Relating to the authority of the Harris County Municipal Utility District No. 405 to exclude territory; validating and confirming all previous acts of the district, the official text

H.B. No. 5699

AN ACT

relating to the authority of the Harris County Municipal Utility

District No. 405 to exclude territory; validating and confirming

all previous acts of the district.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Subtitle F, Title 6, Special District Local Laws

Code, is amended by adding Chapter 8024A to read as follows:

CHAPTER 8024A. HARRIS COUNTY MUNICIPAL UTILITY DISTRICT NO. 405

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 8024A.0101. DEFINITIONS. In this chapter:

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

(2) "District" means the Harris County Municipal

Utility District No. 405.

SUBCHAPTER B. POWERS AND DUTIES

Sec. 8024A.0201. EXCLUSION OF PROPERTY BY CONTRACT. (a)

Notwithstanding any other law, the district may enter into a

written contract with an owner of undeveloped property in the

district to exclude the property from the district on terms and

conditions the board considers advantageous for the district.

(b) The district may issue an order excluding the property

from the district only if the terms and conditions of the contract

are satisfied. The district shall record a copy of the order in the

real property records of Harris County.

(c) Except as provided by the contract described by

Subsection (a) and Section 8024A.0202, on issuance of the order,

the excluded property is no longer part of the district and is not

entitled to any services from the district.

Sec. 8024A.0202. EFFECT OF EXCLUSION ON INDEBTEDNESS AND

TAXES. (a) Until a property's pro rata share of the district's

indebtedness is paid in full after the property is excluded from the

district under Section 8024A.0201:

(1) the excluded property's pro rata share of the

district's indebtedness remains the obligation of the owner of the

excluded property and continues to be secured by statutory liens on

the excluded property;

(2) the district shall continue to levy and collect

debt service taxes each year on the excluded property at the same

rate levied on other property in the district; and

(3) the taxes collected under Subdivision (2) remain

pledged as security for the district's indebtedness and shall be

applied exclusively to the payment of the excluded property's pro

rata share of the district's indebtedness.

(b) The contract for exclusion must state the amount of or a

method of determining the excluded property's pro rata share of the

district's indebtedness.

(c) The owner of any part of the excluded property at any

time may pay in full the remaining unpaid portion of the excluded

property's pro rata share of the district's indebtedness.

(d) On payment in full of the excluded property's pro rata

share of the district's indebtedness, the excluded property is

released from payment of the district's debt service taxes.

Sec. 8024A.0203. RIGHTS OF BONDHOLDERS. The exclusion of

property from the district under Section 8024A.0201 does not

diminish or impair the rights of the holders of any outstanding and

unpaid bonds, warrants, or other certificates of indebtedness of

the district.

Sec. 8024A.0204. RELIANCE ON PRIOR ELECTION.

Notwithstanding any other law, the district may issue any unissued

additional bonds, notes, or other obligations approved by voters of

the district before the exclusion of property from the district

under Section 8024A.0201 without holding a new election to

authorize the issuance of the bonds, notes, or other obligations.

SECTION 2. The Harris County Municipal Utility District

No. 405 retains all the rights, powers, privileges, authority,

duties, and functions that it had before the effective date of this

Act.

SECTION 3. (a) The legislature validates and confirms all

governmental acts and proceedings of the district that were taken

before the effective date of this Act.

(b) This section does not apply to any matter that on the

effective date of this Act:

(1) is involved in litigation if the litigation

ultimately results in the matter being held invalid by a final court

judgment; or

(2) has been held invalid by a final court judgment.

SECTION 4. (a) The legal notice of the intention to

introduce this Act, setting forth the general substance of this

Act, has been published as provided by law, and the notice and a

copy of this Act have been furnished to all persons, agencies,

officials, or entities to which they are required to be furnished

under Section 59, Article XVI, Texas Constitution, and Chapter 313,

Government Code.

(b) The governor, one of the required recipients, has

submitted the notice and Act to the Texas Commission on

Environmental Quality.

(c) The Texas Commission on Environmental Quality has filed

its recommendations relating to this Act with the governor, the

lieutenant governor, and the speaker of the house of

representatives within the required time.

(d) All requirements of the constitution and laws of this

state and the rules and procedures of the legislature with respect

to the notice, introduction, and passage of this Act are fulfilled

and accomplished.

SECTION 5. 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, 2025.

______________________________
______________________________

President of the Senate
Speaker of the House

I certify that H.B. No. 5699 was passed by the House on May

16, 2025, by the following vote: Yeas 91, Nays 40, 2 present, not

voting.

______________________________

Chief Clerk of the House

I certify that H.B. No. 5699 was passed by the Senate on May

27, 2025, by the following vote: Yeas 28, Nays 3.

______________________________

Secretary of the Senate

APPROVED: _____________________

Date

_____________________

Governor