Relating to the use of certain tolls and charges imposed by certain counties; authorizing a civil penalty and limiting the counties' authority to adopt an ad valorem tax rate.

89(R) SB 2722 - House Committee Report version - Bill Text

89R30395 CXP-F

By: Bettencourt, et al.

S.B. No. 2722

(DeAyala, Cunningham, Hull, Jones of Harris, Paul)

Substitute the following for S.B. No. 2722:
No.

A BILL TO BE ENTITLED

AN ACT

relating to the use of certain tolls and charges imposed by certain

counties; authorizing a civil penalty and limiting the counties'

authority to adopt an ad valorem tax rate.

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

SECTION 1. Subchapter A, Chapter 284, Transportation Code,

is amended by adding Section 284.014 to read as follows:

Sec.

284.014.

RESTRICTION ON USE OF REVENUE FROM TOLLS AND

OTHER CHARGES IN CERTAIN COUNTIES. (a) This section applies only

to a county with a population of four million or more.

(b)

Except as provided by this section, a county that

imposes tolls or charges as otherwise authorized by this chapter

may only use the revenues collected from the tolls or charges to:

(1)

pay the costs of operating, expanding,

maintaining, or administering a project;

(2) retire debt related to a project; or

(3)

use or pledge revenues to pay or finance the costs

of a project, including the costs to study, design, construct,

maintain, operate, and pool a turnpike project or system, and to pay

bonds or other obligations related to a project.

(c)

Subsection (b) applies to any fees received by a county

for operating a project of another entity but does not apply to any

other revenue of a project that is collected by the county on behalf

of another entity under an agreement with the entity.

(c-1)

Of the revenues collected from tolls and charges that

remain after paying the costs described by Subsection (b),

including costs to establish reserves required by a bond instrument

and to maintain ratings on bonds or other obligations related to a

project:

(1)

except as provided by Subsection (c-4), $25

million shall be distributed to the municipality that contains more

than 40 percent of the number of lane miles of the project and may be

used by the municipality only for the costs of providing law

enforcement, fire protection, and emergency medical services

during accidents or disasters affecting a toll project of the

county under this chapter; and

(2)

subject to Subsection (e) and except as provided

by Subsection (f), the amount remaining after the distribution

described by Subdivision (1), if any, shall be retained by the

county and may be used only to pay costs related to a county road

owned and maintained by the county.

(c-2)

An independent auditor hired by a municipality

described by Subsection (c-1)(1) annually shall review the

municipality's annual financial report to determine whether the

municipality is in compliance with the usage requirements of that

subsection and shall certify the amount of the municipality's

expenditures that were used for the purposes described by that

subsection. The independent auditor shall provide a copy of the

audit and report any violation of the usage requirements of

Subsection (c-1)(1) to the:

(1) commissioners court of the county;

(2) attorney general;

(3) governor;

(4) lieutenant governor;

(5) speaker of the house of representatives;

(6)

chair of each standing committee of the

legislature with primary jurisdiction over transportation; and

(7) chair of the commission.

(c-3)

If the independent auditor certifies under Subsection

(c-2) that the municipality's expenditures were less than the

amount transferred to the municipality under Subsection (c-1)(1)

for the applicable period, the county shall deduct that difference

from the amount to be transferred to the municipality as the next

disbursement under Subsection (c-1)(1).

(c-4)

Subsections (c-1)(1), (c-2), and (c-3) do not apply if

a county has entered into a contractual arrangement with a

municipality regarding the use of revenues collected from tolls or

charges as otherwise authorized by this chapter to pay the

municipality's costs of providing law enforcement, fire

protection, and emergency medical services during accidents or

disasters affecting a toll project of the county under this

chapter.

(c-5)

This subsection and Subsections (c-1), (c-2), (c-3),

and (c-4) expire September 1, 2030.

(d)

Beginning September 1, 2030, the county shall retain the

amount that remains from the revenues collected from tolls and

charges after paying the costs described by Subsection (b),

including costs to establish reserves required by a bond instrument

and to maintain ratings on bonds or other obligations related to a

project, and, subject to Subsection (e) and except as provided by

Subsection (f), may use the amount retained only to pay costs

related to a county road owned and maintained by the county.

(e)

At least 95 percent of the amount retained by a county

under this section must be allocated among all commissioners

precincts as follows:

(1)

one-third of the amount allocated based on the

historical surplus funds transferred for the county's fiscal years

2005 through 2025 by precinct;

(2)

one-third of the amount allocated based on the

number of county lane miles in each precinct, excluding freeways as

defined by Section 541.302 and any road facilities for which a user

must pay a toll, fee, or fare, according to the county's road log or

maintenance schedule on September 1 of the fiscal year preceding

the allocation; and

(3)

one-third of the amount allocated based on the

road and pavement condition of county roads in each precinct,

excluding freeways as defined by Section 541.302 and any road

facilities for which a user must pay a toll, fee, or fare, according

to the county engineer's annual report on September 1 of the fiscal

year preceding the allocation.

(f)

A county may allocate up to five percent of the amount

retained under this section to a county department or project with

countywide impact, as determined by the county, for a state,

county, or municipal facility relating to a road, street, highway,

or related facility.

(f-1)

An amount allocated under Subsection (e) or (f) may

not be used on a hike, bike, or trail facility unless the

expenditure is necessary to comply with a state or federal

guideline.

(g)

An independent auditor hired by a county to audit the

county's annual financial report made to the commissioners court

and to the district judges of the county under Section 114.025,

Local Government Code, annually shall review the county's annual

financial report to determine whether the county is in compliance

with this section and shall certify the amount of the county's

expenditures that were used for the purposes described by this

section. The independent auditor shall provide a copy of the audit

and report any violation of this section to the:

(1) commissioners court of the county;

(2) attorney general;

(3) governor;

(4) lieutenant governor;

(5) speaker of the house of representatives;

(6)

chair of each standing committee of the

legislature with primary jurisdiction over transportation; and

(7) chair of the commission.

(h)

A county that violates this section is subject to a

civil penalty. The attorney general shall promptly investigate a

report received under Subsection (g) to determine if the county

violated this section.

On determining that a violation of this

section occurred, the attorney general may file suit to collect a

civil penalty.

If the violation is:

(1)

a first violation of this section, the amount of

the civil penalty is an amount equal to 100 percent of the amount of

revenues used by the county in violation of this section; or

(2)

a second or subsequent violation of this section,

the amount of the civil penalty is an amount equal to 110 percent of

the amount of revenues used by the county in violation of this

section.

(i)

A county for which a civil penalty is imposed under

Subsection (h) shall pay the penalty out of the general fund of the

county.

(j)

Notwithstanding any other law, a county for which a

civil penalty is imposed under Subsection (h)(2) may not adopt a tax

rate for the tax year following the tax year in which the penalty

was imposed that exceeds the lesser of the county's no-new-revenue

tax rate or voter-approval tax rate, as determined under Section

26.04, Tax Code, for that tax year.

(k)

A civil penalty collected under this section shall be

deposited in the state treasury to the credit of the state highway

fund and may only be appropriated for transportation purposes.

SECTION 2. This Act takes effect September 1, 2025.