CHAPTER 382. IMPROVEMENT PROJECTS IN CERTAIN COUNTIES

State Codes and Statutes

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LOCAL GOVERNMENT CODE

TITLE 12. PLANNING AND DEVELOPMENT

SUBTITLE B. COUNTY PLANNING AND DEVELOPMENT

CHAPTER 382. IMPROVEMENT PROJECTS IN CERTAIN COUNTIES

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 382.001. DEFINITIONS. (a) In this chapter:

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

(2) "District" means a public improvement district created by a

county under this chapter.

(3) "Hotel" has the meaning assigned by Section 156.001, Tax

Code, and includes a timeshare, overnight lodging unit, or

condominium during the time the timeshare, overnight lodging

unit, or condominium is rented by a person who is not the owner

of the timeshare, overnight lodging unit, or condominium.

(4) "Municipality" means the municipality in whose

extraterritorial jurisdiction the improvement project is to be

located.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.002. APPLICABILITY. This chapter applies only to:

(1) a county with a population of 825,000 or more, other than a

county that:

(A) borders on the Gulf of Mexico or a bay or inlet of the gulf;

(B) has two municipalities located wholly or partly in its

boundaries each having a population of 300,000 or more; or

(2) a county with a population of 70,000 or more that is

adjacent to a county described by Subdivision (1) in which a

municipality with a population of 35,000 or more is primarily

situated and includes all or a part of the extraterritorial

jurisdiction of a municipality with a population of 1.1 million

or more.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.003. NATURE OF DISTRICT; PURPOSE. (a) A district is

created under Section 52, Article III, and Section 59, Article

XVI, Texas Constitution.

(b) By enacting this chapter, the legislature has created a

program for economic development as provided in Section 52-a,

Article III, Texas Constitution. A county may engage in economic

development projects as provided by this chapter, and, on a

determination of the commissioners court of the county to create

a district, may delegate the authority to oversee and manage the

economic development project to an appointed board of directors.

In appointing a board, the commissioners court delegates its

authority to serve a public use and benefit.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.004. COUNTY MAY ESTABLISH DISTRICT. A county may

create a public improvement district under this chapter if the

county determines it is in the county's best interest. A

district is a political subdivision of this state.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.005. APPLICABILITY; CONFLICT OF LAWS. This chapter

controls to the extent of a conflict between this chapter and

Subchapter A, Chapter 372.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.006. ESTABLISHMENT OF ECONOMIC DEVELOPMENT PROJECTS;

OPTIONAL CREATION OF PUBLIC IMPROVEMENT DISTRICT. (a) The

commissioners court of a county may on receipt of a petition

satisfying the requirements of Section 372.005, establish by

order an economic development project in a designated portion of

the county, or, if the county determines it is in the best

interests of the county, create a district by order only in an

area located in the extraterritorial jurisdiction of a

municipality in that county. If the county is a county described

by Section 382.002(2), the petition described by this subsection

must also be approved by a resolution adopted by the municipality

with a population of 1.1 million or more.

(b) For a county described by Section 382.002(2), a district may

only be created in an area containing at least 2,000 contiguous

acres of land that is located wholly or partly in the

extraterritorial jurisdiction of a municipality with a population

of 1.1 million or more.

(1) describe the territory in which the economic development

project is to be located or the boundaries of a district;

(2) specifically authorize the district to exercise the powers

of this chapter if the county has determined that creating a

district is in the county's best interests; and

(3) state whether the petition requests improvements to be

financed and paid for with taxes authorized by this chapter

instead of or in addition to assessments.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

SUBCHAPTER B. BOARD OF DIRECTORS

Sec. 382.051. GOVERNING BODY; TERMS. If a county elects to

delegate the authority granted under this chapter, it shall

appoint a board of seven directors to serve staggered two-year

terms, with three or four directors' terms expiring June 1 of

each year to manage the economic development project or, at the

option of the county, govern the district.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.052. ELIGIBILITY. (a) To be eligible to serve as a

director, a person must be at least 18 years old.

(b) If the population of the district is more than 1,000, to be

eligible to serve as a director, a person must be at least 18

years old, reside in the district, and meet the qualifications of

Section 375.063.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.053. VACANCIES; QUORUM. (a) A board vacancy is filled

in the same manner as the original appointment.

(b) A vacant board position is not counted for the purposes of

establishing a quorum of the board.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.054. CONFLICTS OF INTEREST. Chapter 171 governs

conflicts of interest for directors.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.055. COMPENSATION. (a) For purposes of this section,

"performs the duties of a director" means substantial performance

of the management of the district's business, including

participation in board and committee meetings and other

activities involving the substantive deliberation of district

business and in pertinent educational programs, but does not

include routine or ministerial activities such as the execution

of documents or self-preparation for meetings.

(b) A county is authorized to compensate the directors when they

perform the duties of a director. The county shall compensate a

director not more than $50 a day for each day that the director

performs the duties of a director.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.056. OATH AND BOND; OFFICER ELECTIONS. As soon as

practicable, a board member shall give the bond and take the oath

of office in accordance with Section 375.067, and the board shall

elect officers in accordance with Section 375.068.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

SUBCHAPTER C. POWERS AND DUTIES

Sec. 382.101. COUNTY'S GENERAL POWERS AND DUTIES. (a) A county

operating under this chapter has the powers and duties of:

(1) a county development district under Chapter 383, except for

Section 383.066;

(2) a road district created by a county under Section 52,

Article III, Texas Constitution; and

(3) a municipality or county under Chapter 380 or 381, or under

Section 372.003(b)(9).

(b) A county is authorized to manage an economic development

project in a designated portion of the county, or to create a

district and to delegate to a board the county's powers and

duties as provided by this chapter.

duties of a road district or the power to provide water,

wastewater, or drainage facilities under this section unless both

the municipality and county consent by resolution.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.102. DEVELOPMENT AGREEMENTS. A county may enter into a

development agreement with an owner of land in the territory

designated for an economic development project, or a district may

enter into a development agreement, for a term not to exceed 30

years on any terms and conditions the county or the board

considers advisable. The parties may amend the agreement.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.103. ECONOMIC DEVELOPMENT AGREEMENT; ELECTION; TAXES.

(a) A county may enter into an agreement, only on terms and

conditions the commissioners court and a board consider

advisable, to make a grant or loan of public money to promote

state or local economic development and to stimulate business and

commercial activity in the territory where the economic

development project is located, or in the district, including a

grant or loan to induce the construction of a tourist destination

or attraction in accordance with Chapter 380 or 381.

(b) If authorized by the county, a district may order an

election to be held in the district to approve a grant or loan

agreement. The grant or loan may be payable over a term of years

and be enforceable on the district under the terms of the

agreement and the conditions of the election, which may, subject

to the requirements of Section 382.153(c), include the

irrevocable obligation to impose an ad valorem tax, sales and use

tax, or hotel occupancy tax for a term not to exceed 30 years.

If authorized at the election, the board may contract to pay the

taxes to the recipient of the grant or loan in accordance with

the agreement.

district under Section 382.006 propose that the district be

created only to provide economic development grants or loans and

road improvements and not to impose assessments, and the county

determines that the creation of the district is in the best

interests of the county, the district is not required to prepare

a feasibility report, a service plan or assessment plan, or an

assessment roll as required by Subchapter A, Chapter 372.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.104. CONTRACTS; GENERAL. (a) A district may contract

with any person, including the municipality or county, on the

terms and conditions and for a period of time the board

determines, to:

(1) accomplish any district purpose, including a contract to

pay, repay, or reimburse from tax proceeds or another specified

source of money any costs, including reasonable interest,

incurred by a person on the county's or the district's behalf,

including all or part of the costs of an improvement project; and

(2) receive, administer, and perform the county's or the

district's duties and obligations under a gift, grant, loan,

conveyance, or other financial assistance arrangement relating to

the investigation, planning, analysis, study, design,

acquisition, construction, improvement, completion,

implementation, or operation by the district or another person of

an improvement project or proposed improvement project.

(b) A state agency, municipality, county, other political

subdivision, corporation, or other person may contract with the

county or district to carry out the purposes of this chapter.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.105. PROCUREMENT CONTRACTS. A district may contract

for materials, supplies, and construction:

(1) in accordance with the laws applicable to counties; or

(2) in the same manner that a local government corporation

created pursuant to Chapter 431, Transportation Code, is

authorized to contract.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.106. RULES; ENFORCEMENT. A county may authorize the

board to adopt rules:

(1) to administer and operate the district;

(2) for the use, enjoyment, availability, protection, security,

and maintenance of district property, including facilities; or

(3) to provide for public safety and security in the district.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.107. FEES. A county may authorize a board to

establish, revise, repeal, enforce, collect, and apply the

proceeds from user fees or charges for the enjoyment, sale,

rental, or other use of its facilities or other property, or for

services or improvement projects.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.108. RULES; REGULATION OF ROADS AND OTHER PUBLIC AREAS.

(a) A county may authorize a board to adopt rules to regulate

the private use of public roadways, open spaces, parks,

sidewalks, and similar public areas in the district, if the use

is for a public purpose.

(b) A rule, order, ordinance, or regulation of a county or

municipality that conflicts with a rule adopted under this

section controls to the extent of any conflict.

and orderly use of public roadways, open spaces, parks,

sidewalks, and similar public areas in the area of the district

or economic development project.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.109. ROAD PROJECTS. (a) To the extent authorized by

Section 52, Article III, Texas Constitution, the county may

delegate to the district the authority to construct, acquire,

improve, maintain, or operate macadamized, graveled, or paved

roads or turnpikes, or improvements in aid of those roads or

turnpikes, inside the territory targeted by the county for an

economic development project, or the district.

(b) A road project must meet all applicable construction

standards, zoning and subdivision requirements, and regulatory

ordinances of each municipality in whose corporate limits or

extraterritorial jurisdiction the district is located. If the

district is located outside the extraterritorial jurisdiction of

a municipality, a road project must meet all applicable

construction standards, zoning and subdivision requirements, and

regulatory ordinances of each county in which the district is

located.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.110. UTILITIES. (a) This chapter does not grant the

board any right-of-way management authority over public

utilities.

(b) To the extent the construction, maintenance, or operation of

a project under this chapter requires the relocation or extension

of a public utility facility, the district shall reimburse the

public utility for all costs associated with the relocation,

removal, extension, or other adjustment of the facility.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.111. SERVICE PLAN REQUIRED. The commissioners court of

the county that created the district may require a district to

prepare an annual service plan, in the manner provided for by

Section 372.013, that meets the approval of the commissioners

court.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.112. NO EMINENT DOMAIN. A district may not exercise

the power of eminent domain.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

SUBCHAPTER D. GENERAL FINANCIAL PROVISIONS; TAXES

Sec. 382.151. NO TAX ABATEMENTS. A county may not grant a tax

abatement or enter into a tax abatement agreement for a district.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.152. BONDS; NOTES. (a) A district may not issue bonds

unless approved by the commissioners court of the county that

created the district. Bonds may not be issued unless approved by

a majority of the voters of the district voting in an election

held for that purpose. A bond election under this subsection

does not affect prior bond issuances and is not required for

refunding bond issuances.

(b) A district may not issue a negotiable promissory note or

notes unless approved by the commissioners court of the county

that created the district.

section, bonds, notes, and other district obligations may be

secured by district revenue or any type of district taxes or

assessments, or any combination of taxes and revenue pledged to

the payment of bonds.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.153. AUTHORITY TO IMPOSE ASSESSMENTS AND AD VALOREM,

SALES AND USE, AND HOTEL OCCUPANCY TAXES; ELECTION. (a) A

county or a district may accomplish its purposes and pay the cost

of services and improvements by imposing:

(1) an assessment;

(2) an ad valorem tax;

(3) a sales and use tax; or

(4) a hotel occupancy tax.

(b) A district may impose an ad valorem tax, hotel occupancy

tax, or sales and use tax to accomplish the economic development

purposes prescribed by Section 52a, Article III, Texas

Constitution, if the tax is approved by:

(1) the commissioners court of the county that created the

district; and

(2) a majority of the voters of the district voting at an

election held for that purpose.

has the authority to impose a hotel occupancy tax, sales and use

tax, or ad valorem tax, and must provide the rate at which the

district may impose the tax. A tax rate approved by the

commissioners court and pledged to secure bonds, notes, grant

agreements, or development agreements may not be reduced until

the obligations of those instruments have been satisfied.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.154. USE OF REVENUE FROM TAXES. A tax authorized by a

county to be imposed under this chapter may be used to accomplish

any improvement project or road project, or to provide any

service authorized by this chapter or Chapter 372, 380, 381, or

383.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.155. HOTEL OCCUPANCY TAX. (a) A county may authorize

a district to impose a hotel occupancy tax on a person who pays

for the use or possession of or for the right to the use or

possession of a room that is ordinarily used for sleeping in a

hotel in the district.

(b) If authorized by a county, a district shall impose a hotel

occupancy tax as provided by Chapter 383, Local Government Code,

and Section 352.107, Tax Code, except that a hotel occupancy tax:

(1) may be used for any purpose authorized in this chapter; and

(2) is authorized by the county to be imposed by the district.

or the rate imposed by the municipality.

(d) A hotel occupancy tax may not be imposed on the occupants of

a hotel unless the owner of the hotel agrees to the imposition of

the hotel occupancy taxes under this chapter. After the owner

agrees, the agreement may not be revoked by the owner of the

hotel or any subsequent owner of the hotel. After an agreement

under this section, the district may impose hotel occupancy taxes

as provided by this chapter.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.156. SALES AND USE TAX. (a) A commissioners court may

authorize a district to impose a sales and use tax in increments

of one-eighth of one percent up to a rate of two percent.

(b) Except as otherwise provided in this chapter, a sales and

use tax must be imposed in accordance with Chapter 383, Local

Government Code, or Chapter 323, Tax Code.

provide for voting for or against the proposition: "A sales and

use tax at a rate not to exceed ____ [insert percentage rate] in

the _______________ [insert name of district]" or "The adoption

of a ____ [insert percentage rate] sales and use tax in the

_______________ [insert name of district]."

(d) A tax authorized at an election held under this section may

be imposed at a rate less than or equal to the rate printed in

the ballot proposition.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.157. AD VALOREM TAX. A commissioners court may

authorize a district to impose an ad valorem tax on property in

the district in accordance with Chapter 257, Transportation Code.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.158. BORROWING. The commissioners court may authorize

a district to borrow money for any district purpose, including

for a development agreement that authorizes the district to

borrow money.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.159. REPAYMENT OF COSTS. The commissioners court may

authorize a district, by a lease, lease-purchase agreement,

installment purchase contract, or other agreement, or by the

imposition or assessment of a tax, user fee, concession, rental,

or other revenue or resource of the district, to provide for or

secure the payment or repayment of:

(1) the costs and expenses of the establishment, administration,

and operation of the district;

(2) the district's costs or share of costs of an improvement

project; or

(3) the district's contractual obligations or indebtedness.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

SUBCHAPTER E. ANNEXATION BY MUNICIPALITY; TAXES

Sec. 382.201. LIABILITIES; ASSUMPTION OF ASSETS AFTER COMPLETE

ANNEXATION BY MUNICIPALITY. (a) If the municipality annexes the

entire territory of a district, the municipality shall assume the

district's assets, but is not liable for the district's debt or

other obligations.

(b) If the county has authorized a district to have debt or

other obligations, the district remains in existence after the

territory is annexed by the municipality for the purpose of

collecting any taxes or assessments authorized by the county and

imposed by the district before annexation. Taxes or assessments

collected after annexation must be used by the district solely

for the purpose of satisfying any preexisting county-authorized

district debt or other obligation. After the debt or other

obligations have been discharged, or two years have expired since

the date of the annexation, the district is dissolved and any

outstanding debt or obligations are extinguished.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

Sec. 382.202. AUTHORITY TO IMPOSE TAXES OF ASSESSMENTS AFTER

PARTIAL OR COMPLETE ANNEXATION. (a) After a district has been

annexed by a municipality wholly or partly for general purposes,

the county may not authorize the district to impose an ad valorem

tax, hotel occupancy tax, or sales and use tax, or collect an

assessment in the area that the municipality overlaps the

district, except as provided by Subsection (b) or Section

382.201(b).

(b) A district may continue to impose a tax in an area that the

municipality annexes for limited purposes and in which the

municipality does not impose taxes. If the municipality annexes

an area for limited purposes and imposes some of the taxes which

the district is imposing but not all of them, the district may

continue to impose taxes only to the extent that the level of

taxation of the municipality and the district combined,

calculating the hotel tax, the sales tax, and the ad valorem tax

independently, is equal to or less than the tax level of the

municipality as to fully annexed areas.

where the district and the municipality overlap do not exceed the

level of taxation of fully annexed areas.

Transferred from Local Government Code, Subchapter C, Chapter 372

and amended by Acts 2009, 81st Leg., R.S., Ch.

87, Sec. 15.009, eff. September 1, 2009.

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