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HB5670

Regular Session

Relating to the creation of the Montgomery County Municipal Utility District No. 259; granting a limited power of eminent domain; providing authority to issue bonds; providing authority to impose assessments, fees, and taxes.

Low
Low Cost
Effective:2025-09-01
Enforcing Agencies

District Board of Directors (Montgomery County MUD No. 259) • Montgomery County Commissioners Court • Texas Commission on Environmental Quality (TCEQ) • Texas Transportation Commission (regarding state road connectivity)

HB5670
Relating to the creation of the Montgomery County Municipal Utility District No. 259; granting a limited power of eminent domain; providing authority ...
Low Urgency
Heavily Contested
House Vote81 - 47
YEA
NAY
63% in favor128 voting
Senate Vote28 - 3
YEA
90% in favor31 voting
50
Total Opposition Votes
Cost Impact
Low
Effective
2025-09-01
Enforcing Agencies
District Board of DirectorsMontgomery County Commissioners ...TCEQTexas Transportation Commission
Primary Author: Rep. Janis Holt
89th Texas Legislature
jdkey.com
01

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

  • Effective Date: September 1, 2025
  • Compliance Deadline: Immediate upon effective date for land acquisition planning; Confirmation Election must be held prior to September 1, 2029.
  • Agency Rulemaking: No new agency rules required; however, the District must submit road project plans to the Texas Transportation Commission or Montgomery County prior to construction.

Immediate Action Plan

  • Map the ETJ: Confirm immediately if the land sits within the ETJ of Conroe, Houston, or another municipality to initiate the consent process.
  • Secure ROW Voluntarily: Audit all proposed utility and road routes. If any cross property not owned by the developer, initiate purchase negotiations immediately; you have no condemnation backstop.
  • Activate Insurance: Purchase D&O insurance for the temporary directors effective September 1, 2025.
  • Schedule Election: Set the date for the confirmation and tax authorization election to ensure the District can begin levying assessments in the next tax cycle.

Operational Changes Required

Contracts

  • Developer Reimbursement Agreements: Agreements must be drafted to include contingency clauses for "failure to acquire right-of-way." Without eminent domain, a single holdout landowner can stall infrastructure projects; contracts must protect the developer's capital if projects are rerouted or cancelled.
  • Construction Bids: All infrastructure contracts funded by the District must adhere to Texas Water Code Chapter 49 public bidding requirements.
  • Municipal Consent: If the District lies within a city's ETJ (likely Houston or Conroe), a Consent Agreement/Strategic Partnership Agreement must be executed before bonds are sold.

Hiring/Training

  • Director Bonding: The five temporary directors named in the statute must be sworn in and secure Public Official Bonds and D&O liability insurance immediately upon the Act’s effective date.
  • Election Management: Retain legal counsel specialized in special district election procedures to manage the confirmation election, as procedural errors here will invalidate future tax levies.

Reporting & Record-Keeping

  • Election Results: Certified returns for the confirmation election (approving the District, taxes, and bonds) must be filed with the TCEQ and retained permanently.
  • Road Plans: Engineering plans for road projects must be submitted to Montgomery County (and TxDOT if connecting to a state highway) for approval *before* breaking ground.
  • Tax Rate Filings: Once the tax rate is set, annual filings with the Montgomery County Tax Assessor-Collector are mandatory.

Fees & Costs

  • Ad Valorem Taxes: The District is authorized to levy an unlimited O&M tax and bond tax, subject to voter approval.
  • Bond Issuance Costs: Road bonds are strictly capped at 25% of the assessed value of real property within the District.
  • Impact Fees: The Board may impose impact fees on new development to fund district purposes.

Strategic Ambiguities & Considerations

  • "Applicable Municipality" Jurisdiction: The statute requires consent from the municipality in whose ETJ the land resides. If the 342-acre tract straddles two jurisdictions, or if ETJ boundaries are contested, you may face dual-regulatory requirements. Verify GIS data immediately.
  • Road Bond Valuation Lag: The 25% cap on road bonds is based on *assessed* value. In early development stages, assessed value is low, creating a funding gap for road infrastructure that developers must front-end without immediate reimbursement.

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Information presented is for general knowledge only and is provided without warranty, express or implied. Consult qualified government affairs professionals and legal counsel before making compliance decisions.

02

Legislative Timeline

This bill's path through the Texas Legislature

Filed
Apr 11, 2025
Passed House
May 10, 2025
Passed Senate
May 28, 2025
Signed
Jun 20, 2025
TopicsMontgomery County Municipal Utility District No. 259Special Districts & AuthoritiesSpecial Districts & Authorities--municipal Utility Districts
03

House Authors

Rep. Janis HoltRepublican · Primary Author

Senate Sponsor

Sen. Charles CreightonRepublican · Primary Sponsor

Bill Text(with markup)

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More from Rep. Janis Holt

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Related by Topic

View more Montgomery County Municipal Utility District No. 259 legislation
Quick Reference

Frequently Asked Questions

Common questions about HB5670

Q

What does Texas HB5670 do?

HB5670 establishes Montgomery County Municipal Utility District No. 259 effective September 1, 2025, creating a new taxing and regulatory authority over approximately 342 acres. Crucially, the legislation failed to secure the required two-thirds legislative vote, meaning this District is statutorily prohibited from exercising eminent domain.

Q

Who authored HB5670?

HB5670 was authored by Texas Representative Janis Holt during the Regular Session.

Q

When was HB5670 signed into law?

HB5670 was signed into law by Governor Greg Abbott on June 20, 2025.

Q

Which agencies enforce HB5670?

HB5670 is enforced by District Board of Directors (Montgomery County MUD No. 259), Montgomery County Commissioners Court, Texas Commission on Environmental Quality (TCEQ) and Texas Transportation Commission (regarding state road connectivity).

Q

How urgent is compliance with HB5670?

The compliance urgency for HB5670 is rated as "low". Businesses and organizations should review the requirements and timeline to ensure timely compliance.

Q

What is the cost impact of HB5670?

The cost impact of HB5670 is estimated as "low". This may vary based on industry and implementation requirements.

Q

What topics does HB5670 address?

HB5670 addresses topics including montgomery county municipal utility district no. 259, special districts & authorities and special districts & authorities--municipal utility districts.

Legislative data provided by LegiScanLast updated: November 25, 2025

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