HomeMy WebLinkAboutR2006-032S:\Our Documents\Resolutions\06\TML Resolution - Special District in ETJ.doc
RESOLUTION NO.ZOOh -0,52
RESOLUTION OF THE CITY OF DENTON REQUESTING THE TEXAS MUNICIPAL
LEAGUE TO SUPPORT LEGISLATION TO PLACE A MORATORIUM ON THE
CREATION OF CERTAIN SPECIAL DISTRICTS UNTIL THE STATE LEGISLATURE CAN
APPOINT A TASK FORCE TO STUDY THEIR ADVERSE AFFECTS; AND PROVIDING
FOR AN EFFECTIVE DATE.
WHEREAS, the Texas Municipal League will hold its annual conference on October 25 -
27, in Austin, Texas; and
WHEREAS, certain non-educational special districts were originally formed to allow
rural areas to obtain adequate water and sewer supplies in areas not served by municipalfacilities; and
WHEREAS, in conjunction with the reduction in city authority to annex and vested rights
legislation designed to protect developers, developers of dense urban developments in rural Extra
Territorial Jurisdiction (ETJ) areas are using this special district legislation to create mini-quasipoliticalsubdivisionsintheETJ's of cities; and
WHEREAS, the incentive for creating special districts is that the developer obtains
public financing where all of his development costs are reimbursed on the front end when the
bonds for special district infrastructure are sold, and the bond holders are paid back through ad
valorem taxes assessed against the future homeowners that are typically at a tax rate that is
dramatically higher than normal city tax rates; and
WHEREAS, if the city decides to annex the special district area it must assume the
district's debt, thus putting the city in the position of having to pay for infrastructure through amuchlowertaxrateandtherefore, is a disincentive to annex the area until the debt is paid off,thereby further eroding the city's ability to annex area within its ETJ; and
WHEREAS, these districts typically propose very dense development in rural areas that
are not compatible with the life style of the area, and persons that live in these areas of the ETJ
commonly complain that they want their rural life style to be preserved, and cities are better
suited to look out for the public interest in these ETJ areas; and
WHEREAS, cities are not allowed to apply there zoning controls in the ETJ, counties
generally have no zoning controls, and there are no regional or state authorities that have zoningpowerinETJ's, thus under current law cities only have two options, try to negotiate a
development agreement with the developer proposing the special district or institute involuntaryannexationproceedings; and
WHEREAS, a city's ability to involuntary annex property in the ETJ has been greatlycurtailedbystatelaw, and it is often difficult to negotiate a favorable agreement because of the
SAOur Documents\Resolutions\06\TML Resolution - Special District in ETJ.doc
vested rights laws that lock in development rights once any kind of application is filed; NOW,THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY RESOLVES:
SECTION 1. The City Council requests the Texas Municipal League to supportlegislationthatwouldplaceamoratoriumonthecreationofcertainnon-educational specialdistrictsuntilthestatelegislaturecanappointataskforcetostudytheiradverseaffects.
SECTION 2. The City Manager is authorized to forward a copy of this resolution to Mr.
Frank Sturzl, Executive Director of the Texas Municipal League.
SECTION 3. This resolution shall become effective immediately upon its passage and
approval.
PASSED AND APPROVED this the day of 2006.
t Y It
PE McNEILL, MAYOR
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
BY:/~
APPROVED AS TO LEGAL FORM:
EDWIN M. SNYDER, CITY ATTORNEY
BY:
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