1-1 By: Turner of Harris (Senate Sponsor - Whitmire) H.B. No. 1990 1-2 (In the Senate - Received from the House April 23, 2001; 1-3 April 24, 2001, read first time and referred to Committee on 1-4 Intergovernmental Relations; May 4, 2001, reported favorably by the 1-5 following vote: Yeas 6, Nays 0; May 4, 2001, sent to printer.) 1-6 A BILL TO BE ENTITLED 1-7 AN ACT 1-8 relating to the creation of the Near Northwest Management District; 1-9 providing authority to impose a tax and issue bonds. 1-10 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-11 SECTION 1. Chapter 376, Local Government Code, is amended by 1-12 adding Subchapter K to read as follows: 1-13 SUBCHAPTER K. NEAR NORTHWEST MANAGEMENT DISTRICT 1-14 Sec. 376.451. CREATION OF DISTRICT. (a) A special district 1-15 to be known as the "Near Northwest Management District" exists as a 1-16 governmental agency, body politic and corporate, and political 1-17 subdivision of the state. 1-18 (b) The name of the district may be changed by resolution of 1-19 the board. 1-20 (c) The creation of the district is essential to accomplish 1-21 the purposes of Section 52, Article III, Section 59, Article XVI, 1-22 and Section 52-a, Article III, Texas Constitution, and other public 1-23 purposes stated in this subchapter. 1-24 Sec. 376.452. DECLARATION OF INTENT. (a) The creation of 1-25 the district is necessary to promote, develop, encourage, and 1-26 maintain employment, commerce, transportation, housing, tourism, 1-27 recreation, arts, entertainment, economic development, safety, and 1-28 the public welfare in the near northwest area of the city of 1-29 Houston. 1-30 (b) The creation of the district and this legislation are 1-31 not to be interpreted to relieve the county or the municipality 1-32 from providing the level of services, as of the effective date of 1-33 this subchapter, to the area in the district or to release the 1-34 county or the municipality from the obligations each entity has to 1-35 provide services to that area. The district is created to 1-36 supplement and not supplant the municipal or county services 1-37 provided in the area in the district. 1-38 (c) By creating the district and in authorizing the 1-39 municipality, county, and other political subdivisions to contract 1-40 with the district, the legislature has established a program to 1-41 accomplish the public purposes set out in Section 52-a, Article 1-42 III, Texas Constitution. 1-43 Sec. 376.453. DEFINITIONS. In this subchapter: 1-44 (1) "Board" means the board of directors of the 1-45 district. 1-46 (2) "County" means Harris County, Texas. 1-47 (3) "District" means the Near Northwest Management 1-48 District. 1-49 (4) "Municipality" means the City of Houston, Texas. 1-50 (5) "Utility" means a person that provides to the 1-51 public cable television, gas, light, power, telephone, sewage, or 1-52 water service. 1-53 Sec. 376.454. BOUNDARIES. The district includes all the 1-54 territory contained in the area bounded by T.C. Jester Boulevard on 1-55 the east, Pinemont Drive on the south, Hollister Drive projected to 1-56 State Road 249 on the west, and State Road 249 on the north as 1-57 those roads exist on the effective date of this Act. 1-58 Sec. 376.455. FINDINGS RELATING TO BOUNDARIES. The 1-59 boundaries described by Section 376.454 form a closure. If a 1-60 mistake is made in the description in the course of the 1-61 legislative process, the mistake does not in any way affect the: 1-62 (1) organization, existence, and validity of the 1-63 district; 1-64 (2) right of the district to issue any type of bonds 2-1 or refunding bonds for the purposes for which the district is 2-2 created or to pay the principal of and interest on the bonds; 2-3 (3) right of the district to impose and collect 2-4 assessments or taxes; or 2-5 (4) legality or operation of the district or its 2-6 governing body. 2-7 Sec. 376.456. FINDINGS OF BENEFIT AND PUBLIC PURPOSE. (a) 2-8 All the land and other property included in the district will be 2-9 benefited by the improvements and services to be provided by the 2-10 district under powers conferred by Section 52, Article III, Section 2-11 59, Article XVI, and Section 52-a, Article III, Texas Constitution, 2-12 and other powers granted under this subchapter, and the district is 2-13 created to serve a public use and benefit. 2-14 (b) The creation of the district is in the public interest 2-15 and is essential to: 2-16 (1) further the public purposes of the development and 2-17 diversification of the economy of the state; and 2-18 (2) eliminate unemployment and underemployment and 2-19 develop or expand transportation and commerce. 2-20 (c) The district will: 2-21 (1) promote the health, safety, and general welfare of 2-22 residents, employers, employees, visitors, consumers in the 2-23 district, and the general public; 2-24 (2) provide needed funding for the near northwest area 2-25 of the city of Houston to preserve, maintain, and enhance the 2-26 economic health and vitality of the area as a community and 2-27 business center; and 2-28 (3) further promote the health, safety, welfare, and 2-29 enjoyment of the public by providing pedestrian ways and by 2-30 landscaping and developing certain areas in the district, which are 2-31 necessary for the restoration, preservation, and enhancement of 2-32 scenic and aesthetic beauty. 2-33 (d) Pedestrian ways along or across a street, whether at 2-34 grade or above or below the surface, and street lighting, street 2-35 landscaping, and street art objects are parts of and necessary 2-36 components of a street and are considered to be a street or road 2-37 improvement. 2-38 (e) The district will not act as the agent or 2-39 instrumentality of any private interest even though many private 2-40 interests will be benefited by the district, as will the general 2-41 public. 2-42 Sec. 376.457. APPLICATION OF OTHER LAW. Except as otherwise 2-43 provided by this subchapter, Chapter 375 applies to the district 2-44 and its governing body and employees. 2-45 Sec. 376.458. CONSTRUCTION OF SUBCHAPTER. This subchapter 2-46 shall be liberally construed in conformity with the findings and 2-47 purposes stated in this subchapter. 2-48 Sec. 376.459. BOARD OF DIRECTORS IN GENERAL. (a) The 2-49 district is governed by a board of nine directors who serve 2-50 staggered terms of four years, with five members' terms expiring 2-51 June 1 of an odd-numbered year and four members' terms expiring 2-52 June 1 of the following odd-numbered year. The board by resolution 2-53 may increase or decrease the number of directors on the board if it 2-54 is in the best interest of the district to do so and if the board 2-55 consists of not fewer than 9 and not more than 30 directors. 2-56 (b) Subchapter D, Chapter 375, applies to the board to the 2-57 extent that subchapter does not conflict with this subchapter. The 2-58 imposition of a tax, assessment, or impact fee requires a vote of a 2-59 majority of the directors serving. Directors may vote on any 2-60 matter authorized by Subchapter D, Chapter 375, and action may be 2-61 taken by the board only if it is approved in the manner prescribed 2-62 by Subchapter D, Chapter 375. 2-63 Sec. 376.460. APPOINTMENT OF DIRECTORS; VACANCY. The mayor 2-64 and members of the governing body of the municipality shall appoint 2-65 directors from persons recommended by the board who meet the 2-66 qualifications of Subchapter D, Chapter 375. A vacancy in the 2-67 office of director because of the death, resignation, or removal of 2-68 a director shall be filled by the remaining members of the board by 2-69 appointing a qualified person for the unexpired term. 3-1 Sec. 376.461. POWERS OF DISTRICT. The district has: 3-2 (1) all powers necessary or required to accomplish the 3-3 purposes for which the district was created; 3-4 (2) the rights, powers, privileges, authority, and 3-5 functions of a district created under Chapter 375; 3-6 (3) the powers given to a corporation under Section 3-7 4B, Development Corporation Act of 1979 (Article 5190.6, Vernon's 3-8 Texas Civil Statutes), and the power to own, operate, acquire, 3-9 construct, lease, improve, and maintain projects; 3-10 (4) the power to impose ad valorem taxes, assessments, 3-11 or impact fees in accordance with Chapter 375 to provide 3-12 improvements and services for a project or activity the district is 3-13 authorized to acquire, construct, improve, or provide under this 3-14 subchapter; 3-15 (5) the power to correct, add to, or delete 3-16 assessments from its assessment rolls after notice and hearing as 3-17 provided by Subchapter F, Chapter 375; and 3-18 (6) the powers given to a housing finance corporation 3-19 created under Chapter 394 to provide housing or residential 3-20 development projects in the district. 3-21 Sec. 376.462. SALES AND USE TAX. The district may not 3-22 impose a sales and use tax. 3-23 Sec. 376.463. EMINENT DOMAIN. The district may not exercise 3-24 the power of eminent domain. 3-25 Sec. 376.464. EX OFFICIO BOARD MEMBERS. (a) The following 3-26 persons shall serve as nonvoting ex officio directors: 3-27 (1) the director of the following departments of the 3-28 municipality: 3-29 (A) parks and recreation; 3-30 (B) planning and development; 3-31 (C) public works; and 3-32 (D) civic center; 3-33 (2) the municipality's chief of police; 3-34 (3) the general manager of the Metropolitan Transit 3-35 Authority; and 3-36 (4) the presidents of any institutions of higher 3-37 learning located in the district. 3-38 (b) If a department described by Subsection (a) is 3-39 consolidated, renamed, or changed, the board may appoint a director 3-40 of the consolidated, renamed, or changed department as a nonvoting 3-41 ex officio board member. If a department described by Subsection 3-42 (a) is abolished, the board may appoint a representative of another 3-43 department of the municipality that performs duties comparable to 3-44 those performed by the abolished department. 3-45 (c) The board may appoint the presiding officer of a 3-46 nonprofit corporation that is actively involved in activities in 3-47 the municipality's midtown area to serve as a nonvoting ex officio 3-48 director. 3-49 Sec. 376.465. CONFLICTS OF INTEREST; ONE-TIME AFFIDAVIT. 3-50 (a) Except as provided in this section: 3-51 (1) a director may participate in all board votes and 3-52 decisions; and 3-53 (2) Chapter 171 governs conflicts of interest for 3-54 board members. 3-55 (b) Section 171.004 does not apply to the district. A 3-56 director who has a substantial interest in a business or charitable 3-57 entity that will receive a pecuniary benefit from a board action 3-58 shall file a one-time affidavit declaring the interest. An 3-59 additional affidavit is not required if the director's interest 3-60 changes. After the affidavit is filed with the board secretary, 3-61 the director may participate in a discussion or vote on that action 3-62 if: 3-63 (1) a majority of the directors have a similar 3-64 interest in the same entity; or 3-65 (2) all other similar business or charitable entities 3-66 in the district will receive a similar pecuniary benefit. 3-67 (c) A director who is also an officer or employee of a 3-68 public entity may not participate in the discussion of or vote on a 3-69 matter regarding a contract with that same public entity. 4-1 (d) For purposes of this section, a director has a 4-2 substantial interest in a charitable entity in the same manner that 4-3 a person would have a substantial interest in a business entity 4-4 under Section 171.002. 4-5 Sec. 376.466. EXPENSES AND LIABILITY FOR CERTAIN ACTIONS 4-6 AFFECTING PROPERTY. (a) If the district, in exercising a power 4-7 conferred by this subchapter, requires a relocation, adjustment, 4-8 raising, lowering, rerouting, or changing of the grade or the 4-9 construction of any of the following items, the district must take 4-10 that required action at the sole expense of the district: 4-11 (1) a street, alley, highway, overpass, underpass, 4-12 road, railroad track, bridge, facility, or other property; 4-13 (2) an electric line, conduit, facility, or other 4-14 property; 4-15 (3) a telephone or telegraph line, conduit, facility, 4-16 or other property; 4-17 (4) a gas transmission or distribution pipe, pipeline, 4-18 main, facility, or other property; 4-19 (5) a water, sanitary sewer, or storm sewer pipe, 4-20 pipeline, main, facility, or other property; 4-21 (6) a cable television line, cable, conduit, facility, 4-22 or other property; or 4-23 (7) another pipeline, facility, or other property 4-24 relating to the pipeline. 4-25 (b) The district shall bear damages that are suffered by 4-26 owners of the facility or other property. 4-27 Sec. 376.467. RELATION TO OTHER LAW. If any provision of 4-28 general law, including a law referenced in this subchapter, is in 4-29 conflict with or is inconsistent with this subchapter, this 4-30 subchapter prevails. Any law referenced in this subchapter that is 4-31 not in conflict or inconsistent with this subchapter is adopted and 4-32 incorporated by reference. 4-33 Sec. 376.468. REQUIREMENTS FOR FINANCING SERVICES AND 4-34 IMPROVEMENTS. The board may not finance services and improvement 4-35 projects under this subchapter unless a written petition requesting 4-36 those improvements or services has been filed with the board. The 4-37 petition must be signed by: 4-38 (1) the owners of a majority of the assessed value of 4-39 real property in the district as determined by the most recent 4-40 certified county property tax rolls; or 4-41 (2) at least 50 persons who own land in the district, 4-42 if there are more than 50 persons who own property in the district 4-43 as determined by the most recent certified county property tax 4-44 rolls. 4-45 Sec. 376.469. NONPROFIT CORPORATION. (a) The board by 4-46 resolution may authorize the creation of a nonprofit corporation to 4-47 assist and act on behalf of the district in implementing a project 4-48 or providing a service authorized by this subchapter. 4-49 (b) The board shall appoint the board of directors of a 4-50 nonprofit corporation created under this section. The board of 4-51 directors of the nonprofit corporation shall serve in the same 4-52 manner as, for the same term as, and on the conditions of the board 4-53 of directors of a local government corporation created under 4-54 Chapter 431, Transportation Code. 4-55 (c) A nonprofit corporation created under this section has 4-56 the powers of and is considered for purposes of this subchapter to 4-57 be a local government corporation created under Chapter 431, 4-58 Transportation Code. 4-59 (d) A nonprofit corporation created under this section may 4-60 implement any project and provide any services authorized by this 4-61 subchapter. 4-62 Sec. 376.470. DISBURSEMENTS OR TRANSFERS OF FUNDS. The 4-63 board by resolution shall establish the number of directors' 4-64 signatures and the procedure required for a disbursement or 4-65 transfer of the district's money. 4-66 Sec. 376.471. BONDS. (a) The district may issue bonds or 4-67 other obligations payable in whole or in part from ad valorem 4-68 taxes, assessments, impact fees, revenues, grants, or other money 4-69 of the district, or any combination of those sources of money, to 5-1 pay for any authorized purpose of the district. 5-2 (b) Bonds or other obligations of the district may be issued 5-3 in the form of bonds, notes, certificates of participation, 5-4 including other instruments evidencing a proportionate interest in 5-5 payments to be made by the district, or other obligations that are 5-6 issued in the exercise of the district's borrowing power and may be 5-7 issued in bearer or registered form or not represented by an 5-8 instrument but the transfer of which is registered on books 5-9 maintained by or on behalf of the district. The board may impose 5-10 and collect an assessment under Subchapter F, Chapter 375, for any 5-11 purpose authorized by this subchapter or by Chapter 375. 5-12 (c) Except as provided by Subsection (d), the district must 5-13 obtain the municipality's approval of: 5-14 (1) the issuance of bonds for an improvement project; 5-15 (2) the plans and specifications of the improvement 5-16 project to be financed by the bonds; and 5-17 (3) the plans and specifications of a district 5-18 improvement project related to: 5-19 (A) the use of land owned by the municipality; 5-20 (B) an easement granted by the municipality; or 5-21 (C) a right-of-way of a street, road, or 5-22 highway. 5-23 (d) If the district obtains the municipality's approval of a 5-24 capital improvements budget for a specified period not to exceed 5-25 five years, the district may finance the capital improvements and 5-26 issue bonds specified in the budget without further municipal 5-27 approval. 5-28 (e) Before the district issues bonds, the district shall 5-29 submit the bonds and the record of proceedings of the district 5-30 relating to authorization of the bonds to the attorney general for 5-31 approval as provided by Chapter 1202, Government Code. 5-32 Sec. 376.472. ASSESSMENTS. (a) The board may impose and 5-33 collect an assessment for any purpose authorized by this 5-34 subchapter. 5-35 (b) Assessments, reassessments, or assessments resulting 5-36 from an addition to or correction of the assessment roll by the 5-37 district, penalties and interest on an assessment or reassessment, 5-38 expenses of collection, and reasonable attorney's fees incurred by 5-39 the district: 5-40 (1) are a first and prior lien against the property 5-41 assessed; 5-42 (2) are superior to any other lien or claim other than 5-43 a lien or claim for county, school district, or municipal ad 5-44 valorem taxes; and 5-45 (3) are the personal liability of and charge against 5-46 the owners of the property even if the owners are not named in the 5-47 assessment proceedings. 5-48 (c) The lien is effective from the date of the resolution of 5-49 the board levying the assessment until the assessment is paid. The 5-50 board may enforce the lien in the same manner that the board may 5-51 enforce an ad valorem tax lien against real property. 5-52 Sec. 376.473. PROPERTY EXEMPTED FROM FEE OR ASSESSMENT. 5-53 (a) The district may not impose an impact fee or assessment on a 5-54 residence homestead as defined by Section 11.13, Tax Code. 5-55 (b) The district may not impose an impact fee or assessment 5-56 on the property, equipment, or facilities of a utility. 5-57 Sec. 376.474. ELECTIONS. (a) In addition to the elections 5-58 the district must hold under Subchapter L, Chapter 375, the 5-59 district shall hold an election in the manner provided by that 5-60 subchapter to obtain voter approval before the district imposes a 5-61 maintenance tax or issues bonds payable from ad valorem taxes or 5-62 assessments. 5-63 (b) The board may submit multiple purposes in a single 5-64 proposition at an election. 5-65 Sec. 376.475. IMPACT FEES. The district may impose an 5-66 impact fee for an authorized purpose as provided by Subchapter G, 5-67 Chapter 375. 5-68 Sec. 376.476. MAINTENANCE TAX. (a) If authorized at an 5-69 election held in accordance with Section 376.474, the district may 6-1 impose and collect an annual ad valorem tax on taxable property in 6-2 the district for the maintenance and operation of the district and 6-3 the improvements constructed or acquired by the district or for the 6-4 provision of services. 6-5 (b) The board shall determine the tax rate. 6-6 Sec. 376.477. DISSOLUTION OF DISTRICT. The district may be 6-7 dissolved as provided by Subchapter M, Chapter 375. If the 6-8 district has debt and is dissolved, the district shall remain in 6-9 existence solely for the limited purpose of discharging its bonds 6-10 or other obligations according to their terms. 6-11 Sec. 376.478. CONTRACTS. (a) To protect the public 6-12 interest, the district may contract with the municipality or the 6-13 county for the municipality or county to provide law enforcement 6-14 services in the district for a fee. 6-15 (b) The municipality, the county, or another political 6-16 subdivision of the state, without further authorization, may 6-17 contract with the district to implement a project of the district 6-18 or assist the district in providing the services authorized under 6-19 this subchapter. A contract under this subsection may: 6-20 (1) be for a period on which the parties agree; 6-21 (2) include terms on which the parties agree; 6-22 (3) be payable from taxes or any other sources of 6-23 revenue that may be available for that purpose; or 6-24 (4) provide that taxes or other revenue collected at a 6-25 district project or from a person using or purchasing a commodity 6-26 or service at a district project may be paid or rebated to the 6-27 district under the terms of the contract. 6-28 (c) The district may enter into a contract, lease, or other 6-29 agreement with or make or accept grants and loans to or from: 6-30 (1) the United States; 6-31 (2) the state or a state agency; 6-32 (3) a county, a municipality, or another political 6-33 subdivision of the state; 6-34 (4) a public or private corporation, including a 6-35 nonprofit corporation created by the board under this subchapter; 6-36 or 6-37 (5) any other person. 6-38 (d) The district may perform all acts necessary for the full 6-39 exercise of the powers vested in the district on terms and for the 6-40 period the board determines advisable. 6-41 Sec. 376.479. ANNEXATION. The district may: 6-42 (1) annex territory as provided by Subchapter C, 6-43 Chapter 375; and 6-44 (2) annex territory located inside the boundaries of a 6-45 reinvestment zone created by the municipality under Chapter 311, 6-46 Tax Code, if the governing body of the municipality consents to the 6-47 annexation. 6-48 Sec. 376.480. AGREEMENTS: GENERAL; DONATIONS, INTERLOCAL 6-49 AGREEMENTS, AND LAW ENFORCEMENT SERVICES. (a) The district may 6-50 make an agreement with or accept a donation, grant, or loan from 6-51 any person. 6-52 (b) The implementation of a project is a governmental 6-53 function or service for the purposes of Chapter 791, Government 6-54 Code. 6-55 (c) To protect the public interest, the district may 6-56 contract with the municipality or the county for the municipality 6-57 or county to provide law enforcement services in the district for a 6-58 fee. 6-59 SECTION 2. The legislature finds that: 6-60 (1) proper and legal notice of the intention to 6-61 introduce this Act, setting forth the general substance of this 6-62 Act, has been published as provided by law, and the notice and a 6-63 copy of this Act have been furnished to all persons, agencies, 6-64 officials, or entities to which they are required to be furnished 6-65 by the constitution and laws of this state, including the governor, 6-66 who has submitted the notice and Act to the Texas Natural Resource 6-67 Conservation Commission; 6-68 (2) the Texas Natural Resource Conservation Commission 6-69 has filed its recommendations relating to this Act with the 7-1 governor, lieutenant governor, and speaker of the house of 7-2 representatives within the required time; 7-3 (3) the general law relating to consent by political 7-4 subdivisions to the creation of districts with conservation, 7-5 reclamation, and road powers and the inclusion of land in those 7-6 districts has been complied with; and 7-7 (4) all requirements of the constitution and laws of 7-8 this state and the rules and procedures of the legislature with 7-9 respect to the notice, introduction, and passage of this Act have 7-10 been fulfilled and accomplished. 7-11 SECTION 3. Notwithstanding Section 376.459, Local Government 7-12 Code, as added by this Act: 7-13 (1) the initial board of directors of the Near 7-14 Northwest Management District consists of: 7-15 Pos. No. Name of Director 7-16 1 ____________________ 7-17 2 ____________________ 7-18 3 ____________________ 7-19 4 ____________________ 7-20 5 ____________________ 7-21 6 ____________________ 7-22 7 ____________________ 7-23 8 ____________________ 7-24 9 ____________________; and 7-25 (2) of the initial board, members in positions 1-5 7-26 serve terms that expire June 1, 2005, and members in positions 6-9 7-27 serve terms that expire June 1, 2003. 7-28 SECTION 4. This Act takes effect immediately if it receives 7-29 a vote of two-thirds of all the members elected to each house, as 7-30 provided by Section 39, Article III, Texas Constitution. If this 7-31 Act does not receive the vote necessary for immediate effect, this 7-32 Act takes effect September 1, 2001. 7-33 * * * * *