HOUSTON — In a milestone decision Thursday, the Montrose Management District caved under pressure from local taxpayer activists and dissolved, marking perhaps the first time in state history that a Texas government entity has been forced to shutter by its own citizens.
“The fact that the Montrose Management District did the right thing and dissolved today marks a significant point in Texas history, not just Houston history,” said Andy Taylor, the attorney for the Montrose taxpayers fighting the taxing district. “This is the first time that the citizens have absolutely been able to dissolve the government. It’s an unbelievable precedent that we’ve just achieved.”
Taxpayers — management districts such as Montrose charge business owners, rather than homeowners — have been fighting the Montrose district for six years, although issues have been coming to a head since the end of 2017.
Judge Daryl Moore of the Harris County 333rd Civil Court ruled late last year that the management district improperly assessed nearly $6.6 million from business owners. Moore also ruled that the district “is further ordered to refrain from attempting to collect further assessments” from taxpayers, as well as spending any of that money wrongly collected.
Indeed, the assessments paid by property owners were done so under duress, according to Moore.
Claude Wynn, a longtime board member who became chairman of the Montrose district in 2011, said in a letter that his resignation would be effective Dec. 31. Wynn, a commercial real estate developer, praised in his letter the work that the district has done.
“(W)e provided the Montrose area with local vision and attention worthy of its unique and vital character,” Wynn wrote. “As I continue to live and work in Montrose, we will all be beneficiaries of the many accomplishments and improvements we have made for the betterment of the district.”
Officials with the district, in previous interviews, have said than Wynn stepping down had nothing to do with the controversy surrounding the district or the fight. Montrose officials declined to comment to The Texas Monitor Thursday.
Taylor estimates taxpayers saved $60 million by assuring the district didn’t sign-off on another multi-year service agreement.
“We always hear we can’t beat city hall,” Taylor said. “Well, today proves just the opposite. You can beat city hall if you just have the resolve to keep fighting. My hat is off to the commercial taxpayers who bonded together and banded together to kill the Wicked Witch of the West.”
Along with many special taxing districts, the creation of the Montrose Management District — initially called the West Montrose Management District before the merger with a neighboring district — was controversial.
The district was created in 2010. And like all of these management districts, they are not created by a vote of the people, but in the State Capitol in Austin where the bills are pushed quietly with very little input from those who would be taxed.
Once lawmakers and the governor sign off on the district legislation, management district officials must collect the signatures of 25 real commercial property owners within the district’s specified boundaries. It’s the businesses that are taxed rather than homeowners.
“This battle that we just won doesn’t mean the war is completely over,” Taylor said. “We were able to dissolve this district, but that doesn’t mean the lawmakers in the next legislative session, which is January of next year can’t create a new district.”
But once created, they seldom go away. And in the case of the Montrose Management District, taxpayers have long argued they’ve gotten very little for their sizable tax bills.
Montrose taxpayer activist Philip Navratil is one of those who takes care of his own business and sees little need for a management district.
“They’ve wiggled, they’ve jiggled. I can’t believe they’ve decided to come to the end of the road, but they have,” Navratil said. “It stops here today and we’re grateful. And we’re happy.”
He’s disappointed that management district officials didn’t follow what the taxpayers wanted sooner.
“These guys have had ample opportunity,” Navratil said. “For many years they’ve known that the bulk of the people paying the assessment did not want them here.”
Trent Seibert can be reached at [email protected] or at 832-258-6119.