Texas House Bill HB1407

Texas 2025 - 89th Regular

• Filed: 11/19/24

Caption

Relating to public utility agencies; providing authority to issue bonds; providing authority to impose assessments.

Impact

The implications of HB 1407 on state laws are notable. It amends existing sections of the Local Government Code to redefine the powers and responsibilities of public utility agencies, aligning their functionalities more closely with those of municipalities. Specifically, the bill allows these agencies to raise revenue through special assessments while reiterating that they cannot impose taxes. This differentiation is crucial as it outlines the limits of fiscal power that these agencies hold, emphasizing their role in local governance without overstepping into taxation, an area historically reserved for public entities.

Summary

House Bill 1407 proposes significant changes to the governance and operational structure of public utility agencies within Texas. The bill grants these agencies expanded authority to issue bonds for financing their operations and to impose assessments. This authority is intended to provide public utilities with the necessary financial flexibility to enhance infrastructure projects, ensure sustainable service delivery, and manage costs effectively. By enabling public utility agencies to secure funding through various mechanisms, the bill aims to address critical funding gaps that have historically impeded infrastructure improvements in water and sewer services.

Contention

A point of contention surrounding HB 1407 centers on the balance of power between local governance and the increased authority vested in public utility agencies. Supporters argue that the changes will streamline operations and improve efficiencies in utility management, facilitating better service delivery for residents. Opponents, however, may raise concerns about potential overreach by these agencies, fearing a lack of accountability and transparency in financial dealings. The requirement for agencies to provide clear communication regarding rate changes and financial assessments to ratepayers is an important aspect of the discussions, aiming to ensure accountability and protect consumer interests.

Texas Constitutional Statutes Affected

Local Government Code

• Chapter 572. Public Utility Agencies For Provision Of Water Or Sewer Service
  • Section: 001
  • Section: 012
  • Section: 051
  • Section: 052
  • Section: 053
  • Section: 061
  • Section: 062
  • Section: New Section

Water Code

• Chapter 13. Water Rates And Services
  • Section: 002
  • Section: 043
  • Section: 242