By: Estes S.B. No. 1413
A BILL TO BE ENTITLED
AN ACT
relating to the powers, duties, and administration of groundwater
conservation districts.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 36.001, Water Code, is amended by
amending Subdivisions (8) and (16) and adding Subdivision (31) to
read as follows:
(8) "Waste" means any one or more of the following:
(A) withdrawal of groundwater from a groundwater
reservoir at a rate and in an amount that causes or threatens to
cause intrusion into the reservoir of water unsuitable for
agricultural, gardening, domestic, or stock raising purposes;
(B) the flowing or producing of wells from a
groundwater reservoir if the water produced is not used for a
beneficial purpose;
(C) escape of groundwater from a groundwater
reservoir to any other reservoir or geologic strata that does not
contain groundwater;
(D) pollution or harmful alteration of
groundwater in a groundwater reservoir by saltwater or by other
deleterious matter admitted from another stratum or from the
surface of the ground;
(E) willfully [wilfully] or negligently causing,
suffering, or allowing groundwater to escape into any river, creek,
natural watercourse, depression, lake, reservoir, drain, sewer,
street, highway, road, or road ditch, or onto any land other than
that of the owner of the well unless such discharge is authorized by
permit, rule, or order issued by the commission under Chapter 26;
(F) groundwater pumped for irrigation that
escapes as irrigation tailwater onto land other than that of the
owner of the well unless permission has been granted by the occupant
of the land receiving the discharge; or
(G) for water produced from an artesian well,
"waste" also has the meaning assigned by Section 11.205.
(16) "Loan fund" means the groundwater conservation
district loan assistance fund created under Section 36.371.
(31) "Operating permit" as used in this chapter means
any type of permit issued by a district that relates to the
operation of or production from a water well, which may include
authorization to drill or complete a water well if the district
does not require a separate permit for drilling or completing a
water well.
SECTION 2. Section 36.017(i), Water Code, is amended to
read as follows:
(i) If a majority of the votes cast at the election are
against the levy of a maintenance tax, the district shall set
[production] fees authorized by this chapter to pay for the
district's regulation of groundwater in the district[, including
fees based on the amount of water to be withdrawn from a well].
SECTION 3. Section 36.0171(h), Water Code, is amended to
read as follows:
(h) If the majority of the votes cast at the election are
against the levy of a maintenance tax, the district shall set
[production] fees authorized by this chapter in accordance with
Section 35.013(g-1) to pay for the district's regulation of
groundwater in the district[, including fees based on the amount of
water to be withdrawn from a well].
SECTION 4. Section 36.058, Water Code, is amended to read as
follows:
Sec. 36.058. CONFLICTS OF INTEREST. A director of a
district is subject to the provisions of Chapters [Chapter] 171 and
176, Local Government Code, relating to the regulation of conflicts
of officers of local governments.
SECTION 5. Section 36.061(a), Water Code, is amended to
read as follows:
(a) Subject to the law governing the district, the board
shall adopt the following in writing:
(1) a code of ethics for district directors, officers,
employees, and persons who are engaged in handling investments for
the district;
(2) a policy relating to travel expenditures;
(3) a policy relating to district investments that
ensures that:
(A) purchases and sales of investments are
initiated by authorized individuals, conform to investment
objectives and regulations, and are properly documented and
approved; and
(B) periodic review is made of district
investments to evaluate investment performance and security;
(4) policies and procedures for selection,
monitoring, or review and evaluation of professional services; and
(5) policies that ensure a better use of management
information, including:
(A) budgets for use in planning and controlling
cost; and
(B) an audit or finance committee of the board.[;
and
[(C) uniform reporting requirements that use
"Audits of State and Local Governmental Units" as a guide on audit
working papers and that uses "Governmental Accounting and Financial
Reporting Standards."]
SECTION 6. Section 36.116(c), Water Code, is amended to
read as follows:
(c) In regulating the production of groundwater based on
tract size or acreage, a district may consider the service needs or
service area of a retail public [water] utility. For the purposes
of this subsection, "retail public [water] utility" shall have the
meaning provided by [at] Section 13.002.
SECTION 7. Sections 36.117(a) and (d), Water Code, are
amended to read as follows:
(a) A district by rule may provide an exemption from the
district's requirement to obtain [a drilling permit, an operating
permit, or] any [other] permit required by this chapter or the
district's rules.
(d) A district may cancel a previously granted exemption[,]
and may require an operating permit for or restrict production from
a well and assess any appropriate fees[,] if:
(1) [the well is located in the Hill Country Priority
Groundwater Management Area and] the groundwater withdrawals that
were exempted under Subsection (b)(1) are no longer used solely for
domestic use or to provide water for livestock or poultry;
(2) the groundwater withdrawals that were exempted
under Subsection (b)(2) are no longer used solely to supply water
for a rig that is actively engaged in drilling or exploration
operations for an oil or gas well permitted by the Railroad
Commission of Texas; or
(3) the groundwater withdrawals that were exempted
under Subsection (b)(3) are no longer necessary for mining
activities or are greater than the amount necessary for mining
activities specified in the permit issued by the Railroad
Commission of Texas under Chapter 134, Natural Resources Code.
SECTION 8. Section 36.122(e), Water Code, is amended to
read as follows:
(e) The district may impose an export [a reasonable] fee or
surcharge [for an export fee] using one of the following methods:
(1) a fee negotiated between the district and the
exporter [transporter];
(2) a rate not to exceed the equivalent of the
district's tax rate per hundred dollars of valuation for each
thousand gallons of water exported from [transferred out of] the
district or 2.5 cents per thousand gallons of water, if the district
assesses a tax rate of less than 2.5 cents per hundred dollars of
valuation; or
(3) for a fee-based district, a 50 percent [export]
surcharge, in addition to the district's production fee, for water
exported from [transferred out of] the district.
SECTION 9. Sections 36.153(a), (b), and (d), Water Code,
are amended to read as follows:
(a) Annually and subject to Subsection (c), the board shall
have an audit made of the financial condition of the district. The
district audit shall be performed according to the generally
accepted government auditing standards adopted by the American
Institute of Certified Public Accountants.
(b) Financial statements shall be prepared in accordance
with generally accepted accounting principles as adopted by the
American Institute of Certified Public Accountants. The annual
audit and other district records must be open to inspection during
regular business hours at the principal office of the district.
(d) A financially dormant district may elect not to conduct
an audit and instead submit to the executive director a financial
dormancy affidavit [instead of complying with the audit
requirements of Section 49.191].
SECTION 10. Section 36.157(a), Water Code, is amended to
read as follows:
(a) A district, or the county or counties where the district
is to be located, may pay all costs and expenses necessarily
incurred in the creation and organization of a district, including
legal fees and other incidental expenses, and may reimburse any
person, including a county, for money advanced for these purposes.
SECTION 11. Section 36.159, Water Code, is amended to read
as follows:
Sec. 36.159. GROUNDWATER CONSERVATION DISTRICT MANAGEMENT
PLAN FUNDS. The Texas Water Development Board may allocate funds
from the water assistance fund to a district to:
(1) conduct initial data collections under this
chapter;
(2) [, to] develop and implement a long-term
management plan under Section 36.1071;[,] and
(3) [to] participate in regional water plans.
SECTION 12. Section 36.204, Water Code, is amended by
adding Subsection (c) to read as follows:
(c) Sections 26.04(c)-(j), 26.05(b), (c), (d), (e), and
(g), and 26.07, Tax Code, do not apply to a tax levied and collected
under this chapter or an ad valorem tax levied and collected for the
payment of the interest on and principal of bonds issued by a
district.
SECTION 13. Sections 36.205(f) and (g), Water Code, are
amended to read as follows:
(f) A district, including a district described under
Subsection (d), may assess a production fee under Subsection (c)
and an export fee under Subsection (g), if applicable, for any water
produced under an exemption under Section 36.117 if that water is
subsequently sold to another person.
(g) A district may assess an export [a transportation] fee
under Section 36.122.
SECTION 14. Section 36.206(a), Water Code, is amended to
read as follows:
(a) A temporary board may set [user] fees authorized by this
chapter to pay for the creation and initial operation of a district,
until such time as the district creation has been confirmed and a
permanent board has been elected by a majority vote of the qualified
voters voting in the district in an election called for those
purposes.
SECTION 15. Section 36.207, Water Code, is amended to read
as follows:
Sec. 36.207. USE OF [PERMIT] FEES [AUTHORIZED BY SPECIAL
LAW]. A district may use funds obtained from administrative,
production, or export [permit] fees collected under a [pursuant to
the] special law governing the district or this chapter for any
purpose consistent with the district's approved management plan,
including, without limitation, making grants, loans, or
contractual payments to achieve, facilitate, or expedite
reductions in groundwater pumping or the development or
distribution of alternative water supplies.
SECTION 16. Section 36.251, Water Code, is amended to read
as follows:
Sec. 36.251. SUIT AGAINST DISTRICT. (a) A person, firm,
corporation, or association of persons affected by and dissatisfied
with any [provision or with any] rule or order made by a district,
including an appeal of a decision on a permit application, is
entitled to file a suit against the district or its directors to
challenge the validity of the law, rule, or order.
(b) Only the district, the applicant, and parties to a
contested case hearing may participate in an appeal of a decision on
the application that was the subject of that contested case
hearing. An appeal of a decision on a permit application must
include the applicant as a necessary party.
(c) The suit shall be filed in a court of competent
jurisdiction in any county in which the district or any part of the
district is located. The suit may only be filed after all
administrative appeals to the district are final.
SECTION 17. Section 36.3011, Water Code, is amended to read
as follows:
Sec. 36.3011. COMMISSION INQUIRY AND ACTION REGARDING
DISTRICT DUTIES. (a) In this section, "affected person" means, with
respect to a management area:
(1) an owner of land in the management area;
(2) a groundwater conservation district or subsidence
district in or adjacent to the management area;
(3) a regional water planning group with a water
management strategy in the management area;
(4) a person who holds or is applying for a permit from
a district in the management area;
(5) a person with a legally defined interest in
groundwater in the management area; or
(6) any other person defined as affected by commission
rule.
(b) An affected person may file a petition with the
commission requesting an inquiry for any of the following reasons:
(1) a district fails to submit its management plan to
the executive administrator;
(2) a district fails to participate in the joint
planning process under Section 36.108;
(3) a district fails to adopt rules;
(4) a district fails to adopt the applicable desired
future conditions adopted by the management area at a joint
meeting;
(5) a district fails to update its management plan
before the second anniversary of the adoption of desired future
conditions by the management area;
(6) a district fails to update its rules to implement
the applicable desired future conditions before the first
anniversary of the date it updated its management plan with the
adopted desired future conditions;
(7) the rules adopted by a district are not designed to
achieve the adopted desired future conditions;
(8) the groundwater in the management area is not
adequately protected by the rules adopted by a district; or
(9) the groundwater in the management area is not
adequately protected due to the failure of a district to enforce
substantial compliance with its rules.
(c) Not later than the 90th day after the date the petition
is filed, the commission shall review the petition and either:
(1) dismiss the petition if the commission finds that
the evidence is not adequate to show that any of the conditions
alleged in the petition exist; or
(2) select a review panel as provided in Subsection
(d).
(d) If the petition is not dismissed under Subsection (c),
the commission shall appoint a review panel consisting of a
chairperson and four other members. A director or general manager
of a district located outside the management area that is the
subject of the petition may be appointed to the review panel. The
commission may not appoint more than two members of the review panel
from any one district. The commission also shall appoint a
disinterested person to serve as a nonvoting recording secretary
for the review panel. The recording secretary may be an employee of
the commission. The recording secretary shall record and document
the proceedings of the panel.
(e) Not later than the 120th day after appointment, the
review panel shall review the petition and any evidence relevant to
the petition and, in a public meeting, consider and adopt a report
to be submitted to the commission. The commission may direct the
review panel to conduct public hearings at a location in the
management area to take evidence on the petition. The review panel
may attempt to negotiate a settlement or resolve the dispute by any
lawful means.
(f) In its report, the review panel shall include:
(1) a summary of all evidence taken in any hearing on
the petition;
(2) a list of findings and recommended actions
appropriate for the commission to take and the reasons it finds
those actions appropriate; and
(3) any other information the panel considers
appropriate.
(g) The review panel shall submit its report to the
commission.
(h) Not later than the 45th day after receiving the review
panel's report under this section [Section 36.1082], the executive
director or the commission shall take action to implement any or all
of the panel's recommendations. The commission may take any action
against a district it considers necessary in accordance with
Section 36.303 if the commission finds that:
(1) the district has failed to submit its management
plan to the executive administrator;
(2) the district has failed to participate in the
joint planning process under Section 36.108;
(3) the district has failed to adopt rules;
(4) the district has failed to adopt the applicable
desired future conditions adopted by the management area at a joint
meeting;
(5) the district has failed to update its management
plan before the second anniversary of the adoption of desired
future conditions by the management area;
(6) the district has failed to update its rules to
implement the applicable desired future conditions before the first
anniversary of the date it updated its management plan with the
adopted desired future conditions;
(7) the rules adopted by the district are not designed
to achieve the desired future conditions adopted by the management
area during the joint planning process;
(8) the groundwater in the management area is not
adequately protected by the rules adopted by the district; or
(9) the groundwater in the management area is not
adequately protected because of the district's failure to enforce
substantial compliance with its rules.
SECTION 18. Section 36.303(a), Water Code, is amended to
read as follows:
(a) If Section [36.108,] 36.301, 36.3011, or 36.302(f)
applies, the commission, after notice and hearing in accordance
with Chapter 2001, Government Code, shall take action the
commission considers appropriate, including:
(1) issuing an order requiring the district to take
certain actions or to refrain from taking certain actions;
(2) dissolving the board in accordance with Sections
36.305 and 36.307 and calling an election for the purpose of
electing a new board;
(3) requesting the attorney general to bring suit for
the appointment of a receiver to collect the assets and carry on the
business of the groundwater conservation district; or
(4) dissolving the district in accordance with
Sections 36.304, 36.305, and 36.308.
SECTION 19. Section 36.321, Water Code, is amended to read
as follows:
Sec. 36.321. ADDING LAND BY PETITION OF LANDOWNER. Subject
to Section 36.331, the [The] owner of land not already in
[contiguous to] a district may file with the board a notarized
petition requesting that the owner's land be included in the
district. The petition must describe the land by legal description
or by metes and bounds or by lot and block number if there is a
recorded plat of the area to be included in the district.
SECTION 20. Section 36.325, Water Code, is amended to read
as follows:
Sec. 36.325. ADDING CERTAIN TERRITORY BY PETITION. (a)
Landowners of a defined area of territory not already in a district
may file with any district a petition requesting inclusion in that
district and, subject to Section 36.331, the defined area of
territory is not required to be contiguous with that district.
(b) The petition must be signed by:
(1) a majority of the landowners in the territory;
(2) at least 50 landowners if the number of landowners
is more than 50; or
(3) the commissioners court of the county in which the
area is located if the area is identified as a priority groundwater
management area or includes the entire county.
(c) The petition must describe the land by legal description
or by metes and bounds or by lot and block number if there is a
recorded plat of the area to be included in the district.
SECTION 21. Section 36.328(a), Water Code, is amended to
read as follows:
(a) Annexation of the territory by petition filed under
Section 36.325 is not final until ratified by a majority vote of the
voters in the territory to be added. An election in the existing
district accepting the addition of land is not required.
SECTION 22. The heading to Subchapter L, Chapter 36, Water
Code, is amended to read as follows:
SUBCHAPTER L. GROUNDWATER CONSERVATION DISTRICT LOAN ASSISTANCE
FUND
SECTION 23. Section 36.371, Water Code, is amended to read
as follows:
Sec. 36.371. GROUNDWATER CONSERVATION DISTRICT LOAN
ASSISTANCE FUND. (a) The groundwater conservation district loan
assistance fund is created, to be funded by direct appropriation
and by the Texas Water Development Board from the water assistance
fund.
(b) Repayments of loans shall be deposited in the water
assistance fund.
SECTION 24. Section 36.1082, Water Code, is repealed.
SECTION 25. 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.