LEGISLATIVE BUDGET BOARD

Austin, Texas

FISCAL NOTE, 80TH LEGISLATIVE REGULAR SESSION

March 5, 2007

TO:	Honorable Anna Mowery, Chair, House Committee on Land & Resource Management
FROM:	John S. O'Brien, Director, Legislative Budget Board
IN RE:	HB252 by Mowery (Relating to the authority of the governing body of a municipality to change previously adopted zoning regulations.), As Introduced

No fiscal implication to the State is anticipated.

The bill would amend the Local Government Code to prohibit a municipality from changing the zoning classification of a property if the proposed change would result in a diminution of more than 10 percent of the property's value unless certain other actions occur or if the municipality compensates the property owner for the diminution in value resulting from the change.

The bill would amend the Property Code to classify a proceeding related to zoning reclassification as a condemnation or eminent domain proceeding for the purpose of determining change in property value. The proceeding could be heard before the special commissioners or a district court. The municipality would be allowed to change the property's zoning classification after the special commissioners have made an award.

The bill would establish a procedure for the governing body of a municipality or a political subdivision of the state that is unable to reach an agreement with a property owner regarding damages under a zoning reclassification to petition the proper court to resolve the issue. If the condemnor does not prevail in a proceding, the condemnor would be required to pay the full amount of the court or commisioner's award not later than the latter of the second anniversary of the date the judgment is final or when all appeals have been exhausted. Instead of enforcing a judgment, a prevailing property owner could be allowed to develop the property under the zoning rules that were in place prior to a change in zoning. The condemnor would be required to waive any associated fees, including application and impact fees and any pro rata changes.

Local Government Impact

It is unknown how many zoning reclassifications would result in a condemnation/eminent domain proceeding and how much in damages a condemnor may have to pay or what amount in fees would have to be waived; therefore, the negative fiscal impact to units of local government cannot be determined.

Source Agencies:

LBB Staff:

JOB, WK, SD, DB