| 1 | 1 | | 84R7787 DDT-F |
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| 2 | 2 | | By: Garcia S.B. No. 1526 |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | A BILL TO BE ENTITLED |
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| 6 | 6 | | AN ACT |
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| 7 | 7 | | relating to the revocation of certain water utilities' certificate |
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| 8 | 8 | | of public convenience and necessity for major rules violations. |
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| 9 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 10 | 10 | | SECTION 1. Subchapter G, Chapter 13, Water Code, is amended |
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| 11 | 11 | | by adding Section 13.2541 to read as follows: |
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| 12 | 12 | | Sec. 13.2541. REVOCATION OF CERTIFICATE FOR CERTAIN MAJOR |
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| 13 | 13 | | VIOLATORS. (a) Utility commission staff shall file a petition to |
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| 14 | 14 | | revoke an investor-owned water utility's certificate of public |
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| 15 | 15 | | convenience and necessity if the staff has reason to believe: |
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| 16 | 16 | | (1) the utility has committed repeated or continuous |
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| 17 | 17 | | major violations of one or more commission rules related to safe |
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| 18 | 18 | | drinking water for at least six years before the petition is filed; |
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| 19 | 19 | | (2) none of the owners of the utility have borrowed |
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| 20 | 20 | | money from a federally insured lending institution to use to remedy |
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| 21 | 21 | | a violation of one or more commission rules related to safe drinking |
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| 22 | 22 | | water; |
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| 23 | 23 | | (3) the utility serves more than 1,000 connections but |
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| 24 | 24 | | is made up of less than five public water systems; |
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| 25 | 25 | | (4) the utility does not serve customers who are |
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| 26 | 26 | | located in a municipality; and |
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| 27 | 27 | | (5) the utility is located in a county with a |
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| 28 | 28 | | population of more than four million. |
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| 29 | 29 | | (b) If, after notice and hearing, the utility commission |
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| 30 | 30 | | finds that the facts alleged in the petition are true, the utility |
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| 31 | 31 | | commission shall revoke the investor-owned water utility's |
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| 32 | 32 | | certificate on or before the 90th day after the date the petition is |
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| 33 | 33 | | filed. |
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| 34 | 34 | | (c) At the time the utility commission revokes the |
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| 35 | 35 | | certificate it shall appoint a temporary manager and temporarily |
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| 36 | 36 | | transfer the certificate to the temporary manager. The temporary |
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| 37 | 37 | | manager has all the powers necessary to operate and manage the |
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| 38 | 38 | | utility until the utility commission certifies another retail |
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| 39 | 39 | | public utility. |
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| 40 | 40 | | (d) Not more than 12 months after the date the utility |
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| 41 | 41 | | commission appoints a temporary manager under Subsection (c), the |
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| 42 | 42 | | utility commission shall offer at auction any property that the |
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| 43 | 43 | | utility commission determines is rendered useless or valueless to |
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| 44 | 44 | | the decertified investor-owned water utility as a result of the |
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| 45 | 45 | | decertification. |
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| 46 | 46 | | (e) Any person, including public and private water |
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| 47 | 47 | | utilities and the temporary manager appointed under Subsection (c), |
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| 48 | 48 | | may apply for approval to bid on the decertified utility's assets |
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| 49 | 49 | | and property. The utility commission shall review each application |
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| 50 | 50 | | and approve applicants that it determines have the financial, |
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| 51 | 51 | | managerial, and technical ability to provide safe, adequate, and |
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| 52 | 52 | | continuous water service to the decertified utility's customers. |
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| 53 | 53 | | Only approved applicants may bid in the auction. The utility |
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| 54 | 54 | | commission shall request proposals from all approved bidders. |
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| 55 | 55 | | (f) Before the auction, the utility commission and the |
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| 56 | 56 | | decertified utility shall: |
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| 57 | 57 | | (1) make the books and records of the decertified |
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| 58 | 58 | | utility available to all approved bidders; and |
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| 59 | 59 | | (2) provide an opportunity for all approved bidders to |
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| 60 | 60 | | inspect the decertified utility's assets and property. |
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| 61 | 61 | | (g) Each bid must: |
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| 62 | 62 | | (1) estimate the rates the bidder would charge for |
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| 63 | 63 | | service during the first five years following the date of the sale; |
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| 64 | 64 | | and |
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| 65 | 65 | | (2) agree that the bidder, if the bidder purchases the |
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| 66 | 66 | | assets and property, will seek funds available under the board's |
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| 67 | 67 | | safe drinking water revolving fund for improvements to remedy and |
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| 68 | 68 | | prevent damages from previous violations of commission rules |
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| 69 | 69 | | related to safe drinking water. |
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| 70 | 70 | | (h) The utility commission shall, upon completion of the |
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| 71 | 71 | | sale to the selected bidder, transfer the certificate of public |
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| 72 | 72 | | convenience and necessity from the temporary manager to the |
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| 73 | 73 | | selected bidder. |
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| 74 | 74 | | SECTION 2. This Act takes effect September 1, 2015. |
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