Relating to the date of dissolution of the Save Historic Muny District.
LowStandard timeline
Low Cost
Effective:2025-09-01
Enforcing Agencies
Save Historic Muny District Board of Directors • City of Austin
01
Compliance Analysis
Key implementation requirements and action items for compliance with this legislation
Implementation Timeline
Effective Date: September 1, 2025.
Compliance Deadline:Immediate. You must adjust contract terms and billing cycles prior to May 31, 2025, to mitigate the risk of the statutory gap.
Agency Rulemaking: No formal rulemaking required. However, the City of Austin and the District Board must legally navigate the interim period (June 1, 2025 – August 31, 2025) where the District technically lacks statutory authority.
Immediate Action Plan
1.Accelerate Invoicing: Submit all outstanding invoices to the District immediately and demand payment before May 31, 2025.
2.Amend Contracts: Execute simple extensions for any agreements set to expire in May 2025 to bridge the gap to September.
3.Verify Insurance: Contact your broker to ensure your COI covers the District continuously through the Summer 2025 gap, regardless of its technical legal status.
4.Pause Work (If Necessary): If you hold high-value contracts, consider negotiating a work stoppage or "standby" phase for Summer 2025 to minimize exposure until the law takes effect in September.
Operational Changes Required
Contracts
Termination Clauses: Audit all Master Service Agreements (MSAs) and vendor contracts with the District. If a clause triggers termination "upon District dissolution," execute an amendment immediately to define the term through May 31, 2027.
Interlocal Agreements: Contractors paid via City utility fee revenue sharing must verify that the City of Austin extends the underlying interlocal agreement to match the new 2027 date; otherwise, the funding mechanism for your contract may lapse.
Hiring/Training
Accounts Receivable: Instruct finance teams to flag the Save Historic Muny District as a "High Risk" payor for the period of June 1, 2025, through September 1, 2025.
Site Management: Staff working on-site must be aware that the District's authority to direct work may be legally challenged during the Summer 2025 gap.
Reporting & Record-Keeping
Entity Status: Update internal vendor management systems (VMS). Remove any automatic "inactive" flags set for May 2025.
Agreement Monitoring: Continue monitoring for the execution of a land purchase/preservation agreement with the University of Texas. If this is not signed by May 31, 2027, dissolution becomes mandatory.
Fees & Costs
Cash Flow Impact: Anticipate payment delays. Invoices submitted in June or July 2025 may be held until the law becomes effective in September 2025 due to lack of disbursement authority.
Strategic Ambiguities & Considerations
The "Zombie District" Gap (June 1 – Aug 31, 2025):
The law saving the District takes effect three months *after* the District is scheduled to dissolve. This creates a legal vacuum.
Payment Authority: It is unclear if the District has the legal authority to process payments during this gap.
Liability Shield: It is unclear if the District retains governmental immunity under the Texas Tort Claims Act during this interim.
Insurance: There is a risk that commercial general liability policies naming the District as an Additional Insured could be contested by carriers claiming the entity ceased to exist on May 31.
Need Help Understanding Implementation?
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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.
The Save Historic Muny District contains the historic Lions Municipal Golf Course, known locally as "Muny," which is a public golf course and parkland. The land the golf course sits on is currently owned by The University of Texas at Austin and leased by the City of Austin on a monthly basis, but if an agreement is not reached for the purchase or preservation of the land, then the district is set to dissolve on May 31, 2025. Negotiations are ongoing for transferring ownership of the golf course and addressing development restrictions on the remainder of the tracts that expire with the lease, but a final decision has not been made. H.B. 2421 seeks to give all involved parties more time to come to an agreement by postponing the dissolution of the district.
CRIMINAL JUSTICE IMPACT
It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.
RULEMAKING AUTHORITY
It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.
ANALYSIS
H.B. 2421 amends the Special District Local Laws Code to postpone from not later than May 31, 2025, to not later than May 31, 2027, the deadline by which the Save Historic Muny District's board of directors must dissolve the district as provided by state law. The bill changes the provision regarding the district's authority to enter into a certain contract with the City of Austin to reflect the extended deadline.
EFFECTIVE DATE
On passage, or, if the bill does not receive the necessary vote, September 1, 2025.
HB2421 extends the statutory life of the Save Historic Muny District from May 31, 2025, to May 31, 2027, providing two additional years for the District to negotiate a land preservation agreement. However, because the bill takes effect on September 1, 2025—three months after the current dissolution date—vendors and contractors face a "legal gap" creating significant payment and liability risks during Summer 2025. Implementation Timeline Effective Date: September 1, 2025.
Q
Who authored HB2421?
HB2421 was authored by Texas Representative Donna Howard during the Regular Session.
Q
When was HB2421 signed into law?
HB2421 was signed into law by Governor Greg Abbott on June 22, 2025.
Q
Which agencies enforce HB2421?
HB2421 is enforced by Save Historic Muny District Board of Directors and City of Austin.
Q
How urgent is compliance with HB2421?
The compliance urgency for HB2421 is rated as "low". Businesses and organizations should review the requirements and timeline to ensure timely compliance.
Q
What is the cost impact of HB2421?
The cost impact of HB2421 is estimated as "low". This may vary based on industry and implementation requirements.
Q
What topics does HB2421 address?
HB2421 addresses topics including save historic muny district, city government, city government--land use & zoning, special districts & authorities and special districts & authorities--miscellaneous.
Legislative data provided by LegiScanLast updated: November 25, 2025
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