CHAPTER 272. SALE OR LEASE OF PROPERTY BY MUNICIPALITIES, COUNTIES, AND CERTAIN OTHER LOCAL GOVERNMENTS

LOCAL GOVERNMENT CODE

TITLE 8. ACQUISITION, SALE, OR LEASE OF PROPERTY

SUBTITLE C. ACQUISITION, SALE, OR LEASE PROVISIONS APPLYING TO

MORE THAN ONE TYPE OF LOCAL GOVERNMENT

CHAPTER 272. SALE OR LEASE OF PROPERTY BY MUNICIPALITIES,

COUNTIES, AND CERTAIN OTHER LOCAL GOVERNMENTS

Sec. 272.001. NOTICE OF SALE OR EXCHANGE OF LAND BY POLITICAL

SUBDIVISION; EXCEPTIONS. (a) Except for the types of land and

interests covered by Subsection (b), (g), (h), (i), or (j), and

except as provided by Section 253.008, before land owned by a

political subdivision of the state may be sold or exchanged for

other land, notice to the general public of the offer of the land

for sale or exchange must be published in a newspaper of general

circulation in either the county in which the land is located or,

if there is no such newspaper, in an adjoining county. The notice

must include a description of the land, including its location,

and the procedure by which sealed bids to purchase the land or

offers to exchange the land may be submitted. The notice must be

published on two separate dates and the sale or exchange may not

be made until after the 14th day after the date of the second

publication.

(b) The notice and bidding requirements of Subsection (a) do not

apply to the types of land and real property interests described

by this subsection and owned by a political subdivision. The land

and those interests described by this subsection may not be

conveyed, sold, or exchanged for less than the fair market value

of the land or interest unless the conveyance, sale, or exchange

is with one or more abutting property owners who own the

underlying fee simple. The fair market value is determined by an

appraisal obtained by the political subdivision that owns the

land or interest or, in the case of land or an interest owned by

a home-rule municipality, the fair market value may be determined

by the price obtained by the municipality at a public auction for

which notice to the general public is published in the manner

described by Subsection (a). The notice of the auction must

include, instead of the content required by Subsection (a), a

description of the land, including its location, the date, time,

and location of the auction, and the procedures to be followed at

the auction. The appraisal or public auction price is conclusive

of the fair market value of the land or interest, regardless of

any contrary provision of a home-rule charter. This subsection

applies to:

(1) narrow strips of land, or land that because of its shape,

lack of access to public roads, or small area cannot be used

independently under its current zoning or under applicable

subdivision or other development control ordinances;

(2) streets or alleys, owned in fee or used by easement;

(3) land or a real property interest originally acquired for

streets, rights-of-way, or easements that the political

subdivision chooses to exchange for other land to be used for

streets, rights-of-way, easements, or other public purposes,

including transactions partly for cash;

(4) land that the political subdivision wants to have developed

by contract with an independent foundation;

(5) a real property interest conveyed to a governmental entity

that has the power of eminent domain;

(6) a municipality's land that is located in a reinvestment zone

designated as provided by law and that the municipality desires

to have developed under a project plan adopted by the

municipality for the zone; or

(7) a property interest owned by a defense base development

authority established under Chapter 378, Local Government Code,

as added by Chapter 1221, Acts of the 76th Legislature, Regular

Session, 1999.

(c) The land or interests described by Subsections (b)(1) and

(2) may be sold to:

(1) abutting property owners in the same subdivision if the land

has been subdivided; or

(2) abutting property owners in proportion to their abutting

ownership, and the division between owners must be made in an

equitable manner.

(d) This section does not require the governing body of a

political subdivision to accept any bid or offer or to complete a

sale or exchange.

(e) This section does not apply to land in the permanent school

fund that is authorized by legislation to be exchanged for other

land of at least equal value.

(f) The fair market value of land, an easement, or other real

property interest in exchange for land, an easement, or other

real property interest as authorized by Subsection (b)(3) is

conclusively determined by an appraisal obtained by the political

subdivision. The cost of any streets, utilities, or other

improvements constructed on the affected land or to be

constructed by an entity other than the political subdivision on

the affected land may be considered in determining that fair

market value.

(g) A political subdivision may acquire or assemble land or real

property interest, except by condemnation, and sell, exchange, or

otherwise convey the land or interests to an entity for the

development of low-income or moderate-income housing. The

political subdivision shall determine the terms and conditions of

the transactions so as to effectuate and maintain the public

purpose. If conveyance of land under this subsection serves a

public purpose, the land may be conveyed for less than its fair

market value. In this subsection, "entity" means an individual,

corporation, partnership, or other legal entity.

(h) A municipality having a population of 575,000 or less and

owning land within 5,000 feet of where the shoreline of a lake

would be if the lake were filled to its storage capacity may,

without notice or the solicitation of bids, sell the land to the

person leasing the land for the fair market value of the land as

determined by a certified appraiser. While land described by this

subsection is under lease, the municipality owning the land may

not sell the land to any person other than the person leasing the

land. To protect the public health, safety, or welfare and to

ensure an adequate municipal water supply, property sold by the

municipality under this subsection is not eligible for and the

owner is not entitled to the exemption provided by Section

11.142(a), Water Code. The instrument conveying property under

this subsection must include a provision stating that the

exemption does not apply to the conveyance. In this subsection,

"lake" means an inland body of standing water, including a

reservoir formed by impounding the water of a river or creek but

not including an impoundment of salt water or brackish water,

that has a storage capacity of more than 10,000 acre-feet.

(i) A political subdivision that acquires land or a real

property interest with funds received for economic development

purposes from the community development block grant

nonentitlement program authorized by Title I of the Housing and

Community Development Act of 1974 (42 U.S.C. Section 5301 et

seq.) may lease or convey the land or interest, without the

solicitation of bids, to a private, for-profit entity or a

nonprofit entity that is a party to a contract with the political

subdivision if the land or interest will be used by the private,

for-profit entity or the nonprofit entity in carrying out the

purpose of the entity's grant or contract. The land or interest

may be leased or conveyed without the solicitation of bids if the

political subdivision adopts a resolution stating the conditions

and circumstances for the lease or conveyance and the public

purpose that will be achieved by the lease or conveyance.

(j) A political subdivision may donate, exchange, convey, sell,

or lease land, improvements, or any other interest in real

property to an institution of higher education, as that term is

defined by Section 61.003, Education Code, to promote a public

purpose related to higher education. The political subdivision

shall determine the terms and conditions of the transaction so as

to effectuate and maintain the public purpose. A political

subdivision may donate, exchange, convey, sell, or lease the real

property interest for less than its fair market value and without

complying with the notice and bidding requirements of Subsection

(a).

(k) This section does not apply to sales or exchanges of land

owned by a municipality operating a municipally owned electric or

gas utility if the land is held or managed by the municipally

owned utility, or by a division of the municipally owned electric

or gas utility that constitutes the unbundled electric or gas

operations of the utility, provided that the governing body of

the municipally owned utility shall adopt a resolution stating

the conditions and circumstances for the sale or exchange and the

public purpose that will be achieved by the sale or exchange. For

purposes of this subsection, "municipally owned utility" includes

a river authority engaged in the generation, transmission, or

distribution of electric energy to the public, and "unbundled"

operations are those operations of the utility that have, in the

discretion of the utility's governing body, been functionally

separated.

Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.

Amended by Acts 1989, 71st Leg., ch. 1, Sec. 63(a), eff. Aug. 28,

1989; Acts 1989, 71st Leg., ch. 1243, Sec. 1, eff. Aug. 28, 1989;

Acts 1991, 72nd Leg., ch. 282, Sec. 1, eff. June 6, 1991; Acts

1993, 73rd Leg., ch. 110, Sec. 1, eff. Aug. 30, 1993; Acts 1993,

73rd Leg., ch. 206, Sec. 2, eff. Aug. 30, 1993; Acts 1993, 73rd

Leg., ch. 429, Sec. 1, eff. Aug. 30, 1993; Acts 1993, 73rd Leg.,

ch. 509, Sec. 1, eff. Aug. 30, 1993; Acts 1993, 73rd Leg., ch.

948, Sec. 1, eff. Aug. 30, 1993; Acts 1995, 74th Leg., ch. 76,

Sec. 17.01(40), eff. Sept. 1, 1995; Acts 1995, 74th Leg., ch.

311, Sec. 1, eff. Sept. 1, 1995; Acts 1999, 76th Leg., ch. 296,

Sec. 1, eff. May 29, 1999; Acts 1999, 76th Leg., ch. 405, Sec.

43, eff. Sept. 1, 1999; Acts 1999, 76th Leg., ch. 451, Sec. 1,

eff. June 18, 1999; Acts 1999, 76th Leg., ch. 968, Sec. 1, eff.

June 18, 1999; Acts 2001, 77th Leg., ch. 1121, Sec. 1, eff. Sept.

1, 2001; Acts 2001, 77th Leg., ch. 1030, Sec. 1, eff. June 15,

2001; Acts 2001, 77th Leg., ch. 1420, Sec. 12.109(a), eff. Sept.

1, 2001; Acts 2001, 77th Leg., ch. 1420, Sec. 12.109(b), eff.

Sept. 1, 2001; Acts 2003, 78th Leg., ch. 179, Sec. 1, eff. May

29, 2003.

Sec. 272.002. CONVEYANCES BY CERTAIN POLITICAL SUBDIVISIONS TO

THE UNITED STATES FOR PURPOSES RELATED TO WATERWAYS. (a) This

section applies to property, including land or an interest in

land, that:

(1) is owned by:

(A) a county having a boundary coinciding with a part of the

international boundary between the United States and Mexico;

(B) a county contiguous to a county described by Paragraph (A);

or

(C) a municipal corporation, political subdivision, or district

organized under the state constitution and statutes and located

in a county described by Paragraph (A) or (B), including a

municipality, independent school district, common school

district, water improvement district, water control and

improvement district, navigation district, road district, levee

district, or drainage district; and

(2) is desired by the United States to enable a department or

establishment of the United States to carry out a federal law in

aid of navigation, flood control, or improvement of water courses

and to accomplish the purposes specified by Section 2204.101,

Government Code, and is necessary for the construction,

operation, and maintenance of works required for those purposes.

(b) On the request of the United States through its proper

officers, an entity described by Subsection (a)(1) may convey

with or without monetary consideration the title or an easement

to the property to the United States or to another entity

described by Subsection (a)(1) that has agreed by resolution of

its governing body to acquire the property for conveyance to the

United States.

(c) All rights conferred by law to the Port of Harlingen

Authority to develop a navigation project and all improvements

incidental, necessary, or convenient for that project are

reserved for the authority. This section does not take away any

right of the authority to dredge, widen, straighten, or otherwise

improve the Arroyo-Colorado and all other lakes, bays, streams,

or bodies of water within, or adjacent or appurtenant to, the

boundaries of the authority as a navigation project or to

construct turning basins, yacht basins, or port facilities.

Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.

Amended by Acts 1995, 74th Leg., ch. 76, Sec. 5.95(24), eff.

Sept. 1, 1995.

Sec. 272.003. RENTAL OF OFFICE SPACE BY COUNTY OR MUNICIPALITY

FOR UNEMPLOYMENT RELIEF ADMINISTRATION. (a) The commissioners

court of a county or the governing body of a municipality may

lease, rent, or provide office space to aid and cooperate with

state and federal agencies engaged in the administration of

relief to the unemployed or needy people of the state. The

commissioners court or governing body may pay the regular monthly

utility bills for the office space, including bills for

electricity, gas, and water.

(b) If a majority of the commissioners court considers the

office space essential to the proper administration of the state

or federal agency, the court may pay for the space and the

regular monthly utility bills out of the general fund of the

county by warrants as in the payment of other obligations of the

county.

Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.

Sec. 272.004. TRANSFERS OF PROPERTY BY CERTAIN POLITICAL

SUBDIVISIONS. (a) In this section, "political subdivision" has

the same meaning as the term "issuer" under Section 1371.001,

Government Code.

(b) A political subdivision may sell, lease as a lessee or

lessor, or otherwise transfer property in the same manner as the

subregional board of a regional transportation authority under

Sections 452.108(d) and (e), Transportation Code.

(c) A sale, lease, or other transfer of property under this

section must be approved by a majority of the voters voting at an

election held within the boundaries of the political subdivision

if the agreement:

(1) involves the levy by the political subdivision of a tax in

an amount sufficient to make payments due under the agreement;

and

(2) is executed on or after September 1, 1999.

Added by Acts 1999, 76th Leg., ch. 1284, Sec. 1, eff. Aug. 30,

1999. Amended by Acts 2001, 77th Leg., ch. 1420, Sec. 8.300, eff.

Sept. 1, 2001.

Sec. 272.005. LEASE OF PROPERTY TO GOVERNMENTAL ENTITY. (a) To

promote a public purpose of the political subdivision, a

political subdivision may:

(1) lease property owned by the political subdivision to another

political subdivision or an agency of the state or federal

government; or

(2) make an agreement to provide office space in property owned

by the political subdivision to the other political subdivision

or agency.

(b) In acting under Subsection (a), the political subdivision:

(1) shall determine the terms of the lease or agreement so as to

promote and maintain the public purpose;

(2) may provide for the lease of the property or provision of

the office space at less than fair market value; and

(3) is not required to comply with any competitive purchasing

procedure or any notice and publication requirement imposed by

this chapter or other law.

Added by Acts 2007, 80th Leg., R.S., Ch.

245, Sec. 1, eff. May 25, 2007.