The Legislative Budget Board in cooperation with the Water Development Board (TWDB) and Texas Commission on Environmental Quality (TCEQ) has determined the following:

Subject to a confirmation election the bill would create the East Montrose Management District and the Fourth Ward Management District out of part of the territory of the Buffalo Bayou Management District; authorizing taxes and bonds.

1) Population- The City of Houston population projection for use in the 2007 State Water Plan shows an increase from 1,953,631 to 2,240,974 in 2010, a 15 percent increase.

2) Location & Size- The Buffalo Bayou MD and the two proposed districts are located in west Houston; in the area around the intersection of Montrose Boulevard and the Buffalo Bayou.   

3) Powers- The Districts have the rights, powers, privileges, authority, and functions governed by Local Government Code Chapter 375. The Districts also have the power to create a nonprofit corporation under Transportation Code Chapter 431.

4) District Finances- The Districts have the authority to levy benefit assessments, ad valorem taxes, and issue bonds. A petition signed by the owners of a majority of the assessed value or surface area in the District, is required prior to financing projects. The Districts must obtain City approval before issuing bonds.

5) Board of Directors- The Districts to be created are governed by 11 voting directors, who will serve staggered terms of four years. Directors are appointed by the Mayor and Houston’s governing body. The board will also consist of 5 non-voting directors consisting of directors of various city departments described in the bill. The bill reduces the number of directors of Buffalo Bayou Management District to eleven.

6) Eminent Domain- The Districts may not exercise the power of eminent domain.

7) Ability to Tax- The Districts may impose assessments, impact fees, ad valorem debt service and operation and maintenance taxes according to Local Government Code Chapter 375. A written petition filed with the board signed by a the owners of a majority of assessed value in the District is required before financing a project with an assessment. The Districts may not impose an impact fee or assessment on the property, equipment, or facilities of an electric utility, power generation company, gas utility, or telecommunications provider.

8) Ability to Exclude Property- Same as a general law municipal management district under Local Government Code Chapter 375.

9) Overlapping Services- An adequate boundary description and location map was not provided for the proposed Districts. Therefore, an overlap check could not be performed.

10) Adequacy of Boundary Description- The boundaries follow known landmarks; however, a closure computation could not be performed.

11) Comments on Powers /Duties Different from Similar Types of Districts- The Districts may authorize the creation of a nonprofit corporation to assist and act on behalf of the District in implementing a project or providing a service governed by Chapter 431, Transportation Code.

12) TCEQ’s Supervision- Similar with general law municipal management districts are exempt from TCEQ auditing and bond review authority unless bonds are issued specifically for water, wastewater and drainage.

13) State Water Plan Objectives-Water Use: Although the district would be given powers to sell bonds and to develop a capital improvement plan, the main intent of the district would be to promote “employment, commerce, transportation, housing, tourism, etc”.  The creation of this district does not relieve Harris County or the City of Houston from providing services that they are currently providing, including water and wastewater service.  For this reason, I believe that the creation of this district would have no impact on the State Water Plan objectives.