81R33584 SMH-F
By: Hegar S.B. No. 1846
Substitute the following for S.B. No. 1846:
By: Corte C.S.S.B. No. 1846
A BILL TO BE ENTITLED
AN ACT
relating to the powers and duties of the Texas Commission on
Environmental Quality and related entities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter C, Chapter 341, Health and Safety
Code, is amended by adding Section 341.0365 to read as follows:
Sec. 341.0365. ADDITIONAL REQUIREMENTS FOR OWNERS AND
OPERATORS OF CERTAIN WATER WELLS. (a) In addition to any
applicable requirements under this chapter or other law, a person
who owns or operates a water well that, for compensation, provides
water to not fewer than 3 and not more than 14 residences for any
purpose shall ensure that the well water is treated with chlorine or
a chlorine compound.
(b) The chlorination system for the well water must be
designed by a professional water engineer. The owner or operator of
the well must submit the plans to the commission for approval before
use of the chlorination system. The owner or operator of the well
shall maintain the chlorination system and keep the system in
functional operating condition.
(c) In coordination with the local health department, the
owner or operator of the well must perform testing for foreign
organisms in the water, including fecal coliform bacteria and E.
coli bacteria, every six months. The owner or operator of the well
must provide the commission and the recipients of water from the
well with the results of the testing.
SECTION 2. Section 5.1175, Water Code, is amended to read as
follows:
Sec. 5.1175. PAYMENT OF PENALTY BY INSTALLMENT. (a) The
commission by rule may [shall] allow a person who [small business
that] owes a monetary civil or administrative penalty imposed for a
violation of law within the commission's jurisdiction or for a
violation of a license, permit, or order issued or rule adopted by
the commission to pay the penalty in periodic installments. The
rule must provide a procedure for a person [qualified small
business] to apply for permission to pay the penalty over time.
(b) [The rule must classify small businesses by their net
annual receipts and number of employees. A business that is a
wholly owned subsidiary of a corporation may not qualify as a small
business under this section.
[(c)] The rule may vary the period over which the penalty
may be paid or the amount of the periodic installments according to
the amount of the penalty owed and the size of the business that
owes the penalty. The period over which the penalty may be paid may
not exceed 36 [12] months.
SECTION 3. Section 7.002, Water Code, is amended to read as
follows:
Sec. 7.002. ENFORCEMENT AUTHORITY. The commission may
initiate an action under this chapter to enforce provisions of this
code and the Health and Safety Code within the commission's
jurisdiction as provided by Section 5.013 of this code and rules
adopted under those provisions. The commission or the executive
director may institute legal proceedings to compel compliance with
the relevant provisions of this code and the Health and Safety Code
and rules, orders, permits, or other decisions of the commission.
The commission may delegate to the executive director the authority
to issue an administrative order including the authority to assess
penalties or order corrective measures to ensure compliance with
the provisions of this code and the Health and Safety Code within
the commission's jurisdiction as provided by Section 5.013 of this
code and rules adopted under those provisions.
SECTION 4. Section 13.043, Water Code, is amended by
amending Subsection (h) and adding Subsection (h-1) to read as
follows:
(h) The commission or the executive director may[, on a
motion by the executive director or by the appellant under
Subsection (a), (b), or (f) of this section,] establish interim
rates to be in effect until a final decision is made.
(h-1) If the commission sets a final rate that is lower than
the interim rate established under Subsection (h), the retail
public utility shall refund or credit the difference between the
interim rate and the final rate plus interest as determined by the
commission, unless otherwise agreed to by the parties to the
proceeding. If the commission sets a final rate that is higher than
the interim rate, the retail public utility may collect the
difference between the interim rate and the final rate unless
otherwise agreed to by the parties to the proceeding.
SECTION 5. Subsection (c), Section 13.131, Water Code, is
amended to read as follows:
(c) The commission shall fix proper and adequate rates and
methods of depreciation, amortization, or depletion of the several
classes of property of each utility and shall require every utility
to carry a proper and adequate depreciation account in accordance
with those rates and methods and with any other rules the commission
prescribes. Rules adopted under this subsection must require the
book cost less net salvage of depreciable utility plant retired to
be charged in its entirety to the accumulated depreciation account
in a manner consistent with accounting treatment of regulated
electric and gas utilities in this state. Those rates, methods, and
accounts shall be utilized uniformly and consistently throughout
the rate-setting and appeal proceedings.
SECTION 6. Subsection (a), Section 13.145, Water Code, is
amended to read as follows:
(a) A utility may consolidate more than one system under a
single tariff on a regional or statewide basis [only] if[:
[(1) the systems under the tariff are substantially
similar in terms of facilities, quality of service, and cost of
service; and
[(2)] the tariff provides for rates that promote water
conservation for single-family residences and landscape
irrigation.
SECTION 7. Section 13.187, Water Code, is amended by
amending Subsections (f), (i), (j), (k), (l), (n), and (o) and
adding Subsection (l-1) to read as follows:
(f) The regulatory authority may set the matter for hearing
on its own motion at any time within 120 days after the effective
date of the rate change. [If more than half of the ratepayers of the
utility receive service in a county with a population of more than
2.5 million, the hearing must be held at a location in that county.]
(i) The regulatory authority or the executive director,
pending final action in a rate proceeding, may order the utility to
deposit all or part of the rate increase received or to be received
into an escrow account with a financial institution approved by the
regulatory authority. Unless otherwise agreed to by the parties to
the rate proceeding, the utility shall refund or credit against
future bills all sums collected during the pendency of the rate
proceeding in excess of the rate finally ordered plus interest as
determined by the regulatory authority.
(j) For good cause shown, the regulatory authority or the
executive director may authorize the release of funds to the
utility from the escrow account during the pendency of the
proceeding.
(k) If the regulatory authority receives at least the number
of complaints from ratepayers required for the regulatory authority
to set a hearing under Subsection (e), the regulatory authority or
the executive director may, pending the hearing and a decision,
suspend the date the rate change would otherwise be effective.
Except as provided by Subsection (d-1), the proposed rate may not be
suspended for longer than:
(1) 90 days by a local regulatory authority; or
(2) 250 [150] days by the commission or executive
director.
(l) During [At any time during] the pendency of the rate
proceeding the regulatory authority or the executive director may
fix interim rates to remain in effect until a final determination is
made on the proposed rate. The regulatory authority may fix interim
rates at any time during the pendency of the rate proceeding. The
executive director may fix interim rates not later than the 120th
day after the proposed effective date of the proposed rate change.
The interim rates established by the executive director may not be
lower than the rates on the utility's approved tariff or higher than
those in the application of the utility. In establishing an interim
rate, the executive director shall consider only representative
operating data for the test year proposed in the application of the
utility. The executive director may request additional data or
information for the test year. In establishing an interim rate, the
executive director shall consider:
(1) whether the interim rate will preserve the
financial integrity of the utility during the period that the
interim rate is in effect;
(2) whether the interim rate will provide sufficient
money for the capital improvements necessary to provide facilities
capable of providing adequate and continuous utility service during
the period that the interim rate is in effect;
(3) whether the interim rate equitably distributes
costs across and is consistent in application to each class of
affected customers; and
(4) any other factor that the executive director
considers adequately balances the public interest and that of the
utility.
(l-1) If the executive director establishes an interim rate
under Subsection (l), the executive director shall issue an order
establishing the interim rate that states the basis on which the
executive director established the interim rate, after taking into
consideration the factors provided by this section.
(n) For good cause shown, the regulatory authority or the
executive director may at any time during the proceeding require
the utility to refund money collected under a proposed rate before
the rate was suspended or an interim rate was established to the
extent the proposed rate exceeds the existing rate or the interim
rate.
(o) If a regulatory authority other than the commission or
the executive director establishes interim rates or an escrow
account, the regulatory authority must make a final determination
on the rates not later than the first anniversary of the effective
date of the interim rates or escrowed rates or the rates are
automatically approved as requested by the utility.
SECTION 8. Subchapter F, Chapter 13, Water Code, is amended
by adding Section 13.193 to read as follows:
Sec. 13.193. UTILITY FACILITIES CONSTRUCTION AND
IMPROVEMENT CHARGE. (a) Notwithstanding any other provision of
this chapter, a utility may assess a utility facilities
construction and improvement charge to recover the depreciation and
return on investment of a utility facilities construction and
improvement project that:
(1) is completed and placed into service between two
consecutive statements of intent to change the utility's rates or
tariff filed under Section 13.187; and
(2) serves the utility's certificated service area,
including a facility used for:
(A) the production, transmission, storage,
distribution, or provision of potable or recycled water to the
public; or
(B) the collection, transportation, treatment,
or disposal of sewage.
(b) The commission by rule shall require a utility that
proposes to assess a utility facilities construction and
improvement charge under this section:
(1) to file a tariff establishing a just and
reasonable manner for calculating the charge; and
(2) to receive the executive director's approval of
the tariff.
(c) In adopting rules under Subsection (b), the commission
shall ensure that:
(1) not later than the 60th day before a utility's
proposed inclusion of a charge or a proposed increase of a charge in
a tariff under this section, the utility submits to the executive
director for review of a project's eligibility a written notice
that contains:
(A) the amount of the proposed charge or increase
of a charge;
(B) the proposed implementation date for the
charge or increase of a charge;
(C) a list of completed, eligible capital
projects, and related depreciation and return on investment for
which the utility seeks reimbursement through the charge or
increase of a charge; and
(D) a calculation of the projected total annual
increase in revenue due to the charge or increase of a charge;
(2) the total amount the utility is authorized to
recover annually through a charge assessed under this section and
the amount the utility actually recovers are subject to annual
audit by the executive director;
(3) the amount of the charge the utility requests
authorization to assess is based on the amount necessary to ensure
that the charge yields a rate of return on invested capital that is
equal to:
(A) the rate of return approved for the utility
in the utility's most recent approved base rate or tariff change
application filed under Section 13.187; or
(B) the rate of return proposed by the utility,
if the rates in the utility's most recent base rate or tariff change
application were approved by settlement;
(4) the cumulative annual amount the utility proposes
to recover from the charge does not exceed an amount equal to 10
percent of the utility's annual revenue;
(5) the utility does not implement an increase under
this section more often than twice every calendar year;
(6) the charge is applied to each customer included in
the tariff;
(7) the utility provides to each customer written
notice of the charge on the initial tariff filing that proposes to
implement the charge; and
(8) the charge is subject to a true-up or
reconciliation at the utility's next rate case filed under Section
13.187.
(d) Notwithstanding any other provision of this code, the
implementation of a utility facilities construction and
improvement charge or an increase in a utility facilities
construction and improvement charge is not subject to a contested
case hearing under Chapter 2001, Government Code.
(e) This section does not apply to a utility that has in
place a negotiated stay-out agreement on September 1, 2009.
SECTION 9. Subsection (c), Section 13.242, Water Code, is
amended to read as follows:
(c) The commission may by rule allow a municipality or
utility or water supply corporation to render retail water or sewer
service without a certificate of public convenience and necessity
if the municipality has given notice under Section 13.255 [of this
code] that it intends to provide retail water or sewer service to an
area or if the utility or water supply corporation has less than 15
potential connections and is not within the certificated area of
another retail public utility.
SECTION 10. Section 13.248, Water Code, is amended to read
as follows:
Sec. 13.248. CONTRACTS VALID AND ENFORCEABLE. Contracts
between retail public utilities designating areas to be served and
customers to be served by those retail public utilities, when
approved by the commission or the executive director after public
notice [and hearing], are valid and enforceable and are
incorporated into the appropriate areas of public convenience and
necessity.
SECTION 11. Subsection (h), Section 26.0135, Water Code, is
amended to read as follows:
(h) The commission shall apportion, assess, and recover the
reasonable costs of administering the water quality management
programs under this section [from users of water and wastewater
permit holders in the watershed according to the records of the
commission generally in proportion to their right, through permit
or contract, to use water from and discharge wastewater in the
watershed]. Irrigation water rights, non-priority hydroelectric
rights of a water right holder that owns or operates privately owned
facilities that collectively have a capacity of less than two
megawatts, and water rights held in the Texas Water Trust for terms
of at least 20 years will not be subject to this assessment. The
cost to river authorities and others to conduct water quality
monitoring and assessment shall be subject to prior review and
approval by the commission as to methods of allocation and total
amount to be recovered. The commission shall adopt rules to
supervise and implement the water quality monitoring, assessment,
and associated costs. The rules shall ensure that water users and
wastewater dischargers do not pay excessive amounts, [that program
funds are equitably apportioned among basins,] that a river
authority may recover no more than the actual costs of
administering the water quality management programs called for in
this section, and that no municipality shall be assessed cost for
any efforts that duplicate water quality management activities
described in Section 26.177. [The rules concerning the
apportionment and assessment of reasonable costs shall provide for
a recovery of not more than $5,000,000 annually. Costs recovered by
the commission are to be deposited to the credit of the water
resource management account and may be used only to accomplish the
purposes of this section. The commission may apply not more than 10
percent of the costs recovered annually toward the commission's
overhead costs for the administration of this section and the
implementation of regional water quality assessments. The
commission, with the assistance and input of each river authority,
shall file a written report accounting for the costs recovered
under this section with the governor, the lieutenant governor, and
the speaker of the house of representatives on or before December 1
of each even-numbered year.]
SECTION 12. Section 49.321, Water Code, is amended to read
as follows:
Sec. 49.321. DISSOLUTION AUTHORITY. After notice [and
hearing], the commission or executive director may dissolve any
district that is inactive for a period of five consecutive years and
has no outstanding bonded indebtedness.
SECTION 13. Section 49.324, Water Code, is amended to read
as follows:
Sec. 49.324. ORDER OF DISSOLUTION. The commission or the
executive director may enter an order dissolving the district [at
the conclusion of the hearing] if the commission or executive
director [it] finds that the district has performed none of the
functions for which it was created for a period of five consecutive
years [before the day of the proceeding] and that the district has
no outstanding bonded indebtedness.
SECTION 14. Subsection (a), Section 49.326, Water Code, is
amended to read as follows:
(a) Appeals from an [a commission] order dissolving a
district shall be filed and heard in the district court of any of
the counties in which the land is located.
SECTION 15. Subsection (b), Section 54.030, Water Code, is
amended to read as follows:
(b) The governing body of a district which desires to
convert into a district operating under this chapter shall adopt
and enter in the minutes of the governing body a resolution
declaring that in its judgment, conversion into a municipal utility
district operating under this chapter and under Article XVI,
Section 59, of the Texas Constitution, would serve the best
interest of the district and would be a benefit to the land and
property included in the district. The resolution shall also
request that the commission approve [to hold a hearing on the
question of] the conversion of the district.
SECTION 16. Section 54.032, Water Code, is amended to read
as follows:
Sec. 54.032. CONVERSION OF DISTRICT: NOTICE. (a) Notice
of the conversion [hearing] shall be given by publishing notice in a
newspaper with general circulation in the county or counties in
which the district is located.
(b) The notice shall be published once a week for two
consecutive weeks [with the first publication to be made not less
than 14 full days before the time set for the hearing].
(c) The notice shall:
(1) [state the time and place of the hearing;
[(2)] set out the resolution adopted by the district
in full; and
(2) [(3)] notify all interested persons how they may
offer comments [to appear and offer testimony] for or against the
proposal contained in the resolution.
SECTION 17. Section 54.033, Water Code, is amended to read
as follows:
Sec. 54.033. CONVERSION OF DISTRICT; FINDINGS. (a) If
[After a hearing, if] the commission or the executive director
finds that conversion of the district into one operating under this
chapter would serve the best interest of the district and would be a
benefit to the land and property included in the district, the
commission or executive director [it] shall enter an order making
this finding and the district shall become a district operating
under this chapter and no confirmation election shall be required.
(b) If the commission or the executive director finds that
the conversion of the district would not serve the best interest of
the district and would not be a benefit to the land and property
included in the district, the commission or executive director [it]
shall enter an order against conversion of the district into one
operating under this chapter.
(c) The findings of the commission or the executive director
entered under this section shall be subject to appeal or review
within 30 days after entry of the order [of the commission] granting
or denying the conversion.
(d) A copy of the [commission] order converting a district
shall be filed in the deed records of the county or counties in
which the district is located.
SECTION 18. Sections 49.322 and 54.031, Water Code, are
repealed.
SECTION 19. Section 13.145(a), Water Code, as amended by
this Act, applies only to an application for approval of a tariff
filed on or after the effective date of this Act. An application
filed before the effective date of this Act is governed by the law
in effect on the date the application is filed, and that law is
continued in effect for that purpose.
SECTION 20. The changes in law made by Section 13.187, Water
Code, as amended by this Act, apply only to a rate application or
appeal filed with the Texas Commission on Environmental Quality on
or after the effective date of this Act. A rate application or
appeal filed with the commission before the effective date of this
Act is governed by the law as it existed immediately before the
effective date of this Act, and that law is continued in effect for
that purpose.
SECTION 21. The changes in law made by Section 13.193, Water
Code, as added by this Act, apply only to a project that is
completed and placed into service on or after the effective date of
this Act. A project that is completed and placed into service before
the effective date of this Act is subject to the law in effect at
that time, and that law is continued in effect for that purpose.
SECTION 22. (a) Except as provided by Subsection (b) of
this section, this Act takes effect September 1, 2009.
(b) Section 341.0365, Health and Safety Code, as added by
this Act, takes effect September 1, 2010.