Texas 2011 82nd Regular

Texas Senate Bill SB341 Senate Committee Report / Bill

Filed 02/01/2025

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                    By: Uresti, Wentworth S.B. No. 341
 (In the Senate - Filed January 12, 2011; February 14, 2011,
 read first time and referred to Committee on Natural Resources;
 March 14, 2011, reported adversely, with favorable Committee
 Substitute by the following vote:  Yeas 10, Nays 0; March 14, 2011,
 sent to printer.)
 COMMITTEE SUBSTITUTE FOR S.B. No. 341 By:  Uresti


 A BILL TO BE ENTITLED
 AN ACT
 relating to the appointment of a conservator for and authorizing
 the dissolution of the Bexar Metropolitan Water District; providing
 a penalty.
 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 ARTICLE 1.  CONSERVATORSHIP ESTABLISHED
 SECTION 1.01.  Section 1, Chapter 306, Acts of the 49th
 Legislature, Regular Session, 1945, is amended to read as follows:
 Sec. 1.  In obedience to the provisions of Article 16,
 Section 59 of the Constitution of Texas, there is hereby created
 Bexar Metropolitan Water District.[, hereinafter in this Act
 sometimes called the "District."]
 SECTION 1.02.  Chapter 306, Acts of the 49th Legislature,
 Regular Session, 1945, is amended by adding Sections 1A, 34, 35, 36,
 37, 38, and 39 to read as follows:
 Sec. 1A.  In this Act:
 (1)  "Board" means the District's Board of Directors.
 (2)  "Commission" means the Texas Commission on
 Environmental Quality.
 (3)  "Committee" means the Bexar Metropolitan Water
 District Oversight Committee.
 (4)  "Director" means a Board member.
 (5)  "District" means the Bexar Metropolitan Water
 District.
 (6)  "System" means a water utility owned by a
 municipality with a population of more than one million in the area
 served by the District.
 Sec. 34.  (a)  The Commission shall appoint as conservator
 for the District an individual who, at the time of the individual's
 appointment:
 (1)  has demonstrated a high level of expertise in
 water utility management;
 (2)  is not a Director; and
 (3)  has no financial interest in the District or any
 entity that has a contract with the District or that is likely to
 develop a contractual relationship with the District.
 (b)  The conservator's term expires on the date the
 Commission determines that the duties of the conservator under this
 Act have been discharged.
 Sec. 35.  (a)  The conservator shall use District staff to
 carry out the duties assigned to the conservator.  The conservator
 may hire up to three additional persons who will report to and
 assist the conservator if:
 (1)  assistance from District staff is not provided; or
 (2)  the conservator needs special expertise from one
 or more of the persons.
 (b)  A conservator appointed under Section 34 of this Act and
 any additional persons hired by the conservator under this section
 are entitled to receive a salary determined by the executive
 director of the Commission for performing those duties.
 (c)  The District shall pay the compensation of the
 conservator and any additional persons hired by the conservator
 under this section.
 (d)  The executive director of the Commission shall set the
 compensation of the conservator after considering the
 conservator's:
 (1)  level of expertise in water utility management;
 and
 (2)  certifications and education.
 Sec. 36.  (a)  A conservator appointed under Section 34 and
 the persons hired under Section 35 of this Act are entitled to
 reimbursement of the reasonable and necessary expenses incurred by
 the conservator or the persons hired under Section 35 of this Act in
 the course of performing duties under this Act.
 (b)  The District shall pay the expenses incurred by the
 conservator and the persons hired under Section 35 of this Act.  The
 executive director of the Commission shall determine if an expense
 is reasonable and necessary after considering whether the expense
 is:
 (1)  necessary to complete the duties of the
 conservator as assigned by law;
 (2)  at or below the cost of a similar expense incurred
 by other utilities;
 (3)  documented by an invoice, bill, or work order that
 includes details relating to the:
 (A)  time spent on services; or
 (B)  cost of supplies; and
 (4)  in accordance with procedures used to minimize
 expenses, including comparing vendor rates or competitive bidding.
 Sec. 37.  (a)  The Board shall work cooperatively with the
 conservator to identify the policies, assets, liabilities, and
 resources of the District.
 (b)  The conservator shall:
 (1)  complete an inventory of and evaluate each
 distinct water system in the District to determine:
 (A)  the District's basis in or the intrinsic
 value of the infrastructure associated with that water system;
 (B)  the District's bonded debt and commercial
 paper reasonably associated with or allocable to the infrastructure
 in that water system; and
 (C)  the adequacy of the water supply sources,
 water storage facilities, and distribution systems located in that
 water system's service area to supply current and projected demands
 in that service area;
 (2)  identify any District assets whose transfer to
 another appropriate public water utility would be likely to
 improve:
 (A)  service to the former customers of the
 District who would be served by that utility; or
 (B)  the District's overall efficiency;
 (3)  compile a list and copies of existing contracts to
 which the District is a party, including for each contract:
 (A)  effective and termination dates;
 (B)  general scope of the property and services
 involved;
 (C)  obligations of the District, including
 financial obligations;
 (D)  how the District benefits from the contract;
 and
 (E)  whether the District has waived governmental
 immunity;
 (4)  compile a list of the following in regard to the
 District:
 (A)  property;
 (B)  rights, including certificates of
 convenience and necessity, pumping rights, and any other rights;
 (C)  staff; and
 (D)  internal policies, including employment
 rules, benefits, and an evaluation of the usefulness and efficacy
 of each policy;
 (5)  develop a comprehensive rehabilitation plan for
 the District that:
 (A)  identifies strategies for restoring the
 District's financial integrity and developing a system of sound
 financial management;
 (B)  describes a standard of ethics,
 professionalism, and openness expected of each Director and
 employee of the District;
 (C)  provides a mechanism to enforce compliance
 with District policies, including procurement policies;
 (D)  identifies ways to enhance the District's
 operational efficiency and improve the District's provision of
 redundancy in water services; and
 (E)  provides for educating the Board and
 management personnel on improving management practices and
 complying with District policy and state and federal laws and
 regulations; and
 (6)  assess the District's ability to provide reliable,
 cost-effective, quality service to customers, including an
 assessment of operations compared to the best management practices
 of modern utilities.
 Sec. 38.  The conservator shall report to the Commission and
 the Committee quarterly on the progress the conservator has made in
 carrying out the duties under Section 37 of this Act.
 Sec. 39.  At the conservator's request, the state auditor's
 office may audit the District under Chapter 321, Government Code.
 The District shall reimburse the state auditor's office for the
 cost of the audit.
 SECTION 1.03.  Not later than the 60th day after the
 effective date of this Act, the Texas Commission on Environmental
 Quality shall appoint a conservator for the Bexar Metropolitan
 Water District as required by Section 34, Chapter 306, Acts of the
 49th Legislature, Regular Session, 1945, as added by this Act.
 ARTICLE 2.  ELECTION; EFFECTIVE DATE OF ARTICLES 3 AND 4
 SECTION 2.01.  (a)  In this article:
 (1)  "Commission" means the Texas Commission on
 Environmental Quality.
 (2)  "District" means the Bexar Metropolitan Water
 District.
 (b)  On the next uniform election date following the date of
 preclearance under Section 5 of the federal Voting Rights Act of
 1965 (42 U.S.C. Section 1973c) of all provisions of the Act enacting
 this section that are subject to that preclearance, the commission
 shall hold an election in the district on the question of dissolving
 the district and disposing of the district's assets and
 obligations.  If the commission determines that preclearance under
 Section 5 of the federal Voting Rights Act of 1965 is not required,
 the commission shall hold the election on the next uniform election
 date after the date the commission makes that determination.
 (c)  The commission may contract with another entity to
 conduct the election.  The district shall pay any cost of conducting
 the election.
 (d)  The order calling the election must state:
 (1)  the nature of the election, including the
 proposition to appear on the ballot;
 (2)  the date of the election;
 (3)  the hours during which the polls will be open; and
 (4)  the location of the polling places.
 (e)  The commission shall give notice of an election under
 this section by publishing once a week for two consecutive weeks a
 substantial copy of the election order in a newspaper with general
 circulation in the district.  The first publication of the notice
 must appear not later than the 35th day before the date of the
 election.
 (f)  The ballot for an election under this section must be
 printed to permit voting for or against the proposition: "The
 dissolution of the Bexar Metropolitan Water District and the
 transfer of all the District's assets, obligations, and duties to
 the water utility of the municipality with the largest population
 in the area served by the District."
 (g)  The commission shall certify that a majority of the
 voters voting in the district have voted:
 (1)  in favor of dissolution; or
 (2)  not in favor of dissolution.
 SECTION 2.02.  (a)  Not later than the 20th day after the
 date on which the election results are officially declared, the
 commission shall certify that result to the secretary of state.
 (b)  If the proposition is approved by a majority of the
 voters voting in the election:
 (1)  Article 3 of this Act does not take effect; and
 (2)  Article 4 of this Act takes effect on the date the
 results are officially declared.
 (c)  If a majority of the voters voting in the election do not
 approve the proposition:
 (1)  Article 3 of this Act takes effect on the date the
 results are officially declared; and
 (2)  Article 4 of this Act does not take effect.
 ARTICLE 3.  CHANGES TO THE BEXAR METROPOLITAN WATER DISTRICT IF
 VOTERS DO NOT DISSOLVE THE DISTRICT UNDER ARTICLE 2
 SECTION 3.01.  Section 8, Chapter 306, Acts of the 49th
 Legislature, Regular Session, 1945, is amended to read as follows:
 Sec. 8. (a)  [.] The seven [five (5)] members of the Board of
 Directors are [shall hereafter be] elected to staggered two-year
 terms in an election held on the uniform election date in November.
 Directors are elected from numbered single-member districts
 established by the Board.  The Board shall revise each
 single-member district after each decennial census to reflect
 population changes and to conform with state law, the federal
 Voting Rights Act of 1965 (42 U.S.C. Section 1973 et seq.), and any
 applicable court order [for a term of six (6) years each, provided
 that an election for two (2) Directors for a term of six (6) years
 shall be held on the first Tuesday in April, 1954; the terms of
 three (3) members of the present Board shall be, and are, hereby,
 extended to the first Tuesday in April, 1957; and the present
 Directors shall determine such three (3) by lot. Three (3)
 Directors shall be elected on the first Tuesday in April, 1957, and
 two (2) Directors and three (3) Directors, alternately, shall be
 elected each three (3) years thereafter on the first Tuesday in
 April as the six-year terms expire]. At an election of Directors,
 the candidate from each single-member district who receives [The
 two (2) or three (3) persons, respectively, receiving] the greatest
 number of votes is [shall be declared] elected to represent that
 single-member district. Each Director shall hold office until his
 successor is [shall have been] elected or appointed and has [shall
 have] qualified.
 (a-1)  A person is not eligible to serve as a Director for
 more than three terms or for more than a total of seven years of
 service.[;]
 (b)  Such [such] elections shall be called, conducted and
 canvassed in the manner provided by the Election Code. [Chapter 25,
 General Laws of the Thirty-ninth Legislature, Regular Session,
 1925, and any amendments thereto;]
 (c)  The [the] Board of Directors shall fill all vacancies on
 the Board by appointment and such appointees shall hold office
 until a successor elected at the next scheduled election date has
 qualified. [for the unexpired term for which they were appointed;]
 (d)  Any four [any three] members of the Board are [shall
 constitute] a quorum for the adoption or [of] passage of any
 resolution or order or the transaction of any business of the
 District.[;]
 (e)  A Director must [Directors succeeding the first Board,
 whether now or hereafter elected, shall] be a qualified voter of the
 single-member district from which the Director is elected [resident
 electors of Bexar County, Texas, and owners of taxable property
 within the area comprising said District, and shall organize in
 like manner].
 (f)  A payment to a Director for fees of office under Section
 49.060, Water Code, may not be made for a meeting that occurs in a
 different fiscal year from the one in which the payment is made.
 SECTION 3.02.  Section 33A, Chapter 306, Acts of the 49th
 Legislature, Regular Session, 1945, is amended by amending
 Subsection (c) and adding Subsection (g) to read as follows:
 (c)  The oversight committee is comprised of seven [5]
 members appointed as follows [to represent the following members]:
 (1)  two Senators who represent Senate districts that
 include territory within the Bexar Metropolitan Water District,
 [the Senator sponsor of this Act, or, in the event this Senator
 cannot serve, a Senator] appointed by the Lieutenant Governor;
 (2)  two Representatives who represent [the] House
 districts that include territory within the District, [author of
 this Act, or, in the event this Representative cannot serve, a
 Representative] appointed by the Speaker of the Texas House of
 Representatives;
 (3)  one member with special expertise in the operation
 of public water utilities appointed by the Governor;
 (4)  one member appointed by the Governor to represent
 the public; and
 (5)  one [a] member of the Bexar County Commissioners
 Court who represents a precinct in which customers of the District
 reside.
 (g)  On or before December 31, 2012, the oversight committee
 shall provide a report under Subsection (e) of this section to the
 legislature. The committee is abolished and this section expires
 January 1, 2013.
 SECTION 3.03.  Chapter 306, Acts of the 49th Legislature,
 Regular Session, 1945, is amended by adding Sections 8A, 8B, 8C,
 10A, and 10B to read as follows:
 Sec. 8A.  (a)  To be eligible to be a candidate for or to be
 elected or appointed as a Director, a person must have:
 (1)  resided continuously in the single-member
 district that the person seeks to represent for 12 months
 immediately preceding the date of the regular filing deadline for
 the candidate's application for a place on the ballot;
 (2)  viewed the open government training video provided
 by the attorney general and provided to the Board a signed affidavit
 stating that the candidate viewed the video;
 (3)  obtained 200 signatures from individuals living in
 the District; and
 (4)  paid a filing fee of $250 or filed a petition in
 lieu of the filing fee that satisfies the requirements prescribed
 by Section 141.062, Election Code.
 (b)  In this subsection, "political contribution" and
 "specific-purpose committee" have the meanings assigned by Section
 251.001, Election Code.  A Director or a candidate for the office of
 Director may not knowingly accept political contributions from a
 person that in the aggregate exceed $500 in connection with each
 election in which the person is involved.  For purposes of this
 subsection, a contribution to a specific-purpose committee for the
 purpose of supporting a candidate for the office of Director,
 opposing the candidate's opponent, or assisting the candidate as an
 officeholder is considered to be a contribution to the candidate.
 Sec. 8B.  (a)  A person who is elected or appointed to and
 qualifies for office as a Director on or after the effective date of
 this section may not vote, deliberate, or be counted as a member in
 attendance at a meeting of the Board until the person completes a
 training program on District management issues.  The training
 program must provide information to the person regarding:
 (1)  the enabling legislation that created the
 District;
 (2)  the operation of the District;
 (3)  the role and functions of the Board;
 (4)  the rules of the Board;
 (5)  the current budget for the Board;
 (6)  the results of the most recent formal audit of the
 Board;
 (7)  the requirements of the:
 (A)  open meetings law, Chapter 551, Government
 Code;
 (B)  public information law, Chapter 552,
 Government Code; and
 (C)  administrative procedure law, Chapter 2001,
 Government Code;
 (8)  the requirements of the conflict of interest laws
 and other laws relating to public officials; and
 (9)  any applicable ethics policies adopted by the
 Board or the Texas Ethics Commission.
 (b)  The Commission may create an advanced training program
 designed for a person who has previously completed a training
 program described by Subsection (a) of this section. If the
 Commission creates an advanced training program under this
 subsection, a person who completes that advanced training program
 is considered to have met the person's obligation under Subsection
 (a) of this section.
 (c)  Each Director who is elected or appointed on or after
 the effective date of this section shall complete a training
 program described by Subsection (a) or (b) of this section at least
 once in each term the Director serves.
 (d)  The Board shall adopt rules regarding the completion of
 the training program described by Subsection (a) or (b) of this
 section by a person who is elected or appointed to and qualifies for
 office as a Director before the effective date of this section. A
 Director described by this subsection who does not comply with
 Board rules is considered incompetent as to the performance of the
 duties of a Director in any action to remove the Director from
 office.
 (e)  A Director may not:
 (1)  accept or solicit a gift, favor, or service, the
 value of which exceeds $50 per gift, favor, or service, that:
 (A)  might reasonably influence the Director in
 the discharge of an official duty; or
 (B)  the Director knows or should know is being
 offered with the intent to influence the Director's official
 conduct;
 (2)  accept other employment or engage in a business or
 professional activity that the Director might reasonably expect
 would require or induce the Director to disclose confidential
 information acquired by reason of the official position;
 (3)  accept other employment or compensation that could
 reasonably be expected to impair the Director's independence of
 judgment in the performance of the Director's official duties;
 (4)  make personal investments that could reasonably be
 expected to create a substantial conflict between the Director's
 private interest and the interest of the District;
 (5)  intentionally or knowingly solicit, accept, or
 agree to accept any benefit for having exercised the Director's
 official powers or performed the Director's official duties in
 favor of another; or
 (6)  have a personal interest in an agreement executed
 by the District.
 (f)  Not later than April 30 each year, a Director shall file
 with the Bexar County clerk a verified financial statement
 complying with Sections 572.022, 572.023, 572.024, and 572.0252,
 Government Code. The District shall keep a copy of a financial
 statement filed under this section in the main office of the
 District.
 Sec. 8C.  (a)  A Director may be recalled for:
 (1)  incompetency or official misconduct as defined by
 Section 21.022, Local Government Code;
 (2)  conviction of a felony;
 (3)  incapacity;
 (4)  failure to file a financial statement as required
 by Section 8B(f) of this Act;
 (5)  failure to complete a training program described
 by Section 8B(a) or (b) of this Act; or
 (6)  failure to maintain residency in the District.
 (b)  If at least 10 percent of the registered voters in a
 single-member voting district of the District submit a petition to
 the Board requesting the recall of the Director who serves that
 single-member voting district, the Board, not later than the 10th
 day after the date the petition is submitted, shall mail a written
 notice of the petition and the date of its submission to each
 registered voter in the single-member voting district.
 (c)  Not later than the 30th day after the date a petition
 requesting the recall of a Director is submitted, the Board shall
 order an election on the question of recalling the Director.
 (d)  A recall election under this section may be held on any
 uniform election date.
 (e)  If a majority of the voters of a single-member voting
 district voting at an election held under this section favor the
 recall of the Director who serves that single-member voting
 district, the Director is recalled and ceases to be a Director.
 Sec. 10A.  All Board reimbursements and expenditures must be
 approved by the Board in a regularly scheduled meeting.
 Sec. 10B.  The Board may not select the same auditor to
 conduct an audit required by Section 49.191, Water Code, for more
 than three consecutive annual audits.
 SECTION 3.04.  Chapter 306, Acts of the 49th Legislature,
 Regular Session, 1945, is amended by adding Sections 40 and 41 to
 read as follows:
 Sec. 40.  (a)  If the conservator reports to the Commission
 that the District has been sufficiently rehabilitated to provide
 reliable, cost-effective, quality service to its customers, the
 Commission shall evaluate the condition of the District and
 determine whether:
 (1)  the District has been sufficiently rehabilitated
 to enable the District to provide reliable, cost-effective, quality
 service to its customers; and
 (2)  the conservatorship is no longer necessary.
 (b)  Not later than the 60th day after the date the
 Commission receives a report under this section, the Commission
 shall issue an order dissolving the conservatorship if the
 Commission determines the conservatorship is no longer necessary.
 Sec. 41.  (a)  The conservator appointed under Section 34 of
 this Act continues to serve until the conservatorship is dissolved
 under Section 40 of this Act.
 (b)  The Commission may order the District to implement any
 part of the rehabilitation plan developed under Section 37 of this
 Act.
 (c)  If the District fails to comply with a Commission order,
 the Commission may assess a penalty against the District in the
 manner provided by Section 13.4151, Water Code.
 SECTION 3.05.  (a)  Section 8, Chapter 306, Acts of the 49th
 Legislature, Regular Session, 1945, as amended by this Act, applies
 only to a member of the board of directors of the Bexar Metropolitan
 Water District who is elected to the board on or after the effective
 date of this Act.
 (b)  Section 8A, Chapter 306, Acts of the 49th Legislature,
 Regular Session, 1945, as added by this Act, applies only to a
 member of the board of directors of the Bexar Metropolitan Water
 District who is elected to the board on or after the effective date
 of this Act.  A director who is elected before the effective date of
 this Act is governed by the law in effect when the director was
 elected, and the former law is continued in effect for that purpose.
 (c)  For two of the numbered single-member district
 director's positions that expire in 2012, the Bexar Metropolitan
 Water District shall call and hold an election on a uniform election
 date in that year to elect the directors for those positions for
 terms that expire on the uniform election date in November 2013.
 For the other two director's positions that expire in 2012, the
 district shall call and hold an election on the same uniform
 election date in that year to elect the directors for those
 positions for terms that expire on the uniform election date in
 November 2014.  The district shall determine by lot which
 single-member districts shall elect directors to serve one-year
 terms and which shall elect directors to serve two-year terms.
 ARTICLE 4.  TRANSFER OF DISTRICT ASSETS AND LIABILITIES IF VOTERS
 DISSOLVE THE BEXAR METROPOLITAN WATER DISTRICT UNDER ARTICLE 2
 SECTION 4.01.  Chapter 306, Acts of the 49th Legislature,
 Regular Session, 1945, is amended by adding Sections 50, 51, 52, 53,
 54, 55, 56, and 57 to read as follows:
 Sec. 50.  (a)  The term of each person who is serving as a
 Director of the District on the date of the canvass of the election
 authorized by Article 2 of the Act enacting this section expires on
 that date.
 (b)  Under the Commission's and Committee's oversight, the
 conservator shall transfer or assign to the System, beginning not
 later than the 60th day after the date the election results are
 certified the:
 (1)  rights and duties of the District associated with
 the provision of water services, including existing contracts,
 assets, and obligations of the District;
 (2)  files, records, and accounts of the District,
 including those that pertain to the control, finances, management,
 and operation of the District; and
 (3)  permits, approvals, and certificates necessary to
 provide water services.
 (c)  To the extent that the transfer of an item listed in
 Subsection (b) of this section requires the approval of a state
 agency, the state agency shall grant approval without additional
 notice or hearing.
 (d)  After the conservator has transferred the property,
 assets, and liabilities as prescribed by this section, the
 conservator shall file a written report with the Commission and the
 Committee summarizing the conservator's actions in dissolving the
 District.
 (e)  Not later than the 60th day after the date the
 Commission receives the report and determines that the requirements
 of this section have been fulfilled, the Commission shall enter an
 order dissolving the District and releasing the conservator from
 any further duty or obligation.
 Sec. 51.  This section expires on the fifth anniversary of
 the date the Commission enters an order dissolving the District.
 Sec. 52.  (a)  Not later than five years after the date the
 election results were certified in favor of dissolution under
 Article 2 of the Act enacting this section, the System shall
 integrate the services and infrastructure of the District into the
 System in a reasonable and orderly manner based on the
 consideration of relevant information, including:
 (1)  the location and condition of the infrastructure;
 (2)  debt obligations;
 (3)  costs and revenue; and
 (4)  potential impacts on the customers of the District
 and the System.
 (b)  The System shall provide an annual report on the
 progress of integration to the Commission.  The Commission for good
 cause may grant an extension to complete integration.  If the System
 fails to comply with the requirements of this section, the
 Commission may assess a penalty against the System in the manner
 provided by Section 13.4151, Water Code.
 (c)  Until the date specified in Subsection (a) of this
 section, the System may operate the former District as a special
 project under the System's existing senior lien revenue bond
 ordinances.
 (d)  Once the conservator has transferred the assets,
 obligations, and duties to the System, and at least until the date
 specified in Subsection (a) of this section, the System shall
 provide affordable and reliable water services to all of the former
 ratepayers of the District.
 Sec. 53.  (a)  For a 24-month period following the transfer
 of the employment of any employee of the former District, the System
 may not terminate that employee, except for cause, if the employee:
 (1)  is vested in the retirement program of the
 District on the effective date of this Act; and
 (2)  earns an annual base salary of less than $50,000 on
 the effective date of the Act enacting this section.
 (b)  An employee who qualifies under Subsection (a) of this
 section and who is terminated by the System has the same opportunity
 for appeal as a person employed by the System who is not an employee
 of the former District.
 (c)  The System is not required to employ an employee of the
 District if that person was formerly terminated from, or resigned
 in lieu of termination from, the System.
 Sec. 54.  From the effective date of the Act enacting this
 section until the date election results dissolving the District are
 certified to the Secretary of State, the attorney general may not
 approve any public security, as defined by Chapter 1201, Government
 Code, of the District unless:
 (1)  the Commission consents in writing before
 approval; or
 (2)  the District provides written evidence that
 issuing the public security represents a refunding of outstanding
 debt for the purpose of realizing debt service savings in each year
 that outstanding obligations are refunded and that results in a
 cumulative net present value savings of three percent compared to
 refunded debt service.
 Sec. 55.  (a)  From the effective date of the Act enacting
 this section until the date election results dissolving the
 District are certified to the Secretary of State, a contract or
 other agreement entered into during that period to which the
 District is a party must include a provision that the contract or
 other agreement is subject to:
 (1)  review by the System; and
 (2)  termination by the System at the System's sole
 discretion, including the termination of all rights, duties,
 obligations, and liabilities of the District or the System under
 the contract or other agreement, if the contract or other agreement
 is assumed by the System.
 (b)  A person is not entitled to compensation for loss or
 other damages resulting from the termination of the contract or
 other agreement under Subsection (a)(2) of this section.
 Sec. 56.  From the effective date of the Act enacting this
 section until the date the election results dissolving the District
 are certified to the Secretary of State, the District may not
 dispose of, sell, transfer, assign, impair, or restrict any of the
 District's rights or assets outside the normal and customary course
 of business.
 Sec. 57.  A state agency at which an administrative or
 enforcement action is pending shall grant the District special
 consideration and reasonable extensions to identify and resolve the
 action in a manner satisfactory to the agency.
 ARTICLE 5.  NOTICE; EFFECTIVE DATE OF ACT
 SECTION 5.01.  (a)  The legal notice of the intention to
 introduce this Act, setting forth the general substance of this
 Act, has been published as provided by law, and the notice and a
 copy of this Act have been furnished to all persons, agencies,
 officials, or entities to which they are required to be furnished
 under Section 59, Article XVI, Texas Constitution, and Chapter 313,
 Government Code.
 (b)  The governor, one of the required recipients, has
 submitted the notice and Act to the Texas Commission on
 Environmental Quality.
 (c)  The Texas Commission on Environmental Quality has filed
 its recommendations relating to this Act with the governor, the
 lieutenant governor, and the speaker of the house of
 representatives within the required time.
 (d)  All requirements of the constitution and laws of this
 state and the rules and procedures of the legislature with respect
 to the notice, introduction, and passage of this Act are fulfilled
 and accomplished.
 SECTION 5.02.  Except as otherwise provided by Article 2 of
 this Act, 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.
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