Amend HB 3246 by striking all below the enacting clause and substituting the following:

SECTION 1.  Section 372.0015, Local Government Code, is amended to read as follows:

Sec. 372.0015.  DEFINITIONS [DEFINITION]. In this subchapter:

(2)  "Extraterritorial[, "extraterritorial] jurisdiction" means extraterritorial jurisdiction as determined under Chapter 42.

SECTION 2.  Subchapter A, Chapter 372, Local Government Code, is amended by adding Section 372.0025 to read as follows:

SECTION 3.  Sections 372.003(b) and (c), Local Government Code, are amended to read as follows:

(b)  A public improvement project may include:

(1)  landscaping;

(2)  erection of fountains, distinctive lighting, and signs;

(3)  acquiring, constructing, improving, widening, narrowing, closing, or rerouting of sidewalks or of streets, any other roadways, or their rights-of-way;

(4)  construction or improvement of pedestrian malls;

(5)  acquisition and installation of pieces of art;

(6)  acquisition, construction, or improvement of libraries;

(7)  acquisition, construction, or improvement of off-street parking facilities;

(8)  acquisition, construction, improvement, or rerouting of mass transportation facilities;

(9)  acquisition, construction, or improvement of water, wastewater, or drainage facilities or improvements;

(10)  the establishment or improvement of parks and recreation facilities;

(11)  facilities or equipment for firefighters, police, sheriffs, and emergency service providers;

(13)  projects similar to those listed in Subdivisions (1)-(12) [(1)-(10)];

(14) [(12)]  acquisition, by purchase or otherwise, of real property in connection with an authorized improvement;

(15) [(13)]  special supplemental services for improvement and promotion of the district, including services relating to:

(A)  advertising;

(B)  [,] promotion;

(C)  [,] health and sanitation;

(D)  [,] water and wastewater;

(E)  firefighters, police, sheriffs, emergency service providers, and other public safety and [,] security personnel;

(F)  [,] business recruitment;

(G)  [,] development;

(H)  [,] recreation;[,] and

(I)  cultural enhancement;

(16) [(14)]  payment of expenses incurred in the establishment, administration, and operation of the district; and

(17) [(15)]  the development, rehabilitation, or expansion of affordable housing.

(c)  A public improvement project may be limited to the provision of the services described by Subsection (b)(15) [(b)(13)].

SECTION 4.  Subchapter A, Chapter 372, Local Government Code, is amended by adding Section 372.0035 to read as follows:

SECTION 5.  Section 372.014, Local Government Code, is amended by adding Subsection (c) to read as follows:

SECTION 6.  Section 372.015, Local Government Code, is amended by adding Subsections (e), (f), (g), and (h) to read as follows:

SECTION 7.  Subchapter A, Chapter 372, Local Government Code, is amended by adding Section 372.0175 to read as follows:

SECTION 8.  Section 372.018, Local Government Code, is amended by amending Subsections (a) and (f) and adding Subsection (g) to read as follows:

(a)  An assessment bears interest at the rate specified by the governing body of the municipality or county beginning at the time or times or on the occurrence of one or more events specified by the governing body. If general obligation bonds, revenue bonds, installment sales contracts, reimbursement agreements, time warrants, or temporary notes are issued or entered into to finance or pay for the improvement for which the assessment is levied [assessed], the interest rate for the [that] assessment may not exceed a rate that is one-half of one percent higher than the actual interest rate paid on the debt. [Interest on the assessment between the effective date of the ordinance or order levying the assessment and the date the first installment is payable shall be added to the first installment.] The interest on any delinquent installment shall be added to each subsequent installment until all delinquent installments are paid. The added interest may be used to pay costs, including the payment or prepayment of the assessment, administrative costs, costs of improvements, and costs of financing such as reserves for debt service.

(f)  Delinquent installments of the assessment shall incur interest, penalties, and attorney's fees in the same manner as delinquent ad valorem taxes.

(g)  The owner of assessed property may pay at any time on any parcel or lot all or any part of the assessment, with interest that:

(1)  has accrued on the assessment; and

(2)  will accrue on the assessment until the next scheduled prepayment or redemption date on the general obligation bonds, revenue bonds, installment sales contract, reimbursement agreement, temporary note, or time warrant issued or entered into to finance or pay for the improvements [, on any lot or parcel].

SECTION 9.  Section 372.023, Local Government Code, is amended by amending Subsections (a), (d), (e), and (g) and adding Subsections (a-1) and (d-1) to read as follows:

(a)  Costs of improvements may be paid or reimbursed by any combination of the methods described by this section if the improvements are dedicated, conveyed, leased, or otherwise provided to or for the benefit of:

(B)  is authorized by order, ordinance, resolution, or other official action to act for an entity described by Subdivision (1) or (2) [The cost of an improvement made under this subchapter must be paid in accordance with this section].

(a-1)  The payment or reimbursement may be provided before or after a method of payment or reimbursement authorized by this section is entered into or issued.

(d)  Costs [A cost] payable from a special assessment that is payable [to be paid] in installments may be paid by any combination of the following methods [and a cost payable by the municipality or county as a whole but not payable from available general funds or other available general improvement funds shall be paid]:

(1)  under an installment sales [sale] contract or a reimbursement agreement between the municipality or county and [with] the person who acquires, installs, or constructs the improvements [contracts to install or construct the improvement for which the costs apply];

(2)  as provided by a temporary note or time warrant issued by the municipality or county and payable to the [reimburse a] person who acquires, installs, or constructs the improvements [for money advanced or work performed in connection with an improvement]; or

(3)  by the issuance and sale of [revenue or general obligation] bonds under Section 372.024.

(e)  The [net effective] interest rate[, as computed for a public security under Section 1204.005, Government Code,] on unpaid amounts due under an installment sales contract, reimbursement agreement, temporary note, or time warrant described by [money owed or paid under] Subsection (d):

(1)  may not exceed, for a period of not more than five years, as determined by the governing body of the municipality or county, five [one-half of one] percent above the highest average index [interest] rate for tax-exempt bonds reported in a daily or [by a newspaper in a] weekly bond index approved by the governing body and reported in the month before the date the obligation was incurred; and

(2)  after the period described by Subdivision (1), may not exceed two percent above the bond index rate described by Subdivision (1) [of the contract or agreement or the issuance of the bond, temporary note, or time warrant. The newspaper must specialize in bonds and be acceptable as a reliable source for bond interest rates to the governing body of the municipality or county that enters into the contract or agreement or that issues the bond, temporary note, or time warrant].

(g)  The cost of more than one improvement may be paid:

(1)  from a single issue and sale of bonds without other consolidation proceedings before the bond issue; or

(2)  under a single installment sales contract, reimbursement agreement, temporary note, or time warrant [an agreement with a person who contracts to install or construct the improvement and who sells the improvement to the municipality or county].

SECTION 10.  Section 372.024, Local Government Code, is amended to read as follows:

Sec. 372.024.  GENERAL OBLIGATION AND REVENUE BONDS. (a) The governing body of a municipality or county may issue:

(1)  general [General] obligation bonds [issued to pay costs under Section 372.023(d) must be issued] under [the provisions of] Subtitles A and C, Title 9, Government Code;

(3)  revenue [. Revenue] bonds, issued [to pay costs under that subsection may be issued from time to time] in one or more series [and are to be payable from and secured by liens on all or part of the revenue derived from improvements authorized under this subchapter, including revenue derived from installment payments of special assessments].

SECTION 11.  Section 372.026, Local Government Code, is amended by adding Subsection (g) to read as follows:

SECTION 12.  Section 372.023(f), Local Government Code, is repealed.

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, 2011.