By Brimer                                             H.B. No. 2045
         76R894 PAM-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to financing capital improvements and facility expansions
 1-3     through the assessment of impact fees.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Section 395.001(10), Local Government Code, is
 1-6     amended to read as follows:
 1-7                 (10)  "Service unit" means a standardized measure of
 1-8     consumption, use, generation, or discharge, as established by the
 1-9     Texas Natural Resource Conservation Commission, attributable to an
1-10     individual unit of development [calculated in accordance with
1-11     generally accepted engineering or planning standards for a
1-12     particular category of capital improvements or facility
1-13     expansions].
1-14           SECTION 2.  Section 395.014(a), Local Government Code, is
1-15     amended to read as follows:
1-16           (a)  The political subdivision shall use qualified
1-17     professionals to prepare the capital improvements plan and to
1-18     calculate the impact fee.  The capital improvements plan must
1-19     contain specific enumeration of the following items:
1-20                 (1)  a description of the existing capital improvements
1-21     within the service area and the costs to upgrade, update, improve,
1-22     expand, or replace the improvements to meet existing needs and
1-23     usage and stricter safety, efficiency, environmental, or regulatory
1-24     standards, which shall be prepared by a qualified professional
 2-1     engineer licensed to perform the professional engineering services
 2-2     in this state;
 2-3                 (2)  an analysis of the total capacity, the level of
 2-4     current usage, and commitments for usage of capacity of the
 2-5     existing capital improvements, which shall be prepared by a
 2-6     qualified professional engineer licensed to perform the
 2-7     professional engineering services in this state;
 2-8                 (3)  a description of all or the parts of the capital
 2-9     improvements or facility expansions and their costs necessitated by
2-10     and attributable to new development in the service area based on
2-11     the approved land use assumptions, which shall be prepared by a
2-12     qualified professional engineer licensed to perform the
2-13     professional engineering services in this state;
2-14                 (4)  a definitive table establishing the specific level
2-15     or quantity of use, consumption, generation, or discharge of a
2-16     service unit for each category of capital improvements or facility
2-17     expansions and an equivalency or conversion table establishing the
2-18     ratio of a service unit to various types of land uses, including
2-19     residential, commercial, and industrial;
2-20                 (5)  the total number of projected service units
2-21     necessitated by and attributable to new development within the
2-22     service area based on the approved land use assumptions and
2-23     calculated in accordance with generally accepted engineering or
2-24     planning criteria; [and]
2-25                 (6)  the projected demand for capital improvements or
2-26     facility expansions required by new service units projected over a
2-27     reasonable period of time, not to exceed 10 years; and
 3-1                 (7)  the sum of revenue received by the political
 3-2     subdivision from sources generated by new development, including
 3-3     sales tax and sales tax on construction materials, property tax,
 3-4     development fees, and building fees.
 3-5           SECTION 3.  Section 395.016, Local Government Code, is
 3-6     amended by amending Subsection (d) and adding Subsection (h) to
 3-7     read as follows:
 3-8           (d)  This subsection applies only to land platted in
 3-9     accordance with Subchapter A, Chapter 212, or the subdivision or
3-10     platting procedures of a political subdivision after adoption of an
3-11     impact fee adopted after June 20, 1987.  The political subdivision
3-12     shall assess the impact fees before or at the time of recordation
3-13     of a subdivision plat or other plat under Subchapter A, Chapter
3-14     212, or the subdivision or platting ordinance or procedures of any
3-15     political subdivision in the official records of the county clerk
3-16     of the county in which the tract is located.  Except as provided by
3-17     Section 395.019, the political subdivision may collect the fees at
3-18     [either] the time of [recordation of the subdivision plat or]
3-19     connection to the political subdivision's water or sewer system or
3-20     at the time the political subdivision issues either the building
3-21     permit or the certificate of occupancy, whichever is later.
3-22           (h)  In the first statement or billing sent to the homeowner
3-23     by the political subdivision under this section, the political
3-24     subdivision shall notify the homeowner of the amount of impact fees
3-25     assessed.
3-26           SECTION 4.  Section 395.021, Local Government Code, is
3-27     amended to read as follows:
 4-1           Sec. 395.021.  AUTHORITY OF POLITICAL SUBDIVISIONS TO SPEND
 4-2     FUNDS TO REDUCE FEES.  (a)  In this section, "enterprise funds"
 4-3     means funds received by a political subdivision from fees for
 4-4     services provided by a capital improvement.
 4-5           (b)  Political subdivisions may spend funds from any lawful
 4-6     source to pay for all or a part of the capital improvements or
 4-7     facility expansions to reduce the amount of impact fees.
 4-8           (c)  A political subdivision shall use excess funds generated
 4-9     by enterprise funds to pay for capital improvements or facility
4-10     expansions.  Any enterprise funds remaining after capital
4-11     improvements and facility expansions have been paid in full may be
4-12     transferred to the political subdivision's general fund.
4-13           SECTION 5.  Section 395.052, Local Government Code, is
4-14     amended by adding Subsection (c) to read as follows:
4-15           (c)  An update of the land use assumptions and capital
4-16     improvements plan does not:
4-17                 (1)  constitute a new impact fee;
4-18                 (2)  extend the period for providing a refund under
4-19     Section 395.025; or
4-20                 (3)  extend the period for performing a duty under
4-21     Section 395.071.
4-22           SECTION 6.  The Texas Natural Resource Conservation
4-23     Commission shall develop a standardized measure of consumption,
4-24     use, generation, or discharge attributable to an individual unit of
4-25     development for purposes of Section 395.001(10), Local Government
4-26     Code, as amended by this Act, on or before November 1, 1999.
4-27           SECTION 7.  (a)  Except as provided by Subsection (b) of this
 5-1     section, this Act takes effect September 1, 1999.
 5-2           (b)  The amendments made by this Act to Chapter 395, Local
 5-3     Government Code, take effect January 1, 1999.
 5-4           SECTION 8.  The importance of this legislation and the
 5-5     crowded condition of the calendars in both houses create an
 5-6     emergency and an imperative public necessity that the
 5-7     constitutional rule requiring bills to be read on three several
 5-8     days in each house be suspended, and this rule is hereby suspended.