Elections

Board of Directors Member Eligibility & Voting Restrictions

To be qualified to serve as a member of a municipal utility district’s board of directors, an individual must be (a) at least 18 years of age, (b) a resident citizen of the State of Texas, and (c) either own land subject to taxation within the district or be a qualified voter within the district. Texas Water Code § 54.102. A person is disqualified from serving as a member of the board of directors if such person (a) is a developer (sub-divider of real estate for resale) of property in the district, (b) provides professional services to either the district, or a developer in the district, or (c) is a party to a contract with the district or a developer in the district relating to the district or property within the district, other than a contract for the purchase of utility service or the purchase or conveyance of residential or commercial property for such person’s use. Texas Water Code § 49.052(a)(3), (4) & (5). A person is also disqualified from serving as a member of the board of directors if such person either is related within the third degree of affinity of consanguinity to or is an employee of (a) a developer of property within the district, (b) any other member of the board of directors, or (c) any person providing professional services to the district. Texas Water Code § 49.052(a)(1) & (2). If a vacancy on the board of directors arises, a person is not qualified to be appointed to fill such vacancy if such person resigned from the board (a) in the two years preceding the vacancy date or (b) on or after the vacancy date but before the vacancy is filled or if such person was defeated in a directors election conducted by the district in the two years preceding the vacancy date. Texas Water Code § 54.103.

An otherwise qualified member of a district board of directors may generally not participate in discussions nor vote on a matter in which such member has a substantial business or property interest or is related to a person within the first degree of affinity or consanguinity having such a substantial business or property interest in the matter coming before the board. Texas Loc. Gov’t Code § 171.004(a). A substantial business interest is represented by (a) ownership of 10% or more of an affected entity’s voting stock, (b) ownership of 10% or more or $15,000 or more of the fair market value of such business entity, or (c) receipt of funds from such business entity exceeding 10% of such person’s gross income from the preceding year. Texas Loc. Gov’t Code § 171.002(a) & (c). A substantial property interest is represented by a legal or equitable interest in real property having a fair market value of $2500 or more. Texas Loc. Gov’t Code § 171.002(b). In such instances, the member is required to file an affidavit stating the nature and extent of the affected interest. Texas Loc. Gov’t Code § 171.004(a). If a majority of the members of the board are likewise required to file and do file an affidavit of similar interest on the same official action, such members are not required to abstain from participating or voting on the matter. Texas Loc. Gov. Code § 171.004(c). The board is also required to conduct a separate vote on any budget item specifically dedicated to a contract in which a member has a substantial interest. Texas Loc. Gov’t Code § 171.005(a). The affected member may not participate in such a vote, except as provided in Texas Loc. Gov’t Code § 171.004(c); however, once such separate budget matter has been resolved, the affected member may participate in the vote on the final budget if such member has filed the affidavit required by Texas Loc. Gov’t Code § 171.004(a). Texas Loc. Gov’t Code § 171.005(b)