CHAPTER 62. ABOLITION OF MUNICIPALITIES
LOCAL GOVERNMENT CODE
TITLE 2. ORGANIZATION OF MUNICIPAL GOVERNMENT
SUBTITLE E. CONSOLIDATION AND ABOLITION OF MUNICIPALITIES
CHAPTER 62. ABOLITION OF MUNICIPALITIES
SUBCHAPTER A. AUTHORITY AND PROCEDURE
Sec. 62.001. ABOLITION OF CORPORATE EXISTENCE. A special-law
municipality with 10,000 or fewer inhabitants or a general-law
municipality may abolish its corporate existence as provided by
this subchapter.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.002. PETITION AND ELECTION. (a) The mayor of the
municipality shall order an election on the question of
abolishing the municipality's corporate existence if a petition
requesting that the election be held is submitted to the mayor
and is signed by at least 400 qualified voters of the
municipality. However, if a majority of the qualified voters of
the municipality is less than 400, the petition must be signed by
at least two-thirds of the qualified voters of the municipality.
If the municipality has less than 400 qualified voters and has no
municipal debt and does not provide services that would be
otherwise provided by the county, the petition must be signed by
at least one-fourth of the qualified voters in the municipality.
(b) The mayor shall order the election to be held on the same
date as the next general election at which the office of mayor is
to be filled.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Amended by Acts 2001, 77th Leg., ch. 402, Sec. 8, eff. Sept. 1,
2001.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
329, Sec. 1, eff. June 15, 2007.
Sec. 62.003. ELECTION ORDER; CONDUCT OF ELECTION. The election
shall be ordered, conducted, and canvassed in the same manner as
is required for an election to incorporate the municipality,
except that the mayor of the municipality shall perform all acts
that would be performed by the county judge.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.004. DECLARATION OF ABOLITION; CERTIFICATION. If a
majority of the votes received in an abolition election are for
abolition, the mayor of the municipality shall declare the
municipality abolished and certify the abolition to the
commissioners court of the county in which the municipality is
located. The commissioners court shall enter the abolition order
in its minutes, at which time the municipality ceases to exist.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
SUBCHAPTER B. RECEIVERSHIPS
Sec. 62.041. APPLICATION FOR AND APPOINTMENT OF RECEIVER. (a)
Any creditor of a validly incorporated municipality that
abolishes its corporate existence may apply to a district judge
in the district in which the municipality is located to appoint a
receiver for the municipality.
(b) After an application is filed and proper notice of the
application is posted, the judge hearing the application in term
time or vacation may appoint a suitable person as receiver.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.042. NOTICE OF APPLICATION. Before a judge may appoint
a receiver, written notice stating the substance of the
application for the appointment of the receiver and when and
before whom the application will be heard must be posted at three
or more public places in the county in which the municipality is
located, one of which must be in the municipality itself.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.043. BOND. (a) A judge appointing a receiver shall set
the receiver's bond at an amount that is at least twice the
probable amount of the indebtedness or the value of the property
of the municipality.
(b) The bond must be conditioned that the receiver will
faithfully perform the duties of receiver and that the receiver
will pay and deliver all money and property acquired as receiver
to the parties entitled to the money or property.
(c) The bond must be approved by the judge who appoints the
receiver.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.044. FILING AND RECORDING ORDER AND BOND. The district
clerk of the county in which the abolished municipality is
located shall file the receiver's bond and the order appointing
the receiver with the minutes of the court, and the clerk shall
record the order and the bond in the minutes.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.045. DUTIES AND AUTHORITY. (a) After the receiver
gives the required bond, and after the bond is filed and
recorded, the receiver shall:
(1) take control of all real and personal property of the
abolished municipality, including money, minute books,
ordinances, and similar property, but not including property that
pertains to the public schools or that is devoted exclusively to
public use; and
(2) in the next term of the court in which the receivership is
pending, return to the court an inventory of the property taken
by the receiver.
(b) Under a court order, or an order of the judge if the court
is in vacation, the receiver may bring suit against any person in
possession of the property of an abolished municipality or who is
indebted to it in the same manner as the municipality could if it
were still incorporated.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.046. COMPENSATION. A court appointing a receiver under
this subchapter may authorize compensation for the receiver.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
SUBCHAPTER C. PAYMENT OF INDEBTEDNESS AND DISPOSITION OF ASSETS
UNDER RECEIVERSHIP
Sec. 62.081. PRESENTATION OF CLAIMS. A person who has a claim
against an abolished municipality must present a verified
statement of the amount of the claim to the receiver within six
months after the date the receiver is appointed.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.082. NOTICE OF CLAIMS. (a) A receiver may not allow or
approve a claim or account against an abolished municipality
until notice of presentment of the claim or account is given by
publication in a newspaper in the municipality in which the claim
is filed or presented for four consecutive weeks or, if a
newspaper is not published in the municipality, by posting the
notice for four consecutive weeks at the door of the courthouse
of the county in which the municipality is located.
(b) The published or posted notice must state:
(1) the name and residence address of the creditor;
(2) the amount and date of the claim and account; and
(3) the purpose for which the claim or account was incurred.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.083. APPROVAL OF CLAIMS. If the receiver of an
abolished municipality determines a claim is correct, the
receiver shall mark it as allowed and file it in the district
court. The court shall also approve the claim at its next regular
term if no protest is filed. On approval by the court, the claim
is a valid debt of the municipality.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.084. COMPLETE OR PARTIAL DISALLOWANCE OF CLAIM. (a) If
a receiver of an abolished municipality determines that a claim
is partially or completely unjust, the receiver shall endorse his
finding on the claim and return it to the claimant.
(b) A claimant who accepts the findings of the receiver may file
the claim with the district court. The court shall act on the
part of the claim allowed in the same manner as other claims.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.085. TAXPAYER PROTEST. (a) A district court may not
approve a claim against an abolished municipality until the full
amount of the claim is established by the judgment of a court of
competent jurisdiction if a taxpayer of the municipality:
(1) files a protest against the claim in the district court; and
(2) files a bond that is conditioned that the taxpayer will pay
all costs of suit if the claimant fully establishes his claim by
the judgment of a state court with jurisdiction of the claim.
(b) The taxpayer's bond must be approved by the court in which
it is filed.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.086. SUITS TO ESTABLISH CLAIMS. (a) A claimant may
bring a suit against the receiver of an abolished municipality to
establish a claim the receiver completely or partially disallowed
or to establish a claim protested by a taxpayer.
(b) The receiver shall assert all applicable legal defenses
against a suit under this section.
(c) The court trying a suit under this section may hear and
consider any material defense against the claim except
limitation, even if the claim previously has been reduced to
judgment. However, the court shall consider a prior judgment
establishing the claim as prima facie evidence of the justness of
the claim.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.087. ALLOWANCE AND APPROVAL OF ESTABLISHED CLAIMS. A
receiver of an abolished municipality shall allow, and a district
court shall approve, a claim that is established by a judgment
against the receiver.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.088. LIABILITY FOR COSTS. (a) A claimant in a suit
against the receiver of an abolished municipality who rejects
part of the claimant's claim is liable for the costs of the suit
unless the claimant establishes the claim in an amount greater
than the amount allowed by the receiver.
(b) A claimant in a suit to establish his claim because of a
taxpayer protest under Section 62.085 is liable for the costs of
the suit unless the claimant obtains a judgment for the full
amount he asked the district court to approve.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.089. LIMITATIONS. (a) Limitations do not begin to run,
do not expire, and may not be pled to bar a claim against an
abolished municipality until six months after the date a receiver
is appointed for the municipality.
(b) A claimant may not bring a suit against the receiver of an
abolished municipality on a claim that is partially or completely
disallowed under Section 62.084 or against which a taxpayer files
a protest under Section 62.085 after six months after the date
the claim is disallowed or the protest is filed.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.090. PAYMENT OF CLAIMS. The court in which the
receivership of an abolished municipality is pending shall:
(1) provide for the payment of the claims legally established
against the municipality;
(2) determine the priority of the claims;
(3) order the sale of all property held by the receiver that is
subject to sale for the satisfaction of the municipality's
indebtedness; and
(4) direct the receiver to pay the claims legally established
against the municipality.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.091. ADDITIONAL TAX. (a) If the money of an abolished
municipality and the proceeds from the sale of its property are
insufficient to pay its indebtedness, at the request of any
creditor the court in which the receivership is pending at its
first regular term each year shall levy a tax on all real and
personal property that is not exempt from taxation and that on
the first day of January of the preceding year is located within
the corporate limits of the municipality as those limits
previously existed.
(b) The court shall levy a tax sufficient to discharge the
municipality's indebtedness, except that the court may not set
the tax at a rate that is greater than the rate allowed by law
for such purposes in municipalities.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.092. ASSESSMENT AND COLLECTION OF TAX. (a) The tax
assessor-collector for the county in which an abolished
municipality is located shall assess and collect a tax ordered
under Section 62.091.
(b) The tax assessor-collector shall pay the taxes collected to
the receiver for the municipality.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.093. DELINQUENT TAXES. A receiver for an abolished
municipality may bring suit against a delinquent taxpayer and
enforce a lien against the taxpayer's property in the same manner
as if the corporate existence of the municipality had not been
abolished and the levy and assessment had been made by the
municipality's governing body and assessor.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.094. DISTRIBUTION OF ASSETS. (a) The compensation of
the receiver, court costs, and expenses have priority over other
claims against an abolished municipality and shall be paid first
out of money on hand or collected.
(b) Money collected each year from taxes shall be paid pro rata
on claims according to their priorities until all claims
established against the municipality and all costs and expenses
are paid in full.
(c) After the final settlement of the receivership, the receiver
shall deliver money or other property remaining to the trustees
or other officers in charge of any public school district located
completely within the boundaries of the abolished municipality,
and the money or property shall be used for the benefit of the
school district. If there is no such public school district, the
receiver shall deliver the remaining money or property to the
county in which the municipality is located. The money shall be
deposited in the general fund of the county, and the property
shall be used for the benefit of the county.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
SUBCHAPTER D. SCHOOLS AND PUBLIC PROPERTY
Sec. 62.121. ADMINISTRATION OF PUBLIC SCHOOLS. If at the time a
municipality is abolished under this chapter the public schools
of the municipality are managed by trustees appointed or elected
by the voters of the municipality or by its governing body, the
trustees shall continue to manage the schools for the remainder
of their appointive or elective term.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.122. TAXES. A receiver for an abolished municipality
shall collect all unpaid taxes levied before the date of
abolition for municipal or school purposes, together with any
penalties or interest that is due. The receiver shall pay the
part of the taxes levied for maintaining the public schools to
the trustees of the school district, who shall use the taxes for
the purpose for which they were levied.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.123. PUBLIC PROPERTY. If a municipality abolished under
this chapter owns public buildings, public parks, public works,
or other public property on the date of abolition and the
property is not sold or disposed of under this chapter, the
commissioners court shall manage and control the property for the
purposes for which the property was originally used and intended.
In managing and controlling the property, the commissioners court
may exercise the powers originally given by charter to the
governing body of the municipality.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
SUBCHAPTER E. PAYMENT OF INDEBTEDNESS AND DISPOSITION OF ASSETS
BY CORPORATE OFFICERS OR TRUSTEES
Sec. 62.161. SETTLEMENT BY CORPORATE OFFICERS. (a) If a
municipality or de facto municipality that has indebtedness
outstanding is abolished, declared void by a court of competent
jurisdiction, or ceases to operate and exercise municipal
functions, the municipality's officers at the time the
municipality is dissolved or ceases to function shall:
(1) take control of the municipality's property;
(2) sell and dispose of the municipality's property; and
(3) settle the debts owed by the municipality.
(b) For the purpose of settling the debts of the municipality,
the former municipal officers may levy and collect a tax on the
residents of the municipality in the same manner as the
municipality could have done.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.162. SETTLEMENT BY TRUSTEES. (a) If a municipality's
officers fail or refuse to settle its affairs under Section
62.161, on the petition of any resident taxpayer of the
municipality or any holder of an evidence of its indebtedness, a
court with jurisdiction and located in the county in which the
municipality is located shall appoint three trustees to take
control of the municipality's property, dispose of the property,
and settle its debts.
(b) The trustees have the same powers that municipal officers
have under this subchapter.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 62.163. ACTION FOR DEBT. (a) The holder of an
indebtedness against a municipality to which Section 62.161
applies may bring a suit to establish the indebtedness in any
court in this state with jurisdiction in the county in which the
municipality is located. The court may render judgment in the
suit against the municipality as fully as if the municipality had
not been abolished or its organization declared void. The status
of the municipality remains the same insofar as it affects the
holders of its indebtedness until the indebtedness is paid.
(b) The municipality may be served with process in the suit by
serving the citation on a person who was or who acted as the
mayor, the secretary, or the treasurer of the municipality at the
time of the municipality's abolition.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
SUBCHAPTER F. ABOLITION OF MUNICIPALITY CEASING TO HAVE RESIDENTS
Sec. 62.201. PETITION FOR ABOLITION. After the 120th day after
the date a municipality ceases to have any persons residing
within its boundaries, the owners of a majority of the land
within the municipality may file a petition with a district court
of the county in which all or a majority of the land in the
municipality is located requesting the court to abolish the
municipality.
Added by Acts 1989, 71st Leg., ch. 1, Sec. 8(a), eff. Aug. 28,
1989.
Sec. 62.202. HEARING. (a) Before the 60th day after the date
the petition is filed, the district judge of the court shall hold
a hearing on the petition. Members of the public who wish to give
testimony on the matter of abolishing the municipality must be
given the opportunity to do so at the hearing.
(b) The district judge must publish notice of the hearing in a
newspaper of general circulation in the county in which all or a
majority of the land in the municipality is located. The notice
must be published before the 10th day before the date of the
hearing. The notice must state:
(1) the date, time, and place of the hearing;
(2) the purpose of the hearing; and
(3) the name of the municipality that is the subject of the
hearing.
Added by Acts 1989, 71st Leg., ch. 1, Sec. 8(a), eff. Aug. 28,
1989.
Sec. 62.203. ABOLITION ORDER. At the conclusion of the hearing
or within 10 days after the date the hearing is concluded, the
district judge shall issue an order declaring the municipality to
be abolished if the judge finds that a valid petition was filed
and no persons reside within the municipality. The municipality
ceases to exist on the date the order is issued.
Added by Acts 1989, 71st Leg., ch. 1, Sec. 8(a), eff. Aug. 28,
1989.
Sec. 62.204. NOTICE TO COMMISSIONERS COURT. On the issuance of
the order abolishing the municipality, the district judge shall
certify the abolition to the commissioners court of the county in
which all or a majority of the land in the abolished municipality
is located.
Added by Acts 1989, 71st Leg., ch. 1, Sec. 8(a), eff. Aug. 28,
1989.