1-1 AN ACT 1-2 relating to the creation of the Midtown Management District; 1-3 providing authority to impose a tax and issue bonds. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Chapter 376, Local Government Code, is amended by 1-6 adding Subchapter H to read as follows: 1-7 SUBCHAPTER H. MIDTOWN MANAGEMENT DISTRICT 1-8 Sec. 376.301. CREATION OF DISTRICT. (a) The Midtown 1-9 Management District is created as a special district under Section 1-10 59, Article XVI, Texas Constitution. 1-11 (b) The board by resolution may change the district's name. 1-12 (c) The creation of the district is essential to accomplish 1-13 the purposes of Sections 52 and 52-a, Article III, and Section 59, 1-14 Article XVI, Texas Constitution, and other public purposes stated 1-15 in this subchapter. 1-16 Sec. 376.302. DECLARATION OF INTENT. (a) The creation of 1-17 the district is necessary to promote, develop, encourage, and 1-18 maintain employment, commerce, transportation, housing, tourism, 1-19 recreation, arts, entertainment, economic development, safety, and 1-20 the public welfare in the municipality's midtown area. 1-21 (b) The creation of the district and this legislation are 1-22 not to be interpreted to relieve the county or the municipality 1-23 from providing the level of services, as of the effective date of 1-24 this subchapter, to the area in the district or to release the 2-1 county or the municipality from the obligations each entity has to 2-2 provide services to that area. The district is created to 2-3 supplement and not supplant the municipal or county services 2-4 provided in the area in the district. 2-5 (c) By creating the district and in authorizing the 2-6 municipality, county, and other political subdivisions to contract 2-7 with the district, the legislature has established a program to 2-8 accomplish the public purposes set out in Section 52-a, Article 2-9 III, Texas Constitution. 2-10 Sec. 376.303. DEFINITIONS. In this subchapter: 2-11 (1) "Board" means the board of directors of the 2-12 district. 2-13 (2) "County" means Harris County. 2-14 (3) "District" means the Midtown Management District. 2-15 (4) "Municipality" means the City of Houston. 2-16 (5) "Utility" means a person that provides to the 2-17 public gas, electricity, telephone, sewage, or water service. 2-18 Sec. 376.304. BOUNDARIES. The district includes all the 2-19 territory contained within the following described area: 2-20 Being all of the following described property in the 2-21 Obedience Smith Survey, Abstract No. 696, and the James S. Holman 2-22 Survey No. 323, City of Houston, Harris County, Texas and being 2-23 more particularly described as follows: 2-24 BEGINNING at the intersection of the westerly line of Bagby 2-25 Street with the southerly line of McGowen Avenue; 2-26 THENCE in a southwesterly direction along the westerly line 2-27 of Bagby Street to its intersection with the southerly line of Tuam 3-1 Street; 3-2 THENCE in a southeasterly direction along the southerly line 3-3 of Tuam Avenue to its intersection with the westerly line of Brazos 3-4 Street; 3-5 THENCE in a southwesterly direction along the westerly line 3-6 of Brazos Street to its intersection with the northerly line of 3-7 Elgin Avenue; 3-8 THENCE in a southeasterly direction along the northerly line 3-9 of Elgin Avenue to its intersection with the easterly line of 3-10 Brazos Street which is also the easterly line of Spur 527, a 3-11 segment of the Southwest Freeway; 3-12 THENCE in a southerly direction along the easterly line of 3-13 said Spur 527 to its intersection with the easterly line of Milam 3-14 Street; 3-15 THENCE in a southwesterly direction along the easterly line 3-16 of Milam Street to its intersection with the easterly line of said 3-17 Spur 527; 3-18 THENCE in a southerly and southwesterly direction along said 3-19 Spur 527 to its intersection with northerly line of US 59 south; 3-20 THENCE easterly along the northerly line of said US 59 South 3-21 to its intersections with the southeasterly line of Austin Street; 3-22 THENCE northeasterly along the southeasterly line of Austin 3-23 Street to its intersection with the northeasterly line of Eagle 3-24 Avenue; 3-25 THENCE northwesterly along northeasterly line of Eagle Avenue 3-26 to the southeasterly line of San Jacinto Street; 3-27 THENCE northeasterly along the southeasterly line of San 4-1 Jacinto Street to the southeasterly line of Alabama Avenue; 4-2 THENCE in a southeasterly direction along the southerly line 4-3 of Alabama Avenue to its intersection with the easterly line of La 4-4 Branch Street; 4-5 THENCE in a northeasterly direction along the easterly 4-6 direction along the easterly line of La Branch Street to its 4-7 intersection with the southerly line of Winbern Avenue; 4-8 THENCE in a southeasterly direction along the southerly line 4-9 of Winbern Avenue to its intersection with the easterly line of 4-10 Crawford Street; 4-11 THENCE in a northeasterly direction along the easterly line 4-12 of Crawford Street to its intersection with the southerly line of 4-13 Stuart Avenue; 4-14 THENCE in a southeasterly direction along the southerly line 4-15 of Stuart Avenue to the intersection with the Easterly line of 4-16 Hamilton Street which is adjacent to US Highway 59/State Highway 4-17 288; 4-18 THENCE in a northeasterly and northerly direction along the 4-19 easterly line of Hamilton Street and westerly line of said US 4-20 Highway 59/State Highway 288 to its intersection with the northerly 4-21 line of West Gray Avenue; 4-22 THENCE in a northwesterly direction along the northerly line 4-23 of West Gray Avenue to its intersection with the easterly line of 4-24 Smith Street; 4-25 THENCE in a northeasterly direction along the easterly line 4-26 of Smith Street to its intersection with the southerly line of 4-27 Interstate Highway No. 45; 5-1 THENCE in a northwesterly and northerly direction along the 5-2 southerly line of said Interstate Highway No. 45 to its 5-3 intersection with the north line of Cleveland Street; 5-4 THENCE in a westerly direction along the northerly line of 5-5 Cleveland Street to its intersection with the westerly line of 5-6 Arthur Street; 5-7 THENCE in a southerly direction along the westerly line of 5-8 Arthur Street to the southerly dead end thereof; 5-9 THENCE in a southeasterly direction at right angles to the 5-10 northwesterly line of Baldwin Street to its intersection with said 5-11 line; 5-12 THENCE in a southwesterly direction along the northwesterly 5-13 line of Baldwin Street to its intersection with the southerly line 5-14 of West Gray Avenue; 5-15 THENCE in a northwesterly and westerly direction along the 5-16 southerly line of West Gray Avenue to its intersection with the 5-17 north line of Webster Avenue; 5-18 THENCE in a southeasterly direction along the northerly line 5-19 of Webster Avenue to its intersection with an easterly projection 5-20 of the north line of West Webster Avenue; 5-21 THENCE westerly along the northerly line of West Webster 5-22 Avenue to the westerly line of Bailey Street; 5-23 THENCE southerly along the westerly line of Bailey Street and 5-24 a southerly projection thereof to its intersection with the 5-25 southerly line of McGowen Avenue; 5-26 THENCE southeasterly along the southerly of McGowen Avenue to 5-27 its intersection with the westerly line of Bagby Street, which is 6-1 the place of beginning of the tract herein described. There is 6-2 excepted from the boundaries of the district the following tract: 6-3 BEGINNING at the intersection of the center line of Pierce 6-4 Avenue and Bagby Street; 6-5 THENCE in a northeasterly direction with a center line of 6-6 Bagby Street to the westerly right-of-way of Interstate Highway 45; 6-7 THENCE south and southeasterly along the right-of-way of 6-8 Interstate Highway 45 to its intersection with the center line of 6-9 Pierce Avenue; 6-10 THENCE westerly along the center line of Pierce Avenue to the 6-11 intersection with the center line of Bagby Street the point and 6-12 place of beginning; 6-13 SAVE AND EXCEPT all tracts or parcels of land, rights-of-way, 6-14 facilities, and improvements owned by a utility. 6-15 Sec. 376.305. FINDINGS RELATING TO BOUNDARIES. The 6-16 boundaries and field notes of the district form a closure. If a 6-17 mistake is made in the field notes or in copying the field notes in 6-18 the legislative process, it does not affect the district's: 6-19 (1) organization, existence, or validity; 6-20 (2) right to issue any type of bond for the purposes 6-21 for which the district is created or to pay the principal of and 6-22 interest on a bond; 6-23 (3) right to impose or collect an assessment; or 6-24 (4) legality or operation. 6-25 Sec. 376.306. FINDINGS OF BENEFIT AND PUBLIC PURPOSE. (a) 6-26 All the land and other property included in the district will be 6-27 benefited by the improvements and services to be provided by the 7-1 district under powers conferred by Sections 52 and 52-a, Article 7-2 III, and Section 59, Article XVI, Texas Constitution, and other 7-3 powers granted under this subchapter, and the district is created 7-4 to serve a public use and benefit. 7-5 (b) The creation of the district is in the public interest 7-6 and is essential to: 7-7 (1) further the public purposes of the development and 7-8 diversification of the economy of the state; and 7-9 (2) eliminate unemployment and underemployment and 7-10 develop or expand transportation and commerce. 7-11 (c) The district will: 7-12 (1) promote the health, safety, and general welfare of 7-13 residents, employers, employees, visitors, consumers in the 7-14 district, and the general public; 7-15 (2) provide needed funding for the municipality's 7-16 midtown area to preserve, maintain, and enhance the economic health 7-17 and vitality of the area as a community and business center; and 7-18 (3) further promote the health, safety, welfare, and 7-19 enjoyment of the public by providing pedestrian ways and by 7-20 landscaping and developing certain areas in the district, which are 7-21 necessary for the restoration, preservation, and enhancement of 7-22 scenic and aesthetic beauty. 7-23 (d) Pedestrian ways along or across a street, whether at 7-24 grade or above or below the surface, and street lighting, street 7-25 landscaping, and street art objects are parts of and necessary 7-26 components of a street and are considered to be a street or road 7-27 improvement. 8-1 (e) The district will not act as the agent or 8-2 instrumentality of any private interest even though many private 8-3 interests will be benefited by the district, as will the general 8-4 public. 8-5 Sec. 376.307. APPLICATION OF OTHER LAW. Except as otherwise 8-6 provided by this subchapter: 8-7 (1) Chapter 375 applies to the district, its governing 8-8 body, and its employees; and 8-9 (2) the district has rights and powers of a district 8-10 created under Chapter 375. 8-11 Sec. 376.308. LIBERAL CONSTRUCTION OF SUBCHAPTER. This 8-12 subchapter shall be liberally construed in conformity with the 8-13 findings and purposes stated in this subchapter. 8-14 Sec. 376.309. BOARD OF DIRECTORS IN GENERAL. (a) The 8-15 district is governed by a board of 17 directors who serve staggered 8-16 terms of four years, with eight directors' terms expiring June 1 of 8-17 an odd-numbered year and nine directors' terms expiring June 1 of 8-18 the following odd-numbered year. 8-19 (b) A director shall receive compensation as provided by 8-20 Section 49.060, Water Code. 8-21 Sec. 376.310. APPOINTMENT OF DIRECTORS. (a) The mayor and 8-22 members of the governing body of the municipality shall appoint 8-23 directors from persons recommended by the board. A person is 8-24 appointed if a majority of the members and the mayor vote to 8-25 appoint that person. 8-26 (b) A person may not be appointed to the board if the 8-27 appointment of that person would result in less than two-thirds of 9-1 the directors residing in the municipality. 9-2 (c) District directors are public officials entitled to 9-3 governmental immunity for their official actions. 9-4 Sec. 376.311. EX OFFICIO BOARD MEMBERS. (a) The following 9-5 persons shall serve as a nonvoting ex officio director: 9-6 (1) the director of the following departments of the 9-7 municipality: 9-8 (A) parks and recreation; 9-9 (B) planning and development; 9-10 (C) public works; and 9-11 (D) civic center; 9-12 (2) the municipality's chief of police; 9-13 (3) the county's general manager of the Metropolitan 9-14 Transit Authority; and 9-15 (4) the presidents of any institutions of higher 9-16 learning located in the district. 9-17 (b) If a department described by Subsection (a) is 9-18 consolidated, renamed, or changed, the board may appoint a director 9-19 of the consolidated, renamed, or changed department as a nonvoting 9-20 ex officio board member. If a department described by Subsection 9-21 (a) is abolished, the board may appoint a representative of another 9-22 department of the municipality that performs duties comparable to 9-23 those performed by the abolished department. 9-24 (c) The board may appoint the presiding officer of a 9-25 nonprofit corporation that is actively involved in activities in 9-26 the municipality's midtown area to serve as a nonvoting ex officio 9-27 director. 10-1 Sec. 376.312. CONFLICTS OF INTEREST; ONE-TIME AFFIDAVIT. 10-2 (a) Except as provided in this section: 10-3 (1) a director may participate in all board votes and 10-4 decisions; and 10-5 (2) Chapter 171 governs conflict of interests for 10-6 board members. 10-7 (b) Section 171.004 does not apply to the district. A 10-8 director who has a substantial interest in a business or charitable 10-9 entity that will receive a pecuniary benefit from a board action 10-10 shall file a one-time affidavit declaring the interest. An 10-11 additional affidavit is not required if the director's interest 10-12 changes. After the affidavit is filed with the board secretary, 10-13 the director may participate in a discussion or vote on that action 10-14 if: 10-15 (1) a majority of the directors have a similar 10-16 interest in the same entity; or 10-17 (2) all other similar business or charitable entities 10-18 in the district will receive a similar pecuniary benefit. 10-19 (c) A director who is also an officer or employee of a 10-20 public entity may not participate in the discussion of or vote on a 10-21 matter regarding a contract with that same public entity. 10-22 (d) For purposes of this section, a director has a 10-23 substantial interest in a charitable entity in the same manner that 10-24 a person would have a substantial interest in a business entity 10-25 under Section 171.002. 10-26 Sec. 376.313. ADDITIONAL POWERS OF DISTRICT. (a) The 10-27 district may exercise the powers given to a corporation created 11-1 under Section 4B, Development Corporation Act of 1979 (Article 11-2 5190.6, Vernon's Texas Civil Statutes). 11-3 (b) The district may exercise the powers given to a housing 11-4 finance corporation created under Chapter 394 to provide housing or 11-5 residential development projects in the district. 11-6 (c) The district may impose an ad valorem tax, assessment, 11-7 or impact fee in accordance with Chapter 375 on all property in the 11-8 district, including industrial, commercial, or residential 11-9 property, to finance an improvement this subchapter authorizes the 11-10 district to construct or acquire or a service this subchapter 11-11 authorizes the district to provide. 11-12 Sec. 376.314. AGREEMENTS: GENERAL; DONATIONS, INTERLOCAL 11-13 AGREEMENTS, AND LAW ENFORCEMENT SERVICES. (a) The district may 11-14 make an agreement with or accept a donation, grant, or loan from 11-15 any person. 11-16 (b) The implementation of a project is a governmental 11-17 function or service for the purposes of Chapter 791, Government 11-18 Code. 11-19 (c) To protect the public interest, the district may 11-20 contract with the municipality or the county for the municipality 11-21 or county to provide law enforcement services in the district for a 11-22 fee. 11-23 Sec. 376.315. NONPROFIT CORPORATION. (a) The board by 11-24 resolution may authorize the creation of a nonprofit corporation to 11-25 assist and act on behalf of the district in implementing a project 11-26 or providing a service authorized by this subchapter. 11-27 (b) The board shall appoint the board of directors of a 12-1 nonprofit corporation created under this section. The board of 12-2 directors of the nonprofit corporation shall serve in the same 12-3 manner, term, and conditions as a board of directors of a local 12-4 government corporation created under Chapter 431, Transportation 12-5 Code. 12-6 (c) A nonprofit corporation created under this section has 12-7 the powers of and is considered for purposes of this subchapter to 12-8 be a local government corporation created under Chapter 431, 12-9 Transportation Code. 12-10 (d) A nonprofit corporation created under this section may 12-11 implement any project and provide any service authorized by this 12-12 subchapter. 12-13 Sec. 376.316. ANNEXATION. The district may: 12-14 (1) annex territory as provided by Subchapter C, 12-15 Chapter 375; and 12-16 (2) annex territory located inside the boundaries of a 12-17 reinvestment zone created by the municipality under Chapter 311, 12-18 Tax Code, if the governing body of the municipality consents to the 12-19 annexation. 12-20 Sec. 376.317. PETITION REQUIRED FOR FINANCING SERVICES AND 12-21 IMPROVEMENTS. The board may not finance a service or improvement 12-22 project under this subchapter unless a written petition requesting 12-23 the improvement or service has been filed with the board. The 12-24 petition must be signed by: 12-25 (1) the owners of a majority of the assessed value of 12-26 real property in the district as determined by the most recent 12-27 certified county property tax rolls; or 13-1 (2) at least 25 persons who own land in the district, 13-2 if there are more than 25 persons who own property in the district 13-3 as determined by the most recent certified county property tax 13-4 rolls. 13-5 Sec. 376.318. ELECTIONS. (a) In addition to the elections 13-6 the district must hold under Subchapter L, Chapter 375, the 13-7 district shall hold an election in the manner provided by that 13-8 subchapter to obtain voter approval before the district imposes a 13-9 maintenance tax or issues bonds payable from ad valorem taxes or 13-10 assessments. 13-11 (b) The board may include more than one purpose in a single 13-12 proposition at an election. 13-13 Sec. 376.319. MAINTENANCE TAX. (a) If authorized at an 13-14 election held in accordance with Section 376.318, the district may 13-15 impose and collect an annual ad valorem tax on taxable property in 13-16 the district for the maintenance and operation of the district and 13-17 the improvements constructed or acquired by the district or for the 13-18 provision of services. 13-19 (b) The board shall determine the tax rate. 13-20 Sec. 376.320. ASSESSMENTS. (a) The board may impose and 13-21 collect an assessment for any purpose authorized by this 13-22 subchapter. 13-23 (b) Assessments, including assessments resulting from an 13-24 addition to or correction of the assessment roll by the district, 13-25 reassessments, penalties and interest on an assessment or 13-26 reassessment, expenses of collection, and reasonable attorney's 13-27 fees incurred by the district: 14-1 (1) are a first and prior lien against the property 14-2 assessed; 14-3 (2) are superior to any other lien or claim other than 14-4 a lien or claim for county, school district, or municipal ad 14-5 valorem taxes; and 14-6 (3) are the personal liability of and charge against 14-7 the owners of the property even if the owners are not named in the 14-8 assessment proceedings. 14-9 (c) The lien is effective from the date of the resolution of 14-10 the board imposing the assessment until the assessment is paid. 14-11 The board may enforce the lien in the same manner that the board 14-12 may enforce an ad valorem tax lien against real property. 14-13 Sec. 376.321. CERTAIN RESIDENTIAL PROPERTY NOT EXEMPT. 14-14 Section 375.161 does not apply to the district. 14-15 Sec. 376.322. UTILITIES. The district may not impose an 14-16 assessment or impact fee on a utility's property. 14-17 Sec. 376.323. MUNICIPAL APPROVAL. (a) Except as provided by 14-18 Subsection (b), the district must obtain approval from the 14-19 municipality's governing body of: 14-20 (1) the issuance of bonds for an improvement project; 14-21 and 14-22 (2) the plans and specifications of an improvement 14-23 project financed by the bonds. 14-24 (b) If the district obtains approval from the municipality's 14-25 governing body of a capital improvements budget for a period not to 14-26 exceed five years, the district may finance the capital 14-27 improvements and issue bonds specified in the budget without 15-1 further approval from the municipality. 15-2 (c) The district must obtain approval from the 15-3 municipality's governing body of the plans and specifications of 15-4 any district improvement project related to the use of land owned 15-5 by the municipality, an easement granted by the municipality, or a 15-6 right-of-way of a street, road, or highway. 15-7 (d) Except as provided by Section 375.263, a municipality is 15-8 not obligated to pay any bonds, notes, or other obligations of the 15-9 district. 15-10 Sec. 376.324. DISBURSEMENTS OR TRANSFERS OF FUNDS. The 15-11 board by resolution shall establish the number of directors' 15-12 signatures and the procedure required for a disbursement or 15-13 transfer of the district's money. 15-14 Sec. 376.325. COMPETITIVE BIDDING LIMIT. Section 375.221 15-15 does not apply to the district unless the contract is for more than 15-16 $25,000. 15-17 Sec. 376.326. EXCEPTION FOR DISSOLUTION OF DISTRICT WITH 15-18 OUTSTANDING DEBTS. (a) The board may vote to dissolve a district 15-19 that has debt. If the vote is in favor of dissolution, the 15-20 district shall remain in existence solely for the limited purpose 15-21 of discharging its debts. The dissolution is effective when all 15-22 debts have been discharged. 15-23 (b) Section 375.264 does not apply to the district. 15-24 SECTION 2. The legislature finds that: 15-25 (1) proper and legal notice of the intention to 15-26 introduce this Act, setting forth the general substance of this 15-27 Act, has been published as provided by law, and the notice and a 16-1 copy of this Act have been furnished to all persons, agencies, 16-2 officials, or entities to which they are required to be furnished 16-3 by the constitution and laws of this state, including the governor, 16-4 who has submitted the notice and Act to the Texas Natural Resource 16-5 Conservation Commission; 16-6 (2) the Texas Natural Resource Conservation Commission 16-7 has filed its recommendations relating to this Act with the 16-8 governor, lieutenant governor, and speaker of the house of 16-9 representatives within the required time; 16-10 (3) the general law relating to consent by political 16-11 subdivisions to the creation of districts with conservation, 16-12 reclamation, and road powers and the inclusion of land in those 16-13 districts has been complied with; and 16-14 (4) all requirements of the constitution and laws of 16-15 this state and the rules and procedures of the legislature with 16-16 respect to the notice, introduction, and passage of this Act have 16-17 been fulfilled and accomplished. 16-18 SECTION 3. Notwithstanding Section 376.310, Local Government 16-19 Code, as added by this Act: 16-20 (1) the initial board of directors of the Midtown 16-21 Management District consists of: 16-22 Pos. No. Name of Board Member 16-23 1. Gregory Phillips 16-24 2. Andy Bynam 16-25 3. Blanchard Hollins 16-26 4. Suewan Johnson 16-27 5. John Gonzales 17-1 6. Doug Williams 17-2 7. Tran Tian 17-3 8. Al Luna 17-4 9. Angela Lange 17-5 10. John Kirksey 17-6 11. Kathy Perry 17-7 12. Dan Nip 17-8 13. Allen Crosswell 17-9 14. Steve Hefner 17-10 15. Jim Lang 17-11 16. Frank Liu 17-12 17. Grant Martin; and 17-13 (2) of the initial board members, the members 17-14 appointed for positions 1 through 9 serve until June 1, 2003, and 17-15 the members appointed for positions 10 through 17 serve until June 17-16 1, 2001. 17-17 SECTION 4. The importance of this legislation and the 17-18 crowded condition of the calendars in both houses create an 17-19 emergency and an imperative public necessity that the 17-20 constitutional rule requiring bills to be read on three several 17-21 days in each house be suspended, and this rule is hereby suspended, 17-22 and that this Act take effect and be in force from and after its 17-23 passage, and it is so enacted. _______________________________ _______________________________ President of the Senate Speaker of the House I certify that H.B. No. 2894 was passed by the House on April 23, 1999, by the following vote: Yeas 141, Nays 0, 2 present, not voting; and that the House concurred in Senate amendments to H.B. No. 2894 on May 26, 1999, by a non-record vote. _______________________________ Chief Clerk of the House I certify that H.B. No. 2894 was passed by the Senate, with amendments, on May 24, 1999, by the following vote: Yeas 30, Nays 0. _______________________________ Secretary of the Senate APPROVED: _____________________ Date _____________________ Governor