By: Creighton S.B. No. 2014
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to consent of municipalities in the creation of municipal
  utility districts.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Sections 54.016(a) and (f), Water Code, are
  amended to read as follows:
         (a)  No land within the corporate limits of a city or within
  the extraterritorial jurisdiction of a city, shall be included in a
  district unless the city grants its written consent, by resolution
  or ordinance, to the inclusion of the land within the district in
  accordance with Section 42.042, Local Government Code, and this
  section. The request to a city for its written consent to the
  creation of a district, shall be signed by a majority in value of
  the holders of title of the land within the proposed district as
  indicated by the county tax rolls or, if there are more than 50
  persons holding title to the land in the proposed district as
  indicated by the county tax rolls, the request to the city will be
  sufficient if it is signed by 50 holders of title to the land in the
  district. A petition for the written consent of a city to the
  inclusion of land within a district shall describe the boundaries
  of the land to be included in the district by metes and bounds or by
  lot and block number, if there is a recorded map or plat and survey
  of the area, and state the general nature of the work proposed to be
  done, the necessity for the work, and the cost of the project as
  then estimated by those filing the petition. If, at the time a
  petition is filed with a city for creation of a district, the
  district proposes to connect to a city's water or sewer system or
  proposes to contract with a regional water and wastewater provider
  which has been designated as such by the commission as of the date
  such petition is filed, to which the city has made a capital
  contribution for the water and wastewater facilities serving the
  area, the proposed district shall be designated as a "city service
  district." If such proposed district does not meet the criteria for
  a city service district at the time the petition seeking creation is
  filed, such district shall be designated as a "noncity service
  district." The city's consent shall not place any restrictions or
  conditions on the creation of a noncity service district as defined
  by this chapter [Chapter 54 of the Texas Water Code] other than
  those expressly provided in Subsection (e) of this section and
  shall specifically not limit the amounts of the district's bonds. A
  city may not require annexation as a consent to creation of any
  district. A city shall not refuse to approve a district bond issue
  for any reason except that the district is not in compliance with
  valid consent requirements applicable to the district. If a city
  grants its written consent without the concurrence of the applicant
  to the creation of a noncity service district containing conditions
  or restrictions that the petitioning land owner or owners
  reasonably believe exceed the city's powers, such land owner or
  owners may petition the commission to create the district and to
  modify the conditions and restrictions of the city's consent. The
  commission may declare any provision of the consent to be null and
  void. The commission may approve the creation of a district that
  includes any portion of the land covered by the city's consent to
  creation of the district.  The legislature may create and may
  validate the creation of a district that includes any portion of the
  land covered by the city's consent to the creation of the district.
         (f)  A city may provide in its written consent for the
  inclusion of land in a district that is initially located wholly or
  partly outside the corporate limits of the city that a contract
  ("allocation agreement") between the district and the city be
  entered into prior to the first issue of bonds, notes, warrants, or
  other obligations of the district.  The allocation agreement shall
  contain the following provisions:
               (1)  a method by which the district shall continue to
  exist following the annexation of all territory within the district
  by the city, if the district is [initially] located outside the
  corporate limits of the city at the time the creation of the
  district is approved by the district's voters;
               (2)  an allocation of the taxes or revenues of the
  district or the city which will assure that, following the date of
  the inclusion of all the district's territory within the corporate
  limits of the city, the total annual ad valorem taxes collected by
  the city and the district from taxable property within the district
  does not exceed an amount greater than the city's ad valorem tax
  upon such property;
               (3)  an allocation of governmental services to be
  provided by the city or the district following the date of the
  inclusion of all of the district's territory within the corporate
  limits of the city; and
               (4)  such other terms and conditions as may be deemed
  appropriate by the city.
         SECTION 2.  The change in law made to Section 54.016(f),
  Water Code, as amended by this Act, applies only to an agreement
  entered into on or after the effective date of this Act. An
  agreement entered into before the effective date of this Act is
  governed by the law in effect on the date the agreement was entered
  into, and the former law is continued in effect for that purpose.
         SECTION 3.  This Act takes effect September 1, 2017.