S.B. No. 978
AN ACT
relating to procedures for the dissolution of the Hidalgo County
Water Improvement District No. 3.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. DEFINITIONS. In this Act:
(1) "City" means a municipality described by Section 2
of this Act.
(2) "City council" means the governing body of a city.
(3) "District" means the Hidalgo County Water
Improvement District No. 3.
(4) "District board" means the district's board of
directors.
SECTION 2. DISTRICT AND MUNICIPALITY TO WHICH ACT IS
APPLICABLE. This Act applies only to:
(1) the district; and
(2) a municipality that:
(A) has a population greater than 100,000; and
(B) contains within its corporate boundaries or
extraterritorial jurisdiction more than half of the district's
territory.
SECTION 3. DISSOLUTION OF DISTRICT; FINDINGS PREREQUISITE
TO MOTION TO TRANSFER. (a) The district is dissolved on the later
of:
(1) the effective date of this Act; or
(2) the date a transfer ordinance adopted pursuant to
Section 5 of this Act takes effect under Section 8 of this Act.
(b) At a regularly scheduled meeting of the city council, a
city may propose an ordinance to allow the city to accept a transfer
of the obligations, liabilities, and assets of the district if the
city council finds that as of the date of the meeting:
(1) at least 80 percent of the raw water diverted by
the district in the preceding 12 months was diverted for use by the
city;
(2) the city is capable of assuming all rights and
obligations of the district;
(3) the city is capable of assuming responsibility for
operating the district's facilities to benefit the district's
existing customers and performing the services and functions
performed by the district;
(4) dissolution of the district will result in an
overall cost savings to city residents; and
(5) dissolution of the district will result in a more
stable water supply for residents of the city and surrounding
communities.
SECTION 4. HEARING REQUIRED. (a) Before a city may
propose an ordinance described by Section 5 of this Act, the city
must conduct a public hearing on the issue.
(b) Notice of the public hearing must be:
(1) posted in accordance with the laws that apply to
regular meetings of the city council; and
(2) mailed to each district board member.
SECTION 5. TRANSFER ORDINANCE. (a) After a city council
has made the findings required by Section 3(b) of this Act and has
conducted a public hearing as required by Section 4 of this Act, the
city council may adopt an ordinance allowing the city to accept a
transfer of the district's obligations, liabilities, and assets.
(b) The ordinance must contain provisions that:
(1) eliminate the required payment of any flat tax or
assessments paid to the district by landowners in the district;
(2) ensure that all water rights are held in trust by
the city for the uses previously adjudicated;
(3) ensure that all individual water users are
entitled to continue to use or have access to the same amount of
water they were entitled to before the dissolution of the district;
(4) require the city to perform all the functions of
the district, including the provision of services; and
(5) ensure delivery of water to landowners at or below
the lowest comparable delivery charge imposed by any other
irrigation district in Hidalgo County.
(c) The ordinance takes effect only if two-thirds of the
city council votes in favor of the ordinance.
SECTION 6. CITY CONSENT; DISTRICT DUTIES. (a) On or before
the effective date of the ordinance described by Section 5 of this
Act, the district board shall provide the district's management and
operational records to the city that passed the ordinance to ensure
the orderly transfer of management and operational responsibility
to the city.
(b) Without the consent of a majority of the members of a
city council that publishes notice under Section 4(b) of this Act,
the district may not:
(1) sell, transfer, or encumber any district asset;
(2) issue debt or acquire additional obligations; or
(3) default on or fail to honor financial, legal, or
other obligations of the district.
(c) Unless a majority of the members of a city council that
publishes notice under Section 4(b) of this Act agree otherwise,
the district shall:
(1) maintain assets of the district in an appropriate
condition reflective of good stewardship and proper repair; and
(2) preserve district records, including information
maintained by the district in electronic format.
(d) Any action undertaken by the district that does not
comply with Subsection (b) of this section is void.
(e) This section expires on the date a city that has
published notice under Section 4(b) of this Act repeals the city's
ordinance described by Section 5 of this Act.
SECTION 7. PETITION BY VOTERS; SUSPENSION OR REPEAL OF
ORDINANCE; ELECTION. (a) The voters of the district and of a city
that enacts a transfer ordinance under this Act may object to the
ordinance by filing a petition with the secretary of the city.
(b) The petition must be signed by at least five percent of
the combined total of registered voters who reside in the city or
any part of the district outside the city.
(c) The petition must be filed not later than the 30th day
after the date the city council votes in favor of the transfer
ordinance under Section 5(c) of this Act.
(d) The city secretary shall verify the signatures on the
petition and shall present the verified petition to the city
council at the council's next scheduled meeting.
(e) On receipt of the petition, the city council shall
suspend the effectiveness of the ordinance, and the city may not
take action under the ordinance unless the ordinance is approved by
the voters under Subsection (f) of this section.
(f) The city council shall reconsider the suspended
ordinance at the next scheduled meeting of the council. If the city
council does not repeal the transfer ordinance, the city council
shall submit a proposition for or against enactment of the
ordinance to the voters of the city and the district at an election
held jointly by the city and the district on the next uniform
election date. The transfer ordinance takes effect if a majority of
the voters voting in that election vote in favor of the transfer.
SECTION 8. EFFECTIVE DATE OF TRANSFER. A transfer
ordinance under this Act takes effect on the date:
(1) the period for filing a voter petition expires
under Section 7(c) of this Act, if a voter petition is not filed
under that section; or
(2) the voters approve the transfer ordinance under
Section 7(f) of this Act.
SECTION 9. TRANSFER OF ASSETS. (a) On or before the
effective date of a transfer ordinance under Section 8 of this Act,
the district shall:
(1) transfer to the city the ownership of any water
rights and certificates of adjudication;
(2) transfer the assets, debts, and contractual rights
and obligations of the district to the city; and
(3) provide notice and make recordings of the
transfers under this section as required by the Water Code and other
law.
(b) On receipt of notice of the transfer of a district
certificate of adjudication, the Texas Commission on Environmental
Quality shall note in its records that the certificate of
adjudication is owned and held by the city. The Texas Commission on
Environmental Quality shall transfer the district's certificate to
the city as a ministerial act without further application, notice,
or hearing. A person or other legal entity does not have a right to
object to or to request an administrative review of a transfer made
in accordance with this Act.
(c) The transfer of the district's water rights and any
certificate of adjudication to the city does not affect or impair
the priority, extent, validity, or purpose of the water rights or
certificate.
SECTION 10. EXPIRATION. This Act expires January 1, 2016.
SECTION 11. EFFECTIVE DATE. 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 hereby certify that S.B. No. 978 passed the Senate on
April 7, 2011, by the following vote: Yeas 31, Nays 0; and that
the Senate concurred in House amendment on May 27, 2011, by the
following vote: Yeas 31, Nays 0.
______________________________
Secretary of the Senate
I hereby certify that S.B. No. 978 passed the House, with
amendment, on May 25, 2011, by the following vote: Yeas 136,
Nays 5, three present not voting.
______________________________
Chief Clerk of the House
Approved:
______________________________
Date
______________________________
Governor