By Bailey H.B. No. 3258
Line and page numbers may not match official copy.
Bill not drafted by TLC or Senate E&E.
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the creation of commercial and industrial development
1-3 zones in certain populous counties; providing for the power of
1-4 eminent domain and the issuance of bonds.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Subtitle B, Title 12, Local Government Code, is
1-7 amended by adding Chapter 384 to read as follows:
1-8 CHAPTER 384. COMMERCIAL AND INDUSTRIAL DEVELOPMENT ZONES
1-9 SUBCHAPTER A. GENERAL PROVISIONS
1-10 Sec. 384.001. DEFINITIONS. In this chapter:
1-11 (1) "Board" means a board of directors of a commercial
1-12 and industrial development zone.
1-13 (2) "Development zone" means an area designated as a
1-14 commercial and industrial development zone under this chapter.
1-15 Sec. 384.002. JURISDICTION OF MUNICIPALITY. For the
1-16 purposes of this chapter, territory in the extraterritorial
1-17 jurisdiction of a municipality is considered to be in the
1-18 jurisdiction of the municipality.
1-19 (Sections 384.003-384.030 reserved for expansion
1-20 SUBCHAPTER B. CREATION OF COMMERCIAL AND INDUSTRIAL
1-21 DEVELOPMENT ZONE
2-1 Sec. 384.031. CRITERIA FOR DEVELOPMENT ZONE CREATION. (a)
2-2 To be created as a development zone, an area must:
2-3 (1) have a continuous boundary;
2-4 (2) be at least 10 square miles but not larger than
2-5 the greater of:
2-6 (A) 25 square miles, excluding lakes, waterways,
2-7 and transportation arteries; or
2-8 (B) an area that is equal to five percent of the
2-9 area, excluding lakes, waterways, and transportation arteries, of
2-10 the municipality, county, or combination of municipalities or
2-11 counties nominating the area as a development zone;
2-12 (3) be an area of pervasive poverty, unemployment, and
2-13 economic distress;
2-14 (4) be located in a county with a population of 2.5
2-15 million or more;
2-16 (5) be adjacent to major transportation nodes and
2-17 thoroughfares that may be used for exporting products to major
2-18 airports, railways, and ports; and
2-19 (6) be designated as a development zone by an
2-20 ordinance or order adopted by each creating body.
2-21 (b) A municipality may contain not more than three
2-22 development zones within its municipal boundaries.
2-23 (c) A county may contain not more than three development
2-24 zones in its unincorporated areas.
2-25 (d) Creation of a development zone in a municipality or
3-1 county does not affect the number of enterprise zones that may be
3-2 designated in the municipality or county under Chapter 2303,
3-3 Government Code.
3-4 Sec. 384.032. AREA OF PERVASIVE POVERTY, UNEMPLOYMENT, AND
3-5 ECONOMIC DISTRESS. An area is an area of pervasive poverty,
3-6 unemployment, and economic distress for the purposes of Section
3-7 384.031 if it meets the requirements of Section 2303.102,
3-8 Government Code.
3-9 Sec. 384.033. CREATION OF DEVELOPMENT ZONE. (a) The
3-10 governing body of a municipality or county, individually or in
3-11 combination with other municipalities or counties, by ordinance or
3-12 order may create as a development zone an area within its
3-13 jurisdiction that meets the criteria under Section 384.031.
3-14 (b) Each creating body must hold a public hearing before
3-15 adopting an ordinance or order under this section.
3-16 (c) The governing body of a county may not designate
3-17 territory in a municipality, including extraterritorial
3-18 jurisdiction of a municipality, to be included in a proposed
3-19 development zone unless the governing body of the municipality also
3-20 designates the territory.
3-21 (d) A development zone created under this section is a:
3-22 (1) political subdivision of the state; and
3-23 (2) special district.
3-24 Sec. 384.034. DESIGNATING ORDINANCE OR ORDER. (a) An
3-25 ordinance or order designating an area as a development zone must:
4-1 (1) describe precisely the area to be included in the
4-2 zone by a legal description or by reference to roadways, lakes,
4-3 waterways, or municipal or county boundaries;
4-4 (2) state a finding that the area meets the
4-5 requirements of this chapter;
4-6 (3) summarize briefly the incentives, including tax
4-7 incentives, that, at the election of the designating body, apply to
4-8 business enterprises in the area; and
4-9 (4) designate the area as a development zone.
4-10 (b) At least one of the incentives summarized under
4-11 Subsection (a)(3) must be an incentive that does not apply to all
4-12 business enterprises located in the jurisdiction of a governmental
4-13 entity that designated the area as a development zone.
4-14 (c) This section does not prohibit a municipality or county
4-15 from extending additional incentives, including tax incentives, to
4-16 business enterprises in a development zone by a separate ordinance
4-17 or order.
4-18 Sec. 384.035. TAX INCREMENT. A creating body may allow one
4-19 quarter of one percent of a local property tax increment to fund a
4-20 development zone, as provided by Chapter 311, Tax Code. On
4-21 adoption of an order or ordinance by each creating body, the fund
4-22 may be used to pay salaries of employees of the board and
4-23 administrative expenses of the development zone.
4-24 Sec. 384.036. AMENDING BOUNDARIES. (a) A creating body by
4-25 ordinance or order may amend the boundary of a development zone
5-1 after a public hearing on the issue.
5-2 (b) The amended boundary:
5-3 (1) must be continuous;
5-4 (2) may not exceed the original size requirement of
5-5 Section 384.031; and
5-6 (3) may not exclude any area originally included
5-7 within the boundary of the development zone as designated.
5-8 (c) The entire development zone with the amended boundary
5-9 must continue to meet the unemployment and economic distress
5-10 requirements of Section 384.031.
5-11 (d) A creating body may not make more than one boundary
5-12 amendment for a development zone in a calendar year.
5-13 (e) If more than one body created the development zone, each
5-14 body must agree on the amendment by ordinance or order.
5-15 (Sections 384.037-384.060 reserved for expansion
5-16 SUBCHAPTER C. BOARD OF DIRECTORS
5-17 Sec. 384.061. BOARD OF DIRECTORS. (a) A development zone
5-18 is governed by a board of seven directors who serve two-year terms,
5-19 appointed as follows:
5-20 (1) the governing body of the municipality, if any,
5-21 that includes the greatest part of the zone's territory shall
5-22 appoint three directors;
5-23 (2) other municipalities, if any, any part of which
5-24 are included in the zone's territory, jointly shall appoint one
5-25 director; and
6-1 (3) the commissioners court of the county in which the
6-2 zone is located shall appoint:
6-3 (A) seven directors, if the zone contains no
6-4 municipality;
6-5 (B) four directors, if the zone contains only
6-6 one municipality; or
6-7 (C) three directors, if the zone contains more
6-8 than one municipality.
6-9 (b) The initial terms of directors may be staggered, so long
6-10 as a term does not exceed two years.
6-11 Sec. 384.062. QUALIFICATIONS OF DIRECTORS. To serve as a
6-12 director, a person must:
6-13 (1) be at least 21 years old; and
6-14 (2) be registered to vote in the county in which the
6-15 development zone is located.
6-16 Sec. 384.063. PERSONS DISQUALIFIED FROM SERVING. Section
6-17 49.052, Water Code, applies to directors of a development zone
6-18 created under this chapter as if the zone were a district governed
6-19 by that section.
6-20 Sec. 384.064. BOARD VACANCIES. A vacancy in the office of
6-21 director shall be filled by appointment by the entity that
6-22 appointed the vacating director.
6-23 Sec. 384.065. REMOVAL OF DIRECTOR. A majority of the board
6-24 may remove a director for misconduct or failure to carry out the
6-25 director's duties.
7-1 Sec. 384.066. ORGANIZATION OF BOARD. After each appointment
7-2 and qualification of directors by the appointing entities, the
7-3 board shall organize by electing a president, a vice president, a
7-4 secretary, and any other officers the board considers necessary.
7-5 Sec. 384.067. QUORUM; DIRECTOR'S DUTIES; MANAGEMENT OF ZONE.
7-6 Sections 49.053, 49.057, and 49.058, Water Code, apply to the board
7-7 of directors of a development zone created under this chapter as if
7-8 the zone were a district governed by those sections.
7-9 Sec. 384.068. MEETINGS AND NOTICE. (a) The board shall
7-10 designate and establish a development zone office in the county.
7-11 (b) The board may establish regular meetings to conduct
7-12 development zone business and may hold special meetings at other
7-13 times as the business of a zone requires.
7-14 (c) Notice of the time, place, and purpose of any meeting of
7-15 the board shall be given by posting a notice containing that
7-16 information at a place convenient to the public within the
7-17 development zone. A copy of the notice shall be furnished to the
7-18 clerk or clerks of the county in which the zone is located, who
7-19 shall post the notice on a bulletin board in the county courthouse
7-20 used for that purpose.
7-21 Sec. 384.069. DIRECTOR'S COMPENSATION; BOND AND OATH OF
7-22 OFFICE. Sections 375.067, 375.069, and 375.070 apply to directors
7-23 of a development zone created under this chapter as if the zone
7-24 were a municipal management district.
7-25 (Sections 384.070-384.100 reserved for expansion
8-1 SUBCHAPTER D. POWERS AND DUTIES
8-2 Sec. 384.101. GENERAL POWERS. (a) A development zone may
8-3 acquire and dispose of projects and has powers, authority, rights,
8-4 and duties necessary to permit accomplishment of the purposes for
8-5 which the zone was created.
8-6 (b) A development zone may provide for general promotion of
8-7 and tourist advertising regarding the zone and its vicinity and for
8-8 a marketing program to attract visitors. Those activities may be
8-9 conducted by the zone under contracts for professional services
8-10 with persons or organizations selected by the zone.
8-11 (c) A development zone may enter into a memorandum of
8-12 understanding with any state agency, including an institution of
8-13 higher education, to further the economic development of the zone.
8-14 (d) To the extent not inconsistent with this chapter, a
8-15 development zone has the powers of:
8-16 (1) a municipal management district created under
8-17 Chapter 375; and
8-18 (2) a county commissioners court under Section
8-19 381.004.
8-20 Sec. 384.102. EMINENT DOMAIN. A development zone not
8-21 located within the corporate limits of a municipality may exercise
8-22 the power of eminent domain, as provided by Chapter 21, Property
8-23 Code, to acquire interests in land within the zone the board of
8-24 directors of the zone considers necessary to provide water and
8-25 sewer services.
9-1 Sec. 384.103. SUITS. A development zone may, through its
9-2 directors, sue and be sued in this state in the name of the
9-3 development zone. Service of process in any suit may be had by
9-4 serving a director.
9-5 (Sections 384.104-384.200 reserved for expansion
9-6 SUBCHAPTER E. BENEFITS OF DEVELOPMENT ZONE
9-7 Sec. 384.201. GENERAL BENEFITS. To the extent not
9-8 inconsistent with this chapter, a development zone has the powers
9-9 and benefits of an enterprise zone, including powers and benefits
9-10 relating to neighborhood enterprise associations, qualified
9-11 businesses, enterprise projects, and state agencies under:
9-12 (1) Chapter 2303, Government Code; and
9-13 (2) Chapters 151 and 171, Tax Code.
9-14 Sec. 384.202. ENTERPRISE ZONE REFERENCES. For purposes of
9-15 this chapter:
9-16 (1) a reference to the department in Chapter 2303,
9-17 Government Code, means the board, except for the references to the
9-18 department in Sections 2303.502 and 2303.503, Government Code,
9-19 which continue to mean the Texas Department of Economic
9-20 Development; and
9-21 (2) a reference to a "governing body of a municipality
9-22 or county that is the governing body of an enterprise zone" in
9-23 Chapter 2303, Government Code, means a creating body under this
9-24 chapter.
9-25 Sec. 384.203. MONITORING. (a) The board shall monitor each
10-1 person in a development zone that receives benefits available under
10-2 this chapter.
10-3 (b) On the board's request, the Texas Workforce Commission
10-4 or the comptroller's office shall provide to the board tax records
10-5 of a person that receives benefits under this chapter.
10-6 (Sections 384.204-384.300 reserved for expansion
10-7 SUBCHAPTER F. GENERAL FISCAL PROVISIONS
10-8 Sec. 384.301. EXPENDITURES. A development zone's money may
10-9 be disbursed only by check, draft, order, or other instrument
10-10 signed by at least three directors. The general manager,
10-11 treasurer, or other employee of the development zone, if authorized
10-12 by resolution of the board, may sign checks, drafts, orders, or
10-13 other instruments on any development zone operation account on
10-14 behalf of the board.
10-15 Sec. 384.302. COMPETITIVE BIDDING; CONTRACT AWARD. Sections
10-16 375.221 and 375.223 apply to a development zone created under this
10-17 chapter as if the zone were a municipal management district, except
10-18 that a contract between the development zone and a governmental
10-19 entity or nonprofit corporation created under the Development
10-20 Corporation Act of 1979 (Article 5190.6, Vernon's Texas Civil
10-21 Statutes) is not subject to the competitive bidding requirement.
10-22 (Sections 384.303-384.400 reserved for expansion
10-23 SUBCHAPTER G. DISSOLUTION
10-24 Sec. 384.401. DISSOLUTION OF DEVELOPMENT ZONE BY CREATING
10-25 BODY. (a) After a hearing, a creating body may dissolve a
11-1 development zone if:
11-2 (1) the area no longer meets the criteria for
11-3 designation under this chapter;
11-4 (2) the best interests of the creating body and the
11-5 owners of property and interests in property in the zone will be
11-6 served by dissolving the zone; and
11-7 (3) each creating body agrees by ordinance or order on
11-8 the:
11-9 (A) proposition that the zone should be
11-10 dissolved;
11-11 (B) disposition of zone assets; and
11-12 (C) assumption of liabilities by the creating
11-13 bodies.
11-14 (b) The dissolution of a development zone does not affect
11-15 the validity of a:
11-16 (1) tax incentive or regulatory relief granted or
11-17 accrued before the removal; or
11-18 (2) bond issued under this chapter.
11-19 Sec. 384.402. DISSOLUTION BY BOARD REQUEST. A board may
11-20 petition a creating body to dissolve the development zone under
11-21 Section 384.401 if a majority of the board finds at any time:
11-22 (1) before the authorization of bonds or the final
11-23 lending of its credit that the proposed undertaking is
11-24 impracticable or cannot be successfully and beneficially
11-25 accomplished; or
12-1 (2) that all bonds of the development zone or other
12-2 debts of the zone have been paid and the purposes of the zone have
12-3 been accomplished.
12-4 Sec. 384.403. TAXES. On dissolution of a development zone,
12-5 any taxes levied on behalf of the zone are abolished.
12-6 SECTION 2. The importance of this legislation and the
12-7 crowded condition of the calendars in both houses create an
12-8 emergency and an imperative public necessity that the
12-9 constitutional rule requiring bills to be read on three several
12-10 days in each house be suspended, and this rule is hereby suspended,
12-11 and that this Act take effect and be in force from and after its
12-12 passage, and it is so enacted.