LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                               May 16, 2001
  
  
          TO:  Honorable Gary Walker, Chair, House Committee on Land &
               Resource Management
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  SB1398  by Fraser (Relating to the authority of the
               governing body of a municipality to change previously
               adopted zoning regulations.), Committee Report 2nd
               House, Substituted
  
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*  No fiscal implication to the State is anticipated.                    *
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Local Government Impact
  
The bill would prohibit a municipality from changing a previously enacted
zoning regulation affecting a property unless the property owner waives
any right to object or fails to file a written objection within 90 days
after receiving notice of the proposed change, or if the governing body
compensates the property owner.

Provisions of the bill would also identify that overlays of a property's
zoning classification are not considered a change in zoning if the
overlay is for the purpose of regulating roads, landscaping, trees,
signs, parking, flood control, or geologically unstable areas, or to
regulate the construction, reconstruction, alteration, or razing of
buildings and other structures for historical, cultural, or architectural
importance and significance. Another exception to zoning changes as
proposed in the bill would allow zoning reclassification if the property
had not been changed by the governing body of a municipality over the
owner's objections at any time during the immediately preceding 20 years.
Additionally, a property owner would waive their right to any
compensation if they did not file an objection to a proposed property
zoning change in a timely manner.

The bill would set forth that proceedings regarding a change of zoning
classification for the purpose of determining the diminution of a
property's value would be a condemnation or eminent domain proceeding.
Not later than the tenth day before the date the proceeding begins, each
party would be required to provide to the other parties a copy of each
appraisal report supporting that party's opinion of any diminution of
value.  If an agreement cannot be met between the entity and the property
owner on the amount of damages resulting from a zoning change, the
entity may file a condemnation petition.

The act would take effect September 1, 2001 and the provisions affecting
fiscal impact as described above would expire on September 1, 2003.

Based on responses from a sampling of cities, if the property owner
waives the right to object or does not submit a written objection to the
rezoning proposal in the allotted timeframe, the fiscal impact to
municipalities would be insignificant.  If a condemnation or eminent
domain proceeding is conducted, there would be a minimal cost involved.
If the municipality has to compensate the property owner for the
diminution in value resulting from the change in zoning, the fiscal
impact could have the potential of costing the municipality a
significant amount of money.
  
  
Source Agencies:   
LBB Staff:         JK, CL, DB