 in the notice of meeting. An expenditure that is not budgeted may 8-27 not be made. 9-1 (p) The board of a district shall by resolution name one or 9-2 more banks for the deposit of district funds. District funds are 9-3 public funds and may be invested in securities permitted by Chapter 9-4 2256, Government Code. To the extent funds of the district are not 9-5 insured by the Federal Deposit Insurance Corporation or its 9-6 successor, they shall be collateralized in the manner provided for 9-7 county funds. 9-8 Sec. 5. BONDS AND NOTES. (a) A district may issue revenue 9-9 bonds and notes from time to time and in such amounts as its board 9-10 considers necessary or appropriate for the acquisition, purchase, 9-11 construction, reconstruction, repair, equipping, improvement, or 9-12 extension of its commuter rail facilities. All bonds and notes are 9-13 fully negotiable and may be made redeemable before maturity, at the 9-14 option of the issuing district and at prices and under terms and 9-15 conditions the issuing district determines in the resolution 9-16 authorizing the bonds or notes, and may be sold at public or 9-17 private sale, as the board determines. 9-18 (b) A district shall submit all bonds and notes authorized 9-19 to be issued, except notes issued to an agency of the federal or 9-20 state government, and the records relating to their issuance to the 9-21 attorney general for examination before delivery. If the attorney 9-22 general determines that they have been issued in accordance with 9-23 the constitution and this article and that they will be binding 9-24 obligations of the district issuing them, the attorney general 9-25 shall approve them, and the comptroller shall register them. Bonds 9-26 and notes issued under this article are incontestable after 9-27 approval, registration, and sale and delivery of the bonds to the 10-1 purchaser. 10-2 (c) To secure the payment of the bonds or notes, the 10-3 district may encumber and pledge all or any part of the revenues of 10-4 its commuter rail facilities, may mortgage and encumber all or any 10-5 part of the properties of the commuter rail facilities and 10-6 everything pertaining to them acquired or to be acquired, and may 10-7 prescribe the terms and provisions of the bonds and notes in any 10-8 manner not inconsistent with this article. If not prohibited by 10-9 the resolution or indenture relating to outstanding bonds or notes, 10-10 a district may encumber separately any item of real estate or 10-11 personalty. 10-12 (d) All bonds and notes are legal and authorized investments 10-13 for banks, trust companies, savings and loan associations, and 10-14 insurance companies. The bonds and notes are eligible to secure 10-15 the deposit of public funds of the state, cities, towns, villages, 10-16 counties, school districts, or other political corporations or 10-17 subdivisions of the state. The bonds and notes are lawful and 10-18 sufficient security for the deposits to the extent of the principal 10-19 amount or market value of the bonds or notes, whichever is less. 10-20 Sec. 6. COMPETITIVE BIDS. A contract in the amount of more 10-21 than $15,000 for the construction of improvements or the purchase 10-22 of material, machinery, equipment, supplies, or any other property 10-23 except real property may be let only on competitive bids after 10-24 notice published, at least 15 days before the date set for 10-25 receiving bids, in a newspaper of general circulation in the 10-26 district. A board may adopt rules governing the taking of bids and 10-27 the awarding of contracts. This section does not apply to personal 11-1 or professional services or the acquisition of existing rail 11-2 transportation systems. 11-3 Sec. 7. EXEMPTION FROM TAXES. The property, revenues, and 11-4 income of a district and the interest on bonds and notes issued by 11-5 a district are exempt from all taxes levied by the state or a 11-6 political subdivision of the state. 11-7 SECTION 2. The importance of this legislation and the 11-8 crowded condition of the calendars in both houses create an 11-9 emergency and an imperative public necessity that the 11-10 constitutional rule requiring bills to be read on three several 11-11 days in each house be suspended, and this rule is hereby suspended, 11-12 and that this Act take effect and be in force from and after its 11-13 passage, and it is so enacted.