Property Owners battle Management District

It’s clear to all parties at this point that a majority of the commercial property owners in the boundaries of the Montrose Management District are not happy to be governed by the new entity. Both Texas Watchdog’s Steve Miller and the Houston Chronicle have an interesting view of the escalating dispute between the appointed board of directors and the businesses they represent.

Texas Watchdog:

The Montrose Management District was hatched via 2009 legislation carried by City Council member-elect Ellen Cohen, a state legislator at the time. Cohen did not return a call.

Her bill allowed the creation of a West Montrose Management District, which quickly merged with the established East Montrose Management District, as had been planned for years.

Records show that a group calling itself Montrose Management District paid two lobbyists from Vinson & Elkins, which also handles legal matters for the district, to work for it last session. The two were paid under $10,000, one of the broad ranges used in reporting lobbying activity.

Hubbard was a main figure in the original district, nominating Nagar and Ellis in 2006, and motioning to put Grover on the board.

Under the bill creating the West Montrose district in 2009, 10 board members were named, unlike the 2005 legislation creating its east-side counterpart. Eight of the 10 are now on the consolidated management district board.

The 2009 bill also provided a method for directors to avoid abstaining from voting on issues that might favorably affect their own interests.

Under the provisions of the bill, a director files an affidavit acknowledging the conflict of interest. The member may then participate in the vote provided “the majority of directors have a similar interest in the same entity” and “all other similar businesses … in the district will receive a similar pecuniary benefit.”

After meeting jointly for over a year, the districts merged by approval of the two separate boards in February, becoming the Montrose Management District. The vote was unanimous, and there were no public comments.

The property owners complain that the district was created in the darkness of night, with little or no notice to those about to become taxpayers in the new scheme. In fact they formed a grass roots organization called “Stop the District!” specifically to dissolve the newly formed entity. While it’s unclear how many property owners were part of the formation group (as few as 25 it seems) it’s apparent that over 850 are staunchly opposed and signed a petition to force a dissolution. That effort failed.

From the Chronicle:

According to the district’s findings, which are to posted online at the petition contains 849 verified signatures representing property value of $544 million, or 13.7 percent of almost $4 billion in total assessed value within the district.

Another 139 signatures representing $287 million worth of property were not verified.

In its resolution, the board said no additional signatures would be considered as part of the current petition. Still, the district’s use of $4 billion as total property value was met with disbelief by some property owners.

“Did you just squash our number down to nothing?,” one blurted out as the findings were reported to the board.

Rose said obtaining enough required signatures to satisfy the higher number would be unreachable.

There will much more to this story. It’s time for an exhaustive look at these districts from the bottom up. Stay tuned.

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