HB4978 - Relating to the creation of municipal utility districts in the extraterritorial jurisdiction of a municipality.

  89R10466 MP-D     By: Hickland H.B. No. 4978       A BILL TO BE ENTITLED   AN ACT   relating to the creation of municipal utility districts in the   extraterritorial jurisdiction of a municipality.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Sections 42.042(c), (f), and (g), Local   Government Code, are amended to read as follows:          (c)  If, within 120 days after the date the governing body   receives the petition, the governing body fails to make a contract   with a majority of the qualified voters of the area of the proposed   political subdivision and the owners of at least 50 percent of the   land in the proposed political subdivision to provide the services,   that failure constitutes the governing body's consent to the   creation of the proposed political subdivision.   This subsection   does not apply to the creation of a municipal utility district.          (f)  If the municipality fails or refuses to give its consent   to the creation of the political subdivision, including a water   district previously created by an act of the legislature, or fails   or refuses to execute a contract providing for the water or sanitary   sewer services requested within the time limits prescribed by this   section, the applicant may petition the Texas Commission on   Environmental Quality for the creation of the political subdivision   or the inclusion of the land in a political subdivision. The   commission shall allow creation or confirmation of the creation of   the political subdivision or inclusion of the land in a proposed   political subdivision on finding that the municipality either does   not have the reasonable ability to serve or has failed to make a   legally binding commitment with sufficient funds available to   provide water and wastewater service adequate to serve the proposed   development at a reasonable cost to the landowner. The commitment   must provide that construction of the facilities necessary to serve   the land will begin within two years and will be substantially   completed within 4-1/2 years after the date the petition was filed   with the municipality.   This subsection does not apply to the   creation of a municipal utility district.          (g)  On an appeal taken to the district court from the ruling   of the Texas Commission on Environmental Quality, all parties to   the commission hearing must be made parties to the appeal. The   court shall hear the appeal within 120 days after the date the   appeal is filed. If the case is continued or appealed to a higher   court beyond the 120-day period, the court shall require the   appealing party or party requesting the continuance to post a bond   or other adequate security in the amount of damages that may be   incurred by any party as a result of the appeal or delay from the   commission action. The amount of the bond or other security shall   be determined by the court after notice and hearing. On final   disposition, a court may award damages, including any damages for   delays, attorney's fees, and costs of court to the prevailing   party.   This subsection does not apply to the creation of a   municipal utility district.          SECTION 2.  Section 54.016(a), Water Code, is amended to   read as follows:          (a)  No land within the corporate limits of a city or within   the extraterritorial jurisdiction of a city, shall be included in a   district created under this chapter or by local law unless the city   grants its written consent, by resolution or ordinance, to the   inclusion of the land within the district in accordance with   Section 42.042, Local Government Code, and this section.  The   request to a city for its written consent to the creation of a   district, shall be signed by a majority in value of the holders of   title of the land within the proposed district as indicated by the   county tax rolls.  A petition for the written consent of a city to   the inclusion of land within a district shall describe the   boundaries of the land to be included in the district by metes and   bounds or by lot and block number, if there is a recorded map or plat   and survey of the area, and 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.  [ If, at the   time a petition is filed with a city for creation of a district, the   district proposes to connect to a city's water or sewer system or   proposes to contract with a regional water and wastewater provider   which has been designated as such by the commission as of the date   such petition is filed, to which the city has made a capital   contribution for the water and wastewater facilities serving the   area, the proposed district shall be designated as a "city service   district."   If such proposed district does not meet the criteria for   a city service district at the time the petition seeking creation is   filed, such district shall be designated as a "noncity service   district."   The city's consent shall not place any restrictions or   conditions on the creation of a noncity service district as defined   by this chapter other than those expressly provided in Subsection   (e) of this section and shall specifically not limit the amounts of   the district's bonds. ]  A city may not require annexation as a   consent to creation of any district.  A city shall not refuse to   approve a district bond issue for any reason except that the   district is not in compliance with valid consent requirements   applicable to the district.  [ If a city grants its written consent   without the concurrence of the applicant to the creation of a   noncity service district containing conditions or restrictions   that the petitioning land owner or owners reasonably believe exceed   the city's powers, such land owner or owners may petition the   commission to create the district and to modify the conditions and   restrictions of the city's consent.   The commission may declare any   provision of the consent to be null and void.   The commission may   approve the creation of a district that includes any portion of the   land covered by the city's consent to creation of the district.   The   legislature may create and may validate the creation of a district   that includes any portion of the land covered by the city's consent   to the creation of the district. ]          SECTION 3.  Section 8324.107, Special District Local Laws   Code, is amended to read as follows:          Sec. 8324.107.  LIMITATION ON ANNEXATION OF LAND BY   DISTRICT.   The  [ Notwithstanding Section 54.016(d), Water Code,   the ] district may not annex land that is located in the   extraterritorial jurisdiction of a municipality unless the City of   Weatherford provides written consent to that annexation.          SECTION 4.  Section 8325.107, Special District Local Laws   Code, is amended to read as follows:          Sec. 8325.107.  LIMITATION ON ANNEXATION OF LAND BY   DISTRICT.  The  [ Notwithstanding Section 54.016(d), Water Code, the ]   district may not annex land that is located in the extraterritorial   jurisdiction of a municipality unless the City of Weatherford   provides written consent to that annexation.          SECTION 5.  Subchapter B, Chapter 54, Water Code, is amended   by adding Section 54.017 to read as follows:           Sec.   54.017.     MEMORANDUM OF UNDERSTANDING BETWEEN DISTRICT,   MUNICIPALITY, AND COUNTY.   (a)   If a municipality approves the   creation of a district within the extraterritorial jurisdiction of   the municipality under Section 54.016, the district, municipality,   and county in which the district will be located shall enter into a   memorandum of understanding as to how services will be provided to   the district.           (b)     The memorandum of understanding entered into under this   section must detail the provision of:                 (1)  water services; and                 (2)  road services.          SECTION 6.  The following provisions of the Water Code are   repealed:                (1)  Sections 54.016(c) and (d); and                (2)  Sections 54.0165(b) and (c).          SECTION 7.  The changes in law made by this Act apply only to   the creation of a municipal utility district on or after the   effective date of this Act.  A petition for the creation of a   municipal utility district pending before the Texas Commission on   Environmental Quality on 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 8.  This Act takes effect September 1, 2025.