BILL ANALYSIS

C.S.H.B. 1226

By: Gates

Intergovernmental Affairs

Committee Report (Substituted)

BACKGROUND AND PURPOSE

The bill author has informed the committee of concerns regarding the means by which a district may be dissolved through written petition of the owners of at least two-thirds of the assessed value of the property subject to assessment or taxation by the district based on the most recent certified county property tax rolls and has further informed the committee that this signature threshold is nearly impossible to achieve. C.S.H.B. 1226 seeks to improve the ability of the property owners in the district to dissolve a municipal management district.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

C.S.H.B. 1226 amends the Local Government Code to change the condition under which a municipal management district by written petition filed with the district's board of directors is dissolved. Whereas current law requires dissolution by a district's board on written petition filed with the board by the owners of at least two-thirds of the assessed value of the property subject to assessment or taxation by the district based on the most recent certified county property tax rolls, the bill requires the board to dissolve the district on such a written petition filed with the board under one of the following conditions:

· for a district that levies a property or sales tax, the petition must be filed with the board by the owners of at least two-thirds of the assessed value of the property subject to property taxation by the district based on the most recent certified county property tax rolls; or

· for a district that levies an assessment and does not levy a property or sales tax, the petition must be filed with the board by at least a majority of the assessed value of the property subject to assessment by the district based on the most recent certified county property tax rolls.

The bill specifies that in all areas of conflict the statutory process for dissolution by petition takes precedence over a special law governing a district.

C.S.H.B. 1226 amends the Water Code to make conforming changes regarding ship channel security districts.

C.S.H.B. 1226 applies only to a petition filed on or after the bill's effective date. A petition filed before the bill's effective date is governed by the law in effect on the date the petition was filed, and the former law is continued in effect for that purpose.

EFFECTIVE DATE

September 1, 2025.

COMPARISON OF INTRODUCED AND SUBSTITUTE

While C.S.H.B. 1226 may differ from the introduced in minor or nonsubstantive ways, the following summarizes the substantial differences between the introduced and committee substitute versions of the bill.

Both the introduced and the substitute change the threshold for the dissolution of a municipal management district by certain written petition filed with the board by the owners. Whereas the introduced changed the threshold from a petition filed by the owners of at least two-thirds of the assessed value of the property subject to assessment or taxation by the district based on the most recent certified county property tax rolls to a petition filed by the owners of the majority of such assessed value, the substitute instead changes the threshold to a petition filed by the owners of the following:

· if the district levies a property or sales tax, at least two-thirds of the assessed value of the property subject to property taxation by the district based on the most recent certified county property tax rolls; or

· if the district levies an assessment and does not levy a property or sales tax, at least a majority of the assessed value of the property subject to property taxation by the district as such.