By: Callegari, et al. (Senate Sponsor - Janek) H.B. No. 3057
         (In the Senate - Received from the House May 4, 2007;
  May 8, 2007, read first time and referred to Committee on State
  Affairs; May 18, 2007, reported favorably by the following vote:  
  Yeas 7, Nays 0; May 18, 2007, sent to printer.)
  relating to the acquisition of real property for public use.
         SECTION 1.  Section 373.002(b), Local Government Code, is
  amended to read as follows:
         (b)  Activities conducted under this chapter are directed
  toward the following purposes:
               (1)  elimination of [slums and] areas affected by
               (2)  prevention of blighting influences and of the
  deterioration of property and neighborhood and community
  facilities important to the welfare of the community;
               (3)  elimination of conditions detrimental to the
  public health, safety, and welfare;
               (4)  expansion and improvement of the quantity and
  quality of community services essential for the development of
  viable urban communities;
               (5)  more rational use of land and other natural
               (6)  improved arrangement of residential, commercial,
  industrial, recreational, and other necessary activity centers;
               (7)  restoration and preservation of properties of
  special value for historic, architectural, or aesthetic reasons;
               (8)  reduction of the isolation of income groups in
  communities and geographical areas, promotion of increased
  diversity and vitality of neighborhoods through spatial
  deconcentration of housing opportunities for persons of low and
  moderate income, and revitalization of deteriorating or
  deteriorated neighborhoods to attract persons of higher income; and
               (9)  alleviation of physical and economic distress
  through the stimulation of private investment and community
  revitalization in [slum or] blighted areas.
         SECTION 2.  Section 373.004, Local Government Code, is
  amended to read as follows:
         Sec. 373.004.  GOALS OF PROGRAM.  Through a community
  development program, a municipality may conduct work or activities
  designed to:
               (1)  improve the living and economic conditions of
  persons of low and moderate income;
               (2)  benefit low or moderate income neighborhoods;
               (3)  aid in the prevention or elimination of [slums
  and] blighted areas;
               (4)  aid a federally assisted new community; or
               (5)  meet other urgent community development needs,
  including an activity or function specified for a community
  development program that incorporates a federally assisted new
         SECTION 3.  Section 373.006, Local Government Code, is
  amended to read as follows:
  COMMUNITY DEVELOPMENT PROGRAM.  Before exercising powers under
  Section 373.005, the governing body of the municipality must:
               (1)  identify areas of the municipality in which
  predominantly low and moderate income persons reside and each unit
  of real property in the municipality[,] that has the
  characteristics of blight [are blighted or slum areas] or that is a 
  [are] federally assisted new community in the municipality
               (2)  establish community development program areas in
  which community development activities, building rehabilitation,
  or the acquisition of privately owned buildings or land is
               (3)  adopt, by resolution or ordinance, a plan under
  which citizens may publicly comment on the proposed community
  development program;
               (4)  conduct public hearings on the proposed program
  before the 15th day before the date of its final adoption by the
  governing body; and
               (5)  adopt the community development program by
  resolution or ordinance.
         SECTION 4.  Sections 374.002(a) and (b), Local Government
  Code, are amended to read as follows:
         (a)  The legislature finds that [slum and] blighted areas
  exist in municipalities in this state and that those areas:
               (1)  are a serious and growing menace that is injurious
  and inimical to the public health, safety, morals, and welfare of
  the residents of this state;
               (2)  contribute substantially and increasingly to the
  spread of disease and crime, requiring excessive and
  disproportionate expenditures of public funds for the preservation
  of the public health and safety, and for crime prevention,
  correctional facilities, prosecution and punishment, treatment of
  juvenile delinquency, and the maintenance of adequate police, fire,
  and accident protection and other public services and facilities;
               (3)  constitute an economic and social liability,
  substantially impair the sound growth of affected municipalities,
  and retard the provision of housing accommodations.
         (b)  For these reasons, prevention and elimination of [slum
  and] blighted areas are matters of state policy and concern that may
  be best addressed by the combined action of private enterprise,
  municipal regulation, and other public action through approved
  urban renewal plans. The legislature further finds that the repair
  and rehabilitation of buildings and other improvements in affected
  areas, public acquisition of real property, demolition of buildings
  and other improvements as necessary to eliminate [slum or] blight
  conditions or to prevent the spread of those conditions, the
  disposition of property acquired in affected areas and incidental
  to the purposes stated by this subsection, and other public
  assistance to eliminate those conditions are public purposes for
  which public money may be spent and the power of eminent domain
         SECTION 5.  Sections 374.003(3), (18), (25), (26), and (28),
  Local Government Code, are amended to read as follows:
               (3)  "Blighted area" means a tract or unit of property 
  [an area] that presents four or more of the following conditions for
  at least one year after the date on which notice of the conditions
  is provided to the property owner as required by Section
  374.018(a)(1) or (b):
                     (A)  the property contains uninhabitable, unsafe,
  or abandoned structures;
                     (B)  the property has inadequate provisions for
                     (C)  there exists on the property an imminent harm
  to life or other property caused by fire, flood, hurricane,
  tornado, earthquake, storm, or other natural catastrophe declared
  to be a disaster under Section 418.014, Government Code, or
  certified as a disaster for federal assistance under Section
  418.021, Government Code;
                     (D)  the property has been identified by the
  federal Environmental Protection Agency as a superfund site under
  the federal Comprehensive Environmental Response, Compensation,
  and Liability Act of 1980 (42 U.S.C. Section 9601 et seq.) or as
  environmentally contaminated to an extent that the property
  requires remedial investigation or a feasibility study;
                     (E)  the property has been the location of
  substantiated and repeated illegal activity of which the property
  owner knew or should have known;
                     (F)  the maintenance of the property is below
  county or municipal standards;
                     (G)  the property is abandoned and contains a
  structure that is not fit for its intended use because the
  utilities, sewerage, plumbing, or heating or a similar service or
  facility of the structure has been disconnected, destroyed,
  removed, or rendered ineffective; or
                     (H)  the property presents an economic liability
  to the immediate area because of deteriorating structures or
  hazardous conditions [is not a slum area, but that, because of
  deteriorating buildings, structures, or other improvements;
  defective or inadequate streets, street layout, or accessibility;
  unsanitary conditions; or other hazardous conditions, adversely
  affects the public health, safety, morals, or welfare of the
  municipality and its residents, substantially retards the
  provision of a sound and healthful housing environment, or results
  in an economic or social liability to the municipality. The term
  includes an area certified as a disaster area as provided by Section
               (18)  "Rehabilitation" means the restoration of
  buildings or other structures to prevent deterioration of an area
  that is tending to become a blighted area [or a slum area].
               (25)  "Urban renewal activities" includes [slum
  clearance,] redevelopment, rehabilitation, and conservation
  activities to prevent further deterioration of an area that is
  tending to become a blighted [or slum] area. The term includes:
                     (A)  the acquisition of all or part of a [slum area
  or] blighted area or the acquisition of land that is predominantly
  open and that, because of obsolete platting, diversity of
  ownership, deterioration of structures or site improvements, or for
  other reasons, substantially impairs or arrests the sound growth of
  the community;
                     (B)  the demolition and removal of buildings and
                     (C)  the installation, construction, or
  reconstruction of streets, utilities, parks, playgrounds, and
  other improvements necessary to fulfill urban renewal objectives in
  accordance with an urban renewal plan;
                     (D)  the disposition by the municipality of
  property acquired in an urban renewal area for use in accordance
  with an urban renewal plan, including the sale or initial lease of
  the property at its fair value or the retention of the property;
                     (E)  the implementation of plans for a program of
  voluntary repair and rehabilitation of buildings or improvements in
  accordance with an urban renewal plan; and
                     (F)  the acquisition of real property in an urban
  renewal area as necessary to remove or prevent the spread of blight
  or deterioration or to provide land for needed public facilities.
               (26)  "Urban renewal area" means a [slum area,]
  blighted area[, or a combination of those areas] that the governing
  body of a municipality designates as appropriate for an urban
  renewal project.
               (28)  "Urban renewal project" includes any of the
  following activities undertaken in accordance with an urban renewal
                     (A)  municipal activities in an urban renewal area
  that are designed to eliminate or to prevent the development or
  spread of [slums and] blighted areas;
                     (B)  [slum clearance and redevelopment in an urban
  renewal area;
                     [(C)]  rehabilitation or conservation in an urban
  renewal area;
                     (C) [(D)]  development of open land that, because
  of location or situation, is necessary for sound community growth
  and that is to be developed, by replatting and planning, for
  predominantly residential uses; or
                     (D) [(E)]  any combination or part of the
  activities described by Paragraphs (A)-(C) [(D)].
         SECTION 6.  Section 374.011, Local Government Code, is
  amended by amending Subsection (a) and adding Subsection (d) to
  read as follows:
         (a)  Except as provided by Section 374.012, a municipality
  may not exercise a power granted under this chapter unless:
               (1)  the governing body of the municipality adopts a
  resolution that finds that a [slum area or] blighted area exists in
  the municipality and that the rehabilitation, the conservation, or
  the [slum clearance and] redevelopment of the area is necessary for
  the public health, safety, morals, or welfare of the residents of
  the municipality; and
               (2)  a majority of the municipality's voters voting in
  an election held as provided by Subsection (b) favor adoption of the
         (d)  The governing body of the municipality must determine
  that each unit of real property included in a resolution under
  Subsection (a) has the characteristics of blight.
         SECTION 7.  Section 374.012(c), Local Government Code, is
  amended to read as follows:
         (c)  The resolution ordering the election and the notice of
  the election must contain:
               (1)  a complete legal description of each unit of
  property [the area] included in the proposed project;
               (2)  a statement of the nature of the proposed project;
               (3)  a statement of the total amount of local funds to
  be spent on the proposed project; and
               (4)  a statement that each unit of property has the
  characteristics of blight.
         SECTION 8.  Section 374.013(a), Local Government Code, is
  amended to read as follows:
         (a)  To further the urban renewal objectives of this chapter,
  a municipality may formulate a workable program to use appropriate
  private and public resources, including the resources specified by
  Subsection (b), to encourage urban rehabilitation, to provide for
  the redevelopment of [slum and] blighted areas, or to undertake
  those activities or other feasible municipal activities as may be
  suitably employed to achieve the objective of the program. The
  program must specifically include provisions relating to:
               (1)  prevention, through diligent enforcement of
  housing and occupancy controls and standards, of the expansion of
  blight into areas of the municipality that are free from blight; and
               (2)  rehabilitation or conservation of [slum and]
  blighted areas as far as practicable to areas that are free from
  blight through replanning, removing congestion, providing parks,
  playgrounds, and other public improvements, encouraging voluntary
  rehabilitation and requiring the repair and rehabilitation of
  deteriorated or deteriorating structures[, and the clearance and
  redevelopment of slum areas].
         SECTION 9.  Section 374.014(a), Local Government Code, is
  amended to read as follows:
         (a)  A municipality may not prepare an urban renewal plan for
  an area unless the governing body of the municipality has, by
  resolution, declared the area to be a [slum area, a] blighted area[,
  or both,] and has designated the area as appropriate for an urban
  renewal project. The governing body may not approve an urban
  renewal plan until a general plan has been prepared for the
  municipality. A municipality may not acquire real property for an
  urban renewal project until the governing body has approved the
  urban renewal plan as provided by Subsection (d).
         SECTION 10.  Sections 374.015(a) and (d), Local Government
  Code, are amended to read as follows:
         (a)  A municipality may exercise all powers necessary or
  convenient to carry out the purposes of this chapter, including the
  power to:
               (1)  conduct preliminary surveys to determine if
  undertaking an urban renewal project is feasible;
               (2)  conduct urban renewal projects within its area of
               (3)  execute contracts and other instruments necessary
  or convenient to the exercise of its powers under this chapter;
               (4)  provide, arrange, or contract for the furnishing
  or repair by any person of services, privileges, works, streets,
  roads, public utilities, or other facilities in connection with an
  urban renewal project, including installation, construction, and
  reconstruction of streets, utilities, parks, playgrounds, and
  other public improvements necessary to carry out an urban renewal
               (5)  acquire any real property, including
  improvements, and any personal property necessary for
  administrative purposes, that is necessary or incidental to an
  urban renewal project, hold, improve, clear, or prepare the
  property for redevelopment, mortgage or otherwise encumber or
  dispose of the real property, insure or provide for the insurance of
  real or personal property or municipal operations against any risk
  or hazard and to pay premiums on that insurance, and enter any
  necessary contracts;
               (6)  invest urban renewal project funds held in
  reserves or sinking funds, or not required for immediate
  disbursement, in property or securities in which banks may legally
  invest funds subject to their control, redeem bonds issued under
  Section 374.026 at the redemption price established in the bond, or
  purchase those bonds at less than the redemption price, and cancel
  the bonds redeemed or purchased;
               (7)  borrow money and apply for and accept advances,
  loans, grants, contributions, and other forms of financial
  assistance from the federal, state, or county government, other
  public body, or other public or private sources for the purposes of
  this chapter, give any required security, and make and carry out any
  contracts in connection with the financial assistance;
               (8)  make plans necessary to carry out this chapter in
  its area of operation, contract with any person in making and
  carrying out the plans, and adopt, approve, modify or amend the
               (9)  develop, test, and report methods and techniques
  for the prevention of [slums and] urban blight, conduct
  demonstrations and other activities in connection with those
  methods and techniques, and apply for, accept, and use federal
  grants made for those purposes;
               (10)  prepare plans and provide reasonable assistance
  for the relocation of persons displaced from an urban renewal
  project area, including families, business concerns, and others, as
  necessary to acquire possession and to clear the area in order to
  conduct the urban renewal project;
               (11)  appropriate funds and make expenditures as
  necessary to implement this chapter and, subject to Subsection (c),
  levy taxes and assessments for that purpose;
               (12)  close, vacate, plan, or replan streets, roads,
  sidewalks, ways, or other places, plan, replan, zone, or rezone any
  part of the municipality and make exceptions from building
  regulations, and enter agreements with an urban renewal agency
  vested with urban renewal powers under Subchapter C, which may
  extend over any period, restricting action to be taken by the
  municipality under any of the powers granted under this chapter;
               (13)  organize, coordinate, and direct the
  administration of this chapter within the area of operation as
  those provisions apply to the municipality to most effectively
  promote and achieve the purposes of this chapter and establish new
  municipal offices or reorganize existing offices as necessary to
  most effectively implement those purposes; and
               (14)  issue tax increment bonds.
         (d)  A [Except as provided by Section 374.016, a]
  municipality may acquire by condemnation any interest in real
  property, including a fee simple interest, that the municipality
  considers necessary for or in connection with an urban renewal
  project. Property dedicated to a public use may be acquired in that
  manner, except that property belonging to the state or to a
  political subdivision of the state may not be acquired without the
  consent of the state or political subdivision.
         SECTION 11.  Section 374.017(d), Local Government Code, is
  amended to read as follows:
         (d)  Real property or an interest in real property subject to
  this section may only be sold, leased, or otherwise transferred or
  retained at not less than the fair value of the property for uses in
  accordance with the urban renewal plan. In determining the fair
  value, the municipality shall consider:
               (1)  the uses provided in the urban renewal plan;
               (2)  any restrictions on and any covenants, conditions,
  and obligations assumed by the purchaser, lessee, or municipality
  in retaining the property;
               (3)  the objectives of the plan for the prevention of
  the recurrence of [slums or] blighted areas; and
               (4)  any other matters that the municipality specifies
  as appropriate.
         SECTION 12.  Section 374.021(b), Local Government Code, is
  amended to read as follows:
         (b)  In this section, "urban renewal project powers"
  includes the rights, powers, functions, and duties of a
  municipality under this chapter. The term does not include the
  power to:
               (1)  determine an area as a [slum area,] blighted
  area[, or both] and to designate that area as appropriate for an
  urban renewal project;
               (2)  approve and amend urban renewal plans and hold
  public hearings relating to those plans;
               (3)  establish a general plan for the locality as a
               (4)  establish a workable program under Section
               (5)  make determinations and findings under Section
  374.011(a), 374.013(b), or 374.014(d);
               (6)  issue general obligation bonds; and
               (7)  appropriate funds, levy taxes and assessments, and
  exercise other functions under Subdivisions (11) and (12) of
  Section 374.015(a).
         SECTION 13.  Subchapter B, Chapter 374, Local Government
  Code, is amended by adding Sections 374.018 and 374.019 to read as
  (a)  Notwithstanding any other law, an area may not be considered a
  blighted area on the basis of a condition described by Section
  374.003 unless:
               (1)  the municipality has given notice in writing to
  the property owner by first class mail regarding the condition to
                     (A)  last known address of the property owner; and
                     (B)  physical address of the property; and
               (2)  the property owner fails to take reasonable
  measures to remedy the condition.
         (b)  If a mailing address for the property owner cannot be
  determined, the municipality shall post notice in writing regarding
  the condition in a conspicuous place on the property.
         (c)  An area may not be considered a blighted area solely for
  an aesthetic reason.
         (d)  A determination by a municipality that a unit of real
  property has the characteristics of blight is valid for two years.
         (e)  After the two-year period prescribed by Subsection (d),
  a municipality may make a new determination that the unit of real
  property has the characteristics of blight and redesignate the unit
  of real property as a blighted area for another two-year period.
         (f)  A municipality may remove a determination of blight
  under this chapter if the municipality finds that the property
  owner has remedied the condition that was the basis for the
         Sec. 374.019.  COMMON OWNER PROPERTY. For the purposes of
  this chapter and Chapter 21, Property Code, if a municipality
  determines that two or more contiguous units of real property that
  are owned by the same person have the characteristics of blight, the
  municipality may treat those units of property as one unit of
         SECTION 14.  Section 2206.001(b), Government Code, is
  amended to read as follows:
         (b)  A governmental or private entity may not take private
  property through the use of eminent domain if the taking:
               (1)  confers a private benefit on a particular private
  party through the use of the property;
               (2)  is for a public use that is merely a pretext to
  confer a private benefit on a particular private party; or
               (3)  is for economic development purposes, unless the
  economic development results [is a secondary purpose resulting]
  from municipal community development or municipal urban renewal
  activities to eliminate an existing affirmative harm on society
  from [slum or] blighted areas under:
                     (A)  Chapter 373 or 374, Local Government Code,
  other than an activity described by Section 373.002(b)(5), Local
  Government Code; or
                     (B)  Section 311.005(a)(1)(I), Tax Code.
         SECTION 15.  Section 21.041, Property Code, is amended to
  read as follows:
         Sec. 21.041.  EVIDENCE.  As the basis for assessing actual
  damages to a property owner from a condemnation, the special
  commissioners shall admit evidence on:
               (1)  the value of the property being condemned;
               (2)  the injury to the property owner, including the
  financial damages associated with the cost of relocating from the
  condemned property, if the property was habitable, to another
  property that allows the property owner to have a standard of living
  comparable to the property owner's standard of living before the
  condemnation of the property;
               (3)  the benefit to the property owner's remaining
  property; and
               (4)  the use of the property for the purpose of the
         SECTION 16.  Section 21.042(d), Property Code, is amended to
  read as follows:
         (d)  In estimating injury or benefit under Subsection (c),
  the special commissioners shall consider an injury or benefit that
  is peculiar to the property owner, including the property owner's
  financial damages described by Section 21.041(2), and that relates
  to the property owner's ownership, use, or enjoyment of the
  particular parcel of real property, but they may not consider an
  injury or benefit that the property owner experiences in common
  with the general community.
         SECTION 17.  Sections 21.046(a) and (b), Property Code, are
  amended to read as follows:
         (a)  A department, agency, instrumentality, or political
  subdivision of this state shall [may] provide a relocation advisory
  service for an individual, a family, a business concern, a farming
  or ranching operation, or a nonprofit organization that [if the
  service] is compatible with the Federal Uniform Relocation
  Assistance Advisory Program, 23 U.S.C.A. 501, et seq.
         (b)  This state or a political subdivision of this state
  shall [may], as a cost of acquiring real property, pay moving
  expenses and rental supplements, make relocation payments, provide
  financial assistance to acquire replacement housing, and
  compensate for expenses incidental to the transfer of the property
  if an individual, a family, the personal property of a business, a
  farming or ranching operation, or a nonprofit organization is
  displaced in connection with the acquisition.
         SECTION 18.  The following provisions of the Local
  Government Code are repealed:
               (1)  Section 374.003(19); and
               (2)  Section 374.016.
         SECTION 19.  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, 2007.
  * * * * *