HBA-TYH, NLM H.B. 2894 76(R)BILL ANALYSIS
Office of House Bill AnalysisH.B. 2894
By: Coleman
County Affairs
7/22/1999
Enrolled
BACKGROUND AND PURPOSE
Prior to the 76th Legislature, midtown Houston was being revitalized by the
Midtown Redevelopment Authority in conjunction with a tax increment
reinvestment zone established by the city. The purpose of this bill is to
create a public improvement district to expand revitalization efforts in
the area. H.B. 2894 creates the Midtown Management District to assess the
needs of commercial property owners in the area to finance improvements and
services, in accordance with Chapter 375 (Municipal Management Districts in
General), Local Government Code. In addition, this bill sets forth the
intent and findings of the legislature relating to the public benefit and
purpose of the creation of the district.
RULEMAKING AUTHORITY
It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Chapter 376, Local Government Code, by adding Subchapter
H, as follows:
SUBCHAPTER H. MIDTOWN MANAGEMENT DISTRICT
Sec. 376.301. CREATION OF DISTRICT. Creates the Midtown Management District
(district) as a special district under Section 59, Article XVI, Texas
Constitution. Authorizes the name of the district to be changed by
resolution of the board of directors of the district (board). Specifies
that the creation of the district is essential to accomplish the purposes
of Section 52 (Counties, Cities or Other Political Corporations or
Subdivisions; Lending Credit; Grants; Bonds) and 52-a (Loan or Grant of
Public Money for Economical Development), Article III, and Section 59
(Conservation and Development of Natural Resources; Conservation and
Reclamation Districts), Article XVI, Texas Constitution.
Sec. 376.302. DECLARATION OF INTENT. Sets forth the intent relating to
the creation of the district.
Sec. 376.303. DEFINITIONS. Defines "board," "district," "municipality,"
"county," and "utility" for the purposes of this Act.
Sec. 376.304. BOUNDARIES. Specifies the territory contained in the
district.
.
Sec. 376.305. FINDINGS RELATING TO BOUNDARIES. Sets forth the findings
relating to the boundaries.
Sec. 376.306. FINDINGS OF BENEFIT AND PUBLIC PURPOSE. Sets forth the
findings relating to public benefit and purpose. Provides that the
district will not act as the agent or instrumentality of any private
interest even though many private interests will be benefitted by the
district, as will the general public.
Sec. 376.307. APPLICATION OF OTHER LAW. Applies Chapter 375 (Municipal
Management Districts in General), Local Government Code, to the district
and its governing body and employees, and gives the district rights and
powers of a district created under Chapter 375, except as otherwise
provided by this subchapter.
Sec. 376.308. LIBERAL CONSTRUCTION OF SUBCHAPTER. Requires this
subchapter to be liberally construed in conformity with the legislative
findings and purposes stated in this subchapter.
Sec. 376.309. BOARD OF DIRECTORS IN GENERAL. Provides that the district
is governed by a board of 17 directors who shall serve staggered four-year
terms, with eight directors' terms expiring June 1 of an odd-numbered year
and nine directors' terms expiring June 1 of the following odd-numbered
year. Requires a director to receive compensation in accordance with
Section 49.060 (Fees of Office; Reimbursement), Water Code.
Sec. 376.310. APPOINTMENT OF DIRECTORS. Requires the mayor and the
members of the governing body of the municipality to appoint directors from
persons recommended by the board. Provides that a person is appointed if a
majority of the members and the mayor vote to appoint that person.
Prohibits a person from being appointed to the board if the appointment of
that person would result in less than two-thirds of the directors residing
in the municipality. Provides that district directors are public officials
entitled to governmental immunity for their official actions.
Sec. 376.311. EX OFFICIO BOARD MEMBERS. Requires the director of certain
departments described in this section to serve as a nonvoting ex officio
director. Authorizes the board to appoint a director of the consolidated,
renamed, or changed department, if a department described in this section
is consolidated, renamed, or changed, as a nonvoting ex officio board
member. Authorizes the board to appoint a representative of another
department of the municipality that performs duties comparable to those
performed by the abolished department. Authorizes the board to appoint the
presiding officer of a nonprofit corporation that is actively involved in
activities in the municipality's midtown area to serve as a nonvoting ex
officio director.
Sec. 376.312. CONFLICTS OF INTEREST; ONE-TIME AFFIDAVIT. (a) Authorizes a
director to participate in all board votes and decisions, and provides that
Chapter 171 (Regulation of Conflicts of Interest of Officers of
Municipalities, Counties, and Certain Other Local Governments) governs
conflict of interests for board members.
(b) Provides that Section 171.004 (Affidavit and Abstention from Voting
Required) does not apply to the district. Requires a director who has
substantial interest in a business or charitable entity that will receive
a pecuniary benefit from a board action to file a one-time affidavit
declaring the interest. Authorizes the director to participate in a
discussion or vote on that action under specified conditions.
(c) Prohibits a director who is also an officer or employee of a public
entity from participating in the discussion of or vote on a matter
regarding a contract with that same public entity.
(d) Provides that for the purposes of this section, a director has a
substantial interest in a charitable entity in the same manner that a
person would have a substantial interest in a business entity under Section
171.002 (Substantial Interest in Business Entity).
Sec. 376.313. ADDITIONAL POWERS OF DISTRICT. (a) Authorizes the district
to exercise the powers given to a corporation created under Section 4B,
Article 5190.6, V.T.C.S. (Development Corporation Act of 1979).
(b) Authorizes the district to exercise the powers given to a housing
finance corporation created under Chapter 394 (Housing Financing
Corporations in Municipalities and Counties), Local Government Code, to
provide housing or residential development projects within the district.
(c) The district may impose an ad valorem tax, assessment, or impact fee
in accordance with Chapter 375 on all property in the district, including
industrial, commercial, or residential property, to finance an improvement
this subchapter authorizes the district to construct or acquire or a
service this subchapter authorizes the district to provide.
Sec. 376.314. AGREEMENTS: GENERAL; DONATIONS, INTERLOCAL AGREEMENTS, AND
LAW ENFORCEMENT SERVICES. Authorizes the district to make an agreement
with or accept a donation, grant, or loan from any person. Provides that
the implementation of a project is a governmental function or service for
the purposes of Chapter 791 (Interlocal Cooperation Contracts), Government
Code. Authorizes the district to contract with the municipality or the
county for the municipality or county to provide law enforcement services
in the district for a fee.
Sec. 376.315. NONPROFIT CORPORATION. (a) Authorizes the board by
resolution to authorize the creation of a nonprofit corporation to aid,
assist, and act on behalf of the district in implementing a project or
providing a service authorized by this subchapter.
(b) Requires the board to appoint the board of directors of a nonprofit
corporation created under this section. Requires the board of directors of
the nonprofit corporation to serve in the same manner as, for the same term
as, and on the conditions of the board of directors of a local government
corporation created under Chapter 431 (Texas Transportation Corporation
Act), Transportation Code.
(c) Provides that a nonprofit corporation created under this section has
the powers of and is considered for purposes of this subchapter to be a
local government corporation created under Chapter 431, Transportation
Code.
(d) Authorizes a nonprofit corporation created under this section to
implement any project and provide any services authorized by this
subchapter.
Sec. 376.316. ANNEXATION. Authorizes the district to annex territory
located within the boundaries of a reinvestment zone created by the
municipality under Chapter 311 (Tax Increment Financing Act), Tax Code,
with the consent of the governing body of the municipality, in addition to
annexing territory in accordance with Subchapter C (Boundaries), Chapter
375, Local Government Code.
Sec. 376.317. PETITION REQUIRED FOR FINANCING SERVICES AND IMPROVEMENTS.
Prohibits the board from financing services and improvement projects under
this subchapter unless a written petition requesting those improvements or
services has been filed with the board. Provides that the petition must be
signed by certain persons described by this section.
Sec. 376.318. ELECTIONS. Requires the district to hold an election in
the manner provided by Subchapter L (Elections), Chapter 375, Government
Code, to obtain voter approval before the district imposes a maintenance
tax or issues bonds payable from ad valorem taxes or assessments in
addition to other necessary elections. Authorizes the board to submit
multiple purposes in a single proposition at an election.
Sec. 376.319. MAINTENANCE TAX. Authorizes the district, if authorized at
an election held in accordance with Section 376.318, to impose and collect
an annual ad valorem tax on taxable property in the district for the
maintenance and operation of the district and the improvements constructed
or acquired by the district or for the provision of services. Requires the
board to determine the tax rate.
Sec. 376.320. ASSESSMENTS. (a) Authorizes the board to impose and
collect an assessment for any purpose authorized by this subchapter.
(b) Provides that assessments, including assessments resulting from an
addition to or correction of the assessment roll by the district,
reassessments, penalties and interest on an assessment or reassessment,
expenses of collection, and reasonable attorney's fees incurred by the
district:
_are a first and prior lien against the property assessed;
_are superior to any other lien or claim other than a lien or claim for
county, school district, or municipal ad valorem taxes; and
_are the personal liability of and charge against the owners of the
property even if the owners are not named in the assessment proceedings.
(c) Provides that the lien is effective from the date of the resolution of
the board imposing the assessment until the assessment is paid. Authorizes
the board to enforce the lien in the same manner that the board may enforce
an ad valorem tax lien against real property.
Sec. 376.321. CERTAIN RESIDENTIAL PROPERTY NOT EXEMPT. Provides that
Section 375.161 (Certain residential Property Exempt) does not apply to the
district.
Sec. 376.322. UTILITIES. Prohibits the district from imposing an
assessment or impact fee on a utility's property.
Sec. 376.323. MUNICIPAL APPROVAL. (a) Provides that except as provided by
Subsection (b), the district must obtain approval from the municipality's
governing body of the issuance of bonds for an improvement project and the
plans and specifications of an improvement project financed by the bonds.
(b) Provides that if the district obtains approval from the municipality's
governing body of a capital improvements budget for a period not to exceed
five years, the district is authorized to finance the capital improvements
and issue bonds specified in the budget without further approval from the
municipality.
(c) Provides that the district must obtain approval from the
municipality's governing body of the plans and specifications of any
district improvement project related to the use of land owned by the
municipality, an easement granted by the municipality, or a right-of-way of
a street, road, or highway.
(d) Provides that except as provided by Section 375.263 (Dissolution by
Municipal Ordinance), a municipality is not obligated to pay any bonds,
notes, or other obligations of the district.
Sec. 376.324. DISBURSEMENTS OR TRANSFERS OF FUNDS. Requires the board by
resolution to establish the number of directors' signatures and the
procedure required for a disbursement or transfer of the district's money.
Sec. 376.325. COMPETITIVE BIDDING. Provides that Section 375.221
(Competitive Bidding on Certain Public Works Contracts) does not apply to
the district unless the contract is for more than $25,000.
Sec. 376.326. EXCEPTION FOR DISSOLUTION OF DISTRICT WITH OUTSTANDING DEBTS.
Authorizes the board to vote to dissolve a district that has debt. Requires
the district to remain in existence solely for the limited purpose of
discharging its debts, if the vote is in favor of dissolution.
SECTION 2. Sets forth the findings of the legislature relating to the
proper and legal notice of the intention to introduce this Act,
recommendations filed by the Texas Natural Resource Conservation
Commission, and compliance with the constitution and other state laws.
SECTION 3. Provides that, notwithstanding Section 376.310, Local Government
Code, as added by this Act, the initial board consists of certain persons
named in this section. Provides that of the initial directors, the
directors appointed for positions 1 through 9 serve until June 1, 2003, and
the directors appointed for positions 10 through 17 serve until June 1,
2001.
SECTION 4. Emergency clause.
Effective date: upon passage.