Relating to the creation of the Montgomery County Municipal Utility District No. 258; granting a limited power of eminent domain; providing authority to issue bonds; providing authority to impose assessments, fees, and taxes.

Contracts

• Reimbursement Agreements: Developers must execute a Reimbursement Agreement with the District. This contract governs the developer's advance of funds for infrastructure and the District's obligation to repay via future bond proceeds.
• Public Bidding: All construction contracts funded by the District must comply with Texas Water Code Chapter 49 public bidding requirements. Private procurement policies are no longer sufficient for infrastructure work intended for reimbursement.
• Municipal Consent: A development agreement or consent resolution must be negotiated with any municipality in whose Extraterritorial Jurisdiction (ETJ) the District lies prior to the confirmation election.

Hiring/Training

• Board Appointments: You must identify and appoint five temporary directors. These individuals must be qualified (generally, owning land in the district or being a qualified voter) and must secure Public Official Bonds and D&O insurance immediately upon appointment.
• Consultant Retention: The Board must retain Bond Counsel, a General Counsel, a District Engineer, and a Bookkeeper to manage regulatory filings and financial operations.

Reporting & Record-Keeping

• Notice to Purchasers: Sellers of real property within the District boundaries must provide the statutory "Notice to Purchasers" (Texas Water Code § 49.452) to all buyers. This notice discloses the potential tax liability and bond authorization. Failure to provide this allows the buyer to terminate the contract at closing.
• Election Orders: Strict retention of all confirmation election documents is required to withstand Attorney General review for future bond issuances.
• TCEQ Filings: The District must file its creation order, director information, and boundary map with the TCEQ and the Montgomery County Clerk.

Fees & Costs

• Election Costs: The Developer must front the cost of the confirmation and director election (likely May 2026).
• Ad Valorem Taxes: Upon voter approval, the District will levy a new property tax layer. The rate is set annually by the Board based on debt service and O&M needs.
• Bond Issuance Costs: Costs of issuance are paid from bond proceeds, but initial engineering and legal work are advanced by the developer.