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Funding County Roads

Funding County Roads. 92 nd Annual County Judges & Commissioners Association of Texas State Conference-Lubbock, Texas 9/29/14-10/2/14. Funding of County Roads. Taxes and Other Revenue Fines Registration fees Gasoline Tax Ad Valorem Tax Base Special County Road Fund from State of Texas

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Funding County Roads

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  1. Funding County Roads 92nd Annual County Judges & Commissioners Association of Texas State Conference-Lubbock, Texas 9/29/14-10/2/14

  2. Funding of County Roads Taxes and Other Revenue Fines Registration fees Gasoline Tax Ad Valorem Tax Base Special County Road Fund from State of Texas FM Roads and Flood Control Tax Special Road Tax Road Districts TRZ CETRZ Regional Mobility Authority

  3. Gasoline Tax • Article VIII, Section 7-a, Texas Constitution: • Subject to Legislative Appropriation, all net revenues derived from motor vehicle registration, and all taxes on motor fuels and lubricants shall be used for the sole purpose of acquiring right of way, constructing, maintaining and policing public roadways, but ¼ of such funds allocated to the Available School Fund. • Tax is now $0.20 per gallon, $0.05 goes to education. • Counties are no longer receiving tax revenue from gasoline tax, but are occasionally allowed access to surplus road materials, or RAP.

  4. General Ad Valorem Tax • More than 60% of all road revenues come from the ad valorem tax. • Road and Bridge costs are included in calculation and formation of general budget. • Allocation of Road and Bridge funds largely discretionary with Commissioners Court, but should be based upon consideration of many factors, including: • Mileage of roads in each precinct • Amount and type of traffic in each precinct • Number of bridges or stream crossings in each precinct • Kind and condition of bridges and crossings in each precinct • Taxable values in each precinct • Population density in each precinct • Geographic size and distance of necessary travel in each precinct • State or Federal Highways in each precinct (intersections) • Other relevant information for each precinct

  5. Ad Valorem Tax • Road and Bridge as a Part of the General County Budget. • Funded by taxation of real property (definition of real property includes “minerals in place.”) • Part of the “M&O” used in the Effective Tax Rate Calculation. • Available funds fluctuate with real property values and corresponding tax rate.

  6. Fees and Fines • Registration Fees for Motor Vehicles (See §502.198 Transportation Code) • Not to exceed $60,000, and • $350 for each mile of county road, not to exceed 500 miles. • And formula for Sale , Rental and Use of motor vehicles. • Various Traffic Laws provide for revenues to County. • Overweight Truck fines (§623.011 Transportation Code). • Damages cause by overweight trucks (condition of bond) See §623.012 Transportation Code.

  7. Special County Road Tax • §256.052 Transportation Code • Requires an election as provided for in Chapter 51 of the Water Code (sets out procedures of Notice, Hearing, and adoption of a Tax Plan), on the petition of at least 200 voters for the entire county, or 50 for a smaller unit. • May be called for entire County, or a portion of the County. • Rate cannot exceed $.15 per hundred. • Will be included in the calculation of a combined maximum tax rate of $.80 per hundred.

  8. Additional Tax for County Roads and Flood Control • Article VIII, Section 1-a, Texas Constitution, as implemented by §256.054 Transportation Code. • Called by petition signed by not less than 10% of voters casting votes in last general election. • Rate capped at no more than $.30 per hundred. • $3,000.00 exemption for homesteads. • Statute says it is to be use for construction and maintenance of Farm to Market Roads or Flood control. • Rarely used today. First adopted 1932 in midst of depression.

  9. Road Districts • Article III, §52, Texas Constitution, as implemented by §257.001, Transportation Code. • Requires approval by 2/3rds of qualified voters in county or proposed district. • May issue bonds not to exceed 25% of the assessed valuation of property in such district, not to exceed constitutional limits on maximum public tax rate. • For improvement of rivers, creeks, lakes, reservoirs, dams, canals and waterways, or • The construction, maintenance and operations of macadamized, graveled or paved roads and turnpikes. • Fire-fighting activities authorized by this section as well.

  10. Transportation Reinvestment Zones • §222.107 Texas Transportation Code • A Tax Increment Fund, i.e. segregates a designated portion of the “increase” in real property valuations in a particular zone over the tax rate in effect when the Order creating the Zone is created. • Allows for the Commissioners Court to designate a portion of the Increment fund to Transportation Projects anywhere in the county, with the balance of revenue to the General Fund. • Works best around areas of capital improvements, investments, such as refineries, rail yards, industrial parks, or other revenue generators, i.e. hotels, entertainment facilities, etc. • Lapses at the end of 10 years, or until no longer fulfills intended purpose. • Cannot be used to pay bonded debt service.

  11. CETRZ • §222.1071 Transportation Code • Required to be eligible for Texas Infrastructure Grant Funds • Similar to the standard TRZ, but 100% of increase in valuations in the zone must go to Transportation. • Works best with temporary property valuation increases such as mineral development. • Lapses after 10 years, or until it no longer serves intended purposes. • Recent Ag. Opinion calls CETRZ into question: • We believe opinion GA-1076 in error, does not recognize the limitation on use to defer or pay bonded debt (basis for Constitutional Amendment in 1981), and • Does not recognize the ability to use funds outside the CETRZ zone. • May require Legislative fix to clear air.

  12. Regional Mobility Authority • §370.031 Transportation Code • One or more counties may petition the Texas Department of Transportation for creation of an RMA. • Vested with powers of a governmental unit, other than power to tax. • May borrow money, by way of revenue bonds. • Primarily a mechanism to plan, design and ultimately construct, maintain, repair and operate a transportation project. • Principally used as a toll road builder, or a Pass Through road manager.

  13. For More Information Call: Allison, Bass & Magee, LLP 402 West 12th Street Austin, Texas 78701 5121-482-0701 law@allison-bass.com

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