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Signed Into Law
Signed June 20, 2025Effective 2025-09-01
SB3048

Regular Session

Relating to the creation of the Bluebonnet Hills Municipal Management District No. 1; providing authority to issue bonds; providing authority to impose assessments, fees, and taxes; granting a limited power of eminent domain.

Government Affairs & Regulatory Compliance Analysis

SB3048: Government Affairs Overview

SB3048 establishes the Bluebonnet Hills Municipal Management District No. 1 in Midlothian, creating a new taxing authority with the power to levy unlimited ad valorem taxes (subject to voter approval), impose infrastructure assessments, and foreclose on property for non-payment. Commercial landowners and developers within the defined 448-acre tracts must immediately account for increased carrying costs and potential liens superior to mortgage instruments.

Sen. Brian Birdwell·Senate Bill·Regular Session

Moderate
High Cost
Effective:2025-09-01
Enforcing Agencies

Bluebonnet Hills Municipal Management District No. 1 Board of Directors • City of Midlothian (Consent rights) • Texas Commission on Environmental Quality (TCEQ)

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SB3048
Moderate
Relating to the creation of the Bluebonnet Hills Municipal Management District No. 1; providing authority to issue bonds; providing authority to impos...
Moderate Compliance Urgency
Requires near-term attention
Cost Impact
High
Effective
2025-09-01
Enforcing Agencies
Bluebonnet Hills Municipal Manag...City of MidlothianTCEQ
Primary Author: Sen. Brian Birdwell
89th Texas Legislature
jdkey.com
01

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

  • Effective Date: September 1, 2025 (Pending final legislative vote count for immediate effect).
  • Compliance Deadline: Q4 2025. Landowners must monitor the initial meeting of the Board of Directors to contest assessment methodologies before they are adopted.
  • Agency Rulemaking: The District Board of Directors will function as a regulatory agency. They will adopt bylaws and set tax rates post-creation. There is no waiting period for the Board to contract for services once convened.

Immediate Action Plan

  • 1. Map Verification: Immediately overlay the metes and bounds from Section 2 of the Bill against your asset holdings to confirm inclusion in the District.
  • 2. Lease Audit: Review all existing leases in the affected area to determine if the landlord or tenant absorbs the cost of new special district assessments.
  • 3. Monitor Vote Count: Confirm if the bill received a two-thirds vote in both chambers to determine if the District possesses eminent domain power.
  • 4. Engage Initial Directors: Establish contact with the five initial directors named in Section 4016.0203 to advocate for favorable assessment methodologies before the first Board meeting.

Operational Changes Required

Contracts

  • Commercial Leases (NNN): Landlords must amend standard lease templates for properties within the District. "Operating Expenses" must explicitly include special district assessments and new ad valorem taxes to ensure pass-through to tenants.
  • Loan Covenants: Borrowers must notify lenders of the new taxing jurisdiction. Lenders will likely require a recalculation of the Debt Service Coverage Ratio (DSCR) to account for the new tax burden.
  • Vendor Agreements: Service providers (security, construction) contracting with the District must comply with Texas Government Code Chapter 791 (Interlocal Cooperation Act) and public bidding requirements.

Hiring/Training

  • Accounts Payable: Staff must be trained to flag invoices from "Bluebonnet Hills MMD No. 1." These are not optional HOA fees; they are government levies with foreclosure authority.
  • Sales Teams: Real estate brokers must be trained on the specific boundaries of the District to ensure accurate representations to potential buyers regarding future tax liabilities.

Reporting & Record-Keeping

  • Seller Disclosures: Sellers of commercial or residential property within the District are legally required to update disclosure forms under the Texas Water Code. Failure to disclose the District's existence allows the buyer to terminate the contract at closing.
  • Lien Management: Legal teams must track infrastructure assessments. Upon payment, you must secure and record a specific lien release from the District, as these liens do not automatically extinguish like standard property taxes.

Fees & Costs

  • New Ad Valorem Tax: A new property tax rate will be set by the Board.
  • Infrastructure Assessments: Variable costs based on "benefit" to the property (e.g., road frontage or square footage).
  • Foreclosure Penalties: Failure to pay results in a penalty including the total assessment value, interest, collection expenses, and attorney's fees.

Strategic Ambiguities & Considerations

  • Eminent Domain Authority: The District’s power to condemn land is conditional. If the bill passes with less than a two-thirds supermajority, Section 4016.0311 prohibits the exercise of eminent domain. You must verify the final legislative journal vote count to confirm if your property rights are at risk.
  • Assessment Methodology: The statute allows assessments for "any purpose authorized" but does not define the calculation formula. The Board has discretion to assess based on front-footage, acreage, or valuation. This formula will be determined in local Board meetings, not in the statute.
  • Municipal Consent: The District requires consent from the City of Midlothian to issue bonds. The terms of this "Development Agreement" are currently unwritten and will dictate the practical debt ceiling of the District.

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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.

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Legislative Timeline

This bill's path through the Texas Legislature

Filed
Passed Senate
May 14, 2025
Passed House
May 28, 2025
Signed
Jun 20, 2025
Effective
Sep 1, 2025
TopicsBluebonnet Hills Municipal Management District No. 1Midlothian, City ofSpecial Districts & AuthoritiesSpecial Districts & Authorities--miscellaneous
03

Senate Authors

Sen. Brian BirdwellRepublican · Primary Author

House Sponsor

Rep. Angelia OrrRepublican · Primary Sponsor

Bill Text(with markup)

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Quick Reference

Frequently Asked Questions

Common questions about SB3048

Q

What does Texas SB3048 do?

SB3048 establishes the Bluebonnet Hills Municipal Management District No. 1 in Midlothian, creating a new taxing authority with the power to levy unlimited ad valorem taxes (subject to voter approval), impose infrastructure assessments, and foreclose on property for non-payment. Commercial landowners and developers within the defined 448-acre tracts must immediately account for increased carrying costs and potential liens superior to mortgage instruments.

Q

Who authored SB3048?

SB3048 was authored by Texas Senator Brian Birdwell during the Regular Session.

Q

When was SB3048 signed into law?

SB3048 was signed into law by Governor Greg Abbott on June 20, 2025.

Q

Which agencies enforce SB3048?

SB3048 is enforced by Bluebonnet Hills Municipal Management District No. 1 Board of Directors, City of Midlothian (Consent rights) and Texas Commission on Environmental Quality (TCEQ).

Q

How significant are the changes in SB3048?

The regulatory priority for SB3048 is rated as "moderate". Businesses and organizations should review the legislation to understand potential impacts.

Q

What is the cost impact of SB3048?

The cost impact of SB3048 is estimated as "high". This may vary based on industry and implementation requirements.

Q

What topics does SB3048 address?

SB3048 addresses topics including bluebonnet hills municipal management district no. 1, midlothian, city of, special districts & authorities and special districts & authorities--miscellaneous.

Q

What are the key dates for SB3048?

Key dates for SB3048: Effective date is 2025-09-01. Consult with legal counsel regarding applicability.

Q

What are the penalties under SB3048?

SB3048 establishes the following penalties: civil penalty of Total assessment value plus interest, collection expenses, and reasonable attorney's fees for Failure to pay District imposed assessments or taxes, resulting in a first and prior lien against the property superior to most other liens.; civil penalty of Foreclosure of Property for Persistent non-payment of assessments or taxes (Board may enforce lien in the same manner as ad valorem tax liens).. Consult with legal counsel for specific applicability to your situation.

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Legislative data provided by LegiScanLast updated: January 11, 2026