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A BILL TO BE ENTITLED
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AN ACT
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relating to the creation of municipal utility districts in the |
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extraterritorial jurisdiction of a municipality. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Sections 42.042(c), (f), and (g), Local |
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Government Code, are amended to read as follows: |
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(c) If, within 120 days after the date the governing body |
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receives the petition, the governing body fails to make a contract |
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with a majority of the qualified voters of the area of the proposed |
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political subdivision and the owners of at least 50 percent of the |
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land in the proposed political subdivision to provide the services, |
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that failure constitutes the governing body's consent to the |
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creation of the proposed political subdivision. This subsection |
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does not apply to the creation of a municipal utility district. |
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(f) If the municipality fails or refuses to give its consent |
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to the creation of the political subdivision, including a water |
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district previously created by an act of the legislature, or fails |
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or refuses to execute a contract providing for the water or sanitary |
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sewer services requested within the time limits prescribed by this |
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section, the applicant may petition the Texas Commission on |
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Environmental Quality for the creation of the political subdivision |
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or the inclusion of the land in a political subdivision. The |
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commission shall allow creation or confirmation of the creation of |
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the political subdivision or inclusion of the land in a proposed |
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political subdivision on finding that the municipality either does |
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not have the reasonable ability to serve or has failed to make a |
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legally binding commitment with sufficient funds available to |
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provide water and wastewater service adequate to serve the proposed |
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development at a reasonable cost to the landowner. The commitment |
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must provide that construction of the facilities necessary to serve |
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the land will begin within two years and will be substantially |
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completed within 4-1/2 years after the date the petition was filed |
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with the municipality. This subsection does not apply to the |
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creation of a municipal utility district. |
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(g) On an appeal taken to the district court from the ruling |
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of the Texas Commission on Environmental Quality, all parties to |
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the commission hearing must be made parties to the appeal. The |
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court shall hear the appeal within 120 days after the date the |
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appeal is filed. If the case is continued or appealed to a higher |
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court beyond the 120-day period, the court shall require the |
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appealing party or party requesting the continuance to post a bond |
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or other adequate security in the amount of damages that may be |
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incurred by any party as a result of the appeal or delay from the |
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commission action. The amount of the bond or other security shall |
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be determined by the court after notice and hearing. On final |
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disposition, a court may award damages, including any damages for |
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delays, attorney's fees, and costs of court to the prevailing |
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party. This subsection does not apply to the creation of a |
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municipal utility district. |
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SECTION 2. Section 54.016(a), Water Code, is amended to |
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read as follows: |
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(a) No land within the corporate limits of a city or within |
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the extraterritorial jurisdiction of a city, shall be included in a |
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district created under this chapter or by local law unless the city |
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grants its written consent, by resolution or ordinance, to the |
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inclusion of the land within the district in accordance with |
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Section 42.042, Local Government Code, and this section. The |
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request to a city for its written consent to the creation of a |
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district, shall be signed by a majority in value of the holders of |
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title of the land within the proposed district as indicated by the |
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county tax rolls. A petition for the written consent of a city to |
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the inclusion of land within a district shall describe the |
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boundaries of the land to be included in the district by metes and |
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bounds or by lot and block number, if there is a recorded map or plat |
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and survey of the area, and state the general nature of the work |
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proposed to be done, the necessity for the work, and the cost of the |
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project as then estimated by those filing the petition. [If, at the |
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time a petition is filed with a city for creation of a district, the |
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district proposes to connect to a city's water or sewer system or |
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proposes to contract with a regional water and wastewater provider |
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which has been designated as such by the commission as of the date |
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such petition is filed, to which the city has made a capital |
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contribution for the water and wastewater facilities serving the |
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area, the proposed district shall be designated as a "city service |
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district." If such proposed district does not meet the criteria for |
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a city service district at the time the petition seeking creation is |
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filed, such district shall be designated as a "noncity service |
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district." The city's consent shall not place any restrictions or |
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conditions on the creation of a noncity service district as defined |
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by this chapter other than those expressly provided in Subsection |
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(e) of this section and shall specifically not limit the amounts of |
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the district's bonds.] A city may not require annexation as a |
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consent to creation of any district. A city shall not refuse to |
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approve a district bond issue for any reason except that the |
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district is not in compliance with valid consent requirements |
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applicable to the district. [If a city grants its written consent |
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without the concurrence of the applicant to the creation of a |
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noncity service district containing conditions or restrictions |
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that the petitioning land owner or owners reasonably believe exceed |
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the city's powers, such land owner or owners may petition the |
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commission to create the district and to modify the conditions and |
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restrictions of the city's consent. The commission may declare any |
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provision of the consent to be null and void. The commission may |
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approve the creation of a district that includes any portion of the |
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land covered by the city's consent to creation of the district. The |
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legislature may create and may validate the creation of a district |
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that includes any portion of the land covered by the city's consent |
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to the creation of the district.] |
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SECTION 3. Section 8324.107, Special District Local Laws |
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Code, is amended to read as follows: |
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Sec. 8324.107. LIMITATION ON ANNEXATION OF LAND BY |
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DISTRICT. The [Notwithstanding Section 54.016(d), Water Code, |
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the] district may not annex land that is located in the |
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extraterritorial jurisdiction of a municipality unless the City of |
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Weatherford provides written consent to that annexation. |
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SECTION 4. Section 8325.107, Special District Local Laws |
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Code, is amended to read as follows: |
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Sec. 8325.107. LIMITATION ON ANNEXATION OF LAND BY |
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DISTRICT. The [Notwithstanding Section 54.016(d), Water Code, the] |
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district may not annex land that is located in the extraterritorial |
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jurisdiction of a municipality unless the City of Weatherford |
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provides written consent to that annexation. |
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SECTION 5. Subchapter B, Chapter 54, Water Code, is amended |
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by adding Section 54.017 to read as follows: |
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Sec. 54.017. MEMORANDUM OF UNDERSTANDING BETWEEN DISTRICT, |
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MUNICIPALITY, AND COUNTY. (a) If a municipality approves the |
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creation of a district within the extraterritorial jurisdiction of |
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the municipality under Section 54.016, the district, municipality, |
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and county in which the district will be located shall enter into a |
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memorandum of understanding as to how services will be provided to |
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the district. |
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(b) The memorandum of understanding entered into under this |
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section must detail the provision of: |
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(1) water services; and |
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(2) road services. |
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SECTION 6. The following provisions of the Water Code are |
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repealed: |
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(1) Sections 54.016(c) and (d); and |
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(2) Sections 54.0165(b) and (c). |
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SECTION 7. The changes in law made by this Act apply only to |
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the creation of a municipal utility district on or after the |
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effective date of this Act. A petition for the creation of a |
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municipal utility district pending before the Texas Commission on |
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Environmental Quality on the effective date of this Act is governed |
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by the law in effect on the date the petition was filed, and the |
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former law is continued in effect for that purpose. |
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SECTION 8. This Act takes effect September 1, 2025. |