Read the full stored bill text
An Act
ENROLLED SENATE
BILL NO. 2060 By: Haste and Mann of the
Senate
and
Lawson, Caldwell (Trey),
and Hefner of the House
An Act relating to improvement districts; amending 11
O.S. 2021, Sections 39-101, 39-102, and 39-103, which
relate to short title, definitions, and creation of
certain districts; modifying short title; modifying
definitions; providing for the creation of master
development districts upon certain approval;
establishing requirements and procedures for approval
of applications for the creation of certain
districts; allowing protests of approvals within
specified time period; authorizing districts to adopt
rules and bylaws; requiring inclusion of certain
provisions in governing document; granting certain
rights and powers to board of supervisors of master
development districts; authorizing lien on real
property for assessments levied by the master
development districts; authorizing districts to make
certain improvements; construing provisions;
requiring obligations be payable from certain
sources; authorizing districts to take certain
actions related to works or improvements; granting
districts certain contracting authority; requiring
certain parties enter into a master development
agreement; establishing requirements for master
development agreements; directing the State Treasurer
to develop certain template; authorizing certain
covenants; amending 11 O.S. 2021, Section 39-115,
which relates to the issuance of certain bonds;
authorizing the issuance of certain bonds by
districts; modifying and specifying applicability of
certain provisions; updating statutory language;
ENR. S. B. NO. 2060 Page 2
prohibiting certain utility ownership or services
from being provided; providing for codification; and
providing an effective date.
SUBJECT: Improvement districts
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 11 O.S. 2021, Section 39-101, is
amended to read as follows:
Section 39-101. This act shall be known and may be cited as the
Improvement District Act "Building Utilities and Infrastructure for
Long-term Development (BUILD) Act".
SECTION 2. AMENDATORY 11 O.S. 2021, Section 39-102, is
amended to read as follows:
Section 39-102. As used in the Improvement District Building
Utilities and Infrastructure for Long-term Development (BUILD) Act,
the singular includes the plural and:
1. "Acquired" means the acquisition of property or interests in
property by purchase, gift, condemnation or other lawful means;
2. "City" means any city or town incorporated pursuant to the
laws of Oklahoma this state;
3. "Engineer" means a city engineer, city official, employee or
other person competent to advise and assist the governing body in
planning and making an improvement;
4. "Cost" means any cost necessarily or reasonably incurred in
making the improvement, including, but not limited to, cost of:
a. preparation of preliminary reports,
b. preparation of plans and specifications,
ENR. S. B. NO. 2060 Page 3
c. preparation and publication of notices of hearings,
resolutions, ordinances and other proceedings,
d. fees and expenses for engineers, attorneys, laborers
and other personal services,
e. rights-of-way, materials and other lawful expenses
incurred in making any improvement, and
f. capitalized interest, funding of reserves, premiums
for reserve surety bonds, and obtaining bond
insurance, letters of credit or other credit
enhancements or liquidity instruments;
5. 4. "District" means an area designated by the governing body
to be benefited by an improvement and subjected to payment of
special assessments for all or a portion of the cost of the
improvement district or a master development district. Any
reference in the BUILD Act to a district shall be construed to refer
to the specific entity created under Section 39-103 of this title.
Any power, duty, or authority granted to a district or the governing
body of the district shall be exercised independently by the board
of supervisors for a master development district, and by the
municipal governing body for an improvement district;
5. "Engineer" means a city engineer, city official, employee,
or other qualified person employed by a public or private entity who
is competent to advise and assist the governing body of a city or
master development district in planning and making an improvement;
6. "Governing body" means the city council, city commission or
board of trustees of an incorporated city or town, or the board of
supervisors of a master development district;
7. "Governing document" means the document governing the
creation of an improvement district or master development district;
8. "Improve" means to construct, reconstruct, maintain,
restore, replace, renew, repair, install, equip, extend, purchase,
alter or otherwise perform any work which provides a new facility,
or enhances, extends or restores the value or usefulness of an
existing facility;
ENR. S. B. NO. 2060 Page 4
8. 9. "Improvement" means any type of improvement made by
authority of this Improvement District the BUILD Act and includes
reimprovement of any prior improvement made pursuant to the BUILD
Act or any other act;
10. "Improvement district" means an area designated by the
governing body of a city to be benefited by an improvement and
subjected to payment of special assessments for all or a portion of
the cost of the improvement;
11. "Improvement plan" means a comprehensive report prepared by
an engineer outlining the proposed improvements, a preliminary plat
or map of the district, an estimate of costs, and a plan for the
financing, construction, and maintenance of the improvements;
9. 12. "Mail" means by first-class mail;
13. "Master development district" means an area within a city,
municipality, or unincorporated area of a county with defined limits
and boundaries that operates separately and distinctly from the
city, municipality, or county and is subject to the provisions of
the BUILD Act including, but not limited to, special assessments
against real property in such district benefited by an improvement
for the financing, repayment, or maintenance of the costs of the
master development district's public improvements;
14. "Publish" or "publication" means printing in a newspaper
which maintains an office in the city or town and is of general
circulation within the city or town, or, if there is no newspaper
which maintains an office in the city or town, a newspaper of
general circulation within the city or town and in two separate
issues thereof, at least seven (7) days apart;
15. "Street" means any highway, street, alley, boulevard,
avenue, right-of-way, public ground, or other public facility, or
any part thereof;
16. "Surface property owner" means the owner or owners of
record of the surface of the property included in a proposed master
development district or improvement district; and
ENR. S. B. NO. 2060 Page 5
10. 17. "Trustee" means a city or master development district
acting pursuant to this act;
11. "Street" means any highway, street, alley, boulevard,
avenue, right-of-way, public ground, or other public facility, or
any part thereof; and
12. "Publish" or "publication" means printing in a newspaper
which maintains an office in the city or town and is of general
circulation within the city or town, or, if there is no newspaper
which maintains an office in the city or town, a newspaper of
general circulation within the city or town and in two (2) separate
issues thereof, at least seven (7) days apart the BUILD Act.
SECTION 3. AMENDATORY 11 O.S. 2021, Section 39-103, is
amended to read as follows:
Section 39-103. A. The governing body of any city may create
one or more improvement districts for the purpose of making or
causing to be made any improvement or combination of improvements
that confer special benefit upon property within the district.
B. A master development district shall be created upon the
approval of an application to the relevant governing body of a city
or county in which the proposed master development district is
situated, pursuant to the conditions in this subsection. Upon
receipt of an application for a proposed master development
district, the governing body of any city or board of county
commissioners of any county may approve the creation of the master
development district if the applicant demonstrates the following:
1. One hundred percent (100%) of the surface owners within the
boundaries of the proposed master development district have
consented in writing to its creation and approved the master
development district's governing document and improvement plan;
2. The governing document prepared by the applicant includes
all of the provisions in subsection F of this section;
3. An improvement plan for the district that is conducive to
the long-term development of the city or county, as determined by
ENR. S. B. NO. 2060 Page 6
the governing board of the city or board of county commissioners of
the county; and
4. Nothing in the improvement plan interferes with a city or
county's ability to protect infrastructure, comprehensive planning,
zoning, or any other requirements the city or county shall impose
through contracts between the governing bodies and the applicant of
the proposed master development district.
C. If the proposed master development district is located
wholly within an unincorporated area of a county, the county may
approve the creation of the master development district by vote of
the board of county commissioners or other county entity designated
by the board of county commissioners, under the same conditions
provided in this section. If the proposed master development
district is located wholly within the municipal limits of a city,
the city may approve the creation of the master development district
by vote of the governing body of the city. If the proposed master
development district is partially within an unincorporated area of a
county and partially within the municipal limits of a city,
application for the proposed master development district shall be
made to both the board of county commissioners and the city, and
approval by both shall be required for the creation of the master
development district.
D. Any protest challenging the creation of a master development
district shall be filed within ten (10) business days following the
official approval of the district by the governing body, unless
otherwise preempted by law.
E. A master development district may adopt its own bylaws,
rules, and regulations for the conduct of its business and the use
of its facilities.
F. A master development district's governing document shall
create an independent board of supervisors, which shall be the
governing body of the master development district. The governing
document shall include provisions that:
1. Restrict members of the independent board of supervisors and
their immediate family members from holding an interest in any bond
or other securities issued by the board; and
ENR. S. B. NO. 2060 Page 7
2. Delineate provisional officers of the board and a process
for transferring control of the board to surface property owners of
the district within a reasonable time frame, not to exceed ten (10)
years from the initial board appointments.
G. The board of supervisors of a master development district
shall have the same rights and powers over a master development
district that the governing body of a city has over improvement
districts, and shall have such other rights and powers as may be
provided by law. The board of supervisors of a master development
district shall have the power to levy, impose, and collect special
assessments on the property within the district for the purpose of
financing, operating, maintaining, repairing, or replacing district
improvements, including the cost of bonds, reserves, and other
obligations incurred by the district. All assessments levied by the
master development district pursuant to the Building Utilities and
Infrastructure for Long-term Development (BUILD) Act shall
constitute a lien on the real property against which it is assessed
from the date of the levy until paid, equal to the lien of all
state, county, and municipal taxes, including ad valorem, and senior
to all other liens or encumbrances, including mortgage liens.
H. The governing body of an improvement district or the board
of supervisors of a master development district may make such
improvements or combinations of improvements as it deems beneficial
to the district. Such improvement or combination of improvements
may include the following, without limitation because of
enumeration:
1. Acquisition of property or interest in property when
necessary for any of the purposes authorized by the Improvement
District BUILD Act;
2. Opening, creating, widening and extending or altering of
streets to improve paving, and surfacing, constructing and
reconstructing gutters, curbs, sidewalks, crosswalks, driveway
entrances and structures, drainage facilities, and service
connections from sewers, water, gas, electricity and other utility
mains, conduits or pipes;
ENR. S. B. NO. 2060 Page 8
3. Constructing or improving main and lateral storm water
drains and sanitary sewer systems and facilities;
4. Installation or improvement of street lights and street
lighting systems;
5. Construction or improvement of water mains and waterworks
systems;
6. Improvement of parks, playgrounds, and recreational
facilities;
7. Improvement of any street, parking or other facility by
landscaping, or planting of trees, shrubs and other plants;
8. Constructing or improving dikes, levees and other flood
control works, gates, lift stations, bridges and streets appurtenant
thereto;
9. Constructing or improving vehicle and pedestrian bridges,
overpasses and tunnels;
10. Constructing or improving retaining walls and area walls on
public ways or land abutting thereon;
11. Constructing or improving property for off-street parking
facilities, including construction and equipment of buildings
thereon;
12. Constructing or improving pedestrian malls; or
13. Acquiring, constructing, or improving libraries; or
14. Constructing or improving offsite facilities or
infrastructure serving all or a portion of land within a district;
notwithstanding that, such facilities or infrastructure may also
serve areas outside a district, but subject to cost apportionment
requirements of subsection A of Section 39-110 of this title.
Nothing in the BUILD Act shall be construed as authorizing a
master development district to pledge the full faith and credit of
the state or any political subdivision. Obligations of the district
ENR. S. B. NO. 2060 Page 9
shall be payable solely from the revenues and assessments of the
master development district.
SECTION 4. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 39-103.2 of Title 11, unless
there is created a duplication in numbering, reads as follows:
A. An improvement district or master development district is
authorized to purchase, construct, acquire, own, operate, maintain,
repair, improve, or extend inside and outside its boundaries any and
all works, improvements, facilities, plants, equipment, and
appliances necessary to accomplish the purposes of the district
authorized by law, including all works, improvements, facilities,
plants, equipment, and appliances incident, helpful, or necessary
to:
1. Supply water for municipal uses, domestic uses, power,
commercial purposes, and all other beneficial uses or controls;
2. Collect, transport, process, dispose of, and control all
domestic, industrial, or commercial wastes whether in fluid, solid,
or composite state;
3. Gather, conduct, divert, and control local storm water or
other local harmful excesses of water in a district;
4. Irrigate the land in a district;
5. Alter land elevation in a district; and
6. Navigate waters of the district.
B. An improvement district or master development district may
enter into contracts with public or private entities for the
construction, operation, management, maintenance, or provision of
facilities and services related to district facilities and
improvements.
C. To ensure the financial stability and legal status of a
master development district and the security of its assessments, the
governing body of the approving city or board of county
commissioners of the approving county, or both, as provided in
ENR. S. B. NO. 2060 Page 10
subsection C of Section 39-103 of Title 11 of the Oklahoma Statutes,
and the board of supervisors of the master development district
shall enter into a master development agreement.
1. The master development agreement shall constitute a binding
contract and shall legally vest in the master development district
development rights including, but not limited to, permitted uses,
densities, phasing schedules, development standards, and intensities
of use, for the duration of the master development district's
existence. The city or county shall not unilaterally apply
subsequent changes to zoning, land-use regulations, impact fees, or
building codes that substantially impair the master development
district's ability to generate the revenue necessary to service its
bonded indebtedness.
2. The city or county shall finalize and execute the master
development agreement within sixty (60) days of the date the master
development district is created by vote of the applicable governing
body; provided, such timeline may be extended by mutual agreement of
the city or county and the master development district. To ensure
statewide consistency and reduce administrative delay, the State
Treasurer, in consultation with the Council of Bond Oversight, the
Oklahoma Development Finance Authority, and any other officials
needed, shall develop and make publicly available a Standard Master
Development Agreement template to serve as the required basis for
all such agreements. Any modifications to the standard template by
a city or county shall be limited to project-specific technical
infrastructure requirements and shall not impair the core vested
rights or the financial security of the master development district.
D. A master development district may acquire, lease, sell,
convey, or otherwise dispose of real or tangible property, including
for facilities, parks, streets, or other improvements as permitted
by law.
E. A master development district may covenant with bondholders,
trustees, or holders of other obligations as to the operation,
maintenance, and collection of assessments, and other acts necessary
to secure the payment of such bonds.
SECTION 5. AMENDATORY 11 O.S. 2021, Section 39-115, is
amended to read as follows:
ENR. S. B. NO. 2060 Page 11
Section 39-115. A. To pay all or any part of the cost of the
improvement improvements in an improvement district, the governing
body of a city may issue, in the name of the city or a public trust
entity acting on behalf of the city, bonds in one or more series and
in amounts not exceeding the total cost of the improvement
improvements to be financed by each series, including costs of
issuance, capitalized interest, funding of reserves, premiums for
reserve surety bonds, and obtaining bond insurance, letters of
credit or other credit enhancement or liquidity instruments in
connection with each series.
B. To pay all or any part of the cost of improvements in a
master development district, the master development district may
issue, in the name of the district or a public trust entity acting
on behalf of the master development district, bonds in one or more
series and in amounts not exceeding the total cost of the
improvements to be financed by such series, including costs of
issuance, capitalized interest, funding of reserves, premiums for
reserve surety bonds, and obtaining bond insurance, letters of
credit, or other credit enhancement or liquidity instruments in
connection with each series.
C. If the bonds issued pursuant to subsections A and B of this
section recite that:
1. The proceedings relating to making the improvement and
levying the assessments to pay for the improvement have been done in
compliance with law; and
2. All prerequisites to the fixing of the assessment lien
against the tract or parcel of land benefited by the improvement
have been performed;,
such recital shall be conclusive evidence of the facts recited.
B. The bonds
D. Bonds issued pursuant to this section shall:
1. Recite the terms and conditions for their issuance;
ENR. S. B. NO. 2060 Page 12
2. Be payable from the money collected from the assessment
authorized in Section Sections 39-111 and 39-112 of this title;
3. Bear a rate of interest not less than two percent (2%) of
the rate of interest on the deferred installments of the assessment;
and
4. Mature not later than thirty (30) years after the date of
issuance of the bonds of a particular series.
C. E. Payment of the bonds issued by a city or public trust on
behalf of a city for a storm sewer, lighting, street, alley, curb,
gutter or sidewalk improvement may be supplemented from gasoline tax
money remitted by the State of Oklahoma on or before a date not more
than twelve (12) months after the last deferred installment of an
assessment is due from the owner of a tract or parcel of land so
assessed. Payment of the bonds issued for a water, sewer, gas,
electric or other improvement may be supplemented from the funds
received by the water, sewer, gas, electric or other facility on or
before a date not more than twelve (12) months after the last
deferred installment of an assessment is due from the owner of a
tract or parcel of land so assessed.
D. F. The bonds may be issued to the contractor in payment for
the construction of the improvement or may be issued and sold:
1. In payment of the city's or master development district's
proportion of the cost of the improvement;
2. In payment of the proportionate cost if the improvement is
done in cooperation with another governmental agency or master
development district;
3. In payment of the construction of the improvement done under
contract; or
4. In reimbursement to the city or master development district
if the city or master development district constructed the
improvement with city or district owned or leased equipment and city
or district employees.
ENR. S. B. NO. 2060 Page 13
E. G. Any city or master development district may contract for
the issuance and sale of bonds or assignable certificates.
F. H. Bonds or assignable certificates may be sold at a public
or private sale at a discount.
G. I. After the passage of thirty (30) days from the
publication of the ordinance or resolution authorizing the issuance
of district bonds, any action attacking the validity of any
proceedings had or taken by the governing body of the city or master
development district preliminary to and in the authorization and
issuance of the bonds described in the notice is perpetually barred.
J. Bonds issued by master development districts pursuant to
this section shall not:
1. Constitute public debt, liability, or obligation on behalf
of a municipality or county; or
2. Be considered for any purpose of any constitutional,
statutory, or charter debt limitation applicable to a municipality,
county, or school district, or impair the bonding authority of the
same.
K. A master development district created under the Building
Utilities and Infrastructure for Long-term Development (BUILD) Act
shall be a body corporate and politic and a political subdivision of
the state. A master development district shall have the power to
sue and be sued, to plead and be impleaded, to contract and be
contracted with, and to have a corporate seal.
SECTION 6. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 39-122 of Title 11, unless there
is created a duplication in numbering, reads as follows:
Nothing in this act shall be construed to authorize districts to
provide electric or natural gas service, construct or own electric
or natural gas utility facilities, contract for or receive electric
or natural gas service from a party which is not authorized to
provide retail electric or natural gas services in this state,
impair the rights or property of a certified electric or natural gas
ENR. S. B. NO. 2060 Page 14
utility, or limit the jurisdiction of the Oklahoma Corporation
Commission without the utility's consent.
SECTION 7. This act shall become effective November 1, 2026.
ENR. S. B. NO. 2060 Page 15
Passed the Senate the 15th day of April, 2026.
Presiding Officer of the Senate
Passed the House of Representatives the 14th day of April, 2026.
Presiding Officer of the House
of Representatives
OFFICE OF THE GOVERNOR
Received by the Office of the Governor this ____________________
day of ___________________, 20_______, at _______ o'clock _______ M.
By: _________________________________
Approved by the Governor of the State of Oklahoma this _________
day of ___________________, 20_______, at _______ o'clock _______ M.
_________________________________
Governor of the State of Oklahoma
OFFICE OF THE SECRETARY OF STATE
Received by the Office of the Secretary of State this __________
day of __________________, 20 _______, at _______ o'clock _______ M.
By: _________________________________