A tax allocation agreement under Section 8159.102 may include several optional terms about annexation, tax revenue allocation, services, tax rates, bond sales, and when the agreement ends.
Sec. 8159.103. SPECIFIC PROVISIONS OF TAX ALLOCATION AGREEMENT. The tax allocation agreement made under Section 8159.102 may contain: (1) a method by which the district continues to exist following annexation by the municipality of all or part of the district territory, if the district is initially located outside the corporate boundaries of the municipality; (2) an allocation of the ad valorem tax revenues of the district and the municipality from property in the district as the district and the municipality may agree; (3) an allocation of governmental services to be provided by the municipality or the district following the date of the inclusion of all or part of the district territory in the corporate boundaries of the municipality, which must be proportionate to the allocation of taxes to which the district and the municipality agreed under Subdivision (2); (4) an agreement under which the district assesses and collects ad valorem taxes on all taxable property: (A) at a rate applying to the area of the district included in the municipality and designated as a defined area as provided by Subchapter J, Chapter 54, Water Code, calculated to pay for the improvements, facilities, or services that primarily benefit that area and do not generally benefit the district as a whole; and (B) at a rate applying to the area of the district that is not included in the municipality and is designated as a separate defined area as provided by Subchapter J, Chapter 54, Water Code, calculated to pay for the improvements, facilities, or services that primarily benefit that area and do not generally benefit the district as a whole; (5) a provision permitting district bonds in an area designated as a defined area as provided by Subchapter J, Chapter 54, Water Code, to be sold by negotiated contract, notwithstanding other law; (6) a provision that the allocation agreement will end on the date that: (A) all territory in the district is annexed by the municipality for full purposes; and (B) the district is dissolved as otherwise provided by law; and (7) any other terms considered appropriate by the municipality and the district. Added by Acts 2007, 80th Leg., R.S., Ch. 591 (S.B. 2042), Sec. 1, eff. June 16, 2007.