By: Campbell, et al. S.B. No. 1639
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the procedures for municipal annexations.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subchapter A, Chapter 43, Local Government Code,
  is amended by adding Section 43.003 to read as follows:
         Sec. 43.003.  LIMITED PURPOSE ANNEXATION GENERALLY
  PROHIBITED; EXCEPTION. (a)  Except as provided by Section 43.0751,
  beginning September 1, 2015, a municipality may not annex an area
  for the limited purposes of applying its planning, zoning, health,
  and safety ordinances in the area.
         (b)  This section supersedes any municipal charter provision
  that conflicts with this section.
         SECTION 2.  Section 43.051, Local Government Code, is
  transferred to Subchapter B, Chapter 43, Local Government Code,
  redesignated as Section 43.0211, Local Government Code, and amended
  to read as follows:
         Sec. 43.0211  [43.051].  AUTHORITY TO ANNEX LIMITED TO
  EXTRATERRITORIAL JURISDICTION. A municipality may annex area only
  in the municipality's [its] extraterritorial jurisdiction unless
  the municipality owns the area.
         SECTION 3.  Subchapter B, Chapter 43, Local Government Code,
  is amended by adding Section 43.0212 to read as follows:
         Sec. 43.0212.  AUTHORITY OF MUNICIPALITY TO ANNEX AREA ON
  REQUEST OF OWNERS. (a)  A municipality may annex an area if each
  owner of land in the area requests the annexation.
         (b)  If a municipality elects to annex an area under this
  section, the governing body of the municipality must first
  negotiate and enter into a written agreement for the provision of
  services in the area with the owners of land in the area. The
  municipality is not required to provide a service that is not
  included in the agreement.
         (c)  Before a municipality may annex an area under this
  section, the governing body of the municipality must conduct at
  least two public hearings. The hearings must be conducted not less
  than 10 business days apart.  During the first public hearing, the
  governing body must provide persons interested in the annexation
  the opportunity to be heard. During the final public hearing, the
  governing body may adopt an ordinance annexing the area.
         SECTION 4.  The heading to Subchapter C, Chapter 43, Local
  Government Code, is amended to read as follows:
  SUBCHAPTER C.  ANNEXATION OF AREAS WITH A POPULATION OF LESS THAN
  200 [PROCEDURE FOR AREAS ANNEXED UNDER MUNICIPAL ANNEXATION PLAN]
         SECTION 5.  Subchapter C, Chapter 43, Local Government Code,
  is amended by adding Sections 43.0511 through 43.0517 to read as
  follows:
         Sec. 43.0511.  AUTHORITY TO ANNEX. A municipality may annex
  an area with a population of less than 200 only if the municipality
  obtains consent to annex the area through a petition signed by:
               (1)  more than 50 percent of the registered voters of
  the area; and
               (2)  if the registered voters of the area do not own
  more than 50 percent of the land in the area, more than 50 percent of
  the owners of land in the area.
         Sec. 43.0512.  RESOLUTION. The governing body of the
  municipality that proposes to annex an area under this subchapter
  must adopt a resolution that includes:
               (1)  a statement of the municipality's intent to annex
  the area;
               (2)  a detailed description and map of the area to be
  annexed; and
               (3)  a description of the services to be provided by the
  municipality in the area after the annexation, including, as
  applicable:
                     (A)  police protection;
                     (B)  fire protection;
                     (C)  emergency medical services;
                     (D)  solid waste collection;
                     (E)  operation and maintenance of water and
  wastewater facilities in the annexed area;
                     (F)  operation and maintenance of roads and
  streets, including road and street lighting;
                     (G)  operation and maintenance of parks,
  playgrounds, and swimming pools; and
                     (H)  operation and maintenance of any other
  publicly owned facility, building, or service.
         Sec. 43.0513.  NOTICE OF PROPOSED ANNEXATION.  Not later
  than the seventh day after the date the governing body of the
  municipality adopts the resolution under Section 43.0512, the
  municipality must mail to each resident in the area notification of
  the proposed annexation that includes:
               (1)  notice of the public hearing required by Section
  43.0514;
               (2)  an explanation of the 60-day petition period
  described by Section 43.0515; and
               (3)  a description of services to be provided by the
  municipality in the area after the annexation.
         Sec. 43.0514.  INITIAL PUBLIC HEARING. The governing body
  of a municipality must conduct at least one public hearing not
  earlier than the 21st day and not later than the 30th day after the
  date the governing body adopts the resolution under Section
  43.0512.
         Sec. 43.0515.  PETITION. (a)  The petition required by
  Section 43.0511 may be signed only by a registered voter of the area
  or an owner of land in the area.  The petition must provide for the
  person signing to state whether the person is signing as a
  registered voter of the area, as an owner of land in the area, or as
  both.
         (b)  The municipality may collect signatures on the petition
  only during the period beginning on the 31st day after the date the
  governing body of the municipality adopts the resolution under
  Section 43.0512 and ending on the 90th day after the date the
  resolution is adopted. 
         (c)  The petition must clearly state that a person signing
  the petition is consenting to the proposed annexation.
         (d)  The petition must include a map of and describe the area
  proposed to be annexed.
         (e)  The municipality must collect petition signatures in
  person, except that the municipality may provide for an owner of
  land in the area that is not a resident of the area to sign the
  petition electronically.
         (f)  Chapter 277, Election Code, applies to a petition under
  this section.
         Sec. 43.0516.  RESULTS OF PETITION. (a)  When the petition
  period prescribed by Section 43.0515 ends, the petition shall be
  verified by the municipal secretary or other person responsible for
  verifying signatures.  The municipality must notify the residents
  of the area proposed to be annexed of the results of the petition. 
         (b)  If the municipality does not obtain the number of
  signatures on the petition required to annex the area, the
  municipality may not annex the area and may not adopt another
  resolution under Section 43.0512 to annex the same area until the
  first anniversary of the date the petition period ended.
         (c)  If the municipality obtains the number of signatures on
  the petition required to annex the area, the municipality may annex
  the area after:
               (1)  providing notice under Subsection (a);
               (2)  holding a public hearing at which members of the
  public are given an opportunity to be heard; and
               (3)  holding a final hearing not earlier than the 10th
  day after the date of the public hearing under Subdivision (2) at
  which the ordinance annexing the area may be adopted.
         Sec. 43.0517.  VOTER APPROVAL BY MUNICIPAL RESIDENTS ON
  PETITION. Notwithstanding Section 43.0516, a municipality may not
  annex an area under this subchapter without approval of a majority
  of the voters voting at an election called and held for that purpose
  if a petition protesting the annexation is signed by a number of
  registered voters of the municipality equal to at least 50 percent
  of the number of voters who voted in the most recent municipal
  election and is received by the secretary of the municipality
  before the date the petition period prescribed by Section 43.0515
  ends.
         SECTION 6.  The heading to Subchapter C-1, Chapter 43, Local
  Government Code, is amended to read as follows:
  SUBCHAPTER C-1.  ANNEXATION OF AREAS WITH A POPULATION OF AT LEAST
  200 [PROCEDURE FOR AREAS EXEMPTED FROM MUNICIPAL ANNEXATION PLAN]
         SECTION 7.  Subchapter C-1, Chapter 43, Local Government
  Code, is amended by adding Sections 43.0611 through 43.0618 to read
  as follows:
         Sec. 43.0611.  AUTHORITY TO ANNEX. A municipality may annex
  an area with a population of 200 or more only if the following
  conditions are met, as applicable:
               (1)  the municipality holds an election in the area
  proposed to be annexed at which the qualified voters of the area may
  vote on the question of the annexation, and a majority of the votes
  received at the election approve the annexation; and
               (2)  if the registered voters of the area do not own
  more than 50 percent of the land in the area, the municipality
  obtains consent to annex the area through a petition signed by more
  than 50 percent of the owners of land in the area.
         Sec. 43.0612.  RESOLUTION. The governing body of the
  municipality that proposes to annex an area under this subchapter
  must adopt a resolution that includes:
               (1)  a statement of the municipality's intent to annex
  the area;
               (2)  a detailed description and map of the area to be
  annexed; and 
               (3)  a description of the services to be provided by the
  municipality in the area after the annexation, including, as
  applicable:
                     (A)  police protection;
                     (B)  fire protection;
                     (C)  emergency medical services;
                     (D)  solid waste collection;
                     (E)  operation and maintenance of water and
  wastewater facilities in the annexed area;
                     (F)  operation and maintenance of roads and
  streets, including road and street lighting;
                     (G)  operation and maintenance of parks,
  playgrounds, and swimming pools; and
                     (H)  operation and maintenance of any other
  publicly owned facility, building, or service.
         Sec. 43.0613.  NOTICE OF PROPOSED ANNEXATION.  Not later
  than the seventh day after the date the governing body of the
  municipality adopts the resolution under Section 43.0612, the
  municipality must mail to each property owner in the area
  notification of the proposed annexation that includes:
               (1)  notice of the public hearing required by Section
  43.0614;
               (2)  notice that an election on the question of
  annexing the area will be held; and
               (3)  a description of services to be provided by the
  municipality in the area after the annexation.
         Sec. 43.0614.  PUBLIC HEARINGS. (a)  The governing body of
  a municipality must conduct at least one public hearing not earlier
  than the 21st day and not later than the 30th day after the date the
  governing body adopts the resolution under Section 43.0612.
         (b)  The governing body must conduct an additional public
  hearing not earlier than the 31st day and not later than the 90th
  day after the date the governing body adopts a resolution under
  Section 43.0612.
         Sec. 43.0615.  PROPERTY OWNER CONSENT REQUIRED FOR CERTAIN
  AREAS. (a)  If the registered voters in the area to be annexed do
  not own more than 50 percent of the land in the area, the
  municipality must obtain consent to the annexation through a
  petition signed by more than 50 percent of the owners of land in the
  area in addition to the election required by this subchapter.
         (b)  The municipality must obtain the consent required by
  this section through the petition process prescribed by Section
  43.0515, and the petition must be verified in the manner provided by
  Section 43.0516(a).
         Sec. 43.0616.  ELECTION.  (a)  A municipality shall order an
  election on the question of annexing an area to be held on the first
  uniform election date that falls on or after:
               (1)  the 90th day after the date the governing body of
  the municipality adopts the resolution under Section 43.0612; or
               (2)  if the consent of the owners of land in the area is
  required under Section 43.0615, the 78th day after the date the
  petition period to obtain that consent ends.
         (b)  An election under this section shall be held in the same
  manner as general elections of the municipality.  The municipality
  shall pay for the costs of holding the election.
         (c)  A municipality that holds an election under this section
  may not hold another election on the question of annexation before
  the corresponding uniform election date of the following year.
         Sec. 43.0617.  RESULTS OF ELECTION AND PETITION.
  (a)  Following an election held under this subchapter, the
  municipality must notify the residents of the area proposed to be
  annexed of the results of the election and, if applicable, of the
  petition required by Section 43.0615.
         (b)  If at the election held under this subchapter a majority
  of qualified voters do not approve the proposed annexation, or if
  the municipality is required to petition owners of land in the area
  under Section 43.0615 and does not obtain the required number of
  signatures, the municipality may not annex the area and may not
  adopt another resolution under Section 43.0612 to annex the same
  area until the first anniversary of the date of the adoption of the
  resolution.
         (c)  If at the election held under this subchapter a majority
  of qualified voters approve the proposed annexation, and if the
  municipality, as applicable, obtains the required number of
  petition signatures under Section 43.0615, the municipality may
  annex the area after:
               (1)  providing notice under Subsection (a);
               (2)  holding a public hearing at which members of the
  public are given an opportunity to be heard; and
               (3)  holding a final hearing not earlier than the 10th
  day after the date of the public hearing under Subdivision (2) at
  which the ordinance annexing the area may be adopted.
         Sec. 43.0618.  VOTER APPROVAL BY MUNICIPAL RESIDENTS ON
  PETITION. Notwithstanding Section 43.0617, a municipality may not
  annex an area under this subchapter without approval of a majority
  of the voters voting at an election called and held for that purpose
  if a petition protesting the annexation is signed by a number of
  registered voters of the municipality equal to at least 50 percent
  of the number of voters who voted in the most recent municipal
  election and is received by the secretary of the municipality
  before the date the election required by this subchapter is held.
         SECTION 8.  Section 43.071(e), Local Government Code, is
  amended to read as follows:
         (e)  Subsections (b) and (c) [(b)-(d)] do not apply to the
  annexation of:
               (1)  an area within a water or sewer district if:
                     (A)  the governing body of the district consents
  to the annexation;
                     (B)  the owners in fee simple of the area to be
  annexed consent to the annexation; and
                     (C)  the annexed area does not exceed 525 feet in
  width at its widest point;
               (2)  a water or sewer district that has a noncontiguous
  part that is not within the extraterritorial jurisdiction of the
  municipality; or
               (3)  a part of a special utility district created or
  operating under Chapter 65, Water Code.
         SECTION 9.  Section 43.0715(c), Local Government Code, is
  amended to read as follows:
         (c)  At the time notice of the municipality's intent to annex
  the land within the district is first published [in accordance with
  Section 43.052], the municipality shall proceed to initiate and
  complete a report for each developer conducted in accordance with
  the format approved by the Texas [Natural Resource Conservation]
  Commission on Environmental Quality for audits. In the event the
  municipality is unable to complete the report prior to the
  effective date of the annexation as a result of the developer's
  failure to provide information to the municipality which cannot be
  obtained from other sources, the municipality shall obtain from the
  district the estimated costs of each project previously undertaken
  by a developer which are eligible for reimbursement. The amount of
  such costs, as estimated by the district, shall be escrowed by the
  municipality for the benefit of the persons entitled to receive
  payment in an insured interest-bearing account with a financial
  institution authorized to do business in the state. To compensate
  the developer for the municipality's use of the infrastructure
  facilities pending the determination of the reimbursement amount or
  federal preclearance, all interest accrued on the escrowed funds
  shall be paid to the developer whether or not the annexation is
  valid. Upon placement of the funds in the escrow account, the
  annexation may become effective. In the event a municipality
  timely escrows all estimated reimbursable amounts as required by
  this subsection and all such amounts, determined to be owed,
  including interest, are subsequently disbursed to the developer
  within five days of final determination in immediately available
  funds as required by this section, no penalties or interest shall
  accrue during the pendency of the escrow. Either the municipality
  or developer may, by written notice to the other party, require
  disputes regarding the amount owed under this section to be subject
  to nonbinding arbitration in accordance with the rules of the
  American Arbitration Association.
         SECTION 10.  Section 43.072(d), Local Government Code, is
  amended to read as follows:
         (d)  Annexation of area under this section is exempt from the
  provisions of this chapter that prohibit:
               (1)  a municipality from annexing area outside its
  extraterritorial jurisdiction; or
               (2)  [annexation of area narrower than the minimum
  width prescribed by Section 43.054; or
               [(3)]  reduction of the extraterritorial jurisdiction
  of a municipality without the written consent of the municipality's
  governing body.
         SECTION 11.  Sections 43.0751(b), (d), and (h), Local
  Government Code, are amended to read as follows:
         (b)  The governing bodies of a municipality and a district
  may negotiate and enter into a written strategic partnership
  agreement for the district by mutual consent. The governing body of
  a municipality, on written request from a district located in the
  municipality's extraterritorial jurisdiction [included in the
  municipality's annexation plan under Section 43.052], may [shall]
  negotiate and enter into a written strategic partnership agreement
  with the district. [A district included in a municipality's
  annexation plan under Section 43.052:
               [(1)     may not submit its written request before the
  date of the second hearing required under Section 43.0561; and
               [(2)     must submit its written request before the 61st
  day after the date of the second hearing required under Section
  43.0561.]
         (d)  Before the governing body of a municipality or a
  district adopts a strategic partnership agreement, it shall conduct
  two public hearings at which members of the public who wish to
  present testimony or evidence regarding the proposed agreement
  shall be given the opportunity to do so. Notice of public hearings
  conducted by the governing body of a municipality under this
  subsection shall be published in a newspaper of general circulation
  in the municipality and in the district[. The notice must be in the
  format prescribed by Section 43.123(b)] and must be published at
  least once on or after the 20th day before the [each] date of each
  hearing. The notice may not be smaller than one-quarter page of a
  standard-size or tabloid-size newspaper, and the headline on the
  notice must be in 18-point or larger type.  Notice of public
  hearings conducted by the governing body of a district under this
  subsection shall be given in accordance with the district's
  notification procedures for other matters of public importance.
  Any notice of a public hearing conducted under this subsection
  shall contain a statement of the purpose of the hearing, the date,
  time, and place of the hearing, and the location where copies of the
  proposed agreement may be obtained prior to the hearing. The
  governing bodies of a municipality and a district may conduct joint
  public hearings under this subsection, provided that at least one
  public hearing is conducted within the district.
         (h)  On the full-purpose annexation conversion date set
  forth in the strategic partnership agreement pursuant to Subsection
  (f)(5) [(f)(5)(A)], the land included within the boundaries of the
  district shall be deemed to be within the full-purpose boundary
  limits of the municipality without the need for further action by
  the governing body of the municipality. The full-purpose
  annexation conversion date established by a strategic partnership
  agreement may be altered only by mutual agreement of the district
  and the municipality. However, nothing herein shall prevent the
  municipality from terminating the agreement and instituting
  proceedings to annex the district, on request by the governing body
  of the district, on any date prior to the full-purpose annexation
  conversion date established by the strategic partnership
  agreement. [Land annexed for limited or full purposes under this
  section shall not be included in calculations prescribed by Section
  43.055(a).]
         SECTION 12.  Section 43.07515(a), Local Government Code, is
  amended to read as follows:
         (a)  A municipality may not regulate under Section 43.0751
  [or 43.0752] the sale, use, storage, or transportation of fireworks
  outside of the municipality's boundaries.
         SECTION 13.  Section 43.102(d), Local Government Code, is
  amended to read as follows:
         (d)  The municipality may annex the area even if the area is
  outside the municipality's extraterritorial jurisdiction or[,] is
  in another municipality's extraterritorial jurisdiction[, or is
  narrower than the minimum width prescribed by Section 43.054.
  Section 43.055, which relates to the amount of area a municipality
  may annex in a calendar year, does not apply to the annexation].
         SECTION 14.  Section 43.1025(c), Local Government Code, is
  amended to read as follows:
         (c)  Annexation of the [The] area described by Subsection (b)
  [may be annexed without the consent of the owners or residents of
  the area, but the annexation] may not occur unless each
  municipality in whose extraterritorial jurisdiction the area may be
  located:
               (1)  consents to the annexation; and
               (2)  reduces its extraterritorial jurisdiction over
  the area as provided by Section 42.023.
         SECTION 15.  Subchapter F, Chapter 43, Local Government
  Code, is amended by adding Section 43.1211 to read as follows:
         Sec. 43.1211.  APPLICABILITY. This subchapter applies to an
  area that was annexed for a limited purpose as authorized before
  September 1, 2015.
         SECTION 16.  Section 43.127(a), Local Government Code, is
  amended to read as follows:
         (a)  On [Except as provided by Section 43.123(e), on] or
  before the date prescribed by the regulatory plan prepared for the
  limited purpose area [under Section 43.123(d)(2)], the
  municipality must annex the area for full purposes. [This
  requirement may be waived and the date for full-purpose annexation
  postponed by written agreement between the municipality and a
  majority of the affected landowners. A written agreement to waive
  the municipality's obligation to annex the area for full purposes
  binds all future owners of land annexed for limited purposes
  pursuant to that waiver.]
         SECTION 17.  Sections 43.141(a) and (b), Local Government
  Code, are amended to read as follows:
         (a)  A majority of the qualified voters of an annexed area
  may petition the governing body of the municipality to disannex the
  area if the municipality fails or refuses to provide services or to
  cause services to be provided to the area [within the period
  specified by Section 43.056 or by the service plan prepared for the
  area under that section].
         (b)  If the governing body fails or refuses to disannex the
  area within 60 days after the date of the receipt of the petition,
  any one or more of the signers of the petition may bring a cause of
  action in a district court of the county in which the area is
  principally located to request that the area be disannexed. On the
  filing of an answer by the governing body, and on application of
  either party, the case shall be advanced and heard without further
  delay in accordance with the Texas Rules of Civil Procedure. The
  district court shall enter an order disannexing the area if the
  court finds that a valid petition was filed with the municipality
  and that the municipality failed to perform [its obligations in
  accordance with the service plan or failed to perform] in good
  faith.
         SECTION 18.  Section 43.201(2), Local Government Code, is
  amended to read as follows:
               (2)  "Limited-purpose annexation" means annexation
  authorized under former Section 43.121, as that section existed on
  January 1, 2015.
         SECTION 19.  Section 43.203(a), Local Government Code, is
  amended to read as follows:
         (a)  This section applies only to the [The] governing body of
  a district that by resolution petitioned [may petition] a
  municipality to alter the annexation status of land in the district
  from full-purpose annexation to limited-purpose annexation and
  before September 1, 2015:
               (1)  entered into an agreement to alter the status of
  annexation as provided by this section; or
               (2)  had its status automatically altered by operation
  of Subsection (c).
         SECTION 20.  Section 43.905(a), Local Government Code, is
  amended to read as follows:
         (a)  A municipality that proposes to annex an area shall
  provide written notice of the proposed annexation to each public
  school district located in the area proposed for annexation within
  the period prescribed for publishing the notice of the first
  hearing under Section 43.0212, 43.0514, [43.0561] or 43.0614
  [43.063], as applicable.
         SECTION 21.  Section 775.0754(d), Health and Safety Code, is
  amended to read as follows:
         (d)  A municipality that enters into an agreement under this
  section is not required to provide emergency services in that
  annexed territory. To the extent of a conflict between this
  subsection and [Section 43.056, Local Government Code, or] any
  other law, this subsection controls.
         SECTION 22.  (a)  Sections 42.0411, 43.021, 43.022, 43.023,
  43.024, 43.025, 43.030, 43.032, 43.033, 43.034, 43.035(c), 43.036,
  43.052, 43.053, 43.054, 43.0545, 43.0546, 43.055, 43.056, 43.0561,
  43.0562, 43.0563, 43.0564, 43.0565, 43.0567, 43.057, 43.061,
  43.062, 43.063, 43.064, 43.065, 43.071(d), (f), and (g), 43.072(c),
  (e), (g), (h), (i), (j), (k), (l), and (m), 43.0751(o), 43.0752,
  43.101(c) and (d), 43.102(c), 43.1025(e) and (g), 43.103, 43.105,
  43.121, 43.122, 43.123, 43.124, 43.125, 43.126, 43.129, 43.131,
  43.132, and 43.147, Local Government Code, are repealed.
         (b)  Subchapter Y, Chapter 43, Local Government Code, is
  repealed.
         (c)  Sections 8374.252(a), 8375.252(a), 8376.252(a),
  8377.252(a), 8378.252(a), 8382.252(a), 8383.252(a), 8384.252(a),
  8385.252(a), and 8477.302(a), Special District Local Laws Code, are
  repealed.
         SECTION 23.  The changes in law made by this Act do not apply
  to an annexation for which the first hearing notice required by
  former Section 43.0561 or 43.063, Local Government Code, as
  applicable, was published before the effective date of this Act.  An
  annexation described by this section is governed by the law in
  effect at the time the notice was published, and the former law is
  continued in effect for that purpose.
         SECTION 24.  This Act takes effect September 1, 2015.