How does a Texas county assess subdivision road-repair costs, and what can it charge property owners?

Plain-English summary

Texas has a law (article 6702-3) that lets a county fix up roads in a residential subdivision in an unincorporated area, and then send the bill to the property owners in that subdivision. Before a county can do this, it has to find the work is needed for public health, safety, or welfare, give notice, hold a public hearing, and then mail ballots so the property owners can vote on whether to approve the project and the assessment. An earlier opinion (DM-126) had already worked through some details of the process. This opinion answered four more questions a legislator raised.

First, can a county combine several subdivisions into one vote and one assessment? No. The statute keeps talking about "a subdivision" and "the subdivision," so the opinion concluded the county has to propose a separate assessment and hold a separate election in each subdivision. Each subdivision stands on its own.

Second, once a subdivision votes yes, when can the county record the lien that secures the assessment against the property? The statute says there must be a lien, and says the lien takes effect when written notice is filed with the county clerk, but it never says exactly when the county must record it. Another part of the statute (section (g)) gives the commissioners court broad discretion over the time, terms, and conditions of payment. So the opinion concluded the court itself decides when to record the lien after a subdivision approves the assessment.

Third, what if the approved assessment turns out not to be enough money to finish the road? The statute lets the county assess "all or part" of the cost, which signals the county can cover some of the cost from other sources. So the opinion concluded the county has two options: keep working and pay the rest out of non-assessment funds, or propose a new assessment and hold another election. What it cannot do is charge the property owners more than the maximum they already approved without going back to them for approval.

Fourth, beyond the actual construction, what other costs can be assessed, things like engineering fees, interest on borrowed money, or the cost of publishing bid notices? The statute only allows assessing "the costs of the improvement," and defines "improvement" as the construction, reconstruction, or repair of a road. DM-126 had already said the county cannot assess the costs of holding the election and collecting the assessment, because those are administrative costs that would not exist if the road were paid for some other way. Whether the specific costs in the question are assessable improvement costs or non-assessable administrative costs is a factual question, and the opinion said the commissioners court has to decide that in the first instance, not the opinion process.

Currency note

This opinion was issued in 1993. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. Article 6702-3 of the Revised Civil Statutes has since been recodified into the Transportation Code, and the procedures and lien provisions may have been amended, so confirm current law before relying on anything described here.

Background and statutory framework

Article 6702-3, V.T.C.S., authorizes a county commissioners court to improve a road in a subdivision, or an access road to a subdivision, in an unincorporated area of the county, and to assess all or part of the cost pro rata against the owners of real property in the subdivision. As reproduced in the opinion, the statute applies only to subdivisions (or access roads) in unincorporated areas; defines "improvement" as the construction, reconstruction, or repair of a road; and permits the assessment only if the commissioners court determines the improvement is necessary for the public health, safety, or welfare of county residents and a majority of the voting record property owners approve by mailed ballot. Before ordering an improvement and assessment, the court must give notice and hold a public hearing, and within 10 days after the hearing must mail each owner a ballot and a return envelope. DM-126 (1992) had earlier concluded that the court may delegate the details of collecting the assessment and may set the formula for calculating each owner's share (with regard for the particular benefits to each owner), but may not assess the costs of holding the election and collecting the assessment against the property owners.

Question 1: each subdivision is treated separately. The legislator asked whether each recorded, platted subdivision is an autonomous entity as to the amount of assessment and the counting of votes, in effect, whether the court may hold one election and assessment across two or more subdivisions. The opinion concluded it may not. Because the statute repeatedly refers to "a subdivision" and "the subdivision," the commissioners court must propose separate assessments and hold separate elections in each subdivision.

Question 2: timing of recording the lien. The opinion looked at sections (g) and (h). Section (h) requires that an assessment be secured by a lien against the assessed owner's real property, effective from the date written notice of the assessment is filed and recorded with the county clerk (in recordable form, stating the dollar amount, the legal description, and each owner's name and address); the lien is inferior only to tax liens and to bona fide mortgage liens recorded before the assessment lien's effective date, and each owner is personally liable. But section (h) does not say when the lien must be recorded. Section (g) gives the commissioners court broad discretion to provide the time, terms, and conditions of payment and default of an assessment (though it may not require payment of any interest on the assessment). The opinion concluded that section (g) gives the court authority to determine when the lien will be recorded after a subdivision approves an assessment, consistent with DM-126's point that the court must determine the details of the collection process in the absence of statutory guidelines.

Question 3: when the assessment falls short. The legislator asked how the court should proceed if an approved assessment is not enough to complete the improvement, whether work should stop and how completion should be funded. The statute does not directly address this. Because section (c) authorizes the court to assess "all or part of the costs" of an improvement, the statute contemplates that the court may fund part of an improvement from other sources. The opinion therefore concluded the court may either continue the work and pay for it with non-assessment funds, or propose a new assessment to complete the project and hold a new election under the statutory requirements. The property owners, however, cannot be charged for additional costs above the maximum assessment without their approval.

Question 4: which costs are assessable. The legislator asked what costs besides actual construction may be assessed, for example, interest or fees on borrowed money, engineering services used to determine the required improvement, or bid-publication charges. Article 6702-3(c) authorizes the court to assess only "all or part of the costs of the improvement," and "improvement" is defined as "the construction, reconstruction, or repair of a road" (§ 6702-3(b)). DM-126 had concluded this language does not permit assessing the costs of holding the election and collecting the assessment, because those administrative costs would not be incurred if the improvement were funded by other means. Whether the particular costs in the legislator's query are assessable improvement costs or non-assessable administrative costs involves questions of fact not amenable to the opinion process, which the commissioners court should resolve in the first instance.

Common questions

Can a Texas county hold one combined vote for several subdivisions on a road project?
No. The opinion concluded that because the statute speaks of "a subdivision" and "the subdivision," the county must propose separate assessments and hold separate elections in each subdivision.

When can the county record the lien for the road assessment?
After a subdivision approves the assessment, at a time the commissioners court determines. The opinion concluded section (g)'s broad discretion over the timing and terms of payment lets the court decide when to record the lien.

What happens if the assessment money runs short of finishing the road?
The opinion concluded the county can either keep going and pay the remainder from non-assessment funds, or propose a new assessment and hold another election. It cannot charge owners above the maximum they approved without their consent.

Can the county add engineering fees or interest to what owners are charged?
The opinion did not decide. It concluded the statute allows assessing only the costs of the "improvement" (construction, reconstruction, or repair), and whether specific costs like engineering or interest qualify is a fact question for the commissioners court to resolve first.

Citations

• V.T.C.S. art. 6702-3 (county improvement of subdivision roads; assessment against property owners): § (a) (unincorporated-area scope), § (b) (definition of "improvement"), § (c) (order, necessity finding, mailed-ballot approval, assess "all or part of the costs"), § (d) (notice and public hearing), § (e) (mailed ballots), § (g) (time, terms, and conditions of payment; no interest), § (h) (assessment lien; effective date; priority; personal liability)
• Attorney General Opinion DM-126 (1992)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/dan-morales/dm-0204
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1993/dm0204.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain. The linked PDF is authoritative.

Office of the Attorney General
State of Texas

DAN MORALES
ATTORNEY GENERAL

February 25, 1993

Honorable Allen Ross Hightower
Chairman
Committee on Corrections
Texas House of Representatives
P.O. Box 2910
Austin, Texas 78768-2910

Opinion No. DM-204

Re: Authority of a county to improve certain subdivision roads and assess the cost of repairs against subdivisions (RQ-457)

Dear Representative Hightower:

You have requested our opinion regarding the proper construction of article 6702-3, V.T.C.S., in further clarification of Attorney General Opinion DM-126 (1992). Article 6702-3, V.T.C.S., which authorizes a commissioners court to improve a road in a subdivision and assess the costs against the owners of real property within the subdivision, provides:

(a) This article applies only to a subdivision or a part of a subdivision in an unincorporated area of the county. To the extent that this article authorizes the improvement of an access road to a subdivision, this article applies only to an access road in an unincorporated area of the county.

(b) In this article, "improvement" means the construction, reconstruction, or repair of a road.

(c) The commissioners court of a county may order that the county improve a road in a subdivision or an access road to a subdivision to comply with any county standards for roads and assess all or part of the costs of the improvement pro rata against the owners of real property in the subdivision if:

(1) the commissioners court determines that the improvement is necessary for the public health, safety, or welfare of the residents of the county, and

(2) a majority of those record owners of real property in the subdivision who are voting vote by mailed ballot in favor of the county improvement and assessment.

(d) Before ordering an improvement and assessment under this article, the commissioners court must give notice of the proposed improvement and assessment and must hold a public hearing on the question.

(e) Within 10 days after the date of the public hearing, the commissioners court shall send by certified mail to each owner of real property in the subdivision a ballot on the question and a return addressed, stamped envelope for the return of the completed ballot to the county clerk. . . .

In Attorney General Opinion DM-126, we concluded that a commissioners court which orders improvements to a road in an unincorporated area of the county as the result of an election held under article 6702-3, V.T.C.S., may delegate the details of the process of collecting the assessment against the affected property owners, and that it may also determine the precise formula for calculating the assessment, with special regard for the particular benefits which will accrue to each property owner. We also concluded that the costs of holding the election and collecting the assessment may not be assessed against the property owners.

In clarification of Attorney General Opinion DM-126, you first ask whether "each recorded, platted subdivision [is] to be treated as an autonomous entity as to the [a]mount of assessment and counting votes." We understand you to ask whether the statute permits the commissioners court to hold an election on an improvement and assessment among real property owners in two or more subdivisions. We conclude that it does not. The statute repeatedly refers to "a subdivision" and "the subdivision." Clearly, the commissioners court must propose separate assessments and hold separate elections in each subdivision.

You also ask at what point after a subdivision votes to participate in an improvement a lien against the real property to secure an assessment may be recorded. Sections (g) and (h) of article 6702-3 provide as follows:

(g) In making an assessment under this article, the commissioners court may provide the time, terms, and conditions of payment and default of the assessment. The commissioners court may not require the payment of any interest on an assessment.

(h) All assessments shall be secured by a lien against the real property of the assessed property owner. The lien shall be effective from the date that written notice of the assessment is filed for record and recorded in the office of the county clerk of the county in which the assessed property is located. Such written notice shall be in recordable form and contain the dollar amount of the assessment, the legal description of the property assessed, and the name and address of each property owner. The lien securing the assessment shall be inferior only to tax liens and to bona fide mortgage liens recorded prior to the effective date of the assessment lien. Each property owner shall be personally liable for the amount of the assessment.

Although section (h) requires that a lien secure an assessment, it does not specify when such a lien shall be recorded. Section (g) gives the commissioners court broad discretion to "provide the time, terms, and conditions of payment and default of [an] assessment." We believe that section (g) gives the commissioners court the authority to determine when the lien will be recorded after an assessment has been approved by a subdivision. See also Attorney General Opinion DM-126 at 3 ("the commissioners court, in the absence of statutory guidelines, must determine the details of the collection process").

Next, you ask how the commissioners court should proceed in the event an approved assessment is not sufficient to complete the improvement. In particular, you ask whether the work on the improvement should be stopped, and how completion of the project should be funded. The statute does not directly address this particular scenario. Section (c) authorizes the commissioners court to "assess all or part of the costs of [an] improvement" against the real property owners in a subdivision. (Emphasis added.) Thus, the statute appears to contemplate that the commissioners court has the option of funding part of an improvement from other sources. Therefore, we believe that the commissioners court may opt to continue work on the improvement and to pay for such work with non-assessment funds. The statute would also appear to authorize the commissioners court to propose a new assessment to complete the project and to hold a new election according to the statutory requirements; clearly, however, the real property owners cannot be charged for additional costs above the maximum assessment without their approval.

Finally, you ask what costs may be assessed against the real property owners aside from costs for actual construction of a road. You ask, for example, whether loan or note interest or fees, costs for engineering services used to determine the required improvement, or charges for bid publications may be included in the assessment. Article 6702-3(c) authorizes the commissioners court to assess only "all or part of the costs of the improvement." "Improvement" is defined in the statute as "the construction, reconstruction, or repair of a road." V.T.C.S. art. 6702-3(b). In Attorney General Opinion DM-126, we concluded that this statutory language does not permit the commissioners court to include in the assessment the costs of holding the election and collecting the assessment. We did so because the statute clearly does not authorize the commissioners court to assess real property owners for administrative costs associated with the assessment which would not be incurred if an improvement were funded by other means. The determination whether the particular costs raised in your query are assessable improvement costs or nonassessable administrative costs involves questions of fact which are not amenable to the opinion process and should be resolved by the commissioners court in the first instance.

SUMMARY

Article 6702-3, V.T.C.S., requires the commissioners court to propose separate assessments and hold separate elections in each subdivision. Section (g) of article 6702-3 gives the commissioners court the authority to determine when the lien will be recorded after an assessment has been approved by a subdivision. If the costs of an improvement exceed the maximum assessment, the commissioners court may complete the improvement with non-assessment funds or propose a new assessment to complete the project and hold a new election according to the statutory requirements. The determination whether particular costs are assessable improvement costs or nonassessable administrative costs involves questions of fact which are not amenable to the opinion process and should be resolved by the commissioners court in the first instance.

DAN MORALES
Attorney General of Texas

WILL PRYOR
First Assistant Attorney General

MARY KELLER
Deputy Assistant Attorney General

RENEA HICKS
Special Assistant Attorney General

MADELEINE B. JOHNSON
Chair, Opinion Committee