By: Hughes  S.B. No. 558          (In the Senate - Filed January 23, 2023; February 17, 2023,   read first time and referred to Committee on Natural Resources &   Economic Development; April 11, 2023, reported adversely, with   favorable Committee Substitute by the following vote:  Yeas 6, Nays 2;   April 11, 2023, sent to printer.)Click here to see the committee vote     COMMITTEE SUBSTITUTE FOR S.B. No. 558 By:  Hughes     A BILL TO BE ENTITLED   AN ACT     relating to parkland dedication for multifamily, hotel, and motel   property development by certain municipalities; authorizing a fee.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Chapter 212, Local Government Code, is amended   by adding Subchapter H to read as follows:   SUBCHAPTER H. MULTIFAMILY, HOTEL, AND MOTEL PARKLAND DEDICATION:   MUNICIPALITIES WITH POPULATION OF MORE THAN 800,000          Sec. 212.201.  DEFINITIONS. In this subchapter:                (1)  "Affordable dwelling unit" means a residential   unit offered at a below market rate for rent or sale under a   municipal, county, state, or federal program.                (2)  "Consumer price index" means the Consumer Price   Index for All Urban Consumers (CPI-U), U.S. City Average, published   by the Bureau of Labor Statistics of the United States Department of   Labor or its successor in function.                (3)  "Improvement" and "market value" have the meanings   assigned by Section 1.04, Tax Code.                (4)  "Land value" means the market value of land per   acre, not including an improvement to the land.                (5)  "Median family income" means the United States   Census Bureau's most recent American Community Survey's five-year   estimate of median family income for all families within the   applicable municipality.                (6)  "Multifamily unit" means a residential unit other   than a detached single-family or two-family dwelling.                (7)  "Parkland" means an area that is designated as a   park for the purpose of recreational activity. The term includes an   open space, a recreational facility, and a trail.                (8)  "Parkland dedication" means the fee simple   transfer of land or the dedication of an easement to a municipality   for nonexclusive use as parkland.                (9)  "Parkland dedication fee" means a fee imposed by a   municipality on a landowner for the acquisition, development,   repair, and maintenance of parkland.                (10)  "Plan" means a subdivision development plan,   subdivision plan, site plan, land development plan, and site   development plan each proposing the development of multifamily,   hotel, or motel units.          Sec. 212.202.  APPLICABILITY. This subchapter applies only   to a municipality with a population of more than 800,000.          Sec. 212.203.  CONSTRUCTION. This subchapter may not be   construed to prohibit a municipality from requiring by ordinance a   landowner to dedicate a portion of the landowner's property for   parkland use, impose a parkland dedication fee, or both require the   dedication and impose the fee for the development of single-family   or two-family uses.          Sec. 212.204.  EXCLUSIVE AUTHORITY; LIMITATION. (a)   Notwithstanding any other law, a municipality has exclusive   authority within its boundaries to require the dedication of   parkland, impose a parkland dedication fee, or both require the   dedication and impose the fee.  A municipality may not delegate that   authority to another political subdivision.          (b)  A municipality may only exercise its authority under   this section through a plan application in accordance with this   subchapter.          Sec. 212.205.  PARKLAND DEDICATION, FEE, OR COMBINATION.   (a) A municipality may require a landowner to dedicate a portion of   the landowner's property for parkland use, impose a parkland   dedication fee, or both require the dedication and impose the fee   under a plan application filed under this subchapter by:                (1)  paying a fee set in accordance with Section   212.210(b) or 212.211(b), as applicable; or                (2)  dedicating a portion up to the maximum size   authorized under Section 212.208 and paying a reduced fee set in   accordance with Section 212.210(d) or 212.211(c), as applicable.          (b)  A municipality may allow a landowner to elect a parkland   dedication, a parkland dedication fee, or a dedication and fee   under Subsection (a).          Sec. 212.206.  REQUEST FOR PARKLAND DEDICATION   DETERMINATION. (a) A landowner may, at the landowner's sole   discretion, make a written request to a municipality that the   municipality make a timely determination of the dedication amount   the municipality will impose under the municipality's parkland   dedication requirements as applied to the landowner's property   being considered for development.          (b)  A municipality may make a reasonable written request to   the landowner for additional information that is:                (1)  publicly and readily available; and                (2)  necessary to provide a determination under this   section.          (c)  A municipality shall respond in writing to a request   made under Subsection (a) not later than the 30th day after the date   the municipality receives a completed request. If the municipality   fails to respond in accordance with this subsection, the   municipality may not require a parkland dedication as a condition   of approval of a proposed plan or application for property that is   the subject of the request.          (d)  A parkland dedication determination issued under this   section:                (1)  is a legally binding determination of the amount   of the landowner's parkland dedication for the property that is the   subject of the determination; and                (2)  is applicable to the property that is the subject   of the determination for a period that is the lesser of:                      (A)  two years; or                      (B)  the time between the date the determination   is issued and the date a plan application is filed that uses or   relies on the determination.          (e)  A landowner may release in writing a municipality from a   determination made under this section.          Sec. 212.207.  PARKLAND DEDICATION AUTHORITY. (a) A   municipality may not require a parkland dedication, impose a   parkland dedication fee, or both require the dedication and impose   the fee for any commercial use. For the purpose of this section, a   commercial use does not include a multifamily, hotel, or motel use.          (b)  If a plan application submitted to a municipality   proposes development of the land subject to the application that   includes both multifamily, hotel, or motel and commercial uses, the   municipality shall determine the amount of a parkland dedication   based only on the pro rata portion of the land proposed for   multifamily, hotel, or motel use.          Sec. 212.208.  LIMITATION ON PARKLAND DEDICATION AMOUNT. A   municipality may not require a landowner to dedicate as parkland   under this subchapter more than 10 percent, without adjustment or   disqualification for impairment, of the gross site area of the land   subject to a plan application.          Sec. 212.209.  INITIAL REQUIREMENTS FOR DETERMINING FEES.   (a) For purposes of determining the amount of a fee imposed under   this section, the governing body of a municipality, after providing   at least 30 days' public notice and holding a public hearing, shall   by official action designate all territory within its municipal   boundaries as a suburban area, urban area, or central business   district area.  The governing body may use the same designation for   multiple areas in the municipality.  The governing body may amend a   designation only during the adoption or amendment of a municipal   comprehensive plan under Chapter 213.          (b)  Not later than the 10th day after the date the   municipality designates its territory under Subsection (a), the   municipality shall notify each appraisal district in which the   municipality is wholly or partly located of the designation.          (c)  Once every 10 years, each appraisal district in which   the municipality is wholly or partly located shall calculate and   provide to the municipality the average land value for each area or   portion of an area designated by the municipality under Subsection   (a) that is located in the district.           (d)  If multiple appraisal districts calculate an average   land value for different portions of an area designated under   Subsection (a), the municipality shall determine the area's total   average land value by:                (1)  multiplying each district's calculated value for   the portion located in the district by the percentage, expressed as   a fraction, that the portion is to the total area; and                 (2)  adding the resulting amounts.          (e)  In each year other than the year in which an appraisal   district calculates average land values under Subsection (c), a   municipality shall calculate the average land value for each area   designated under Subsection (a) by multiplying the previous year's   average land value for the area by one plus the average consumer   price index for each month of the previous year.          (f)  A municipality shall set the municipality's dwelling   unit factor, which reflects the number of parkland acres for each   dwelling unit proposed by a plan application. The factor may not be   more than:                (1)  .005 for multifamily units; and                (2)  .004 for rooms in a hotel or motel ordinarily used   for sleeping.          (g)  A municipality shall set the municipality's density   factor, which reflects the diminishing expectation of parkland   acres per dwelling unit in increasingly dense urban environments,   for each area designated by the municipality under Subsection (a).   The density factor may not be less than:                (1)  one for the suburban area;                (2)  four for the urban area; and                (3)  40 for the central business district area.          Sec. 212.210.  GENERAL REQUIREMENTS FOR CALCULATION OF FEES.     (a)  This section applies only to a municipality to which Section   212.211 does not apply.          (b)  A municipality shall determine the amount of a fee   imposed under Section 212.205(a)(1) for land subject to a plan   application by:                (1)  adding, as appropriate:                      (A)  the product of the number of multifamily   units proposed by the plan by the dwelling unit factor prescribed by   Section 212.209(f)(1); and                      (B)  the product of the number of hotel and motel   rooms ordinarily used for sleeping proposed by the plan by the   dwelling unit factor prescribed by Section 212.209(f)(2);                (2)  multiplying the sum calculated under Subdivision   (1) by the average land value for the area in which the land is   located; and                (3)  dividing the product calculated under Subdivision   (2) by the applicable density factor.          (c)  For purposes of Subsection (b)(1), a municipality shall   exclude from a plan application the number of affordable dwelling   units proposed by the plan.          (d)  A municipality shall determine the amount of a fee   imposed under Section 212.205(a)(2) for land subject to a plan   application by:                (1)  calculating the amount of the fee for the land   under Subsection (b); and                (2)  subtracting from the amount calculated under   Subdivision (1) the product of the land value applicable to the land   and the number of acres dedicated.          (e)  If a calculation made under Subsection (d) results in a   negative number, the applicable landowner is entitled to receive   from the applicable municipality the amount equal to the positive   difference between the calculated amount and zero. The   municipality shall pay that amount to the landowner at the time of   transfer of fee simple title or the recording of the easement.          Sec. 212.211.  REQUIREMENTS CALCULATION OF FEES FOR   MUNICIPALITIES WITH LOW FEES.  (a)  This section applies only to a   municipality that after August 31, 2023, requires a parkland   dedication fee for a multifamily, hotel, or motel development in an   amount, calculated on a per dwelling unit basis, not greater than   two percent of the median family income.          (b)  A municipality to which this section applies may set a   parkland dedication fee.  If the municipality elects to set the fee   in an amount greater than two percent of the municipality's median   family income:                (1)  this section no longer applies to the   municipality; and                (2)  the municipality must set the fee in accordance   with Section 212.210.          (c)  A municipality shall determine the amount of a fee   imposed under Section 212.205(a)(2) for land subject to a plan   application by subtracting from the amount of the fee set under   Subsection (b) the product of the land value applicable to the land   and the number of acres dedicated.          (d)  If a calculation made under Subsection (c) results in a   negative number, the applicable landowner is entitled to receive   from the applicable municipality the amount equal to the positive   difference between the calculated amount and zero. The   municipality shall pay that amount to the landowner at the time of   transfer of fee simple title or the recording of the easement.          Sec. 212.212.  COLLECTION OF FEES. A municipality shall   provide a landowner a written determination of fees owed under this   subchapter before approving a plan application but may only collect   a fee authorized under this subchapter as a precondition to the   issuance of a final certificate of occupancy.          Sec. 212.213.  APPEAL. (a) A landowner may appeal a   determination made by a municipal department, board, or commission   regarding any element of a parkland dedication requirement,   including amount, orientation, or suitability, as that element   applies to the landowner's property, to the municipal planning   commission or, if the municipality has no planning commission, the   governing body of the municipality.  The appeal must include a   requested adjudication of the issue in controversy.          (b)  A landowner may appeal a municipal planning   commission's determination under Subsection (a) to the governing   body of the municipality.          (c)  In an appeal under this section, a municipal planning   commission or governing body of a municipality may uphold, reverse,   or modify a parkland dedication requirement as applied to the   landowner making the appeal.          (d)  A municipal planning commission or governing body of a   municipality shall uphold, reverse, or modify a parkland dedication   requirement that is the subject of an appeal not later than the 60th   day after the date the appeal is filed with the commission or   governing body. If the commission or governing body fails to act in   accordance with this subsection, the parkland dedication   requirement is considered resolved in favor of the landowner's   requested adjudication.          SECTION 2.  (a) Not later than December 1, 2023, each   municipality to which Subchapter H, Chapter 212, Local Government   Code, as added by this Act, applies shall:                (1)  effective January 1, 2024:                      (A)  designate the areas of the municipality as   required by Section 212.209(a), Local Government Code, as added by   this Act; and                      (B)  set the municipality's dwelling unit and   density factors, as required by Sections 212.209(f) and (g), Local   Government Code, as added by this Act; and                (2)  provide to each appraisal district in which the   municipality is wholly or partly located the location of each area   designated under Subdivision (1)(A) of this subsection in a manner   sufficient to allow the appraisal district to make the calculations   required by Subsection (b) of this section.          (b)  Not later than January 1, 2024, each appraisal district   that appraises property located in a municipality described by   Subsection (a) of this section shall calculate and provide to the   municipality the average land values as required by Section   212.209(c), Local Government Code, as added by this Act.          SECTION 3.  Subchapter H, Chapter 212, Local Government   Code, as added by this Act, applies only to a plan application filed   on or after January 1, 2024.          SECTION 4.  This Act takes effect immediately if it receives   a vote of two-thirds of all the members elected to each house, as   provided by Section 39, Article III, Texas Constitution.  If this   Act does not receive the vote necessary for immediate effect, this   Act takes effect September 1, 2023.     * * * * *