2005S0815-1 04/07/05
By: Deuell S.B. No. 1856
A BILL TO BE ENTITLED
AN ACT
relating to tax increment financing.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 311.002, 311.003, and 311.004, Tax
Code, are amended to read as follows:
Sec. 311.002. DEFINITIONS. In this chapter:
(1) "Governing body" means, except where otherwise
specified, the governing body of a municipality or county
establishing a reinvestment zone.
(2) "Project costs" means the expenditures made or
estimated to be made and monetary obligations incurred or estimated
to be incurred by the municipality or county establishing a
reinvestment zone that are listed in the project plan as costs of
public works or public improvements in the zone, plus other costs
incidental to those expenditures and obligations. "Project costs"
include:
(A) capital costs, including the actual costs of
the acquisition and construction of public works, public
improvements, new buildings, structures, and fixtures; the actual
costs of the acquisition, demolition, alteration, remodeling,
repair, or reconstruction of existing buildings, structures, and
fixtures; and the actual costs of the acquisition of land and
equipment and the clearing and grading of land;
(B) financing costs, including all interest paid
to holders of evidences of indebtedness or other obligations issued
to pay for project costs and any premium paid over the principal
amount of the obligations because of the redemption of the
obligations before maturity;
(C) real property assembly costs;
(D) professional service costs, including those
incurred for architectural, planning, engineering, and legal
advice and services;
(E) imputed administrative costs, including
reasonable charges for the time spent by employees of the
municipality or county in connection with the implementation of a
project plan;
(F) relocation costs;
(G) organizational costs, including the costs of
conducting environmental impact studies or other studies, the cost
of publicizing the creation of the zone, and the cost of
implementing the project plan for the zone;
(H) interest before and during construction and
for one year after completion of construction, whether or not
capitalized;
(I) the cost of operating the reinvestment zone
and project facilities;
(J) the amount of any contributions made by the
municipality or county from general revenue for the implementation
of the project plan; and
(K) payments made at the discretion of the
governing body [of the municipality] that the governing body
[municipality] finds necessary or convenient to the creation of the
zone or to the implementation of the project plans for the zone.
(3) [(2)] "Project plan" means the project plan for
the development or redevelopment of a reinvestment zone approved
under this chapter, including all amendments of the plan approved
as provided by this chapter.
(4) [(3)] "Reinvestment zone financing plan" means
the financing plan for a reinvestment zone described by this
chapter.
(5) [(4)] "Taxing unit" has the meaning assigned by
Section 1.04.
Sec. 311.003. PROCEDURE FOR CREATING REINVESTMENT ZONE.
(a) The governing body [of a municipality] by ordinance or order
may designate a contiguous geographic area in the jurisdiction of
the municipality or county to be a reinvestment zone to promote
development or redevelopment of the area if the governing body
determines that development or redevelopment would not occur solely
through private investment in the reasonably foreseeable future.
(b) Before adopting an ordinance or order providing for a
reinvestment zone, the governing body [of the municipality] must
prepare a preliminary reinvestment zone financing plan. As soon as
the plan is completed, a copy of the plan must be sent to the
governing body of each taxing unit that levies taxes on real
property in the proposed zone.
(c) Before adopting an ordinance or order providing for a
reinvestment zone, the governing body [municipality] must hold a
public hearing on the creation of the zone and its benefits to the
municipality or county and to property in the proposed zone. At the
hearing an interested person may speak for or against the creation
of the zone, its boundaries, or the concept of tax increment
financing. Not later than the seventh day before the date of the
hearing, notice of the hearing must be published in a newspaper
having general circulation in the municipality or county.
(d) A municipality or county must provide a reasonable
opportunity for the owner of property to protest the inclusion of
the property in a proposed reinvestment zone.
(e) Not later than the 60th day before the date of the public
hearing required by Subsection (c), the governing body [of the
municipality] must notify in writing the governing body of each
taxing unit that levies real property taxes in the proposed
reinvestment zone that it intends to establish the zone. The notice
must contain a description of the proposed boundaries of the zone,
the tentative plans for the development or redevelopment of the
zone, and an estimate of the general impact of the proposed zone on
property values and tax revenues. The notice may be given later
than the 60th day before the date of the public hearing if the
governing body of each municipality, county, and school district
that levies real property taxes in the proposed zone agrees to waive
the requirement.
(f) A taxing unit may request additional information from
the governing body [of the municipality]. The governing body [of
the municipality] shall provide the information requested to the
extent practicable. In addition to the notice required by
Subsection (e), the governing body [of the municipality] shall make
a formal presentation to the governing body of each municipality,
county, or school district that levies real property taxes in the
proposed reinvestment zone. The presentation must include a
description of the proposed boundaries of the zone, the tentative
plans for the development or redevelopment of the zone, and an
estimate of the general impact of the proposed zone on property
values and tax revenues. The governing body [of the municipality]
shall notify each taxing unit that levies real property taxes in the
proposed zone of each presentation to be made to a municipality,
county, or school district under this subsection. Members of the
governing body of each taxing unit that levies real property taxes
in the proposed zone may attend a presentation under this
subsection. If agreed to by the municipality, county, or school
districts involved, the governing body [of the municipality] may
make a single presentation to more than one municipality, county,
or school district governing body.
(g) Not later than the 15th day after the date on which the
notice required by Subsection (e) is given, each taxing unit that
levies real property taxes in the proposed reinvestment zone shall
designate a representative to meet with the governing body [of the
municipality] to discuss the project plan and the reinvestment zone
financing plan and shall notify the governing body [of the
municipality] of its designation. At any time after the 15th day
after the date on which the notice required by Subsection (e) has
been given to every taxing unit, the governing body [of the
municipality] may call a meeting of the representatives of the
taxing units. The governing body [of the municipality] may call as
many meetings as it considers necessary. Each representative shall
be notified of each meeting in advance. At the meetings the
governing body [of the municipality] and the representatives of the
other taxing units may discuss the boundaries of the zone,
development in the zone, the tax increment that each taxing unit
will contribute to the tax increment fund, the retention by a taxing
unit of a portion of its tax increment as permitted by Section
311.013, the exclusion of particular parcels of property from the
zone, the board of directors for the zone, and tax collection for
the zone. On the motion of the governing body [of the municipality]
calling the meeting, any other matter relevant to the proposed
reinvestment zone may be discussed.
Sec. 311.004. CONTENTS OF REINVESTMENT ZONE ORDINANCE OR
ORDER. (a) The ordinance or order designating an area as a
reinvestment zone must:
(1) describe the boundaries of the zone with
sufficient definiteness to identify with ordinary and reasonable
certainty the territory included in the zone;
(2) create a board of directors for the zone and
specify the number of directors of the board as provided by Section
311.009 or 311.0091, as applicable;
(3) provide that the zone take effect immediately upon
passage of the ordinance or order;
(4) provide a date for termination of the zone;
(5) assign a name to the zone for identification, with
the first zone created by a municipality or county designated as
"Reinvestment Zone Number One, City (or Town or county, as
applicable) of (name of municipality or county)" and subsequently
created zones assigned names in the same form numbered
consecutively in the order of their creation;
(6) establish a tax increment fund for the zone; and
(7) contain findings that:
(A) improvements in the zone will significantly
enhance the value of all the taxable real property in the zone and
will be of general benefit to the municipality or county; and
(B) the area meets the requirements of Section
311.005.
(b) For purposes of complying with Subsection (a)(7)(A),
the ordinance or order is not required to identify the specific
parcels of real property to be enhanced in value.
(c) To designate a reinvestment zone under Section
311.005(a)(5), the governing body [of a municipality] must specify
in the ordinance or order that the reinvestment zone is designated
under that section.
SECTION 2. Subsection (a), Section 311.005, Tax Code, is
amended to read as follows:
(a) To be designated as a reinvestment zone, an area must:
(1) substantially arrest or impair the sound growth of
the municipality or county creating the zone, retard the provision
of housing accommodations, or constitute an economic or social
liability and be a menace to the public health, safety, morals, or
welfare in its present condition and use because of the presence of:
(A) a substantial number of substandard, slum,
deteriorated, or deteriorating structures;
(B) the predominance of defective or inadequate
sidewalk or street layout;
(C) faulty lot layout in relation to size,
adequacy, accessibility, or usefulness;
(D) unsanitary or unsafe conditions;
(E) the deterioration of site or other
improvements;
(F) tax or special assessment delinquency
exceeding the fair value of the land;
(G) defective or unusual conditions of title; or
(H) conditions that endanger life or property by
fire or other cause;
(2) be predominantly open and, because of obsolete
platting, deterioration of structures or site improvements, or
other factors, substantially impair or arrest the sound growth of
the municipality or county; [or]
(3) be in a federally assisted new community located
in the municipality or county, or in an area immediately adjacent to
a federally assisted new community; or
(5) be an area described in a petition requesting that
the area be designated as a reinvestment zone, if the petition is
submitted to the governing body [of the municipality] by the owners
of property constituting at least 50 percent of the appraised value
of the property in the area according to the most recent certified
appraisal roll for the county in which the area is located.
SECTION 3. Sections 311.007 and 311.008, Tax Code, are
amended to read as follows:
Sec. 311.007. CHANGING BOUNDARIES OF EXISTING ZONE.
(a) Subject to the limitations provided by Section 311.006, the
boundaries of an existing reinvestment zone may be reduced or
enlarged by ordinance or resolution of the governing body [of the
municipality] that created the zone.
(b) The governing body [of the municipality] may enlarge an
existing reinvestment zone to include an area described in a
petition requesting that the area be included in the zone if the
petition is submitted to the governing body [of the municipality]
by the owners of property constituting at least 50 percent of the
appraised value of the property in the area according to the most
recent certified appraisal roll for the county in which the area is
located. The composition of the board of directors of the zone
continues to be governed by Section 311.009(a) or (b), whichever
applied to the zone immediately before the enlargement of the zone,
except that the membership of the board must conform to the
requirements of the applicable subsection of Section 311.009 as
applied to the zone after its enlargement. The provision of Section
311.006(b) relating to the amount of property used for residential
purposes that may be included in the zone does not apply to the
enlargement of a zone under this subsection.
Sec. 311.008. POWERS OF MUNICIPALITY OR COUNTY. (a) In
this section, "educational facility" includes equipment, real
property, and other facilities, including a public school building,
that are used or intended to be used jointly by the municipality or
county and an independent school district.
(b) A municipality or county may exercise any power
necessary and convenient to carry out this chapter, including the
power to:
(1) cause project plans to be prepared, approve and
implement the plans, and otherwise achieve the purposes of the
plan;
(2) acquire real property by purchase, condemnation,
or other means to implement project plans and sell that property on
the terms and conditions and in the manner it considers advisable;
(3) enter into agreements, including agreements with
bondholders, determined by the governing body [of the municipality]
to be necessary or convenient to implement project plans and
achieve their purposes, which agreements may include conditions,
restrictions, or covenants that run with the land or that by other
means regulate or restrict the use of land; and
(4) consistent with the project plan for the zone:
(A) acquire blighted, deteriorated,
deteriorating, undeveloped, or inappropriately developed real
property or other property in a blighted area or in a federally
assisted new community in the zone for the preservation or
restoration of historic sites, beautification or conservation, the
provision of public works or public facilities, or other public
purposes;
(B) acquire, construct, reconstruct, or install
public works, facilities, or sites or other public improvements,
including utilities, streets, street lights, water and sewer
facilities, pedestrian malls and walkways, parks, flood and
drainage facilities, or parking facilities, but not including
educational facilities; or
(C) in a reinvestment zone created on or before
September 1, 1999, acquire, construct, or reconstruct educational
facilities in the municipality.
(c) The powers authorized by Subsection (b)(2) prevail over
any law or municipal charter to the contrary.
(d) A municipality or county may make available to the
public on request financial information regarding the acquisition
by the municipality or county of land in the zone when the
municipality or county acquires the land.
SECTION 4. Subsections (a), (b), (e), and (f), Section
311.009, Tax Code, are amended to read as follows:
(a) Except as provided by Subsection (b), the board of
directors of a reinvestment zone consists of at least five and not
more than 15 members, unless more than 15 members are required to
satisfy the requirements of this subsection.
Each taxing unit other than a municipality or county that
levies taxes on real property in the zone may appoint one member of
the board. A unit may waive its right to appoint a director. The
governing body [of the municipality] that created the zone may
appoint not more than 10 directors to the board; except that if
there are fewer than five directors appointed by taxing units other
than the municipality or county, the governing body [of the
municipality] may appoint more than 10 members as long as the total
membership of the board does not exceed 15.
(b) If the zone was designated under Section 311.005(a)(5),
the board of directors of the zone consists of nine members. Each
school district or county that levies taxes on real property in the
zone may appoint one member of the board if the school district or
county has approved the payment of all or part of the tax increment
produced by the unit. The member of the state senate in whose
district the zone is located is a member of the board, and the
member of the state house of representatives in whose district the
zone is located is a member of the board, except that either may
designate another individual to serve in the member's place at the
pleasure of the member. If the zone is located in more than one
senate or house district, this subsection applies only to the
senator or representative in whose district a larger portion of the
zone is located than any other senate or house district, as
applicable. The remaining members of the board are appointed by the
governing body [of the municipality] that created the zone.
(e) To be eligible for appointment to the board by the
governing body [of the municipality], an individual must:
(1) if the board is covered by Subsection (a):
(A) be a qualified voter of the municipality or
county; or
(B) be at least 18 years of age and own real
property in the zone, whether or not the individual resides in the
municipality or county; or
(2) if the board is covered by Subsection (b):
(A) be at least 18 years of age; and
(B) own real property in the zone or be an
employee or agent of a person that owns real property in the zone.
(f) Each year the governing body [of the municipality] shall
appoint one member of the board to serve as chairman for a term of
one year that begins on January 1 of the following year. The board
of directors may elect a vice-chairman to preside in the absence of
the chairman or when there is a vacancy in the office of chairman.
The board may elect other officers as it considers appropriate.
SECTION 5. Subsections (a), (b), (d), (e), and (f), Section
311.010, Tax Code, are amended to read as follows:
(a) The board of directors of a reinvestment zone shall make
recommendations to the governing body [of the municipality] that
created the zone concerning the administration of this chapter in
the zone. The governing body [of the municipality] by ordinance or
resolution may authorize the board to exercise any of the governing
body's [municipality's] powers with respect to the administration,
management, or operation of the zone or the implementation of the
project plan for the zone, except that the governing body may not
authorize the board to:
(1) issue bonds;
(2) impose taxes or fees;
(3) exercise the power of eminent domain; or
(4) give final approval to the project plan.
(b) The board of directors of a reinvestment zone and the
governing body [of the municipality] that creates a reinvestment
zone may each enter into agreements as the board or the governing
body considers necessary or convenient to implement the project
plan and reinvestment zone financing plan and achieve their
purposes. An agreement may provide for the regulation or
restriction of the use of land by imposing conditions,
restrictions, or covenants that run with the land. An agreement may
during the term of the agreement dedicate, pledge, or otherwise
provide for the use of revenue in the tax increment fund to pay any
project costs that benefit the reinvestment zone, including project
costs relating to the cost of buildings, schools, or other
educational facilities owned by or on behalf of a school district,
community college district, or other political subdivision of this
state, railroad or transit facilities, affordable housing, the
remediation of conditions that contaminate public or private land
or buildings, the preservation of the facade of a private or public
building, or the demolition of public or private buildings. An
agreement may dedicate revenue from the tax increment fund to pay
the costs of providing affordable housing or areas of public
assembly in or out of the zone. An agreement may dedicate revenue
from the tax increment fund to pay a neighborhood enterprise
association for providing services or carrying out projects
authorized under Subchapters E and G, Chapter 2303, Government
Code, in the zone. The term of an agreement with a neighborhood
enterprise association may not exceed 10 years.
(d) The board of directors of a reinvestment zone may
exercise any power granted to a municipality or county by Section
311.008, except that:
(1) the governing body [municipality] that created the
reinvestment zone by ordinance or resolution or order may restrict
any power granted to the board by this chapter; and
(2) the board may exercise a power granted to a
municipality or county under Section 311.008(b)(2) [311.008(a)(2)]
only with the consent of the governing body [of the municipality].
(e) After the governing body [of a municipality] by
ordinance or order creates a reinvestment zone under this chapter,
the board of directors of the zone may exercise any power granted to
a board under this chapter.
(f) The board of directors of a reinvestment zone and the
governing body [of the municipality] may enter into a contract with
a local government corporation to manage the reinvestment zone or
implement the project plan and reinvestment zone financing plan for
the term of the agreement. In this subsection, "local government
corporation" means a local government corporation created by the
municipality or county under Chapter 431, Transportation Code.
SECTION 6. Subsections (a), (b), (d), (e), and (g), Section
311.011, Tax Code, are amended to read as follows:
(a) The board of directors of a reinvestment zone shall
prepare and adopt a project plan and a reinvestment zone financing
plan for the zone and submit the plans to the governing body [of the
municipality] that created the zone. The plans must be as
consistent as possible with the preliminary plans developed for the
zone before the creation of the board.
(b) The project plan must include:
(1) a map showing existing uses and conditions of real
property in the zone and a map showing proposed improvements to and
proposed uses of that property;
(2) proposed changes of zoning ordinances, the master
plan of the municipality, building codes, and other municipal
ordinances if applicable;
(3) a list of estimated nonproject costs; and
(4) a statement of a method of relocating persons to be
displaced as a result of implementing the plan.
(d) The governing body [of the municipality] must approve a
project plan or reinvestment zone financing plan after its adoption
by the board. The approval must be by ordinance or order that finds
that the plan is feasible and conforms to the master plan, if any,
of the municipality, or to subdivision rules and regulations, if
any, of the county.
(e) The board of directors of the zone at any time may adopt
an amendment to the project plan consistent with the requirements
and limitations of this chapter. The amendment takes effect on
approval by the governing body [of the municipality]. That
approval must be by ordinance or order. If an amendment reduces or
increases the geographic area of the zone, increases the amount of
bonded indebtedness to be incurred, increases or decreases the
percentage of a tax increment to be contributed by a taxing unit,
increases the total estimated project costs, or designates
additional property in the zone to be acquired by the municipality
or county, the approval must be by ordinance or order adopted after
a public hearing that satisfies the procedural requirements of
Sections 311.003(c) and (d).
(g) An amendment to the project plan or the reinvestment
zone financing plan for a zone does not apply to a school district
that participates in the zone unless the governing body of the
school district by official action approves the amendment, if the
amendment:
(1) has the effect of directly or indirectly
increasing the percentage or amount of the tax increment to be
contributed by the school district; or
(2) requires or authorizes the municipality or county
creating the zone to issue additional tax increment bonds or notes.
SECTION 7. Subsections (d), (e), (f), and (k), Section
311.013, Tax Code, are amended to read as follows:
(d) If the reinvestment zone is created on or after August
29, 1983, a taxing unit is not required to pay a tax increment into
the tax increment fund of the zone after three years from the date
the zone is created unless the following conditions exist or have
been met within the three-year period:
(1) bonds have been issued for the zone under Section
311.015;
(2) the municipality or county has acquired property
in the zone pursuant to the project plan; or
(3) construction of improvements pursuant to the
project plan has begun in the zone.
(e) If the reinvestment zone was created before August 29,
1983, a taxing unit is not required to pay a tax increment into the
tax increment fund of the zone after September 1, 1986, unless the
following conditions existed or were met before September 1, 1986:
(1) bonds were issued for the zone under Section
311.015;
(2) the municipality or county acquired property in
the zone pursuant to the project plan; or
(3) construction of improvements pursuant to the
project plan has begun in the zone.
(f) A taxing unit is not required to pay into the tax
increment fund any of its tax increment produced from property
located in a reinvestment zone designated under Section 311.005(a)
or in an area added to a reinvestment zone under Section 311.007
unless the taxing unit enters into an agreement to do so with the
governing body [of the municipality] that created the zone. A
taxing unit may enter into an agreement under this subsection at any
time before or after the zone is created or enlarged. The agreement
may include conditions for payment of that tax increment into the
fund and must specify the portion of the tax increment to be paid
into the fund and the years for which that tax increment is to be
paid into the fund. The agreement and the conditions in the
agreement are binding on the taxing unit, the municipality or
county, and the board of directors of the zone.
(k) A school district is not required to pay into the tax
increment fund any of its tax increment produced from property
located in an area added to the reinvestment zone under Section
311.007(a) or (b) unless the governing body of the school district
enters into an agreement to do so with the governing body [of the
municipality] that created the zone[, including a municipality
described by Subsection (h)]. The governing body of a school
district may enter into an agreement under this subsection at any
time before or after the zone is created or enlarged. The agreement
may include conditions for payment of that tax increment into the
fund and must specify the portion of the tax increment to be paid
into the fund and the years for which that tax increment is to be
paid into the fund. The agreement and the conditions in the
agreement are binding on the school district, the municipality or
county, and the board of directors of the zone.
SECTION 8. Subsections (c) and (d), Section 311.014, Tax
Code, are amended to read as follows:
(c) Subject to an agreement with the holders of tax
increment bonds or notes, money in a tax increment fund may be
temporarily invested in the same manner as other funds of the
municipality or county.
(d) After all project costs and all tax increment bonds or
notes issued for a reinvestment zone have been paid, and subject to
any agreement with bondholders, any money remaining in the tax
increment fund shall be paid to the municipality or county and other
taxing units levying taxes on property in the zone in proportion to
the municipality's or county's and each unit's respective share of
the total amount of tax increments derived from taxable real
property in the zone that were deposited in the fund during the
fund's existence.
SECTION 9. Subsections (a), (b), (c), (e), (f), (g), (i),
(j), and (k), Section 311.015, Tax Code, are amended to read as
follows:
(a) A municipality or county creating a reinvestment zone
may issue tax increment bonds or notes, the proceeds of which may be
used to pay project costs for the reinvestment zone on behalf of
which the bonds or notes were issued or to satisfy claims of holders
of the bonds or notes. The municipality or county may issue
refunding bonds or notes for the payment or retirement of tax
increment bonds or notes previously issued by it.
(b) Tax increment bonds and notes are payable, as to both
principal and interest, solely from the tax increment fund
established for the reinvestment zone. The governing body [of the
municipality] may pledge irrevocably all or part of the fund for
payment of tax increment bonds or notes. The part of the fund
pledged in payment may be used only for the payment of the bonds or
notes or interest on the bonds or notes until the bonds or notes
have been fully paid. A holder of the bonds or notes or of coupons
issued on the bonds has a lien against the fund for payment of the
bonds or notes and interest on the bonds or notes and may protect or
enforce the lien at law or in equity.
(c) Tax increment bonds are issued by ordinance or order of
the municipality or county without any additional approval other
than that of the attorney general.
(e) The issuing municipality or county may provide in the
contract with the owners or holders of tax increment bonds that it
will pay into the tax increment fund all or any part of the revenue
produced or received from the operation or sale of a facility
acquired, improved, or constructed pursuant to a project plan, to
be used to pay principal and interest on the bonds. If the
municipality or county agrees, the owners or holders of tax
increment bonds may have a lien or mortgage on a facility acquired,
improved, or constructed with the proceeds of the bonds.
(f) Tax increment bonds may be issued in one or more series.
The ordinance or order approving a tax increment bond or note, or
the trust indenture or mortgage issued in connection with the bond
or note, shall provide:
(1) the date that the bond or note bears;
(2) that the bond or note is payable on demand or at a
specified time;
(3) the interest rate that the bond or note bears;
(4) the denomination of the bond or note;
(5) whether the bond or note is in coupon or registered
form;
(6) the conversion or registration privileges of the
bond or note;
(7) the rank or priority of the bond or note;
(8) the manner of execution of the bond or note;
(9) the medium of payment in which and the place or
places at which the bond or note is payable;
(10) the terms of redemption, with or without premium,
to which the bond or note is subject;
(11) the manner in which the bond or note is secured;
and
(12) any other characteristic of the bond or note.
(g) A bond or note issued under this chapter is fully
negotiable. In a suit, action, or other proceeding involving the
validity or enforceability of a bond or note issued under this
chapter or the security of a bond or note issued under this chapter,
if the bond or note recites in substance that it was issued by the
municipality or county for a reinvestment zone, the bond or note is
conclusively deemed to have been issued for that purpose, and the
development or redevelopment of the zone is conclusively deemed to
have been planned, located, and carried out as provided by this
chapter.
(i) A tax increment bond or note is not a general obligation
of the municipality or county issuing the bond or note. A tax
increment bond or note does not give rise to a charge against the
general credit or taxing powers of the municipality or county and is
not payable except as provided by this chapter. A tax increment
bond or note issued under this chapter must state the restrictions
of this subsection on its face.
(j) A tax increment bond or note may not be included in any
computation of the debt of the issuing municipality or county.
(k) A municipality or county may not issue tax increment
bonds or notes in an amount that exceeds the total cost of
implementing the project plan for the reinvestment zone for which
the bonds or notes are issued.
SECTION 10. Sections 311.016 and 311.017, Tax Code, are
amended to read as follows:
Sec. 311.016. ANNUAL REPORT BY MUNICIPALITY OR COUNTY.
(a) On or before the 90th day following the end of the fiscal year
of the municipality or county, the governing body [of a
municipality] shall submit to the chief executive officer of each
taxing unit that levies property taxes on real property in a
reinvestment zone created by the municipality or county a report on
the status of the zone. The report must include:
(1) the amount and source of revenue in the tax
increment fund established for the zone;
(2) the amount and purpose of expenditures from the
fund;
(3) the amount of principal and interest due on
outstanding bonded indebtedness;
(4) the tax increment base and current captured
appraised value retained by the zone; and
(5) the captured appraised value shared by the
municipality or county and other taxing units, the total amount of
tax increments received, and any additional information necessary
to demonstrate compliance with the tax increment financing plan
adopted by the governing body [of the municipality].
(b) The municipality or county shall send a copy of a report
made under this section to:
(1) the attorney general; and
(2) the comptroller.
Sec. 311.017. TERMINATION OF REINVESTMENT ZONE. (a) A
reinvestment zone terminates on the earlier of:
(1) the termination date designated in the ordinance
or order creating the zone or an earlier termination date
designated by an ordinance or order adopted subsequent to the
ordinance or order creating the zone; or
(2) the date on which all project costs, tax increment
bonds, and interest on those bonds have been paid in full.
(b) The tax increment pledged to the payment of bonds and
interest on the bonds may be discharged and the reinvestment zone
may be terminated if the municipality or county that created the
zone deposits or causes to be deposited with a trustee or other
escrow agent authorized by law funds in an amount that, together
with the interest on the investment of the funds in direct
obligations of the United States, will be sufficient to pay the
principal of, premium, if any, and interest on all bonds issued on
behalf of the reinvestment zone at maturity or at the date fixed for
redemption of the bonds, and to pay any other amounts that may
become due, including compensation due or to become due to the
trustee or escrow agent.
SECTION 11. Subsections (b) and (c), Section 311.019, Tax
Code, are amended to read as follows:
(b) A municipality or county that designates a reinvestment
zone or approves a project plan or reinvestment zone financing plan
under this chapter shall deliver to the comptroller before April 1
of the year following the year in which the zone is designated or
the plan is approved a report containing:
(1) a general description of each zone, including:
(A) the size of the zone;
(B) the types of property located in the zone;
(C) the duration of the zone; and
(D) the guidelines and criteria established for
the zone under Section 311.005;
(2) a copy of each project plan or reinvestment zone
financing plan adopted; and
(3) any other information required by the comptroller
to administer this section and Subchapter F, Chapter 111.
(c) A municipality or county that amends or modifies a
project plan or reinvestment zone financing plan adopted under this
chapter shall deliver a copy of the amendment or modification to the
comptroller before April 1 of the year following the year in which
the plan was amended or modified.
SECTION 12. Section 311.020, Tax Code, is amended to read as
follows:
Sec. 311.020. STATE ASSISTANCE. (a) On request of the
governing body [of a municipality] or of the presiding officer of
the governing body, the comptroller may provide assistance to a
municipality or county relating to the administration of this
chapter.
(b) The Texas Department of Economic Development and the
comptroller may provide technical assistance to a municipality or
county regarding:
(1) the designation of reinvestment zones under this
chapter; and
(2) the adoption and execution of project plans or
reinvestment zone financing plans under this chapter.
SECTION 13. This Act takes effect immediately if it
receives a vote of two-thirds of all the 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, 2005.