CHAPTER 108. MUNICIPAL BONDS FOR CERTAIN DEFINED AREAS - Texas Statutes

LOCAL GOVERNMENT CODE

TITLE 4. FINANCES

SUBTITLE A. MUNICIPAL FINANCES

CHAPTER 108. MUNICIPAL BONDS FOR CERTAIN DEFINED AREAS

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 108.001. DEFINITION. In this chapter, "defined area" means

a defined area created by a municipal utility district under

Subchapter J, Chapter 54, Water Code.

Added by Acts 2007, 80th Leg., R.S., Ch.

813, Sec. 1, eff. June 15, 2007.

Sec. 108.002. APPLICATION OF CHAPTER. This chapter applies only

to a municipality that under Section 43.075 or any other law

abolishes a municipal utility district created under Section 59,

Article XVI, Texas Constitution, that contains a defined area.

Added by Acts 2007, 80th Leg., R.S., Ch.

813, Sec. 1, eff. June 15, 2007.

Sec. 108.003. CONFLICT WITH OTHER LAWS. To the extent of a

conflict between this chapter and any other law, including

Subchapter A, Chapter 372, this chapter controls.

Added by Acts 2007, 80th Leg., R.S., Ch.

813, Sec. 1, eff. June 15, 2007.

SUBCHAPTER B. BONDS USED TO CARRY OUT PURPOSES OF

DEFINED AREA IN ABOLISHED MUNICIPAL UTILITY DISTRICT

Sec. 108.051. BONDS ORIGINALLY AUTHORIZED IN ABOLISHED MUNICIPAL

UTILITY DISTRICT; PROPERTY TAXES. (a) If, before its abolition,

a municipal utility district voted to issue bonds secured by

property taxes for a defined area under Section 54.806, Water

Code, and if some or all of the bonds were not issued, sold, and

delivered before the abolition, the governing body of the

municipality that abolished the district may issue and sell

municipal bonds:

(1) in an amount not to exceed the amount of the unissued

district bonds approved by the voters; and

(2) for the purpose of carrying out the purposes for which the

district bonds were voted.

(b) The bonds are issued under the authority under which they

were voted, particularly Section 59, Article XVI, Texas

Constitution. The bonds must be secured by a tax under the

authority under which they were voted, particularly a tax on the

property in the defined area of the abolished district.

(c) The bonds must be authorized by ordinance of the governing

body of the municipality. The ordinance must provide for the

levy of taxes on all taxable property in the defined area of the

abolished district to pay the principal of and interest on the

bonds when due.

Added by Acts 2007, 80th Leg., R.S., Ch.

813, Sec. 1, eff. June 15, 2007.

Sec. 108.052. BONDS AUTHORIZED UNDER PUBLIC IMPROVEMENT

DISTRICT; ASSESSMENTS. (a) If, before its abolition, a

municipal utility district voted to issue bonds secured by

property taxes for a defined area under Section 54.806, Water

Code, and if some or all of the bonds were not issued, sold, and

delivered before the abolition, the governing body of the

municipality that abolished the district may, on its own motion,

establish a public improvement district under Subchapter A,

Chapter 372, for the purpose of issuing and selling municipal

bonds:

(1) in an amount not to exceed the amount of the unissued

district bonds approved by the voters; and

(2) for the purpose of carrying out the purposes for which the

district bonds were voted, including the cost of facilities

constructed after creation of the defined area in accordance with

the plan for improvements adopted by the board of directors of

the abolished district.

(b) A municipality that establishes a public improvement

district under this section may:

(1) enter into agreements with developers of property in the

public improvement district for the construction, acquisition,

expansion, improvement, or extension of improvements in the

public improvement district;

(2) reimburse a developer for the costs of the improvements

through assessments payable in installments on property in the

public improvement district;

(3) pledge any type of assessment, including installment

assessments, levied against property in the public improvement

district as security for bonds and agreements; and

(4) structure the assessments in any manner determined by the

governing body of the municipality.

(c) In structuring an assessment under this section, the

municipality may include in the assessment:

(1) a coverage factor;

(2) any prepayment dates;

(3) terms or amounts; and

(4) any other methodology or amounts determined necessary or

convenient by the governing body of the municipality.

(d) Any bonds issued by the municipality under this section must

be authorized by ordinance of the governing body of the

municipality and shall provide for the collection of the

assessments as authorized by Subchapter A, Chapter 372, and this

chapter.

(e) The bonds may be payable in installments, as determined by

the governing body of the municipality, against the property in

the defined area.

(f) The municipality may use the bonds to:

(1) pay or reimburse a developer for public improvements in the

public improvement district under a development or other

agreement with the developer;

(2) pay the principal of and interest on the bonds when due; or

(3) pay any combination of purposes described by Subdivisions

(1) and (2).

Added by Acts 2007, 80th Leg., R.S., Ch.

813, Sec. 1, eff. June 15, 2007.

Sec. 108.053. PLEDGES TO SECURE BONDS. The municipality may

further pledge any available funds to secure the bonds, including

taxes or other revenue.

Added by Acts 2007, 80th Leg., R.S., Ch.

813, Sec. 1, eff. June 15, 2007.

Sec. 108.054. CHOICE OF LAWS. (a) A municipality may exercise

powers under Section 108.051 or 108.052, but may not exercise

powers under both sections for the same defined area.

(b) A municipality that exercises powers under Section 108.051

or 108.052 to reimburse a developer's infrastructure costs in a

defined area shall not be required to provide payment to the

developer under Section 43.0715.

Added by Acts 2007, 80th Leg., R.S., Ch.

813, Sec. 1, eff. June 15, 2007.

Sec. 108.055. CONFLICT WITH MUNICIPAL CHARTER. This subchapter

prevails over a municipal charter provision to the extent of a

conflict with this subchapter.

Added by Acts 2007, 80th Leg., R.S., Ch.

813, Sec. 1, eff. June 15, 2007.

Sec. 108.056. EFFECT ON OTHER MUNICIPAL BONDS. This subchapter

does not affect the authority of a municipality to issue bonds

for other purposes.

Added by Acts 2007, 80th Leg., R.S., Ch.

813, Sec. 1, eff. June 15, 2007.