88R11987 MCF-F

By: Toth H.B. No. 5311

A BILL TO BE ENTITLED

AN ACT

relating to the creation and operation of a development zone by and the tax revenue received by The Woodlands Township; providing authority to issue bonds; providing authority to impose assessments and taxes.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 7, Chapter 289, Acts of the 73rd Legislature, Regular Session, 1993, is amended by adding Subsection (gg) to read as follows:

(gg) The district shall be treated the same in all respects as an incorporated municipality for the purposes of Section 183.051, Tax Code.

SECTION 2. Section 11C, Chapter 289, Acts of the 73rd Legislature, Regular Session, 1993, is amended by amending Subsections (b), (f), (l), (p), and (q) and adding Subsections (b-1) and (b-2) to read as follows:

(b) The board, on its own motion or on receipt of a petition signed by the owners of all real property in a defined area of the district, by resolution may create, designate, describe, assign a name to, and appoint the governing body for a development zone in the district:

(1) to promote initial development or substantial redevelopment of the area; or

(2) if the area to be designated as the development zone is composed solely of one or more hotels, to undertake one or more projects to provide supplemental advertising, promotion, or business recruitment services for the area to increase hotel activity[, if the board finds that the creation of the zone will further the public purposes of:

[(1) the development and diversification of the economy of the district and the state;

[(2) the elimination of unemployment or underemployment in the district and the state;

[(3) the development or expansion of transportation or commerce in the district and the state; or

[(4) the promotion and stimulation of business, commercial, and economic activity in the district and the state].

(b-1) The board may create a development zone under Subsection (b) of this section if the board finds that the creation of the zone will further the public purposes of:

(1) the development and diversification of the economy of the district and the state;

(2) the elimination of unemployment or underemployment in the district and the state;

(3) the development or expansion of transportation or commerce in the district and the state; or

(4) the promotion and stimulation of business, commercial, and economic activity in the district and the state.

(b-2) A development zone composed solely of one or more hotels may fund or provide services for the purposes for which the zone was created.

(f) A resolution designating an area as a development zone must:

(1) describe the boundaries of the zone sufficiently to identify with reasonable certainty the territory included;

(2) provide an effective date for the creation of the zone;

(3) provide a date for termination of the zone;

(4) assign a name to the zone for identification;

(5) adopt a preliminary financing plan for the zone;

(6) establish a tax increment fund or project fund for the zone; and

(7) appoint the governing body for the zone or authorize the board to serve ex officio as the governing body of the zone.

(l) The board and the governing body each may enter into an agreement considered necessary or convenient to implement a project plan and development zone financing plan and achieve their purposes, including, for a development zone composed solely of one or more hotels, an agreement with a convention and visitors bureau within or adjacent to the district. An agreement may provide for the regulation or restriction of the use of land by imposing conditions, restrictions, or covenants that run with the land. An agreement may dedicate revenue from the tax increment fund or project fund to pay project costs and may provide that a restriction adopted by the governing body continues in effect after the termination of the development zone. The district and the development zone may agree that the district will provide administration, management, investment, accounting, and other services for the zone in consideration for the benefits received by the district through the implementation of the project plan for the zone.

(p) Sections 311.002 and 311.014 through 311.017, Tax Code, apply to the district, except that for purposes of this subsection:

(1) a reference in those sections to a municipality means the district and the development zone;

(2) a reference in those sections to an ordinance means an order;

(3) a reference in those sections to a reinvestment zone means a development zone;

(4) a reference in those sections to an agreement made under Subsection (b), Section 311.010, Tax Code, means an agreement made under Subsection (l) of this section;

(5) "development" means initial development;

(6) "redevelopment" means substantial redevelopment;

(7) Section 311.016, Tax Code, applies only if ad valorem taxes are used, in whole or in part, in payment of project costs of a development zone; [and]

(8) a development zone created without a duration or date of termination may be dissolved by a two-thirds vote of the board of directors of the district or of the governing body of a municipality or other form of local government, other than the development zone, succeeding to the principal assets, powers, functions, and liabilities of the district, but only if:

(A) the development zone has no outstanding indebtedness or other obligations; or

(B) the assets, powers, functions, and liabilities, and any outstanding indebtedness or obligations, of the development zone are expressly assumed by the district or the succeeding municipality or local government; and

(9) a development zone composed solely of one or more hotels must be dissolved by the board of directors of the district on receipt of a petition for dissolution of the development zone signed by the owners of at least 60 percent of the assessed value of the real property in the development zone and the district must expressly assume the assets, powers, functions, and liabilities, and any outstanding indebtedness or obligations, of the development zone.

(q) Upon the creation and organization of a development zone over the territory of one or more existing development zones, and upon the imposition or assessment by the governing body of an ad valorem tax or limited sales and use tax for the development zone, any [the] existing development zones that impose or assess an ad valorem or sales and use tax are dissolved and abolished and all assets, properties, indebtedness, obligations, and liabilities of the existing development zones transfer to and are assumed by the newly created and organized development zone.

SECTION 3. Section 7(gg), Chapter 289, Acts of the 73rd Legislature, Regular Session, 1993, as added by this Act, applies only to taxes received on or after October 1, 2023. The comptroller shall make the first transfer required by that subsection not later than January 31, 2024.

SECTION 4. (a) The legal notice of the intention to introduce this Act, setting forth the general substance of this Act, has been published as provided by law, and the notice and a copy of this Act have been furnished to all persons, agencies, officials, or entities to which they are required to be furnished under Section 59, Article XVI, Texas Constitution, and Chapter 313, Government Code.

(b) The governor, one of the required recipients, has submitted the notice and Act to the Texas Commission on Environmental Quality.

(c) The Texas Commission on Environmental Quality has filed its recommendations relating to this Act with the governor, lieutenant governor, and speaker of the house of representatives within the required time.

(d) All requirements of the constitution and laws of this state and the rules and procedures of the legislature with respect to the notice, introduction, and passage of this Act have been fulfilled and accomplished.

SECTION 5. This Act takes effect September 1, 2023.