TO:	Honorable Jim Murphy, Chair, House Committee on Special Purpose Districts
FROM:	Ursula Parks, Director, Legislative Budget Board
IN RE:	HB4275 by Lozano (Relating to the creation of the Ingleside Improvement District; providing authority to issue bonds; granting limited power of eminent domain; providing authority to impose assessments, fees, or taxes.), As Introduced

The Legislative Budget Board, in cooperation with the Texas Water Development Board (TWDB) and the Texas Commission on Environmental Quality (TCEQ), has determined that:
 
This bill creates Ingleside Improvement District (District) with the powers and duties of a standard municipal management district under Local Government Code Chapter 375.

Population - The very specific description of the proposed boundaries does not allow staff to develop precise population estimates. Based on the Original Texas Land Surveys mentioned in HB 4275, staff is unable to determine a population estimate.
     
Population growth in the specific area since the 2010 census is unknown. The 2010 population estimate for the City of Ingleside is 9,387.  City of Ingleside population projections approved for the 2017 State Water Plan projects the population to grow to 9,961 in 2020, 10,446 in 2030 and 10,726 in 2040.
 
Location - The Proposed district's initial boundaries are described using Original Texas Land Surveys.  Due to the complexity of these boundaries for the various sub areas of the district, staff is able to determine only the general location of the proposed district.
 
The proposed district's area is approximately 0.98 square miles in eastern San Patricio County, located within the city limits of the City of Ingleside.
 
Comments on Powers/Duties Different from Similar Types of Districts:  The District is to be governed by a board of five voting directors that are appointed by the mayor and the governing body of the City of Ingleside (City) from persons recommended by the board. Section 3942.053 (Director Qualifications) will not apply to initial directors; the District may exercise the powers given to a development corporation under Chapter 505, Local Government Code; the board by resolution may authorize the creation of a nonprofit corporation to assist and act for the District in implementing a project or providing a service authorized by this chapter. The nonprofit corporation: has each power of and is considered to be a local government corporation created under Subchapter D, Chapter 431, Transportation Code; and may implement any project and provide any service authorized by this chapter; the District may contract to provide law enforcement services in the District for a fee; the District may join and pay dues to a charitable or nonprofit organization that performs a service or provides an activity consistent with the furtherance of a District purpose; the District may engage in activities that accomplish the economic development purposes of the District; the District may establish and provide for the administration of one or more programs to promote state or local economic development and to stimulate business and commercial activity in the District.
The District may acquire, lease as lessor or lessee, construct, develop, own, operate, and maintain parking facilities or a system of parking facilities, including lots, garages, parking terminals, or other structures or accommodations for parking motor vehicles off the streets and related appurtenances; the District may annex land as provided by Subchapter J, Chapter 49, Water Code; the District has the powers provided by the general law of this state applicable to navigation districts created under Section 59, Article XVI, Texas Constitution, including Chapters 60 and 62, Water Code; the District may construct, acquire, improve, maintain, and operate rail facilities and improvements in aid of those facilities; this bill grants the District authority for road projects; the District may not take any of the following actions until the City has consented by ordinance or resolution to the creation of the District and to the inclusion of land in the District: hold an election under Subchapter L, Chapter 375, Local Government Code; impose an ad valorem tax; impose an assessment; issue bonds; or enter into an agreement to reimburse the costs of facilities; the District may not exercise the power of eminent domain outside the District to acquire a site or easement for: a road project authorized by Section 3942.113; or a recreational facility as defined by Section 49.462, Water Code; current statutes stipulate that a district may not issue bonds for recreational facilities that exceed one percent of the district's assessed valuation.  The bill specifies that this requirement does not apply to the District; except as provided by Section 375.263, Local Government Code, regarding the dissolution of a district, the City is not required to pay a bond, note, or other obligation of the District; if the bill does not receive a two-thirds vote of all members elected to each house, the District may not exercise the power of eminent domain.
 
Overlapping Services:  TCEQ does not have mapping information for water and/or wastewater providers because this function was transferred from the TCEQ to the Public Utility Commission on September 1, 2014.  As a result, TCEQ is unaware of possible overlapping service providers.
 
TCEQ's Supervision:  As with general law districts, the TCEQ will have general supervisory authority, including bond review authority and review of financial reports.
 
Water Use - HB 4275 specifies that "the district has the powers and duties provided by the general law of the state, including Chapters 60 and 62, Water Code, applicable to navigation districts created under Section 59, Article XVI, Texas Constitution"
 
Within the City of Ingleside, 100 percent of the total water use was surface water in 2015.