82R3306 PAM-D
	By: Villarreal	H.B. No. 659

	A BILL TO BE ENTITLED
	AN ACT
	relating to voluntary assessment of property owners by a
	municipality to finance water or energy efficiency improvements.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Chapter 376, Local Government Code, is amended
	by adding Section 376.0001 to read as follows:
	Sec. 376.0001.  FINDINGS. The legislature finds that the
	contractual assessment of property to finance water or energy
	efficiency public improvements or the installation of distributed
	generation renewable energy sources or water or energy efficiency
	improvements described by this chapter as authorized by this
	chapter serves the public purposes of economic development and
	water and energy conservation.
	SECTION 2.  Section 376.001, Local Government Code, is
	amended to read as follows:
	Sec. 376.001.  AUTHORIZED FINANCING.  An assessment under
	this chapter may finance:
	(1)  water or energy efficiency public improvements to
	developed lots for which the costs and time delays of creating an
	entity under law to assess the lot would be prohibitively large
	relative to the cost of the water or energy efficiency public
	improvement to be financed; and
	(2)  the installation of distributed generation
	renewable energy sources or water or energy efficiency improvements
	that are permanently fixed to residential, commercial, industrial,
	or other real property.
	SECTION 3.  Sections 376.004(a) and (b), Local Government
	Code, are amended to read as follows:
	(a)  The governing body of a municipality may determine that
	it is convenient and advantageous to designate an area of the
	municipality within which authorized municipal officials and
	property owners may enter into contracts to assess properties for
	water or energy efficiency public improvements described by Section
	376.001(1) and make financing arrangements under this chapter.
	(b)  The governing body of a municipality may determine that
	it is convenient, advantageous, and in the public interest to
	designate an area of the municipality within which authorized
	municipal officials and property owners may enter into contracts to
	assess properties to finance the installation of distributed
	generation renewable energy sources or water or energy efficiency
	improvements that are permanently fixed to real property.
	SECTION 4.  Sections 376.005(b), (c), and (d), Local
	Government Code, are amended to read as follows:
	(b)  The resolution of intention must:
	(1)  include a statement that the municipality proposes
	to make contractual assessment financing available to property
	owners;
	(2)  identify the types of water or energy efficiency
	public improvements, distributed generation renewable energy
	resources, or water or energy efficiency improvements that may be
	financed;
	(3)  describe the boundaries of the area in which
	contracts for assessments may be entered into;
	(4)  thoroughly describe the proposed arrangements for
	financing the program; and
	(5)  state the time and place for a public hearing and
	that interested persons may object to or inquire about the proposed
	program at the hearing.
	(c)  If contractual assessments are to be used to finance the
	installation of distributed generation renewable energy sources or
	water or energy efficiency improvements that are permanently fixed
	to real property, the resolution of intention must state that it is
	in the public interest to do so.
	(d)  The resolution shall direct an appropriate municipal
	official to:
	(1)  prepare a report under Section 376.006; and
	(2)  consult with the appropriate assessor and
	collector as provided by Section 376.009 [appraisal district or
	districts] regarding collecting the proposed contractual
	assessments with property taxes imposed on the assessed property.
	SECTION 5.  Sections 376.006 and 376.007, Local Government
	Code, are amended to read as follows:
	Sec. 376.006.  REPORT REGARDING ASSESSMENT. An appropriate
	municipal official designated in the resolution shall prepare a
	report containing:
	(1)  a map showing the boundaries of the area within
	which contractual assessments are proposed to be offered;
	(2)  a draft contract specifying the terms that would
	be agreed to by the municipality and a property owner within the
	contractual assessment area;
	(3)  a statement of municipal policies concerning
	contractual assessments including:
	(A)  identification of types of water or energy
	efficiency public improvements, distributed generation renewable
	energy sources, or water or energy efficiency improvements that may
	be financed through the use of contractual assessments;
	(B)  identification of a municipal official
	authorized to enter into contractual assessments on behalf of the
	municipality;
	(C)  a maximum aggregate dollar amount of
	contractual assessments;
	(D)  a method for ranking requests from property
	owners for financing through contractual assessments in priority
	order if requests appear likely to exceed the authorization amount;
	and
	(E)  a method for ensuring that property owners
	requesting financing demonstrate the financial ability to fulfill
	financial obligations under the contractual assessments;
	(4)  a plan for raising a capital amount required to pay
	for work performed in accordance with contractual assessments that:
	(A)  may include:
	(i)  amounts to be advanced by the
	municipality through funds available to it from any source; and
	(ii)  the sale of bonds or other financing;
	(B)  shall include a statement of or method for
	determining the interest rate and period during which contracting
	property owners would pay any assessment; and
	(C)  shall provide for:
	(i)  any reserve fund or funds; and
	(ii)  the apportionment of all or any
	portion of the costs incidental to financing, administration, and
	collection of the contractual assessment program among the
	consenting property owners and the municipality; and
	(5)  the results of the consultations with the
	appropriate assessor and collector as provided by Section 376.009
	regarding collecting [appraisal districts concerning
	incorporating] the proposed contractual assessments with [into the
	assessments of] property taxes imposed on the assessed property.
	Sec. 376.007.  DIRECT PURCHASE BY OWNER.  On the written
	consent of an authorized municipal official, the proposed
	arrangements for financing the program pertaining to the
	installation of distributed generation renewable energy sources or
	water or energy efficiency improvements that are permanently fixed
	to real property may authorize the property owner to:
	(1)  purchase directly the related equipment and
	materials for the installation of the distributed generation
	renewable energy sources or water or energy efficiency
	improvements; and
	(2)  contract directly for the installation of the
	distributed generation renewable energy sources or water or energy
	efficiency improvements.
	SECTION 6.  Chapter 376, Local Government Code, is amended
	by adding Section 376.0071 to read as follows:
	Sec. 376.0071.  RECORDING OF NOTICE OF CONTRACTUAL
	ASSESSMENT REQUIRED. (a) A municipality that authorizes financing
	through contractual assessments under this chapter shall file
	written notice of each contractual assessment in the real property
	records of the county in which the property is located.
	(b)  The written notice must be in recordable form and must
	contain:
	(1)  the amount of the assessment;
	(2)  the legal description of the property;
	(3)  the name of each property owner; and
	(4)  a reference to the statutory assessment lien
	provided under this chapter.
	SECTION 7.  Section 376.008, Local Government Code, is
	amended to read as follows:
	Sec. 376.008.  LIEN. (a)  A contractual [An] assessment
	[imposed] under this chapter and any interest or penalties on the
	assessment:
	(1)  is [constitutes] a first and prior lien against
	the lot on which the assessment is imposed until the assessment,
	interest, or penalty is paid; and
	(2)  has the same priority as a lien for municipal
	property taxes.
	(b)  The lien runs with the land, and that portion of an
	assessment under the assessment contract that has not yet come due
	is not eliminated by foreclosure of a property tax lien.
	(c)  To the extent practicable, the assessment lien may be
	enforced by the municipality in the same manner that a property tax
	lien against real property may be enforced by the municipality.
	(d)  Delinquent installments of the assessment shall incur
	interest and penalties in the same manner as delinquent property
	taxes.
	(e)  A municipality may recover costs and expenses,
	including attorney's fees, in a suit to collect a delinquent
	installment of an assessment in the same manner as in a suit to
	collect a delinquent property tax.
	SECTION 8.  Chapter 376, Local Government Code, is amended
	by adding Section 376.009 to read as follows:
	Sec. 376.009.  COLLECTION OF ASSESSMENTS. (a)  If the
	municipality authorizing financing through contractual assessments
	under this chapter imposes property taxes, the assessor and
	collector for the municipality shall collect the assessments under
	this chapter. If the property on which an assessment is imposed is
	subject to property taxation, the assessor and collector shall
	include the assessment in the tax bill prepared and mailed as
	provided by Section 31.01, Tax Code. The tax bill must separately
	state the amount of an assessment imposed under this chapter.
	(b)  If the municipality does not impose property taxes, the
	municipality may collect the assessments under this chapter or may
	contract with a third party, including the county
	assessor-collector, to collect the assessments. The county
	assessor-collector has the authority to collect assessments under
	this chapter as provided by this subsection.
	(c)  If the municipality collects its own property taxes and
	the governing body of the municipality authorizes split payment of
	taxes under Section 31.03, Tax Code, the assessor and collector for
	the municipality shall consider an assessment imposed under this
	chapter and included in the tax bill a municipal tax in applying
	each payment for a person who makes split payments.
	(d)  An assessor and collector that accepts a partial payment
	on a tax bill that includes more than one taxing unit and includes
	an assessment under this chapter shall consider the assessment a
	municipal tax in allocating partial payments among taxing units as
	provided by Section 31.07, Tax Code. An assessor and collector that
	accepts a partial payment on a tax bill that includes only a
	municipal tax and an assessment under this chapter shall allocate
	the partial payment in proportion to the amount of the municipal
	taxes and the assessment included in the bill.
	SECTION 9.  This Act takes effect immediately if it receives
	a vote of two-thirds of all the members elected to each house, as
	provided by Section 39, Article III, Texas Constitution.  If this
	Act does not receive the vote necessary for immediate effect, this
	Act takes effect September 1, 2011.