S.B. 18 78 ) BILL ANALYSIS S.B. 18 By: Jackson County Affairs Committee Report (Unamended) BACKGROUND AND PURPOSE SB 18 creates the Baybrook Management District as a political subdivision of the State of Texas to administer and provide funding for community improvement projects and services in certain commercial areas of Baybrook. The District will be a municipal management district similar to those operating pursuant to Chapters 375 and 376, local Government Code. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS SECTION 1. CREATION OF DISTRICT. (a) Creates the Baybrook Management district as a special district under Section 59, Article XVI, Texas Constitution. (b) Authorizes the Board of directors of the district (board) by resolution to change the name of the district. SECTION 2. DEFINITIONS. Defines "board" and "district." SECTION 3. DECLARATION OF INTENT. (a) Sets forth findings that the creation of the district is essential to accomplish certain purpose. (b) Sets forth findings regarding the necessity of the creation of the district. ) Provides that the creation of the district and this legislation are not to relieve Harris County (county) or the City of Houston (municipality) from providing the level of services, as of the effective date of this Act, to the area in the district. Provides that the district is created to supplement and not supplant the county services provided in the area in the district. (d) Sets forth findings that the creation of the district accomplishes certain public purpose. SECTION 4. BOUNDARIES. Sets forth the geographical boundaries of the district. SECTION 5. FINDINGS RELATING TO BOUNDARIES. Provides that the boundaries and field notes of the district form a closure. Provides that if a mistake is made in the field notes or in copying the field notes in the legislative process, the mistake does not in any way affect the district's organization , existence, or validity, its right to issue any type of bond for the purposes for which the district is created or to pay the principal of and interest on a bond, its right to impose or collect an assessment or a tax, or its legality or operation. SECTION 6. FINDINGS OF BENEFIT AND PUBLIC PURPOSE. (a) Provides that the district is created to serve a public use and benefit. (b) Provides that the creation of the district is in the public interest and is essential to further the public purposes of the development and diversification of the economy of the state and eliminate unemployment and underemployment. ) Provides that the district will serve the public purpose of promoting the health, safety and general welfare and provide necessary funding for the economic health and vitality of the district as a community and business center. (d) Provides that pedestrian ways along or across a street, whether at grade or above or below the surface, and street lighting, street landscaping, and street art objects are part of and necessary components of a street and are considered to be a street or road improvement. (e) Provides that the district will not act as the agent or instrumentality of any private interest even though many private interest will be benefitted by the district, as will the general public. SECTION 7. APPLICATION OF OTHER LAW. Provides that Chapter 375, Local Government Code and Chapter 311, Government Code (Code Construction Act), applies to this Act. SECTION 8. CONSTRUCTION OF ACT. Requires that this Act be liberally construed in conformity with the findings and purposes stated in this Act. SECTION 9. BOARD OF DIRECTORS IN GENERAL. Sets forth general provisions for the board of directors in the district. SECTION 10. APPOINTMENT OF DIRECTORS. Provides for the appointment of board members. SECTION 11. NONVOTING DIRECTORS. Provides a list of the people who shall serve as nonvoting directors. SECTION 12. CONFLICTS OF INTEREST; ONE-TIME AFFIDAVIT. Provides for the procedures a board member must follow if the member has a conflict of interest with a matter before the board. SECTION 13. ADDITIONAL POWERS OF THE DISTRICT. Provides that the district may also exercise the powers given to a corporation created under Section 4B, Development Corporation Act of 1979 and a housing finance corporation created under Chapter 394, Local Government Code. SECTION 14. AGREEMENTS; GRANTS. (a) Provides that a district may make an agreement with or accept a gift, grant, or loan from any person. (b) Provides that the implementation of a project is a governmental function or service for the purposes of Chapter 791, Government Code. SECTION 15. LAW ENFORCEMENT SERVICES. Authorizes the district, to protect the public interest, to contract with the municipality or the county for the municipality or the county to provide law enforcement services in the district for a fee. SECTION 16. NONPROFIT CORPORATION. (a) Authorizes the board by resolution to authorize the creation of a nonprofit corporation to assist and act on behalf of the district in implementing a project or providing a service authorized by this Act. (b) Requires the board to appoint the board of directors of a nonprofit corporation created under this section. Requires the board of directors of the nonprofit corporation to serve in the same manner, term, and conditions as a board of directors of a local government corporation created under Chapter 431, Transportation Code. ) Provides that a nonprofit corporation created under this section has the powers of and is considered for purposes of this Act to be a local government corporation created under chapter 431, Transportation Code. SECTION 17. REQUIREMENTS FOR FINANCING SERVICES AND IMPROVEMENTS. (a) Provides that the board may not finance a service or improvement project through an assessment under this Act unless a written petition requesting that service or improvement has been filed with the board. The petition must be signed by: (1) the owners of a majority of the assessed value of real property in the district that will be subject to the assessment according to the most recent certified tax appraisal roll for the county in which the property is located or (2) at least 25 owners of land in the district that will be subject to the assessment, if more than 25 persons own land in the district that will be subject to the assessment according to the most recent certified tax appraisal roll for the county in which the property is located. SECTION 18. ELECTIONS. (a) Requires the district to hold an election in accordance with Subchapter L, Chapter 375, Local Government Code, to obtain voter approval before the district imposes a maintenance tax or issue bonds payable from ad valorem taxes. (b) Authorizes the board to include more than one purpose in a single proposition at an election. ) Provides that Sec. 375.463, Local Government Code, does not apply to the district. SECTION 19. MAINTENANCE TAX. (a) Authorizes the district to impose an annual ad valorem tax on taxable property in the district for any district purpose, including to maintain and operate the district, including improvements constructed or acquired by the district or provide a service, if approved by an election held in accordance with Section 18. (b) Provides that the board shall determine the tax rate. SECTION 20. ASSESSMENTS. (a) Authorizes the board to impose and collect an assessment for any purpose authorized by this Act. (b) Provides the priority of liens for the district. ) Provides that the lien is effective from the date of the board's resolution imposing the assessment until the date the assessment is paid and the board may enforce the lien in the same manner that the board may enforce an ad valorem tax lien against real property. (d) Provides that the board may make corrections or deletions from the assessment roll without notice or a hearing as long as the corrections or deletions do not increases the amount of assessment on any one parcel of land. SECTION 21. UTILITIES. Provides that a district may not impose an assessment or impact fee on the property, equipment, rights-of-way, facilities, or improvement, of an electric utility or power generation company, or of a person that provides to the public cable television or advanced telecommunications services. SECTION 22. BONDS (A) Authorizes the district to issue bonds or other obligations payable in whole or part from ad valorem taxes, assessments, impact fees, revenue, grants, other money sources of the district or any combination of sources to pay for any authorized purpose of the district. (b) Authorizes the district to issue a bond or other obligation evidencing a proportionate interest in payments to be made by the district. SECTION 23. MUNICIPAL APPROVAL. (a) Requires the district to obtain city approval for the issuance of bonds for an improvement project, the plans and specifications of an improvement project financed by bonds and plans and specification relating to certain other projects, except as provided by Subsection (b). (b) Authorizes the district, if it obtains approval from the city's governing body of a capital improvements budget for a period not to exceed five years, to finance the capital improvements and issue bonds specified in the budget without further approval from the city. SECTION 24. MUNICIPALITY NOT REQUIRED TO PAY DISTRICT OBLIGATIONS. Provides that, except as provided by Section 375.263, a municipality is not obligated to pay any bonds, notes, or other obligations of the district. SECTION 25. DISBURSEMENTS OR TRANSFERS OF MONEY. Provides for the procedures required for a disbursement or transfer of the district's money. SECTION 26. COMPETITIVE BIDDING LIMIT. Provides that the competitive biding requirement in Section 375.221, Local Government Code, only applies to a contract that has a value greater than $25,000. SECTION 27. EXCEPTION FOR DISSOLUTION OF DISTRICT WITH OUTSTANDING DEBTS. (a) Authorizes the board to vote to dissolve a district that has debt. Requires the district, if the vote is in favor of dissolution, to remain in existence solely for the limited purpose of discharging the debts. Provides that the dissolution is effective when all debts have been discharged. (b) Provides that Section 375.264 does not apply to the district. SECTION 28. INITIAL DIRECTORS. Provides the names of the initial board of directors for the district. SECTION 29. TAX AND ASSESSMENT ABATEMENTS. Authorizes the district to grant an abatement for a tax or assessment owed to the district without further authorization or other procedural requirements. SECTION 30. MEMBERSHIP IN CHARITABLE ORGANIZATIONS. Authorizes the district to join and pay dues to a charitable organization, and perform services or provide activities consistent with the furtherance of the purposes of the district. SECTION 31. ELIGIBILITY FOR INCLUSION IN SPECIAL ZONES. Provides that the district is eligible for inclusion in a tax increment reinvestment zone created by the municipality under Chapter 311, Tax Code, a tax abatement reinvestment zone created by the municipality under Chapter 312, Tax Code, or an enterprise zone created by the municipality under Chapter 2303, Government Code. SECTION 32. ECONOMIC DEVELOPMENT PROGRAMS. The district may establish or provide for the administration of one or more programs to promote stat or local economic development and to stimulate business and commercial activity in the district. Provides that the district has all the powers and authority of a municipality under Chapter 380. SECTION 33. LEGISLATIVE FINDINGS. Sets forth legislative findings regarding the fulfillment of procedural requirements with respect to the notice, introduction, and passage of this Act. SECTION 34. EFFECTIVE DATE. Provides that the effective date will be upon passage or September 1, 2003. EFFECTIVE DATE This Act takes effect immediately if it receives a vote of two-thirds of all members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, this Act takes effect September 1, 2003.