88R4493 JTZ-D

By: Bettencourt S.B. No. 2434

A BILL TO BE ENTITLED

AN ACT

relating to the dissolution of the SH130 Municipal Management District No. 1.

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

SECTION 1. Subchapter I, Chapter 3971, Special District Local Laws Code, is amended by adding Sections 3971.0902, 3971.0903, and 3971.0904 to read as follows:

Sec. 3971.0902. MANDATORY DISSOLUTION. Except as provided by Section 3971.0903, not later than January 1, 2024, the board shall:

(1) wind up district operations;

(2) transfer all remaining district assets to a trust created for the purposes of this section, with the commissioners court of the most populous county in which the district is located acting as trustee; and

(3) dissolve the district.

Sec. 3971.0903. DISTRICT OBLIGATIONS AND LIABILITIES. (a) If on January 1, 2024, the board finds that the board would not be authorized to dissolve the district under Section 3971.0901 because of an existing condition described by Section 3971.0901(c):

(1) the board may not dissolve the district under Section 3971.0902;

(2) the board shall delay the transfer of assets to the trust as provided by Section 3971.0902 until the board may dissolve the district; and

(3) the district continues in existence solely for the purposes of resolving the condition, winding up district operations, and making the transfer of assets to the trust as provided by Section 3971.0902.

(b) The board shall resolve the conditions and continue to wind up district operations as quickly as practicable until the board would be authorized to dissolve the district under Section 3971.0901, at which time the board shall make the transfer of assets to the trust as provided by Section 3971.0902 and dissolve the district.

Sec. 3971.0904. DISPOSITION OF REMAINING DISTRICT ASSETS. (a) Not later than the 30th day before the date of the transfer of assets described by Section 3971.0902, the district shall:

(1) compile a list of each taxing unit, as defined by Section 1.04, Tax Code, from which a public facility corporation created by the district received a tax exemption under Section 303.042, Local Government Code, before September 1, 2023; and

(2) provide the list compiled under Subdivision (1) to the trustee of the trust created under Section 3971.0902.

(b) As soon as practicable after the transfer of assets described by Section 3971.0902 or 3971.0903, the trustee of the trust created under Section 3971.0902 shall send to each taxing unit, as defined by Section 1.04, Tax Code, from which a public facility corporation created by the district received a tax exemption under Section 303.042, Local Government Code, a payment from the trust assets.

(c) The trustee:

(1) may apply a reasonable portion of the trust assets to the trustee's costs incurred administering this section; and

(2) shall send any trust assets remaining after making the payments required by this section to a special fund of the county for use under Subsection (e).

(d) Each payment must be in an amount equal to the amount of tax revenue the receiving taxing unit would have collected from the public facility corporation without the exemption provided by Section 303.042, Local Government Code. If the total amount of remaining assets of the district are less than the amount required to make the payments required under this subsection, the trustee shall make the payments on a pro-rata basis, based on the payment otherwise to be paid to each taxing unit.

(e) A county that receives assets under Subsection (c)(2) may use the assets only for a service or project that benefits the former territory of the district.

SECTION 2. (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 3. This Act takes effect September 1, 2023.