ENGR. H. B. NO. 1438 Page 1 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
ENGROSSED HOUSE
BILL NO. 1438 By: Patzkowsky of the House
and
Frix of the Senate
An Act relating to waters and water rights; amending
62 O.S. 2021, Section 2003, which relates to
administration of Rural Economic Action Plan grant
program; modifying monetary cap on the award of
certain funds; amending 82 O.S. 2021, Section
1085.39, which relates to grant; modifying monetary
cap on certain grants; and providing an effective
date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 62 O.S. 2021, Section 2003, is
amended to read as follows:
Section 2003. A. Monies appropriated by law to the Oklahoma
Water Resources Board for the purpose of funding the Rural Economic
Action Plan grant program a nd the Rural Economic Action Plan Water
Projects Fund shall be administered by the Oklahoma Water Resources
Board as provided by this section.
B. The monies referred to in subsection A of this section shall
be distributed to eligible cities and towns, uni ncorporated areas or
other qualified entities located within the areas represented by the
following organizations:
ENGR. H. B. NO. 1438 Page 2 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
1. Association of Central Oklahoma Governments (ACOG);
2. Association of South Central Oklahoma Governments (ASCOG);
3. Central Oklahoma E conomic Development District (COEDD);
4. Eastern Oklahoma Economic Development District (EOEDD);
5. Grand Gateway Economic Development Association (GGEDA);
6. Indian Nations Council of G overnments (INCOG);
7. Kiamichi Economic Development District (KED DO);
8. Northern Oklahoma Development Association (NODA);
9. Oklahoma Economic Development Association (OEDA);
10. Southern Oklahoma Development Association (SODA); and
11. South Western Oklahoma Development Authority (SWODA).
C. The monies referred t o in subsection A of this section shall
not be expended for the benefit of cities or towns with a population
in excess of seven thousand (7,000) persons according to the latest
Federal Decennial Census. Funds may also be expended for any city
or town with a population below seven thousand (7,000) persons based
upon the current population estimate according to the U.S. Census
Bureau. Funds may be expended for such cities and towns until the
next following Federal Decennial Census. Any municipality may ent er
into an agreement with an entity described in subsection B of this
section to apply for available funds described by this section if
the municipality is located within the area served by the entity.
Upon approval of the application, funds shall be paid to the
municipality requesting the funds.
ENGR. H. B. NO. 1438 Page 3 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
D. An entity described in subsection B of this section may
apply for a grant to be used for the benefit of an unincorporated
area within a county served by that entity if the area benefited
does not contain a pop ulation in excess of seven thousand (7,000)
persons. Any county may enter into an agreement with an entity
described in subsection B of this section if the county is located
within the area served by the entity. Upon approval of the
application, funds sh all be paid to the county requesting the funds.
E. The monies referred to in subsection A of this section may
be expended for water quality projects, including but not limited to
sewer line construction or repair and related storm or sanitary
sewer projects, water line construction or repair, water treatment,
water acquisition, distribution or recovery and related projects.
F. Any city or town with a population less than one thousand
seven hundred fifty (1,750) persons according to the latest Federal
Decennial Census shall have a higher priority for funds allocated by
the Oklahoma Water Resources Board from the amount referred to in
subsection A of this section than jurisdictions of greater size.
Among such cities or towns, those municipalities having rel atively
weaker fiscal capacity shall have a priority for project funding in
preference to other municipalities.
G. The Oklahoma Water Resources Board shall establish ten
separate accounts containing one-tenth (1/10) of the amount annually
appropriated to the Rural Economic Action Plan Water Projects Fund
ENGR. H. B. NO. 1438 Page 4 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
per account. Each account shall be available for distribution to
qualified entities located within the area served by entities
described in subsection A of Section 2007 of this title or for
distribution to benefit unincorporated areas with the exception of
one account which shall be divided equally into two subaccounts.
Each one of the two subaccounts shall be available for distribution
to qualified entities located within the respective jurisdiction of
one of the entities described by subsection B of Section 2007 of
this title or for distribution to benefit unincorporated areas. No
funds deposited into one account or subaccount shall be transferred
to any other account. The total expenditure from any on e account or
subaccount for each fiscal year may not exceed the amount of funds
available to each account as may be provided by law.
H. No city, town or other entity to which funds will be awarded
pursuant to this section shall be required to provide any form of
match to obtain the funds, whether through cash, services or any
other method.
I. The Oklahoma Water Resources Board shall not be allowed to
retain any of the funds referred to in subsection A of this section
for administration. All such funds sh all be distributed to eligible
entities as authorized by law.
J. In order to ensure fair and equitable distribution of the
funds referred to in subsection A of this section, the Oklahoma
Water Resources Board shall promulgate rules for administering,
ENGR. H. B. NO. 1438 Page 5 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
determining priority of, approving and funding applications for such
funds. The rules shall implement the provisions of this section
including the following:
1. No qualified entity shall be approved nor funded for more
than One Hundred Fifty Thousand Dollars ($150,000.00) Three Hundred
Fifty Thousand Dollars ($350,000.00) from such funds in any twelve -
month period;
2. If a qualified entity has previously been approved for or
received such funds and makes a subsequent application, that
subsequent application may be assigned lower priority than an
application by qualified entities who have not previously been
approved for or received such funds;
3. In order to prevent substantially the same entity or area
from receiving an undue advantage, a political subdivis ion and all
its public trusts and similar subordinate entities together shall be
treated as one and the same qualified entity; provided rural water
or sewer districts shall not be construed to be subordinate entities
of counties unless the effect would be to make multiple grants to
substantially the same entity or service area; and
4. The Oklahoma Water Resources Board may establish limited
time periods for processing applications for available funds.
SECTION 2. AMENDATORY 82 O.S. 2021, Section 1085.39, is
amended to read as follows:
ENGR. H. B. NO. 1438 Page 6 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
Section 1085.39. In furtherance of the purposes of Sections
1085.31 through 1085.49 of this title:
1. The Oklahoma Water Resources B oard shall administer grants
from any monies which may be available to the Water Resources Fund
for furtherance of the purposes of Sections 1085.31 through 1085.49
of this title to eligible entities of the state with such conditions
as shall in its discretion effectuate these purposes. For purposes
of carrying out and im plementing the provisions of this section,
there is hereby created and established within the Water Resources
Fund a grant account which shall contain such monies as may be
available for purposes of carrying out the provisions of this
section. No more tha n ten percent (10%) of such grants shall be
used for planning purposes. All such eligible entities are hereby
authorized to accept grants from the Board. No grant shall be made
to any single eligible entity during any fiscal year in an amount
exceeding twenty percent (20%) of the funds available for grants to
eligible entities during that fiscal year nor shall such grant
exceed One Hundred Thousand Dollars ($100,000.00) Three Hundred
Thousand Dollars ($300,000.00) . In the case of projects to which
more than one eligible entity is a party, no such grant shall be
made exceeding in amount twenty percent (20%) of funds available for
such purposes per participating eligible entity nor shall such grant
exceed One Hundred Thousand Dollars ($100,000.00) Three Hundred
Thousand Dollars ($300,000.00) per participating entity. In making
ENGR. H. B. NO. 1438 Page 7 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
such grants, the Board shall consider: The needs of the area to be
served by the project and the benefit of the pro ject to the area in
relation to the needs of other areas requiring state assistance; the
availability of revenue to the political subdivision, from all
sources, for the ultimate repayment of the cost of the project,
including interest; whether the political subdivision can reasonably
finance the project without assistance from the state; and the
relationship of the project to the overall statewide water and
sewage treatment needs; and whether or not the applicant has taken
all reasonable measures to limit w aste and conserve water;
2. The Board shall prescribe such rules a nd regulations as may
be necessary for determining the eligibility and priority of
applicants for loans and grants and devise rules and regulations to
insure fair and equitable distribution of said loans and grants; and
promulgate and adopt such rules and regulations as may be necessary
for purposes of expenditures and payments. Provided, no grant of
funds shall be made unless such grant is necessary to assist public
bodies in emergency sit uations. Provided also priorities for use of
loan and grant money for a particular project shall be established
by the state agency with primary responsibility. Provided further,
that the Board shall not adopt any rule, regulation or condition
requiring that a particular attorney or law firm be employed by any
eligible entity in connection with such entity's grants or loans
from the Board; and
ENGR. H. B. NO. 1438 Page 8 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
3. The Board is hereby authorized to direct that up to fifty
percent (50%) of the interest income from the invest ment of monies
in the Statewide Water Development Revolving Fund an d the Water
Resources Fund Grant Account accruing from and after the date of
this act be deposited in the Statewide Water Development Revolving
Fund created under Section 1085.40 of this title.
The Board may adopt reasonable nondiscriminatory standards for
selection of legal counsel.
SECTION 3. This act shall become effective November 1, 2025.
Passed the House of Representatives the 10th day of March, 2025.
Presiding Officer of the House
of Representatives
Passed the Senate the ___ day of __________, 2025.
Presiding Officer of the Senate