Zwiener MUD Bill’s Board-Seat Ban Covers Only The Presiding Officer

The text as introduced · 1,977 words

By: Zwiener
H.B. No. 5555

A BILL TO BE ENTITLED

AN ACT

relating to municipal utility districts; limiting the rate of a

tax.

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

SECTION 1. Section 209.00591, Property Code, is amended by

adding Subsection (a-4) to read as follows:

(a-4) A person may not serve on the board of a property

owners' association if the person serves as a director of a

municipal utility district under Chapter 54, Water Code.

SECTION 2. Subchapter B, Chapter 54, Water Code, is amended

by adding Section 54.0135 to read as follows:

Sec. 54.0135. PRE-PETITION NOTICE TO CERTAIN COUNTIES. (a)

This section applies only to a proposed district described by

Section 54.0161(a).

(b) At least 30 days before a petition requesting creation

of a proposed district is filed with the commission under Section

54.014, notice must be sent by certified mail to the commissioners

court of each county in which the proposed district is to be

located. The notice must:

(1) be sent to the address of the main county mailbox,

and the address of each county commissioner and county judge;

(2) generally describe the boundaries of the land to

be included in the proposed district, including identifying

landmarks such as adjacent streets or geographic features such as

rivers or lakes, and if possible, by metes and bounds or by lot and

block number if there is a recorded map or plat and survey of the

area to be included in the district; and

(3) inform the commissioners court of the right to:

(A) respond to the notice provided under this

section;

(B) review the petition requesting creation of

the proposed district; and

(C) submit a written opinion on the creation of

the proposed district under Section 54.0161.

(c) Notice under this section must be sent by certified mail

at least 30 days before the date a petition requesting creation of

the proposed district is filed with the commission under Section

54.014.

SECTION 3. Section 54.015, Water Code, is amended to read as

follows:

Sec. 54.015. CONTENTS OF PETITION. The petition shall:

(1) describe the boundaries of the proposed district

by metes and bounds or by lot and block number, if there is a

recorded map or plat and survey of the area;

(2) state the general nature of the work proposed to be

done, the necessity for the work, and the cost of the project as

then estimated by those filing the petition; [ and ]

(3) include a name of the district which shall be

generally descriptive of the locale of the district followed by the

words Municipal Utility District, or if a district is located

within one county, it may be designated "______ County Municipal

Utility District No. ___." (Insert the name of the county and

proper consecutive number.) The proposed district shall not have

the same name as any other district in the same county; and

(4) for a district described by Section 54.0161(a),

include a copy of the notice described by Section 54.0135.

SECTION 4. Section 54.0161, Water Code, is amended by

amending Subsection (a) to read as follows:

(a) This section applies [ only ] to a proposed district :

(1) partly or wholly [ all of which is to be ] located

outside the corporate limits of a municipality , including proposed

districts which overlap more than one county; or

(2) partly or wholly located inside the

extraterritorial jurisdiction of a municipality .

SECTION 5. Section 54.022, Water Code, is amended by adding

Subsection (d) to read as follows:

(d) Notwithstanding any other subsection, the district

shall immediately schedule an election to elect permanent directors

once 75 percent of the plots under the district's jurisdiction are

leased sold, or conveyed in some manner.

SECTION 6. Chapter 54, Water Code, is amended by adding

Subsection 54.037 to read as follows:

Sec. 54.037. REVIEW OF CREATION BY A GROUNDWATER

CONSERVATION DISTRICT. (a) This section applies to a proposed

district, located in or within five miles of the jurisdiction of a

groundwater conservation district, as that term is defined by

Chapter 36.

(a-1) At least 30 days before a petition requesting creation

of a proposed district is filed with the commission under Section

54.014, notice must be sent by certified mail to the groundwater

conservation district in which the proposed district is to be

located or in proximity to, The notice must:

(1) be sent to the mailing address of the groundwater

conservation district;

(2) generally describe the boundaries of the land to

be included in the proposed district, including identifying

landmarks such as adjacent streets or geographic features such as

rivers or lakes, and if possible, by metes and bounds or by lot and

block number if there is a recorded map or plat and survey of the

area to be included in the district; and

(3) inform the groundwater conservation district of

the right to:

(A) respond to the notice provided under this

section;

(B) review the petition requesting creation of

the proposed district; and

(C) submit a written opinion on the creation of

the proposed district under Section 54.0161.

(a-2) The groundwater conservation district in which the

district is to be located, or in proximity to, may review the

petition for creation and other evidence and information relating

to the proposed district that the groundwater conservation district

consider necessary. Petitioners for the creation of a district

shall submit to the groundwater conservation district any relevant

information requested by the groundwater conservation district.

(b) In the event the groundwater conservation district opts

to submit information to the commission or to make a recommendation

regarding the creation of the proposed district, the groundwater

conservation district shall submit to the commission, at least 10

days before the date set for action on the petition, a written

opinion stating:

(1) whether the groundwater conservation district

recommends the creation of the proposed district; and

(2) any findings, conclusions, and other information

that the groundwater conservation district thinks would assist the

commission in making a final determination on the petition.

(c) In passing on a petition subject to this section, the

commission shall consider the written opinion submitted by the

groundwater conservation district.

SECTION 7. Section 54.102, Water Code, is amended to read as

follows:

Sec. 54.102. QUALIFICATIONS FOR DIRECTORS. (a) To be

qualified to serve as a director, a person shall be at least 18

years old, a resident citizen of the State of Texas, and either own

land subject to taxation in the district or be a qualified voter

within the district.

(a-1) a minimum of three directors must be qualified voters

within the district, and reside within the district.

(b) A person is disqualified from serving as a director if

that person is serving on the board of a property owners'

association under Chapter 209, Property Code.

SECTION 8. Chapter 54, Water Code, is amended by adding Sec.

54.103 to read as follows:

LENGTH OF TERMS FOR DIRECTORS. Notwithstanding any other

Chapter, the length of a term for a director shall not exceed four

years. This Section does not impose term limits.

SECTION 9. Subchapter C, Chapter 54, Water Code, is amended

by adding Section 54.104 to read as follows:

Sec. 54.103. POSTING OF NOTICE; POSTING OF BUDGET; TIME AND

PLACE OF MEETINGS; GENERAL RULE.

(a) Notwithstanding Section 49.062, Water Code or Section

551.043, Government Code, a notice of a meeting of the district's

board must be posted in a place readily accessible to the general

public at all times for at least three business days before the

scheduled date of the meeting, except as provided by Sections

551.044, 551.045, and 551.046, Government Code.

(b) If the board of a district conducts meetings at least

quarterly, the board shall conduct a meeting at a designated

meeting location inside the district or within 10 miles of the

boundary of the district at least once per quarter.

Notwithstanding Chapter 551, Government Code, a district to which

this section applies may satisfy the requirements of this

Subsection by conducting quarterly meetings by telephone

conference call or video conference call. A meeting to discuss the

tax rate of the district must be conducted in person.

(d) The notice of a meeting required to be posted under this

Section, Sec. 551.043(a), Government Code or Sec. 49.063, Water

Code, at which the district's board will discuss or adopt a budget

for the district or board must include a physical copy of the

budget.

SECTION 10. Subchapter G, Chapter 54, Water Code, is

amended by adding Section 54.605 to read as follows:

Sec. 54.605 APPLICABILITY OF TAX HEARINGS; AUTOMATIC

ELECTIONS FOR CERTAIN TAXES; LIMITATIONS ON TAX RATES; GENERAL

RULE. (a) For the purposes of providing notice of a tax hearing and

automatic elections to approve tax rates under Sections 49.236,

49.23601, 49.23602, and 49.23603, and notwithstanding those

sections, a district under this section shall be considered a

developed district under Section 49.23602, regardless of whether

the district has financed, completed, and issued all bonds to pay

for all lands, works, improvements, facilities, plants, equipment,

and appliances necessary to serve at least 95 percent of the

projected build-out of the district in accordance with the purposes

for its creation or the purposes authorized by the constitution,

this code, or any other law.

(b) For the purposes of providing notice of a tax hearing

under Section 49.236, notices shall also apply and include

reference to the district's interest and sinking fund rate.

(c) For the purposes of an automatic election to approve tax

rates under Section 49.23602, the district shall also account for

its interest and sinking fund rate under Sec. 49.23602(a)(4) and

Sec. 49.23602(c).

(d) Notwithstanding any other statutes, the district shall

not assess or impose an interest and sinking fund rate in any tax

year that exceeds a rate of 50 cents on the $100 of assessed value.

(e) Notwithstanding any other statutes, no district shall

levy an ad valorem tax rate in excess of One Dollar and Twenty Five

Cents ($1.25) on the $100 of assessed valuation in any one tax year

for combined district taxes.

SECTION 11. Sections 209.00591(a-4), Property Code, and

54.102(b), as added by this Act, apply only to a person elected or

appointed to serve as the presiding officer of the board of a

property owners ' association or president of the board of a

municipal utility district on or after the effective date of this

Act.

SECTION 12. Section 54.0135, Water Code, as added by this

Act, and Section 54.015, Water Code, as amended by this Act, apply

only to a petition requesting creation of a municipal utility

district that is filed with the Texas Commission on Environmental

Quality on or after the effective date of this Act. A petition

requesting creation of a municipal utility district that was filed

with the commission before the effective date of this Act 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.

SECTION 13. Section 54.102, Water Code, as amended by this

Act, does not affect the entitlement of a member serving

immediately before the effective date of this Act on the board of

directors of a municipal utility district described by that section

to continue to carry out the board's functions for the remainder of

the member's term. That section applies only to a member of the

board of directors of such a district elected or appointed on or

after the effective date of this Act. That section does not

prohibit a person who is a member of the board of directors of such a

district on the effective date of this Act from being reelected or

reappointed to the board if the person has the qualifications

required for a member under that section.

SECTION 14. This Act takes effect September 1, 2025.