Management Districts are established by the Texas Legislature. They have the power to levy taxes and assess property owners for a variety of improvements and services. To become established by the legislature a district must have support of the local State Representatives and Senators whose districts are in all or part of the proposed management district.

The primary purpose of a management district is to promote occupancy of empty retail space, quality of life issues, support and coodinate police services, promote general commerce for all businesses, provide economic development incentives, and in general promote the public welfare especially in commercial areas. Commercial property owners in the designated areas are financially contributing to the district based on the value of their property.