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

The bill would create the Southampton Neighborhood Services District in Harris County with the powers and duties governed by Chapter 375, Local Government Code.

1) Population- Not determined.

2) Location & Size- The District would include an area within Harris County.

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

4) District Finances- The District would have the authority to levy benefit assessments and ad valorem taxes, and to 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 District must obtain City approval before issuing bonds. The District’s initial service and assessment plan must provide that any assessment imposed must be paid in five years and the rate of assessment for the first year may not exceed $505 per residential household. The rate of an assessment may only be increased in a later year to account for increased service costs and by a rate that does not exceed 10 percent of the previous rate. Assessment revenue may only be used for garbage collection, security, landscaping projects, alleyway projects, and operation and administration costs.

5) Board of Directors- The initial board would consist of 18 voting directors named in the bill serving staggering two year terms. Nine of the original directors will serve until December 31, 2005 and nine will serve until December 31, 2006. Persons interested in serving on the board will submit their name to the board, ballots will be sent to all property owners. The board will also consist of 7 non-voting directors consisting of directors of various city departments described in the bill. The board by resolution may change the number of voting directors to consist of no fewer than 11 and no more than 21 directors.

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

7) Ability to Tax- The District 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 2/3 of assessed value in the District is required before financing a project with an assessment. The District 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. Individuals can be exempt from paying an impact fee or assessment if the individual is at least 65 years old or if an individual is under a disability and if the assessment will be imposed against property the individual owns and occupies as a residence.

8) Ability to Exclude Property- Same as a general law municipal management district under Chapter 395, Local Government Code.

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

10) Adequacy of Boundary Description- The description provided follows known landmarks and right-of-ways, however a closure computation could not be performed as the bill does not provide a detailed metes and bounds description.

11) Comments on Powers/Duties Different from Similar Types of Districts- The District must provide notification of the creation of the District to each property owner in the District. The board shall dissolve the District on written petition filed with the board by the owners of at least 2/3 of the residential households. The District is dissolved on September 1, 2011 unless continued in existence by a resolution by the City of Houston, the resolution shall specify the date on which the District is to be dissolved

12) TCEQ’s Supervision- The District would be exempt from TCEQ auditing and bond review authority unless the bonds are issued specifically for water, wastewater, or drainage facilities.

13) State Water Plan Objectives: Water Use- It is anticipated that the creation of this district would have no impact on the State Water Plan objectives.