83R10008 ATP-F
By: Crownover H.B. No. 2692
A BILL TO BE ENTITLED
AN ACT
relating to the authority of certain municipalities to establish an
economic development program to promote the construction of
small-scale electric generating facilities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 380, Local Government Code, is amended
by adding Section 380.005 to read as follows:
Sec. 380.005. ECONOMIC DEVELOPMENT PROGRAMS FOR
CONSTRUCTION OF SMALL-SCALE ELECTRIC GENERATING FACILITIES. (a)
This section applies only to a municipality that is located in a
region subject to retail customer choice under Section 39.102,
Utilities Code, whether or not the municipality has opted for
customer choice. For purposes of this subsection, a municipality
includes an area that:
(1) has been annexed by the municipality for limited
purposes; or
(2) is in the extraterritorial jurisdiction of the
municipality.
(b) In this section, "small-scale electric generating
facility" means:
(1) a central electric generating station with a
capacity of no more than 50 megawatts; or
(2) a distributed electric generation facility with a
capacity of no more than five megawatts that supplies at least 50
percent of the electricity it generates to on-site end-use
consumption.
(c) The governing body of a municipality may establish and
provide for the administration of one or more programs, including
programs for making loans and grants of public money and providing
personnel and services of the municipality, to promote the
construction of small-scale electric generating facilities. The
programs authorized under this section serve the public purposes of
promoting state and local economic development and providing
benefits to municipalities in procuring electricity and may also
serve the public purposes of reducing unemployment or
underemployment and contributing to the state's need for reliable
electricity during periods of peak demand. Before establishing a
program under this section, the municipality shall enact an
ordinance or adopt a resolution that finds that the program will
serve one or more of the public purposes specified in this
subsection.
(d) Notwithstanding any other law:
(1) a municipality that establishes or administers a
program under this section is not required, as a result of
establishing or administering the program, to register or obtain a
certificate under Section 39.351, 39.352, or 39.355, Utilities
Code; and
(2) the owner of a distributed electric generation
facility constructed pursuant to a program authorized under this
section is not required, as a result of owning the facility, to
register under Section 39.351, Utilities Code.
(e) A municipality may, under a contract with a developer,
provide the proceeds of municipal bonds or other obligations of the
municipality to the developer for the purpose of constructing a
small-scale electric generating facility. The funds provided to a
developer under this section:
(1) may not exceed 50 percent of the cost of
construction of the facility; and
(2) must be derived from any source lawfully available
to the municipality under its charter or other law, other than from
the proceeds of bonds or other obligations of the municipality
payable from ad valorem taxes.
(f) A program established under this section shall require
the execution of a contract with the municipality to participate in
the program. A contract entered into under a program established
under this section:
(1) must contain provisions to protect and advance the
interests of the municipality, including:
(A) provisions to protect the municipality
against the failure by the developer or owner of the small-scale
electric generating facility to perform in accordance with the
contract, which may include the authority for the municipality to
impose a lien against the property of the developer or owner; and
(B) requirements that the developer or owner of
the small-scale electric generating facility provide electricity
to the municipality at a certain price and under terms that enable
the municipality to share in the proceeds from the sale of
electricity or ancillary services by the facility;
(2) must be supported by a report that demonstrates
that the expected benefits to the municipality's future budgets,
grid reliability, or state or local economic development during the
life of the contract are expected to justify the distribution of
funds to the developer of the small-scale electric generating
facility by the municipality under the contract; and
(3) must be approved in accordance with the provisions
of the municipality's charter.
SECTION 2. 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, 2013.