Is it legal for a city in Texas to form a PID to partially finance a private development that is only in the planning stage?

Asked over 1 year ago - Rockwall, TX

A local developer has requested our city of about 7500 residents to form a public improvement district and issue bonds that could eventually total over $35M to finance infrastructure. The proposed 780+ acre development has been in the planning stage for over 5 years. The principals have negotiated partial financing that is contingent on the city's participation via the PID. There is significant local citizen opposition as demonstrated in a recent public hearing, however a close majority of our elected city council seem to be in favor. There are no capital improvements to the land at this time and its appraised value will be collateral for the conventional part of financing the project. City advisors claim there is no financial risk to the city in the event of bankruptcy or foreclosure.

Attorney answers (3)

  1. Timothy Joseph Hardesty

    Contributor Level 11


    Lawyers agree

    Best Answer
    chosen by asker

    Answered . This is actually a fairly common arrangement. Developers don't want to spend a lot of time, and investors don't want to put money into, a project only to discover that there's no infrastructure to support it.

    Thank being said, simply because it is legal to do something in general, does not necessarilly mean that there are not other considerations. There are transactions that are not allowed, whether by reasons of self-dealing or whatever. If you feel something untoward is occuring, you should speak to an attorney.

  2. Orsen E. Paxton III


    Contributor Level 18


    Lawyers agree

    Answered . This site is not designed to address your issue nor is it appropriate for a complex issue like this. If there is significant citizen opposition, then they should hire an experienced lawyer.

    DISCLAIMER: This is not specific legal advice and does not establish an attorney/client relationship.
  3. Cheryl Rivera Smith

    Contributor Level 20

    Answered . There are many issues floating around with this. A good entitlements attorney can help you address them. If several of you get together, the cost could be shared. Best of luck.

Related Topics

Real estate

The term real estate means land and items permanently attached to it, like buildings. This area of law deals with who has the right to own and use these items.

State, local, and municipal law

State, local, and municipal laws only apply to one location. However, these laws cover many subjects, such as land use, public services, and education policy.

Can't find what you're looking for? Ask a Lawyer

Get free answers from experienced attorneys.


Ask now

30,780 answers this week

3,445 attorneys answering

Ask a Lawyer

Get answers from top-rated lawyers.

  • It's FREE
  • It's easy
  • It's anonymous

30,780 answers this week

3,445 attorneys answering