H.B. No. 1901
AN ACT
relating to the applicability of provisions concerning bond
approval by the Texas Commission on Environmental Quality to
certain water entities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 49.181(a) and (h), Water Code, are
amended to read as follows:
(a) A district may not issue bonds unless the commission
determines that the project to be financed by the bonds is feasible
and issues an order approving the issuance of the bonds. This
section does not apply to:
(1) refunding bonds if the commission issued an order
approving the issuance of the bonds or notes that originally
financed the project;
(2) refunding bonds that are issued by a district
under an agreement between the district and a municipality allowing
the issuance of the district's bonds to refund bonds issued by the
municipality to pay the cost of financing facilities;
(3) bonds issued to and approved by the Farmers Home
Administration, the United States Department of Agriculture, the
North American Development Bank, or the Texas Water Development
Board; [or]
(4) refunding bonds issued to refund bonds described
by Subdivision (3); or
(5) bonds issued by a public utility agency created
under Chapter 572, Local Government Code, any of the public
entities participating in which are districts if at least one of
those districts is a district described by Subsection (h)(1)(E).
(h) This section does not apply to:
(1) a district if:
(A) [(1)] the district's boundaries include one
entire county;
(B) [(2)] the district was created by a special
Act of the legislature and:
(i) [(A)] the district is located entirely
within one county;
(ii) [(B)] the district is located entirely
within one or more home-rule municipalities;
(iii) [(C)] the total taxable value of the
real property and improvements to the real property zoned by one or
more home-rule municipalities for residential purposes and located
within the district does not exceed 25 percent of the total taxable
value of all taxable property in the district, as shown by the most
recent certified appraisal tax roll prepared by the appraisal
district for the county; and
(iv) [(D)] the district was not required by
law to obtain commission approval of its bonds before the effective
date of this section;
(C) [(3)] the district is a special water
authority;
(D) [(4)] the district is governed by a board of
directors appointed in whole or in part by the governor, a state
agency, or the governing body or chief elected official of a
municipality or county and does not provide, or propose to provide,
water, sewer, drainage, reclamation, or flood control services to
residential retail or commercial customers as its principal
function; or
(E) [(5)] the district on September 1, 2003:
(i) [(A)] is a municipal utility district
that includes territory in only two counties;
(ii) [(B)] has outstanding long-term
indebtedness that is rated BBB or better by a nationally recognized
rating agency for municipal securities; and
(iii) [(C)] has at least 5,000 active water
connections; or
(2) a public utility agency created under Chapter 572,
Local Government Code, any of the public entities participating in
which are districts if at least one of those districts is a district
described by Subdivision (1)(E).
SECTION 2. Section 49.052(f), Water Code, is amended to
read as follows:
(f) This section shall not apply to special water
authorities, districts described in Section 49.181(h)(1)(D)
[49.181(h)(4)], or a district where the principal function of the
district is to provide irrigation water to agricultural lands or to
provide nonpotable water for any purpose.
SECTION 3. Section 49.183(d), Water Code, is amended to
read as follows:
(d) A district's bonds are negotiable instruments within
the meaning and purposes of the Business & Commerce Code. A
district's bonds may be issued and bear interest in accordance with
Chapters 1201, 1204, and 1371, Government Code, and Subchapters
A-C, Chapter 1207, Government Code. Except for this subsection,
this section does not apply to special water authorities or
districts described in Section 49.181(h)(1)(D) [49.181(h)(4)].
SECTION 4. The change in law made by this Act does not apply
to bonds for which an application and report were submitted to the
Texas Commission on Environmental Quality under Section 49.181(b),
Water Code, before the effective date of this Act. Those bonds are
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 5. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2011.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 1901 was passed by the House on April
14, 2011, by the following vote: Yeas 142, Nays 0, 1 present, not
voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 1901 was passed by the Senate on May
12, 2011, by the following vote: Yeas 31, Nays 0
.
______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor