By: Nevárez H.B. No. 4123 A BILL TO BE ENTITLED AN ACT Relating to the creation of the Val Verde County Groundwater Conservation District; providing authority to impose fees and taxes. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. CREATION. A groundwater conservation district, to be known as the Val Verde County Groundwater Conservation District, is created in Val Verde County, subject to approval at a confirmation election under Section 7 of this Act. SECTION 2. FINDINGS OF BENEFIT. (a) The district is created to serve a public use and benefit. (b) The district is created under and is essential to accomplish the purposes of Section 59, Article XVI, Texas Constitution. (c) All of the land and other property included within the boundaries of the district will be benefited by the works and projects that are to be accomplished by the district under powers conferred by Section 59, Article XVI, Texas Constitution. SECTION 3. CONTINUTING PROVISIONS OF DISTRICT. Subtitle H, Title 6, Special District Local Laws Code, is amended by adding Chapter 01 to read as follows: CHAPTER 01. VAL VERDE COUNTY GROUNDWATER CONSERVATION DISTRICT SUBCHAPTER A. GENERAL PROVISIONS Sec. 01.001 DEFINITIONS. In this chapter: (1) "Agricultural use" means any use or activity involving agriculture, including irrigation. (2) "Agriculture" means any of the following activities: (A) cultivating the soil to produce crops for human food, animal feed, or planting seed or for the production of fibers; (B) the practice of floriculture viticulture, silviculture, and horticulture, including the cultivation of plants in containers of nonsoil media, by a nursery grower; (C) raising, feeding, or keeping animals, other than fish, for breeding purposes or for the production of food or fiber, leather, pelts, or other tangible products having a commercial value; (D) planting cover crops, including cover crops cultivated for transplantation, or leaving land idle for the purpose of participating in any governmental program or normal crop or livestock rotation procedure; (E) wildlife management, including hunting, fishing, sightseeing, bird watching and other outdoor recreational activities; and (F) raising or keeping equine animals. (3) "Board" means the board of directors of the district. (4) "Director" means a member of the board. (5) "District" means the Val Verde County Groundwater Conservation District. (6) "Domestic use" means use in the district of water by a person owning the well from which the water is withdrawn and by that person's household, employees, tenants, licensees or guests for: (A) drinking, washing, or culinary purposes; (B) irrigation of lawns; (C) irrigation of a family garden or orchard the produce of which is for household consumption only; (D) swimming pools, decorative ponds, or fountains on the person's property or; (E) watering of domestic animals not raised, maintained, or sold for commercial purposes. (7) "Greatest water usage" means the highest sum for a given calendar year of: (i) groundwater produced; and (ii) water used pursuant to a water right as defined in Section 11.002(5), Water Code. (7) "Political subdivision" means a county, municipality, or other body politic or corporate of the state, including a district or authority created under Section 52, Article III, or Section 59, Article XVI, Texas Constitution, a state agency, or a nonprofit water supply corporation created under Chapter 67, Water Code. (8) "Retail public utility" means an entity defined in Section 13.002(19), Water Code. (9) "Del Rio Certificate of Adjudication" means the Certificate of Adjudication No. 23-2672 issued by the Texas Water Commission to the City of Del Rio on August 15, 1983. SEC. 01.002. NATURE OF DISTRICT. The district is a groundwater conservation district in Val Verde County created under Section 59, Article XVI, Texas Constitution. SEC. 01.003. DISTRICT PURPOSE. The district is created to: (1) provide for the protection, recharging, conserving, protecting, and prevention of waste of groundwater in Val Verde County; (2) control subsidence caused by the withdrawal of water from the groundwater in Val Verde County; (3) regulate the transport of groundwater out of the boundaries of the district; (4) regulate pumping in the district to protect spring flow, base flow and drawdown; (5) implement conservation plans and pumping reduction when conditions warrant action to protect spring flow, base flow and drawdown; and (6) manage the issuance of permits, by requiring studies and groundwater availability model analysis of permit applications, that include conservation triggers that mitigate impact to spring flow, base flow and drawdown. SUBCHAPTER B. TERRITORY Sec. 01.004. BOUNDARIES. The boundaries of the district are coextensive with the boundaries of Val Verde County, Texas. SUBCHAPTER C. BOARD OF DIRECTORS Sec. 01.101. BOARD. The board shall be governed by five directors. Sec. 01.102. METHOD OF APPOINTING SELECTING DIRECTORS: (a) The directors of the district shall be appointed or elected as provided by this section. (b) One (1) director shall be appointed by the City Council of the City of Del Rio, Texas. (c) One (1) director shall be appointed by the Commissioners court of Val Verde County, Texas. (d) One (1) director shall be elected at-large by the voters of Val Verde, County. (e) One (1) director shall be elected by the voters of Commissioner Precincts 2 and 3, combined, of the Commissioners Court of Val Verde County, as such precincts may be redrawn from time to time by such Commissioners Court. (f) One (1) director shall be elected by the voters of Commissioner Precincts 1 and 4, combined, of the Commissioners Court of Val Verde County, as such precincts may be redrawn from time to time by such Commissioners Court (g) To be eligible to serve as a director, a person must be a registered voter of Val Verde County, Texas. (h) Elections for the director positions in subsections (d)-(f) of this Section shall be held in even-numbered years on the uniform election date in November. Sec. 01.103. TERMS. (a) Directors serve staggered four-tear terms and may serve consecutive terms. (b) Directors shall draw lots to determine which three directors shall serve a term expiring December 1 of the year two years after the date of the election in which the district is confirmed and which two directors shall serve a term expiring December 1 of the year four years after the date of the election in which the district is confirmed. Sec. 01.104. VACANCIES. If there is a vacancy on the board, the board shall appoint a director to serve the remainder of the term. Sec. 01.105 COMPENSATION. (a) A director is not entitled to receive fees of office for performing the duties of a director. (b) The board may authorize a director to receive reimbursement for the director's reasonable expenses incurred while engaging in activities outside the district on behalf of the board. SUBCHAPTER D. POWERS AND DUTIES Sec. 01.150. POWERS AND DUTIES. Except as otherwise provided by this chapter, the district has all of the rights, powers, privileges, authority, functions, and duties provided by the general law of this state, including Chapter 36, Water Code, applicable to groundwater conservation districts created under Section 59, Article XVI, Texas Constitution. Sec. 01.151 PERMITS TO PUMP GROUNDWATER. (a) The district by rule shall: (1) require a person to obtain a permit from the district to pump groundwater unless exempted under other sections of this legislation; and (2) regulate the terms of a transfer of groundwater out of the district. (b) The district shall develop rules under this section that: (1) are consistent with the requirements of Section 36.122, Water Code, except as otherwise provided in Section 01.202(c) of this legislation; and (2) provide for reduction and curtailment of groundwater pumping to protect spring flow, base flow and drawdown; and (3) do not, in any event, seek to reduce or curtail usage or production under a water right as defined in Section 11.002(5), Water Code, including the Del Rio Certificate of Adjudication. (c) To implement the rules developed under 01.151(b)(2) of this legislation, the district may make and enforce rules as authorized under Section 36.101(a), Water Code, and to the extent not otherwise authorized by Section 36.101(a), limit groundwater production based on acreage, tract size, spacing of wells, or the service area of a public water supplier. (c-1) Any district rules or enforcement of rules requiring reductions or curtailments on the production of groundwater otherwise authorized by permit shall be applied proportionally to all such permitted production. (d) For better management of the groundwater resources located in the district, if the district determines that conditions in or use of an aquifer differ substantially from one geographic area of the district to another, the district may adopt different rules regulating production from management zones based on acreage, tract size, or the service area of a public water supplier . In creating management zones, the district may consider: (1) each aquifer, subdivision of an aquifer, or geologic strata located in whole or in part within the boundaries of the district; or (2) each geographic area overlying an aquifer or subdivision of an aquifer located in whole or in part within the boundaries of the district. Sec. 01.152. PERMITS FOR USE SOLELY INSIDE DISTRICT. (a) The district shall grant the City of Del Rio a permit in the city's name that authorizes the city to pump from all city wells annually a cumulative volume of groundwater that is not less than the greatest water usage in a calendar year before the date the district is confirmed. The permit shall be for use solely inside the district. (b) In addition to the permit in Section 01.152(a), the district shall grant a permit to each existing political subdivision and retail public utility in the district that authorizes each such political subdivision and retail public utility to pump from its wells annually a volume of water that is not less than the greatest water usage by such political subdivision and retail public utility in a calendar year before the date the district is confirmed. The permit shall be for use solely inside the district. (c) Nothing in this section, or in Section 01.053(a)(1), shall be considered a limitation under Section 36.122(c), Water Code, on the district's authority to establish permit conditions for transporters. Sec. 01.153. EXEMPTIONS. (a) The district shall not require a person to obtain a permit from the district for groundwater production from a well if the well is not capable of producing more than 72,000 gallons a groundwater a day and the groundwater is used inside the district. (a-1) Nothing in Section 01.153(a) makes Section 36.113(a), Water Code, inapplicable in the district. (b) An owner of a well described in this section may be required to register the well with the district. (c) An owner of a well is entitled to a permit exemption under this section only if water from the well is used solely inside the district. If any water from a well is directly or indirectly (other than through an agricultural crop) used outside the district, the well owner must obtain a permit for its production, in addition to any permits that must be obtained for its use outside the district. (d) The district may not require a permit or a permit amendment for maintenance or repair of a well if the maintenance or repair does not increase the production capabilities of the well to more than its authorized or permitted production rate. Sec. 01.154. PROHIBITION OF DISTRICT PURCHASE, SALE, OR DISTRIBUTION OF WATER. The district may not purchase, sell, transport, or distribute surface water or groundwater for any purpose. Sec. 01.155. PROHIBITION ON DISTRICT USE OF EMINENT DOMAIN. The district may not exercise the power of eminent domain. Sec. 01.156. GROUNDWATER FLOW MODEL. (a) The district shall develop a district specific model which shall be used in conjunction with joint planning in the management area process found in Section 36.108 of the Texas Water Code. Until a subsequent study is determined by the district board of directors to be more appropriate, the district shall use as its model the Val Verde County/City of Del Rio Hydrogeological Study dated May 2014 by EcoKai Environmental, Inc. and William R. Hutchison, Ph.D, P.E., P.G. (b) Applicants for transfer will be required to pay for any cost to run updated modeling of the effects of the proposed pumping on the aquifer and spring flow, base flow and drawdown. The district will utilize the information provided by the model in considering the applications. (c) The district can require any other permit applicant to pay for the cost of the model utilization, if it deems the volume of pumping warrants model review. Sec. 01.157. WATER CONSERVATION INITIATIVE. The district may create a water conservation initiative as described by Section 11.32, Tax Code. SUBCHAPTER E. GENERAL FINANCIAL PROVISIONS Sec. 01.201. LIMITATION ON TAXES. (a) The district may not levy ad valorem taxes at any rate that exceeds five (5) cents on each $100 of assessed valuation of taxable property in the district. (b) Sections 26.04, 26.05 and 26.06 of the Texas Tax Code do not apply to a tax levied and collected by the District. Instead, the District must follow the requirements under Section 49.236 of the Texas Water Code. Sec. 01.202. FEES. (a) The board by rule may impose reasonable and equitable fees on each well: (1) for which a permit is issued by the district; and (2) that is not exempt from district regulation. (b) A production fee may be based on: (1) the size of column pipe used by the well, or (2) the amount of water actually withdrawn from the well, or the amount authorized or anticipated to be withdrawn. (c) In addition to the production fee authorized under this section, the district shall assess a reasonable export fee on groundwater produced from a well and transported outside the district. (d) A district may set fees by rule or resolution for administrative acts of the district such as filing applications, reviewing and processing permits, conducting permit hearings, cost of public notices, legal fees, expert fees, hearing facility rental fees and other fees. (e) Nothing in this section authorizes the board to impose a production fee on water used or produced under a water right as defined in Section 11.002(5), Water Code, including under the Del Rio Certificate of Adjudication. SECTION 5. APPOINTMENT OF TEMPORARY DIRECTORS (a) Not later than the 45th day after the effective date of this Act: (1) the Val Verde County Commissioners Court shall appoint two temporary directors; (2) the Del Rio City Council shall appoint two temporary directors; and (3) the Val Verde County Judge and the Mayor of Del Rio shall jointly appoint one temporary director. (b) Temporary directors serve until temporary directors become initial directors as provided by Section 8 of this Act or until this Act expires under Section 12, whichever occurs earlier. (c) Before the confirmation election, the presiding officer of the district or the presiding officer's designee may represent the district in the joint planning process found in Section 36.108 of the Texas Water Code and such designee shall be considered a voting representative. SECTION 6. ORGANIZATIONAL MEETING OF TEMPORARY DIRECTORS. As soon as practicable after all the temporary directors have qualified under Section 36.055 of the Texas Water Code, a majority of the temporary directors shall convene the organizational meeting of the district at a location within the district agreeable to a majority of the directors. If no location can be agreed upon, the organizational meeting shall be at the Val Verde County Courthouse. SECTION 7. CONFIRMATION ELECTION. (a) The temporary directors shall hold an election to confirm the creation of the district. (b) Except as provided by this section, a confirmation election must be conducted as provided by Sections 36.017(b)-(i), Water Code, and the Election Code. (c) The district may hold a subsequent confirmation election if the previous confirmation election fails to pass. A subsequent confirmation election may not be held sooner than one year after the date of the previous confirmation election. (d) The confirmation election ballot shall be printed to permit voting for or against the proposition: "To create the Val Verde County Groundwater Conservation District and to authorize a rate not to exceed 5 cents for each $100 valuation of all taxable property in the district." (e) The costs of an election held under this chapter may be paid by Val Verde County and the City of Del Rio. (f) If the establishment of the district is not confirmed at an election held under this section before September 1, 2020, the district is dissolved, except that: (1) any debts incurred shall be paid; (2) any assets that remain after the payment of the debts shall be transferred to Val Verde County and the City of Del Rio in proportion to the amounts each has contributed to the costs of the confirmation election and district operations; and (3) the organization of the district shall be maintained until all debts are paid and remaining assets are transferred. SECTION 8. INITIAL DIRECTORS If creation of the district is confirmed at an election held under Section 7 of this Act, the temporary directors of the district become the initial directors of the district and serve on the board of directors until replaced according to Section 01.102. SECTION 9. FINDINGS RELATED TO PROCEDURAL REQUIREMENTS (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 under Section 59, Article XVI, Texas Constitution, and Chapter 313 , Government Code. (b) The governor 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 10. EXPIRATION (a) If the creation of the district is not confirmed at a confirmation election held under Section 7 of this Act before September 1, 2020, this Act expires on that date. (b) The expiration of this Act does not affect the liability of the district to pay any debt incurred or the transfer of any assets remaining to Val Verde County and the City of Del Rio as required by Section 7(f) of this Act. 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, 2015.