CHAPTER 3801. HOUSTON DOWNTOWN MANAGEMENT DISTRICT - Texas Statutes

SPECIAL DISTRICT LOCAL LAWS CODE

TITLE 4. DEVELOPMENT AND IMPROVEMENT

SUBTITLE C. DEVELOPMENT, IMPROVEMENT, AND MANAGEMENT

CHAPTER 3801. HOUSTON DOWNTOWN MANAGEMENT DISTRICT

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 3801.001. DEFINITIONS. In this chapter:

(1) "Board" means the board of directors of the district.

(2) "District" means the Houston Downtown Management District.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.002. HOUSTON DOWNTOWN MANAGEMENT DISTRICT. A special

district known as the "Houston Downtown Management District" is a

governmental agency and political subdivision of this state.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.003. PURPOSE; DECLARATION OF INTENT. (a) The

creation of the district is essential to accomplish the purposes

of Sections 52 and 52-a, Article III, and Section 59, Article

XVI, Texas Constitution, and other public purposes stated in this

chapter. By creating the district and in authorizing Harris

County, the City of Houston, and other political subdivisions to

contract with the district, the legislature has established a

program to accomplish the public purposes set out in Section

52-a, Article III, Texas Constitution.

(b) The creation of the district is necessary to promote,

develop, encourage, and maintain employment, commerce,

transportation, housing, tourism, recreation, the arts,

entertainment, economic development, safety, and the public

welfare in the downtown area of the city of Houston.

(c) This chapter and the creation of the district may not be

interpreted to relieve Harris County or the City of Houston from

providing the level of services provided as of August 28, 1995,

to the area in the district or to release the county or the city

from the obligations of each entity to provide services to that

area. The district is created to supplement and not to supplant

the county or city services provided in the area in the district.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.004. FINDINGS OF BENEFIT AND PUBLIC PURPOSE. (a) The

district is created to serve a public use and benefit.

(b) All land and other property included in the district will

benefit from the improvements and services to be provided by the

district under powers conferred by Sections 52 and 52-a, Article

III, and Section 59, Article XVI, Texas Constitution, and other

powers granted under this chapter.

(c) The creation of the district is in the public interest and

is essential to:

(1) further the public purposes of developing and diversifying

the economy of the state;

(2) eliminate unemployment and underemployment; and

(3) develop or expand transportation and commerce.

(d) The district will:

(1) promote the health, safety, and general welfare of

residents, employers, employees, visitors, and consumers in the

district, and of the public;

(2) provide needed funding for the downtown area of the city of

Houston to preserve, maintain, and enhance the economic health

and vitality of the area as a community and business center; and

(3) promote the health, safety, welfare, and enjoyment of the

public by providing pedestrian ways and by landscaping and

developing certain areas in the district, which are necessary for

the restoration, preservation, and enhancement of scenic and

aesthetic beauty.

(e) Pedestrian ways along or across a street, whether at grade

or above or below the surface, and street lighting, street

landscaping, and street art objects are parts of and necessary

components of a street and are considered to be a street or road

improvement.

(f) The district will not act as the agent or instrumentality of

any private interest even though the district will benefit many

private interests as well as the public.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.005. DISTRICT TERRITORY. (a) The district is

composed of the territory described by Section 23.04(b), Chapter

165, Acts of the 75th Legislature, Regular Session, 1997,

enacting former Section 376.004, Local Government Code, and by

Section 1, Chapter 360, Acts of the 76th Legislature, Regular

Session, 1999, as that territory may have been modified under:

(1) Subchapter J, Chapter 49, Water Code; or

(2) other law.

(b) The boundaries and field notes of the district contained in

Section 23.04(b), Chapter 165, Acts of the 75th Legislature,

Regular Session, 1997, enacting former Section 376.004, Local

Government Code, and in Section 1, Chapter 360, Acts of the 76th

Legislature, Regular Session, 1999, form a closure. A mistake in

the field notes or in copying the field notes in the legislative

process does not in any way affect:

(1) the district's organization, existence, and validity;

(2) the district's right to issue any type of bond, including a

refunding bond, for a purpose for which the district is created

or to pay the principal of and interest on the bond;

(3) the district's right to impose and collect an assessment or

tax;

(4) the validity of the enlargement of the district under

Section 1, Chapter 360, Acts of the 76th Legislature, Regular

Session, 1999; or

(5) the legality or operation of the district or the board.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.006. ELIGIBILITY FOR REINVESTMENT ZONES. All or any

part of the area of the district is eligible to be included in:

(1) a tax increment reinvestment zone created by the City of

Houston under Chapter 311, Tax Code; or

(2) a tax abatement reinvestment zone created by the City of

Houston under Chapter 312, Tax Code.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.007. APPLICABILITY OF OTHER LAW. Except as otherwise

provided by this chapter, Chapter 375, Local Government Code,

applies to the district.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.008. LIBERAL CONSTRUCTION OF CHAPTER. This chapter

shall be liberally construed in conformity with the findings and

purposes stated in this chapter.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

SUBCHAPTER B. DISTRICT BOARD OF DIRECTORS

Sec. 3801.051. BOARD OF DIRECTORS; TERMS. The district is

governed by a board of 30 directors who serve staggered terms of

four years, with seven or eight directors' terms expiring June 1

of each year.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.052. APPOINTMENT OF DIRECTORS. (a) The mayor and

members of the governing body of the City of Houston shall

appoint directors from persons recommended by the board.

(b) A person may not be appointed to the board if the

appointment of that person would result in fewer than two-thirds

of the directors being residents of the city of Houston.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.053. EX OFFICIO DIRECTORS. (a) The following persons

serve as nonvoting ex officio directors:

(1) the directors of the parks and recreation, planning and

development, public works, and civic center departments of the

City of Houston;

(2) the chief of police of the City of Houston; and

(3) the general manager of the Metropolitan Transit Authority of

Harris County, Texas.

(b) If a department described by Subsection (a) is consolidated,

renamed, or changed, the board may appoint the director of the

consolidated, renamed, or changed department as a nonvoting ex

officio director. If a department described by Subsection (a) is

abolished, the board may appoint a representative of another

department of the City of Houston that performs duties comparable

to those performed by the abolished department.

(c) The board may appoint the presiding officer of another

nonprofit corporation actively involved in downtown activities in

the city of Houston to serve as a nonvoting ex officio director.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

SUBCHAPTER C. POWERS AND DUTIES

Sec. 3801.101. DISTRICT POWERS. The district has:

(1) all powers necessary to accomplish the purposes for which

the district was created;

(2) the rights, powers, privileges, authority, and functions of

a district created under Chapter 375, Local Government Code;

(3) the powers given to a corporation under Chapter 505, Local

Government Code, and the power to own, operate, acquire,

construct, lease, improve, and maintain projects, other than a

domed football stadium, described by that chapter; and

(4) the powers of a housing finance corporation created under

Chapter 394, Local Government Code, to provide housing or

residential development projects in the district.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Amended by:

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

885, Sec. 3.30, eff. April 1, 2009.

Sec. 3801.103. NONPROFIT CORPORATION. (a) The board by

resolution may authorize the creation of a nonprofit corporation

to assist and act for the district in implementing a project or

providing a service authorized by this chapter.

(b) The nonprofit corporation:

(1) has each power of and is considered for purposes of this

chapter to be a local government corporation created under

Chapter 431, Transportation Code; and

(2) may implement any project and provide any service authorized

by this chapter.

(c) The board shall appoint the board of directors of the

nonprofit corporation. The board of directors of the nonprofit

corporation shall serve in the same manner as, for the same term

as, and on the same conditions as the board of directors of a

local government corporation created under Chapter 431,

Transportation Code.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.104. CONTRACTS; GRANTS. (a) To protect the public

interest, the district may contract with Harris County or the

City of Houston for the county or the city to provide law

enforcement services in the district for a fee.

(b) Harris County, the City of Houston, or another political

subdivision of this state, without further authorization, may

contract with the district to implement a project of the district

or assist the district in providing a service authorized under

this chapter. A contract under this subsection may:

(1) be for a period on which the parties agree;

(2) include terms on which the parties agree;

(3) be payable from taxes or any other source of revenue that

may be available for that project or service; or

(4) provide terms under which taxes or other revenue collected

at a district project or from a person using or purchasing a

commodity or service at a district project may be paid or rebated

to the district.

(c) The district may enter into a contract, lease, or other

agreement with or make or accept a grant or loan to or from any

person, including:

(1) the United States;

(2) this state or a state agency;

(3) any political subdivision of this state; and

(4) a public or private corporation, including a nonprofit

corporation created by the board under this subchapter.

(d) The district may perform all acts necessary for the full

exercise of the powers vested in the district on terms and for

the period the board determines advisable.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.105. COMPETITIVE BIDDING. The district may enter into

a contract for more than $10,000 for services, improvements, or

the purchase of property, including materials, machinery,

equipment, and supplies, only as provided by Subchapter K,

Chapter 375, Local Government Code.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.106. APPROVAL OF CERTAIN IMPROVEMENT PROJECTS. The

district must obtain the approval of the City of Houston of the

plans and specifications of any district improvement project

related to the use of land owned by the City of Houston, an

easement granted by the City of Houston, or a right-of-way of a

street, road, or highway.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.107. NO EMINENT DOMAIN POWER. The district may not

exercise the power of eminent domain.

Added by Acts 2005, 79th Leg., Ch.

684, Sec. 1, eff. June 17, 2005.

SUBCHAPTER D. FINANCIAL PROVISIONS

Sec. 3801.151. PETITION REQUIRED FOR FINANCING SERVICES AND

IMPROVEMENTS. (a) The board may not finance a service or an

improvement project under this chapter unless a written petition

requesting that service or improvement is filed with the board.

(b) The petition must be signed by:

(1) the owners of a majority of the assessed value of real

property in the district according to the most recent certified

tax appraisal roll for Harris County; or

(2) at least 50 owners of land in the district, if more than 50

persons own property in the district according to the most recent

certified tax appraisal roll for Harris County.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.152. DISBURSEMENTS AND TRANSFERS OF MONEY. The board

by resolution shall establish the number of directors' signatures

and the procedure required for a disbursement or transfer of the

district's money.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.153. AUTHORITY TO IMPOSE AD VALOREM TAXES,

ASSESSMENTS, AND IMPACT FEES. The district may impose an ad

valorem tax, assessment, or impact fee as provided by Chapter

375, Local Government Code, to provide an improvement or service

for a project or activity the district may acquire, construct,

improve, or provide under this chapter.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.154. MAINTENANCE TAX. (a) If authorized at an

election held in accordance with Section 3801.158, the district

may impose an annual ad valorem tax on taxable property in the

district to:

(1) maintain and operate the district and the improvements

constructed or acquired by the district; or

(2) provide services to industrial or commercial businesses,

residents, or property owners.

(b) The board shall determine the tax rate.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.155. ASSESSMENTS; LIENS FOR ASSESSMENTS. (a) The

board by resolution may impose and collect an assessment for any

purpose authorized by this chapter.

(b) An assessment, a reassessment, or an assessment resulting

from an addition to or correction of the assessment roll by the

district, penalties and interest on an assessment or

reassessment, an expense of collection, and reasonable attorney's

fees incurred by the district:

(1) are a first and prior lien against the property assessed;

(2) are superior to any other lien or claim other than a lien or

claim for county, school district, or municipal ad valorem taxes;

and

(3) are the personal liability of and a charge against the

owners of the property even if the owners are not named in the

assessment proceeding.

(c) The lien is effective from the date of the board's

resolution imposing the assessment until the date the assessment

is paid. The board may enforce the lien in the same manner that

the board may enforce an ad valorem tax lien against real

property.

(d) The board may correct, add to, or delete assessments from

its assessment rolls after notice and hearing as provided by

Subchapter F, Chapter 375, Local Government Code.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.156. PROHIBITED EXEMPTIONS. A single-family

residential property or a residential duplex, triplex, fourplex,

or condominium may not be exempt from the imposition of a tax, an

impact fee, or an assessment if the tax, impact fee, or

assessment is imposed in accordance with this chapter.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.157. OBLIGATIONS; APPROVAL BY CITY OF HOUSTON. (a)

The district may issue bonds or other obligations payable in

whole or in part from ad valorem taxes, assessments, impact fees,

revenue, grants, or other money of the district, or any

combination of those sources of money, to pay for any authorized

purpose of the district, other than to finance a domed football

stadium.

(b) In exercising the district's borrowing power, the district

may issue a bond or other obligation in the form of a bond, note,

certificate of participation or other instrument evidencing a

proportionate interest in payments to be made by the district, or

other type of obligation.

(c) Except as provided by Subsection (d), the district must

obtain the approval of the City of Houston:

(1) for the issuance of a bond for each improvement project; and

(2) of the plans and specifications of the improvement project

to be financed by the bond.

(d) If the district obtains the approval of the City of Houston

of a capital improvements budget for a specified period not to

exceed five years, the district may finance the capital

improvements and issue bonds specified in the budget without

further approval from the City of Houston.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.158. ELECTIONS REGARDING TAXES OR BONDS. (a) In

addition to the elections required under Subchapter L, Chapter

375, Local Government Code, the district must hold an election in

the manner provided by that subchapter to obtain voter approval

before the district may:

(1) impose a maintenance tax; or

(2) issue a bond payable from ad valorem taxes or assessments.

(b) The board may submit multiple purposes in a single

proposition at an election.

(c) The board may not call an election under this chapter unless

a written petition requesting an election has been filed with the

board. The petition must be signed by:

(1) the owners of a majority of the assessed value of real

property in the district according to the most recent certified

tax appraisal roll for Harris County; or

(2) at least 50 owners of land in the district, if more than 50

persons own property in the district as determined by the most

recent certified tax appraisal roll for Harris County.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

Sec. 3801.159. SALES AND USE TAX PROHIBITED. The district may

not impose a sales and use tax.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.

SUBCHAPTER E. DISSOLUTION

Sec. 3801.201. DISSOLUTION OF DISTRICT WITH OUTSTANDING DEBT.

Despite this section and Section 375.264, Local Government Code,

the district may be dissolved as provided by Subchapter M,

Chapter 375, Local Government Code, if the district has debt. If

the district has debt when it is dissolved, the district shall

remain in existence solely for the purpose of discharging its

bonds or other obligations according to their terms.

Acts 2003, 78th Leg., ch. 1277, Sec. 1, eff. April 1, 2005.