H.B. No. 2964




AN ACT

relating to the operation of municipal school districts and the 
levy of municipal school district taxes.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Subchapter G, Chapter 11, Education Code, is 
amended by adding Section 11.303 to read as follows:
	Sec. 11.303.  MUNICIPAL SCHOOL DISTRICTS.  (a)  Except as 
otherwise provided by this section, a school district operating 
under former Chapter 24 may continue to operate under that chapter 
as it existed on May 1, 1995, and under state law generally 
applicable to school districts that does not conflict with that 
chapter.
	(b)  The governing body of the municipality may participate 
in annual hearings or work sessions held by the board of trustees of 
the municipal school district on the budget and ad valorem tax rate 
for the coming year.
	(c)  The board of trustees of a municipal school district and 
the governing body of the municipality shall jointly hold any 
hearing required by law as a condition for the adoption of an annual 
budget and imposition of an ad valorem tax.
	(d)  Neither an annual budget for a municipal school district 
nor an ad valorem tax to be imposed for the district may be adopted 
without the affirmative vote of:
		(1)  a majority of the members of the board of trustees 
of the municipal school district present and voting; and
		(2)  at least three-quarters of the total of the voting 
members of the board of trustees and the governing body of the 
municipality that are present and voting.
	(e)  If a quorum of the members of the governing body of the 
municipality is not present at a meeting required under Subsection 
(c), the board of trustees may adopt a budget or an ad valorem tax 
rate without regard to the requirements of Subsection (d).
	(f)  Notwithstanding former Section 24.06(c), as it existed 
on May 1, 1995, the governing body of the municipality shall adopt 
an ordinance providing for the levy and assessment of the tax 
approved pursuant to Subsection (d) or (e).
	(g)  After adopting an ordinance levying a tax for the 
municipal school district, the governing body of the municipality 
shall provide a certified copy of the ordinance to the district's 
board of trustees.
	(h)  This section may not be construed as authorizing the 
governing body of a municipality to levy a tax for the support of 
schools of a municipal school district without fully complying with 
all applicable provisions of the Tax Code.
	SECTION 2.  Section 11.301, Education Code, is amended to 
read as follows:   
	Sec. 11.301.  APPLICATION OF FORMER LAW.  (a)  A school 
district or county system operating under former Chapter 17, 18, 
22, [24,] 25, 26, 27, or 28 on May 1, 1995, may continue to operate 
under the applicable chapter as that chapter existed on that date 
and under state law generally applicable to school districts that 
does not conflict with that chapter.
	(b)  A school district operating under former Chapter 22 may 
incorporate and become an independent school district in the manner 
provided by former Subchapter F, Chapter 19, as that subchapter 
existed on May 1, 1995.  [A school district operating under former 
Chapter 24 may be separated from municipal control and become an 
independent school district in the manner provided by former 
Subchapter E, Chapter 19, as that subchapter existed on May 1, 
1995.]
	SECTION 3.  Not later than September 15, 2003, the 
comptroller shall begin a performance review under Section 403.020, 
Government Code, of each municipal school district in this state.  
The comptroller shall complete the review and prepare a report 
showing the results of the review not later than February 1, 2004.
	SECTION 4.  This Act takes effect September 1, 2003.                           




______________________________              ______________________________
 
   President of the Senate                               Speaker of the House      

	I certify that H.B. No. 2964 was passed by the House on May 2, 
2003, by a non-record vote; and that the House concurred in Senate 
amendments to H.B. No. 2964 on May 30, 2003, by a non-record vote.

                                                  ______________________________
                                                     Chief Clerk of the House   

	
I certify that H.B. No. 2964 was passed by the Senate, with 
amendments, on May 28, 2003, by a viva-voce vote.

                                                  ______________________________
                                                      Secretary of the Senate   



APPROVED: __________________                                                
 
                Date                                                         




 
         __________________                                              
 
              Governor