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TexasHB 565089th Legislature Regular SessionHouseWALLET

Relating to the creation of the Travis County Municipal Utility District No. 40; granting a limited power of eminent domain; providing authority to issue bonds; providing authority to impose assessments, fees, and taxes.

Sponsored By: Lulu Flores, Judith Zaffirini (Democratic)

Became Law

TRAVIS COUNTY MUNICIPAL UTILITY DISTRICT NO. 40Special Districts & Authorities--Municipal Utility DistrictsSpecial Districts & Authorities--Water & Utility

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Bill Overview

Analyzed Economic Effects

5 provisions identified: 2 benefits, 2 costs, 1 mixed.

District borrowing brings taxes and limits

The district can fund its work with bonds backed by property taxes, impact fees, revenues, contract payments, grants, or other district money. Property taxes and tax-backed bonds require voter approval; some debt backed by other revenues or qualifying contract payments needs no election. Tax-backed road bonds require approval from two-thirds of district voters who vote in the election. Tax-backed road debt cannot exceed 25% of the assessed value of district real property. For bonds backed wholly or partly by property taxes, the board must provide a yearly tax until all debt is repaid. That repayment tax has no rate or amount limit; the road debt cap does not cap a homeowner's tax bill.

District roads must meet local standards

The district can finance, build, improve, operate, and maintain roads and related storm drainage. It can transfer roads to Texas, a county, or a city for operation and upkeep. Projects must follow applicable city construction, zoning, subdivision, and consent rules; county standards apply outside city limits and extended jurisdiction. The Texas Transportation Commission must approve plans for roads the state will operate and maintain. The law does not require a project or set its cost or schedule.

New utility district in Travis County

The law creates Travis County Municipal Utility District No. 40 to provide water, wastewater, drainage, and related utility services. Its 56.62 acres include three tracts of 21.95, 20.79, and 13.88 acres. Five elected directors serve staggered four-year terms. A confirmation election requires consent from each city whose limits or extended jurisdiction includes district land. Owners holding a majority of assessed property value can petition the Texas Commission on Environmental Quality for temporary directors. Temporary directors serve until permanent directors are elected or until the law's fourth anniversary, whichever comes first. Those owners can petition for replacements if temporary terms expire before permanent directors are elected. Minor survey or boundary errors do not invalidate the district or its taxing and borrowing powers. The law ties immediate effect to approval by two-thirds of all elected members in each legislative chamber; otherwise, it takes effect September 1, 2025. It also requires an express ban on eminent domain if that legislative vote threshold was not met.

Contract taxes can fund district payments

The district can impose a separate tax to make contract payments after voters approve the contract terms. Approval requires a majority of district voters voting in an election held for that purpose. The approved contract can let the board change its terms without another vote, potentially changing payment obligations. This is separate from the upkeep tax, and the law specifies no rate or individual tax bill.

Voters can approve district upkeep taxes

The district can tax taxable property for operations and upkeep only after voters approve the tax. The board sets the rate but cannot exceed the rate voters approved. The law sets no rate or estimated household tax bill.

Sponsors & Cosponsors

Sponsors

  • Lulu Flores

    House

  • Judith Zaffirini

    Democratic • Senate

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 13 • No: 0

Senate vote • 5/28/2025

Record vote

Yes: 0 • No: 0

Senate vote • 5/28/2025

Record vote

Yes: 0 • No: 0

House vote • 5/7/2025

Record vote

Yes: 0 • No: 0

House vote • Unknown

Committee vote: Land & Resource Management

Yes: 7 • No: 0

Senate vote • Unknown

Committee vote: Local Government

Yes: 6 • No: 0

Actions Timeline

  1. Effective immediately

    6/20/2025House

  2. Filed without the Governor's signature

    6/20/2025House

  3. Sent to the Governor

    5/31/2025House

  4. Signed in the Senate

    5/31/2025Senate

  5. Signed in the House

    5/30/2025House

  6. Reported enrolled

    5/30/2025House

  7. Senate passage reported

    5/29/2025House

  8. Record vote

    5/28/2025Senate

  9. Passed

    5/28/2025Senate

  10. Read 3rd time

    5/28/2025Senate

  11. Record vote

    5/28/2025Senate

  12. Three day rule suspended

    5/28/2025Senate

  13. Vote recorded in Journal

    5/28/2025Senate

  14. Read 2nd time & passed to 3rd reading

    5/28/2025Senate

  15. Laid before the Senate

    5/28/2025Senate

  16. Placed on local & uncontested calendar

    5/28/2025Senate

  17. Corrected comm. report printed & distributed

    5/23/2025Senate

  18. Committee report printed and distributed

    5/22/2025Senate

  19. Recommended for local & uncontested calendar

    5/22/2025Senate

  20. Reported favorably w/o amendments

    5/22/2025Senate

  21. Vote taken in committee

    5/22/2025Senate

  22. Considered in public hearing

    5/22/2025Senate

  23. Referred to Local Government

    5/21/2025Senate

  24. Read first time

    5/21/2025Senate

  25. Received from the House

    5/8/2025Senate

Bill Text

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