‘Wicked Witch of the West’ taxing district dissolved after six year fight against taxpayer activists

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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.

12 COMMENTS

  1. This reporter, Trent Siebert, gets it. All of the other news outlets concentrate on the bridge lights over the SW freeway. Why should the Mom and Pop businesses, that make up only 25% of the property in Montrose, with the rest being residential who don’t pay the tax, be responsible to pay for the lights on the bridges? The bridges are owned by TxDOT, not the City.

    Ellen Cohen, Garnet Coleman and Rodney Ellis formed the Montrose District in the 2009 Legislature. Ellen was not responsive to small businesses who contacted her to express their non-support of another tax assessment of their property. Ellen lost her State Representative office in the 2010 election.

    The Montrose District was not formed with 25 legal petitions, this was Judge Halbach’s and Judge Moore’s rulings in our case that we won! There were Board members who did not own commercial property and were not subject to the tax, this was against state law. The Vice Chairman of the District was one of these and has gone on to be the appointed by the Mayor to Chairman of the Montrose TIRZ, another special district.

    A lot of people do not know that we did the petition drive for the West Montrose District before they joined the East and the West Districts. They joined them in January 2011, so we did the combined district petition to find out who wanted the District and who did not. The petitions were presented to the Board for dissolution in the fall of 2011, they refused them. We filed our lawsuit in 2012. We did the petition drive again and presented them again in May 2017. The district makes up their own rules for vetting petitions because no one has ever done this before. Our petitions ended up with the fox watching us chickens. They were refused for the third time.

    A friend of mine got on the board to try to help give a viewpoint for the business taxpayers, but was shut out when he questioned how the District was spending money. One police officer was being paid $48,000 a year to schedule the other off duty police that the District hired for security patrols. The Districts consultant was charging $30,000 per month to manage the District and provide a board meeting per month. It is all about the money, most contract for projects are not even competitively bid out.

    The Galleria area businesses have really suffered from their Uptown District and TIRZ making the decision to put a bus line down the middle of Post Oak Blvd. Not one business in the District got to vote on spending $250-300 million of their tax dollars on the bus line, which has taken away parking, access to their stores and beautiful historic trees. It is all about the money, contracts, and political payback. The Mayor and the City Council are supposed to oversee the budgets and board members of every special district in Houston, they could help with these issues.

  2. Anonymous at 4:19 pm is confused. The vast majority of business owners in the Montrose District are small businesses, Moms & Pops; majority are also from countries around the world, people who have come here to raise their families, make a living and be part of our wonderful town. Contrary to your last comment- businesses were being double taxed by the special district, no breaks there, just bureaucratic greed.

    Good to hear the East End is finally waking up. Have been involved with my many friends from there for the
    last 12 yrs. of the Metro War. The East End District never was formed to have local business representation, just like the Montrose District, pretty amazing how many Metro people have worked for it over the last 12 years. People are using the term “Gentrification?!!” We have warned about this for 12 years, better late than never. If you want to keep your culture, your history and your local businesses, you will have to fight for them!

  3. Second Ward in the East End is going through this battle with “the wicked witch of the West. In their deed of injustice they are threatening our Barrios, Second Ward, Denver Harbor, Magnolia, North Side, Fifth Ward. It is horrendous, as it is destroying our culture, our land marks, our customs of living. We are on an uphill battle, while the Mayor says “nothing”

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