Health and Safety Code
CHAPTER 776. EMERGENCY SERVICES DISTRICTS IN COUNTIES OF 125,000
OR
LESS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 776.001. Definitions.
In this chapter:
(1) "Board" means the board of emergency commissioners.
(2) "District" means an emergency services district created
under this chapter.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.002. Liberal Construction.
This chapter and a proceeding under this chapter shall be
liberally construed to achieve the purposes of this chapter.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.003. Authorization.
In a county with a population of 125,000 or less, an emergency
services district may be organized as provided by Article III,
Section 48-e, of the Texas Constitution, as proposed by S.J.R.
No. 27, Acts of the 70th Legislature, Regular Session, 1987, and
adopted by the voters at an election held November 3, 1987, and
by this chapter to protect life and property and to conserve
natural and human resources.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
SUBCHAPTER B. CREATION OF DISTRICT
Sec. 776.011. Petition for Creation of District Located Wholly in One
County.
(a) To create a district located wholly in one county, a petition
signed by at least 100 qualified voters who own taxable real
property in the proposed district must be filed with the county
judge of that county. If there are fewer than 100 of those
voters, the petition must be signed by a majority of those
voters.
(b) The name of the district proposed by the petition must be
"____________ County Emergency Services District No. __________,"
with the name of the county and the proper consecutive number
inserted.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.012. Petition for Creation of District Located in More Than One
County.
(a) To create a district that contains territory located in
more than one county, a petition must be filed with the county
judge of each county in which the proposed district will be
located. The petition must be signed by at least 100 qualified
voters who own taxable real property that is located in the
county in which that judge presides and in the proposed district.
If there are fewer than 100 of those voters in a county, the
petition must be signed by a majority of those voters in that
county.
(b) The name of the district proposed by the petition must be
"____________ Emergency Services District."
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.013. Contents of Petition.
The petition for the creation of a district must contain:
(1) a statement that the district is to be created and is to
operate under Article III, Section 48-e, of the Texas
Constitution, as proposed by S.J.R. No. 27, Acts of the 70th
Legislature, Regular Session, 1987, and adopted by the voters
at an election held November 3, 1987;
(2) the name of the proposed district;
(3) the district's boundaries as designated by metes and
bounds or other sufficient legal description;
(4) a statement that none of the territory in the proposed
district is included in another emergency services district;
(5) the mailing address of each petitioner; and
(6) an agreement signed by at least two petitioners that
obligates them to pay not more than $150 of the costs incident
to the formation of the district, including the costs of
publishing notices, election costs, and other necessary and
incidental expenses.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.014. Creation of District That Includes Municipal Territory.
(a) When creation of a district that contains territory within
a municipality's limits or extraterritorial jurisdiction is
proposed, a written request to include that territory in the
district must be presented to the municipality's governing body.
Except as provided by Subsection (c), that territory may not be
included in the district unless the municipality's governing body
in writing approves the request for inclusion not later than the
60th day after the date on which the request is received.
(b) If the municipality's governing body does not approve the
request for inclusion within the period prescribed by Subsection
(a), a majority of the qualified voters and the owners of at
least 50 percent of the territory that is in the municipality's
limits or extraterritorial jurisdiction and that is to be
included in the district may petition the governing body to make
emergency services available to their territory. The petition
must be submitted to the governing body not later than the 90th
day after the date on which the municipality receives the
request.
(c) The refusal or failure of the municipality's governing body
to act on the petition requesting emergency services within six
months after the date on which the petition is received
constitutes consent for the territory that is the subject of the
petition to be included in the proposed district.
(d) If the proposed district will include territory designated
by a municipality as an industrial district under Section 42.044,
Local Government Code, a request for inclusion of that territory
must be presented to the municipality's governing body in the
same manner provided by this section for territory within the
limits or extraterritorial jurisdiction of a municipality.
(e) If the municipality's governing body consents to the
inclusion in the proposed district of territory within the
municipality's limits or extraterritorial jurisdiction, or in an
industrial district, the territory may be included in the
district in the same manner as other territory under this
chapter.
(f) A governing body's consent under this section expires six
months after the date on which the consent is given.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Amended by Acts 1989, 71st Leg., 1st C.S., ch. 32, Sec. 1, eff.
Sept. 1, 1989.
Sec. 776.015. Filing of Petition and Notice of Hearing.
(a) The county judge may receive a petition for creation of a
district if the petition is in proper form and shall file it with
the county clerk.
(b) At the next regular or special session of the commissioners
court held after the petition is filed with the county clerk, the
commissioners court shall set a place, date, and time for the
hearing to consider the petition.
(c) The county clerk shall issue a notice of the hearing. The
notice must state:
(1) that creation of a district is proposed;
(2) that the district is to be created and is to operate
under Article III, Section 48-e, of the Texas Constitution, as
proposed by S.J.R. No. 27, Acts of the 70th Legislature,
Regular Session, 1987, and adopted by the voters at an election
held November 3, 1987;
(3) the name of the proposed district;
(4) the district's boundaries and functions as stated in the
petition;
(5) the place, date, and time of the hearing; and
(6) that each person who has an interest in the creation of
the district may attend the hearing and present the person's
opinion for or against creation of the district.
(d) The county clerk shall retain a copy of the notice and
shall deliver sufficient copies of the notice to the sheriff for
posting and publication.
(e) Not later than the 21st day before the date on which the
hearing will be held, the sheriff shall post one copy of the
notice at the courthouse door. The sheriff shall also have the
notice published in a newspaper of general circulation in the
proposed district once a week for two consecutive weeks. The
first publication must occur not later than the 21st day before
the date on which the hearing will be held.
(f) The return of each officer executing notice must:
(1) be endorsed or attached to a copy of the notice;
(2) show the execution of the notice;
(3) specify each date on which the notice was posted or
published; and
(4) include a printed copy of the published notice.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Amended by Acts 1989, 71st Leg., 1st C.S., ch. 32, Sec. 2, eff.
Sept. 1, 1989.
Sec. 776.016. Hearing.
(a) At the time and place set for the hearing or at a later
date set at that time, the commissioners court shall consider the
petition and each issue relating to creation of the district.
(b) Any interested person may appear before the commissioners
court in person or by attorney to support or oppose the creation
of the district and may offer pertinent testimony.
(c) The commissioners court has exclusive jurisdiction to
determine each issue relating to the creation of the district and
may issue incidental orders it considers proper. The
commissioners court may adjourn the hearing as necessary.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.017. Petition Approval; Denial.
(a) If after the hearing the commissioners court finds that the
proposed district is feasible, will benefit the territory in the
district, will secure the public safety, welfare, and
convenience, and will aid in conserving the real property or
natural resources in the proposed district, the commissioners
court shall grant the petition and fix the district's boundaries.
(b) If the commissioners court finds that the proposed district
does not meet the requirements prescribed by Subsection (a), the
commissioners court shall deny the petition.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.018. Consideration of Effect of Municipal Participation.
(a) If the area of the proposed district encompasses the
territory of any municipality, including the area within the
extraterritorial jurisdiction of the municipality, the
commissioners court of the county in which the municipal
territory or jurisdiction is located, in making a determination
under Section 776.017, shall also determine whether those
findings would be the same as to the remaining portion of the
proposed district, excluding any or all of the territory of the
municipalities in the event any one or more of the municipalities
should fail to cast a majority vote in favor of the district and
the tax.
(b) This finding shall be made as to each municipality whose
territory is proposed to be included within the area of the
proposed district.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Amended by Acts 1989, 71st Leg., 1st C.S., ch. 32, Sec. 3, eff.
Sept. 1, 1989.
Sec. 776.019. Election.
(a) On the granting of a petition, the commissioners court
shall order an election to confirm the district's creation and
authorize the levy of a tax not to exceed:
(1) 10 cents on each $100 of the taxable value of property
taxable by the district; or
(2) two cents on each $100 of the taxable value of property
taxable by the district if any area in the district is also
included in a rural fire prevention district.
(b) If the petition indicates that the proposed district will
contain territory in more than one county, the commissioners
court may not order an election until the commissioners court of
each county in which the district will be located has granted the
petition.
(c) Subject to Section 4.003, Election Code, the notice of the
election shall be given in the same manner as the notice of the
petition hearing.
(d) The election shall be held on the first authorized uniform
election date prescribed by the Election Code that allows
sufficient time to comply with other requirements of law.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Amended by Acts 1989, 71st Leg., 1st C.S., ch. 32, Sec. 4, eff.
Sept. 1, 1989.
Sec. 776.020. Election Result and Commissioners Court Order.
(a) If a majority of the votes cast in the election favor
confirmation, the district is created.
(b) A district may not include territory in a municipality's
limits or extraterritorial jurisdiction unless a majority of the
voters residing in that territory who vote at the election vote
in favor of confirmation of the creation of the district and
imposing a tax. The exclusion of that territory does not affect
the creation of a district that includes the remainder of the
proposed territory if the commissioners court's findings under
Section 776.017 were favorable to the district's creation.
(c) If a majority of those voting at the election vote against
creation of the district, the commissioners court may not order
another election before the first anniversary of the date of the
official canvass of the most recent election concerning creation
of the district.
(d) When a district is created, the commissioners court of each
county in which the district is located shall enter an order in
its minutes that reads substantially as follows:
Whereas, at an election held on the ______ day of ____________,
___, in that part of ____________ County, State of Texas,
described as (insert description unless the district is
countywide), there was submitted to the qualified voters the
question of whether that territory should be formed into an
emergency services district under state law; and
Whereas, at the election ______ votes were cast in favor of
formation of the district and ______ votes were cast against
formation; and
Whereas, the formation of the emergency services district
received the affirmative vote of the majority of the votes cast
at the election as provided by law;
Now, therefore, the Commissioners Court of ____________ County,
State of Texas, finds and orders that the tract described in this
order has been duly and legally formed into an emergency services
district (or a portion thereof) under the name of ____________,
under Article III, Section 48-e, of the Texas Constitution, as
proposed by S.J.R. No. 27, Acts of the 70th Legislature, Regular
Session, 1987, and adopted by the voters at an election held
November 3, 1987, and has the powers vested by law in the
district.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Amended by Acts 1989, 71st Leg., 1st C.S., ch. 32, Sec. 5, eff.
Sept. 1, 1989.
Sec. 776.021. Overlapping Districts.
(a) If the territory in one or more districts overlaps, the
commissioners court of the county in which the most recently
created district is located by order shall exclude the
overlapping territory from that district.
(b) For purposes of this section, a district is created on the
date on which the election confirming its creation was held. If
the elections confirming the creation of two or more districts
are held on the same date, the most recently created district is
the district for which the hearing required by Section 776.016
was most recently held.
(c) The fact that a district is created with boundaries that
overlap the boundaries of another district does not affect the
validity of either district.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
SUBCHAPTER C. ORGANIZATION, POWERS, AND DUTIES
Sec. 776.031. District Powers.
(a) A district is a political subdivision of the state. To
perform the functions of the district, a district may carry out
this chapter and:
(1) acquire, hold, lease, manage, occupy, and sell real and
personal property or an interest in property including real
property, improvements, and fixtures necessary to house, repair,
and maintain emergency services vehicles and related equipment;
(2) appoint and employ necessary officers, agents, and employees;
(3) sue and be sued;
(4) impose and collect taxes as prescribed by this chapter;
(5) accept and receive donations;
(6) lease, own, maintain, and operate emergency services vehicles
and other necessary or proper emergency services equipment and
machinery to provide emergency services, including emergency
ambulance service; and
(7) enter into and perform necessary contracts, including a
contract with another district, municipality, or another entity:
(A) to make fire-fighting facilities, fire extinguishment
services, or emergency rescue and ambulance services available to
the district; or
(B) for reciprocal operation of services and facilities if the
contracting parties find that reciprocal operation would be
mutually beneficial and not detrimental to the parties to the
contract.
(b) A district may be created to provide limited services
specified at the time of the district's creation.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Amended by Acts 1989, 71st Leg., 1st C.S., ch. 32, Sec. 6, eff.
Sept. 1, 1989.
Sec. 776.032. Certain Businesses Not Subject to Ad Valorem Tax or District
Powers.
(a) A business entity is not subject to the ad valorem tax
authorized by this chapter or subject to the district's powers if
the business entity:
(1) provides its own fire prevention and fire control
services and owns or operates fire-fighting equipment or
systems equivalent to or better than those of a Class I rural
fire prevention district, metropolitan county fire protection
system, as defined by the State Board of Insurance, for which
the business entity receives the appropriate approval from the
Texas Industrial Fire Training Board of the State Firemen's and
Fire Marshals' Association of Texas;
(2) provides and operates its own equipped industrial
ambulance with a licensed driver and provides industrial victim
care by an emergency care attendant trained to provide the
equivalent of ordinary basic life support, as defined by
Section 773.003; and
(3) provides ordinary emergency services for the business
entity, such as emergency response, as defined by 29 C.F.R.
Sec. 1910.120, rescue, disaster planning, or security services,
as recognized by the Texas Industrial Fire Training Board of
the State Firemen's and Fire Marshals' Association of Texas,
and provides the equipment, training, and facilities necessary
to safely handle emergencies and protect the business entity
and its neighbors in the community.
(b) This section shall not be construed to exempt a business
from a sales and use tax authorized by Section 776.0751.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Amended by Acts 1989, 71st Leg., 1st C.S., ch. 40, Sec. 4, eff.
Sept. 1, 1989; Acts 1991, 72nd Leg., ch. 14, Sec. 277, eff. Sept.
1, 1991.
Sec. 776.033. Appointment of Board in District Located Wholly in One
County.
(a) The commissioners court of a county in which a
single-county district is located shall appoint a five-member
board of emergency commissioners to serve as the district's
governing body. Except as prescribed by Subsection (b), a
commissioner serves a two-year term.
(b) After the votes have been canvassed and the commissioners
court enters the order creating the district, the commissioners
court shall appoint the initial emergency commissioners to serve
until January 1 of the year following the year of the district
election. On January 1, the court shall designate three of those
commissioners to serve two-year terms and two commissioners to
serve one-year terms.
(c) On January 1 of each year, the commissioners court shall
appoint a successor for each emergency commissioner whose term
has expired.
(d) The commissioners court shall fill a vacancy on the board
for the remainder of the unexpired term.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.034. Election of Board in District Located in More Than One
County.
(a) The governing body of a district located in more than one
county consists of a five-person board of emergency commissioners
elected as prescribed by this section. Except as provided by
Subsection (g), an emergency commissioner serves a two-year term.
(b) After a district located in more than one county is
created, the county judges of each county in the district shall
mutually establish a convenient day in November, other than the
date of the general election for state and county officers, to
conduct an election to elect the initial emergency commissioners.
(c) To be eligible as a candidate for emergency commissioner of
a district located in more than one county, a person must be at
least 18 years of age and a resident of the district.
(d) A candidate for emergency commissioner must give the county
clerk of each county in the district a sworn notice of the
candidate's intention to run for office. The notice must state
the person's name, age, and address and state that the person
intends to run for emergency commissioner. On receipt of the
notice, the county clerk shall have the candidate's name placed
on the ballot.
(e) The county clerks of each county in the district shall
jointly appoint an election judge to certify the results of the
election.
(f) After the election is held, the county clerk of each county
or the clerk's deputy shall prepare a sworn statement of the
election costs incurred by the county. The statement shall be
given to the newly elected board, which shall order the
appropriate official to reimburse each county for the county's
election costs.
(g) The initial emergency commissioners' terms of office begin
on January 1 of the year following the year of the election. The
two commissioners who received the fewest votes serve one-year
terms. The other commissioners serve two-year terms.
(h) The general election for commissioner shall be held
annually on an authorized election date as provided by Chapter
41, Election Code.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.035. Powers and Duties of Board.
(a) The board shall:
(1) hold regular monthly meetings and other meetings as
necessary;
(2) keep minutes and records of its acts and proceedings;
(3) file reports as required by the state fire marshal, the
commissioner of health, and other authorized persons;
(4) file a written report not later than February 1 of each
year with the commissioners court regarding the district's
administration for the preceding calendar year and the
district's financial condition; and
(5) administer the district in accordance with this chapter.
(b) The board may require inspections to be made in the
district relating to the causes and prevention of fires, medical
emergencies, or other disasters affecting human life or property.
(c) The board may promote educational programs it considers
necessary to achieve the purposes of this chapter.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Amended by Acts 1989, 71st Leg., 1st C.S., ch. 32, Sec. 7, eff.
Sept. 1, 1989.
Sec. 776.036. Officers of Board.
(a) The emergency commissioners shall elect from among their
members a president, vice-president, secretary, treasurer, and
assistant treasurer to perform the duties usually required of the
respective offices. The office of secretary and treasurer may be
combined.
(b) The treasurer must execute and file with the county clerk a
bond conditioned on the faithful execution of the treasurer's
duties. The treasurer of a district located in more than one
county shall file the bond with the county clerk of the county
with the largest population in the district. The county judge of
the county in which the bond is to be filed shall determine the
amount and sufficiency of the bond before it is filed.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.037. Compensation; Conflict of Interest.
(a) Emergency commissioners serve without compensation but may
be reimbursed for reasonable and necessary expenses incurred in
performing official duties.
(b) Except as a resident or property owner in the district, an
emergency commissioner may not have an interest in a contract or
transaction to which the district is a party and under which the
commissioner may receive money or other things of value as
consideration.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
SUBCHAPTER D. CHANGE IN BOUNDARIES OR DISSOLUTION OF DISTRICT
Sec. 776.051. Expansion of District Territory.
(a) Qualified voters who own taxable real property in a defined
territory that is not included in a district may file a petition
with the secretary of the board requesting the inclusion of the
territory in the district. The petition must be signed by at
least 50 qualified voters who own taxable real property in the
territory or a majority of those voters, whichever is less.
(b) The board by order shall set a time and place for a hearing
on the petition. The hearing must be held not earlier than the
31st day after the date on which the board issues the order.
(c) The secretary of the board shall issue a notice of the
hearing. The notice must contain the time and place for the
hearing and a description of the territory proposed to be annexed
into the district.
(d) Not later than the 16th day before the date on which the
hearing will be held, the secretary shall:
(1) post copies of the notice in three public places in the
district and one public place in the territory proposed to be
annexed into the district; and
(2) publish the notice once in a newspaper of general circulation
in the county.
(e) If after the hearing the board finds that annexation of the
territory into the district is feasible and would benefit the
district, the board may approve the annexation by a resolution
entered in its minutes. The board is not required to include all
of the territory described in the petition if the board finds
that a modification or change is necessary or desirable.
(f) Annexation of territory is final when approved by a majority
of the voters at an election held in the district and by a
majority of the voters at a separate election held in the
territory to be annexed. If the district has outstanding debts
or taxes, the voters in the election to approve the annexation
must also determine if the annexed territory will assume its
proportion of the debts or taxes if added to the district.
(g) The election ballots shall be printed to provide for voting
for or against the following, as applicable:
(1) "Adding (description of territory to be added) to the
____________ Emergency Services District."
(2) "(Description of territory to be added) assuming its
proportionate share of the outstanding debts and taxes of the
____________ Emergency Services District, if it is added to the
district."
(h) The election notice, the manner and time of giving the
notice, and the manner of holding the election are governed by
the applicable provisions of this chapter, except that the board
president shall conduct the election and certify the results to
the county judge of each county in the district.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.052. Removal of Certain Territory by Governing Body of
Municipality.
(a) If territory in a municipality's limits or extraterritorial
jurisdiction is included in a district, the municipality's
governing body may remove that territory from the district if:
(1) the municipality agrees to provide emergency protection
to the territory as prescribed by Section 776.014; or
(2) the territory is designated an industrial district under
Section 42.044, Local Government Code.
(b) To remove territory, the governing body of the municipality
must notify the secretary of the board in writing that the
territory is excluded from the district's territory.
(c) If a municipality that is not in the district annexes
territory that is included in a district, the governing body of
the municipality shall notify the secretary of the board in
writing that the annexed territory is excluded from the
district's territory.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.053. Petition for Dissolution; Notice of Hearing.
(a) Before a district may be dissolved, the district's board
must receive a petition signed by at least 100 qualified voters
who own taxable real property in the district or a majority of
those voters, whichever is less.
(b) If the petition is in proper form, the board shall set a
place, date, and time for a hearing to consider the petition.
(c) The board shall issue a notice of the hearing that
includes:
(1) the name of the district;
(2) a description of the district's boundaries;
(3) the proposal that the district be dissolved; and
(4) the place, date, and time of the hearing on the
petition.
(d) The notice shall be published in a newspaper of general
circulation in the district once a week for two consecutive
weeks. The first publication must occur not later than the 21st
day before the date on which the hearing will be held.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.054. Hearing.
(a) At the hearing on the petition to dissolve the district,
the board shall consider the petition and each issue relating to
the dissolution of the district.
(b) Any interested person may appear before the board to
support or oppose the dissolution.
(c) The board shall grant or deny the petition.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.055. Appeal.
A person in the district or an owner of real or personal
property located in the district may appeal the board's decision
on dissolution of the district. The person or owner must file
the appeal in a district court in a county in which the district
is located.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.056. Election to Confirm Dissolution.
(a) On the granting of a petition to dissolve the district, the
board shall order an election to confirm the district's
dissolution.
(b) Notice of the election shall be given in the same manner as
the notice of the petition hearing.
(c) The election shall be held on the first authorized uniform
election date prescribed by the Election Code that allows
sufficient time to comply with the requirements of law.
(d) The ballot shall be printed to provide for voting for or
against the following: "Dissolving the ____________ Emergency
Services District."
(e) A copy of the tabulation of results shall be filed with the
county clerk of each county in which the district is located.
(f) If a majority of those voting at the election vote to
dissolve the district, the board shall proceed with dissolution.
An election to create a new district within the boundaries of the
old district may not be held before the first anniversary of the
date of dissolution.
(g) If a majority of those voting at the election vote against
dissolving the district, the board may not order another election
on the issue before the first anniversary of the date of the
canvass of the election.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.057. Administration of Property, Debts, and Assets After
Dissolution.
(a) After a vote to dissolve a district, the board shall
continue to control and administer the debts, property, and other
assets of the district until all assets have been disposed of and
all district debts have been satisfied.
(b) The board may not dispose of the district's assets except
for appropriate consideration unless the debts are transferred to
another governmental entity or agency within or embracing the
district and the transfer will benefit the district's citizens.
(c) After the board issues the dissolution order, the board
shall:
(1) determine the amount of debt owed by the district in
excess of the district's assets; and
(2) impose on the property included in the district's tax
rolls a tax that is in proportion of the debt to the property
value.
(d) Each taxpayer may pay the tax imposed by the district under
this section at once.
(e) The board may institute a suit to enforce payment of taxes
and to foreclose liens to secure the payment of taxes due the
district.
(f) When all outstanding debts of the district are paid, the
board shall order the secretary to return the pro rata share of
all unused tax money to each district taxpayer. A taxpayer may
request that the amount of the taxpayer's share of surplus tax
money be credited to the taxpayer's county taxes. If a taxpayer
requests the credit, the board shall direct the secretary to pay
that amount to the county tax assessor-collector.
(g) After the district has paid all its debts and has disposed
of all its assets as prescribed by this section, the board shall
file with the commissioners court of each county in which the
district is located a written report setting forth a summary of
the board's actions in dissolving the district. Not later than
the 10th day after it receives the report and determines that the
requirements of this section have been fulfilled, the
commissioners court of each county shall enter an order
dissolving the district.
(h) Each emergency commissioner is discharged from liability
under the emergency commissioner's bond on entry of the
dissolution order under Subsection (g).
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
SUBCHAPTER E. FINANCES AND BONDS
Sec. 776.071. Limitation on Indebtedness.
Except as provided by Section 776.072 and Sections
776.076-776.081, a district may not contract for an amount of
indebtedness in any one year that is in excess of the funds then
on hand or that may be paid from current revenues for the year.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.072. Depositories.
(a) The board shall designate one or more banks to serve as
depositories for district funds.
(b) The board shall deposit all district funds in its
depository, except that the board:
(1) may deposit funds pledged to pay bonds or notes with a
bank named in the trust indenture or in the bond or note
resolution; and
(2) shall remit funds for the payment of the principal of
and interest on bonds and notes to the bank of payment.
(c) The district may not deposit funds in a depository or
trustee bank in an amount that exceeds the maximum amount secured
by the Federal Deposit Insurance Corporation unless the excess
funds are secured in the manner provided by law for the security
of county funds.
(d) The resolution or trust indenture securing the bonds or
notes may require that some or all of the funds must be secured
by obligations of or unconditionally guaranteed by the federal
government.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.073. Method of Payment.
(a) District funds may be disbursed only by check signed by the
treasurer and countersigned by the president. If the treasurer
is unavailable, the assistant treasurer may sign for the
treasurer. If the president is unavailable, the vice-president
may sign for the president.
(b) An expenditure of more than $2,000 may not be paid from tax
money unless a sworn itemized account covering the expenditure is
presented to the board and the board approves the expenditure.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.074. Competitive Bids Requirement.
(a) The board must submit to competitive bids an expenditure of
more than $15,000 for the purchase or lease of:
(1) one item or service; or
(2) more than one of the same or a similar type of items or
services in a fiscal year.
(b) The board shall notify at least 10 suppliers, vendors, or
providers of the item or service required and inform them of
bidding procedure. If at least 10 suppliers, vendors, or
providers are not available or known to the board, the board may
give notice to fewer than 10 suppliers, vendors, or providers.
(c) The notice for competitive bidding must:
(1) describe the service to be performed or the item to be
purchased or leased;
(2) state the location at which the bidding documents,
plans, specifications, or other data may be examined; and
(3) state the time and place for submitting bids and the
time and place that bids will be opened.
(d) Bids may be opened only by the board at a public meeting or
by a district officer or employee at a district office.
(e) The board may reject any and all bids. The board shall
award a contract to the lowest responsible bidder. The board may
not award a contract to a bidder who is not the lowest bidder
unless, before the bid is awarded, the lowest bidder is given
notice of the proposed award and an opportunity to appear before
the board or its designated representative and present evidence
concerning the bidder's responsibility.
(f) A contract awarded in violation of this section is void.
(g) This section applies to an expenditure of district tax
revenues by any person or entity, including a volunteer fire
department, for the purchase of services, vehicles, equipment, or
goods.
(h) This section does not apply:
(1) to the purchase or lease of real property;
(2) to an item or service that the board determines can be
obtained from only one source; or
(3) to an emergency expenditure.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Amended by Acts 1993, 73rd Leg., ch. 757, Sec. 4, eff. Sept. 1,
1993.
Sec. 776.075. Ad Valorem Tax.
(a) The board shall annually impose an ad valorem tax on all
real and personal property located in the district and subject to
district taxation for the district's support and the purposes
authorized by this chapter.
(b) If a district issues bonds or notes that are payable wholly
from ad valorem taxes, the board shall, when bonds or notes are
authorized, set a tax rate that is sufficient to pay the
principal of and interest on the bonds or notes as they come due
and to provide reserve funds if prescribed in the resolution
authorizing, or the trust indenture securing, the bonds or notes.
(c) If a district issues bonds or notes that are payable from
ad valorem taxes and from revenues, income, or receipts of the
district, the board shall, when the bonds or notes are
authorized, set a tax rate that is sufficient to pay the
principal of and interest on the bonds and notes and to create
and maintain any reserve funds.
(d) In establishing the rate of the ad valorem tax to be
collected for a year, the board shall consider the money that
will be available to pay the principal of and interest on any
bonds or notes issued and to create any reserve funds to the
extent and in the manner permitted by the resolution authorizing,
or the trust indenture securing, the bonds or notes.
(e) The board shall certify the ad valorem tax rate to the
county tax assessor-collector, who is the assessor-collector for
the district.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Amended by Acts 1989, 71st Leg., 1st C.S., ch. 40, Sec. 4, eff.
Sept. 1, 1989.
Sec. 776.0751. Sales and Use Tax.
(a) A district may adopt a sales and use tax, change the rate
of its sales and use tax, or abolish its sales and use tax at an
election held as provided by Section 776.0752. The district may
impose the tax at a rate of one-half percent, one percent, one
and one-half percent, or two percent. Revenue from the tax may
be used for any purpose for which ad valorem tax revenue of the
district may be used.
(b) Chapter 323, Tax Code, applies to the application,
collection, and administration of the tax imposed under this
section. The comptroller may make rules for the collection and
administration of this tax in the same manner as for a tax
imposed under Chapter 323, Tax Code. Where a county and a
hospital district both impose a sales and use tax, the
comptroller may by rule provide for proportionate allocation of
sales and use tax collections between a county and a hospital
district on the basis of the period of time each tax is imposed
and the relative tax rates.
(c) A district may not adopt a tax under this section or
increase the rate of the tax if as a result of the adoption of
the tax or the tax increase the combined rate of all sales and
use taxes imposed by the district and other political
subdivisions of this state having territory in the district would
exceed two percent at any location in the district.
(d) If the voters of a district approve the adoption of the tax
or an increase in the tax rate at an election held on the same
election date on which another political subdivision of this
state adopts a sales and use tax or approves the increase in the
rate of its sales and use tax and as a result the combined rate
of all sales and use taxes imposed by the district and other
political subdivisions of this state having territory in the
district would exceed two percent at any location in the
district, the election to adopt a sales and use tax or to
increase the rate of the sales and use tax in the district under
this subchapter has no effect.
(e) to (h) Expired.
Added by Acts 1989, 71st Leg., 1st C.S., ch. 40, Sec. 5, eff.
Sept. 1, 1989.
Sec. 776.0752. Sales and Use Tax Election Procedures.
(a) Except as otherwise provided by this subchapter, an
election to adopt or abolish a district's sales and use tax or to
change the rate of the tax is governed by the provisions of
Subchapter E, Chapter 323, Tax Code, applicable to an election to
adopt or abolish a county sales and use tax.
(b) An election is called by the adoption of a resolution by
the board. The board shall call an election if a number of
qualified voters of the district equal to at least five percent
of the number of registered voters in the district petitions the
board to call the election.
(c) At an election to adopt the tax, the ballot shall be
prepared to permit voting for or against the proposition: "The
adoption of a local sales and use tax in (name of district) at
the rate of (proposed tax rate) percent."
(d) At an election to abolish the tax, the ballot shall be
prepared to permit voting for or against the proposition: "The
abolition of the local sales and use tax in (name of district)."
(e) At an election to change the rate of the tax, the ballot
shall be prepared to permit voting for or against the
proposition: "The (increase or decrease, as applicable) in the
rate of the local sales and use tax imposed by (name of district)
from (tax rate on election date) percent to (proposed tax rate)
percent."
Added by Acts 1989, 71st Leg., 1st C.S., ch. 40, Sec. 5, eff.
Sept. 1, 1989.
Sec. 776.0753. Sales and Use Tax Effective Date; Boundary Change.
(a) The adoption or abolition of the tax or change in the tax
rate takes effect on the first day of the first calendar quarter
occurring after the expiration of the first complete calendar
quarter occurring after the date on which the comptroller
receives a notice of the results of the election.
(b) If the comptroller determines that an effective date
provided by Subsection (a) will occur before the comptroller can
reasonably take the action required to begin collecting the tax
or to implement the abolition of the tax or the tax rate change,
the effective date may be extended by the comptroller until the
first day of the next succeeding calendar quarter.
(c) The provisions of Section 321.102, Tax Code, governing the
application of a municipal sales and use tax in the event of a
change in the boundaries of a municipality apply to the
application of a tax imposed under this chapter in the event of a
change in the district's boundaries.
Added by Acts 1989, 71st Leg., 1st C.S., ch. 40, Sec. 5, eff.
Sept. 1, 1989.
Sec. 776.076. Bonds and Notes Authorized.
(a) The board may issue bonds and notes as prescribed by this
chapter to perform any of its powers. Before the board may issue
bonds or notes, the commissioners court of each county in which
the district is located must approve the issuance of the bonds or
notes by a majority vote.
(b) The board may issue bonds and notes in one or more issues
or series that are payable from and secured by liens on and
pledges of:
(1) ad valorem taxes;
(2) all or part of the district's revenues, income, or
receipts; or
(3) a combination of those taxes, revenues, income, and
receipts.
(c) The bonds and notes may be issued to mature serially or
otherwise in not more than 40 years from the date of their
issuance.
(d) Provision may be made for the subsequent issuance of
additional parity bonds or notes or subordinate lien bonds or
notes under terms and conditions stated in the resolution
authorizing the issuance of the bonds or notes.
(e) The bonds, notes, and any interest coupons are investment
securities under Chapter 8, Business & Commerce Code.
(f) The bonds and notes may be:
(1) issued registrable as to principal alone or as to
principal and interest;
(2) made redeemable before maturity;
(3) issued in the form, denominations, and manner and under
the terms provided by the resolution; and
(4) sold in the manner, at the price, and under the terms
provided by the resolution.
(g) The bonds and notes bear interest at rates not to exceed
the maximum rate allowed by Chapter 3, Acts of the 61st
Legislature, Regular Session, 1969 (Article 717k-2, Vernon's
Texas Civil Statutes).
(h) If provided by the resolution, the proceeds from the sale
of the bonds or notes may be used for:
(1) paying interest on the bonds or notes during the period
of the acquisition or construction of a facility to be provided
through the issuance of the bonds or notes;
(2) paying expenses of operation and maintenance of the
facility;
(3) creating a reserve fund to pay the principal of and
interest on the bonds or notes; and
(4) creating other funds.
(i) As provided in the resolution, proceeds from the sale of
the bonds and notes may be placed on time deposit or invested
until needed.
(j) If the bonds or notes are issued payable by a pledge of
revenues, income, or receipts, the district may pledge all or
part of its revenues, income, or receipts from fees, rentals,
rates, charges, and proceeds and payments from contracts to the
payment of the bonds or notes, including the payment of principal
of, interest on, and other amounts required or permitted in
connection with the bonds or notes. The pledged fees, rentals,
rates, charges, proceeds, and payments must be established and
collected in amounts that, together with any other pledged
resources, will be at least sufficient to provide for:
(1) all payments of principal of, interest on, and other
amounts required in connection with the bonds or notes; and
(2) the payment of expenses in connection with the bonds or
notes and the operation, maintenance, and other expenses in
connection with the facilities to the extent required by the
resolution authorizing, or the trust indenture securing, the
issuance of the bonds or notes.
(k) The district shall impose a tax as prescribed by Section
776.075 if the bonds or notes are payable wholly or partly from
ad valorem taxes.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.077. Election to Approve Bonds and Notes.
(a) A district may not authorize bonds and notes secured in
whole or in part by taxes unless a majority of the district's
qualified voters who vote at an election called for that purpose
approve the issuance of the bonds and notes.
(b) The board may order an election on the bonds and notes.
The order must contain the same information contained in the
notice of the election.
(c) The board shall publish notice of the election at least
once in a newspaper of general circulation in the district. The
notice must be published not later than the 31st day before
election day.
(d) In addition to the contents of the notice required by the
Election Code, the notice must state:
(1) the amount of bonds or notes to be authorized; and
(2) the maximum maturity of the bonds or notes.
(e) At an election to approve bonds or notes payable wholly
from ad valorem taxes, the ballots must be printed to provide for
voting for or against the following: "The issuance of (bonds or
notes) and the levy of taxes for payment of the (bonds or
notes)."
(f) At an election to approve bonds or notes payable from both
ad valorem taxes and revenues, the ballots must be printed to
provide for voting for or against the following: "The issuance
of (bonds or notes) and the pledge of net revenues and the levy
of ad valorem taxes adequate to provide for the payment of the
(bonds or notes)."
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.078. Bond Anticipation Notes.
(a) A district at any time may issue bond anticipation notes to
carry out one or more of its powers.
(b) The bond anticipation notes may be secured by a pledge of
all or part of the district's ad valorem taxes and revenues,
income, or receipts.
(c) A district may at any time authorize the issuance of bonds
to provide proceeds to pay the principal of and interest on bond
anticipation notes. The bonds must be secured by a pledge of all
or part of the district's ad valorem taxes or revenues, income,
or receipts and may be issued on a parity with or subordinate to
outstanding district bonds.
(d) If the resolution authorizing the issuance of, or the trust
indenture securing, the bond anticipation notes includes a
covenant that the notes are payable from the proceeds of the
subsequently issued bonds, it is not necessary for the district
to demonstrate, in order to receive the approval of the attorney
general or registration by the comptroller, that the ad valorem
taxes or revenues, income, or receipts that may be pledged to
payment of the notes will be sufficient to pay the principal of
and interest on the notes.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.079. Refunding Bonds.
(a) A district may refund or refinance bonds or notes issued
under this chapter by issuing refunding bonds for the purpose and
under the terms determined by the board.
(b) This chapter is applicable to the refunding bonds, and the
refunding bonds shall be issued in the manner provided by this
chapter for issuing other bonds.
(c) Refunding bonds may be sold and delivered in amounts
necessary to pay the principal of, interest on, and redemption
premium, if any, for bonds to be refunded at maturity or on a
redemption date.
(d) The refunding bonds may be issued in exchange for the bonds
being refunded, and the comptroller shall register the refunding
bonds and deliver them to each holder of the bonds being refunded
as provided by the resolution authorizing the refunding bonds.
The exchange may be made in one delivery or in several
installment deliveries.
(e) The bonds and notes issued by the district may be refunded
in the manner provided by other applicable state law.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.080. Approval and Registration of Bonds.
(a) The district shall submit the bonds, notes, and bond
anticipation notes issued under this chapter, and the appropriate
proceedings authorizing their issuance, to the attorney general
for examination.
(b) If the bonds, notes, or bond anticipation notes state that
they are secured by a pledge of contract revenues, the district
may submit a copy of the contract and the proceedings relating to
the contract to the attorney general.
(c) The attorney general shall approve the bonds, notes, or
bond anticipation notes and any submitted contract if the
attorney general finds that the bonds, notes, or bond
anticipation notes are authorized as provided by law, and that
the contract, if submitted, is made as provided by law.
(d) On approval by the attorney general, the comptroller shall
register the bonds, notes, or bond anticipation notes.
(e) After approval and registration, the bonds, notes, or bond
anticipation notes and the contract are incontestable in a court
or other forum for any reason and are valid and binding
obligations in accordance with their terms for all purposes.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989.
Sec. 776.081. Bonds as Investments and Security for Deposits.
(a) District bonds and notes are legal and authorized
investments for:
(1) a bank;
(2) a savings bank;
(3) a trust company;
(4) a savings and loan association;
(5) an insurance company;
(6) a fiduciary;
(7) a trustee;
(8) a guardian; and
(9) a sinking fund of a municipality, county, school
district, or other political corporation or subdivision of the
state.
(b) District bonds and notes are eligible to secure the deposit
of public funds of the state and of municipalities, counties,
school districts, or other political corporations or subdivisions
of the state. The bonds and notes are legal and sufficient
security for deposits to the extent of their value, and if in
coupon form, when accompanied by all unmatured coupons.
Acts 1989, 71st Leg., ch. 678, Sec. 1, eff. Sept. 1, 1989