Texas 2017 - 85th Regular

Texas House Bill HB2540 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	85R7935 TSR-F
2	2	By: Isaac H.B. No. 2540
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the conversion of the Hays Caldwell Public Utility
8	8	Agency to the Alliance Regional Water Authority; providing
9	9	authority to issue bonds; granting the power of eminent domain;
10	10	providing authority to impose fees.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. (a) The Hays Caldwell Public Utility Agency is
13	13	converted to a conservation and reclamation district to be known as
14	14	the Alliance Regional Water Authority located in Bexar, Caldwell,
15	15	Comal, Guadalupe, and Hays Counties.
16	16	(b) The Alliance Regional Water Authority is not required to
17	17	hold an election to confirm the creation of the authority.
18	18	SECTION 2. Subtitle X, Title 6, Special District Local Laws
19	19	Code, is amended by adding Chapter 11010 to read as follows:
20	20	CHAPTER 11010. ALLIANCE REGIONAL WATER AUTHORITY
21	21	SUBCHAPTER A. GENERAL PROVISIONS
22	22	Sec. 11010.001. DEFINITIONS. In this chapter:
23	23	(1) "Authority" means the Alliance Regional Water
24	24	Authority.
25	25	(2) "Board" means the board of directors of the
26	26	authority.
27	27	(3) "Director" means a member of the board.
28	28	(4) "District" means any district or authority created
29	29	under Section 52, Article III, or Section 59, Article XVI, Texas
30	30	Constitution, regardless of the manner of creation.
31	31	(5) "Local government" means:
32	32	(A) a municipality, county, district, or other
33	33	political subdivision of this state;
34	34	(B) a local government corporation;
35	35	(C) a nonprofit corporation created to act on
36	36	behalf of a local government; or
37	37	(D) a combination of two or more of the entities
38	38	described by this subdivision.
39	39	(6) "Private entity" includes an individual,
40	40	corporation, organization, business trust, estate, trust,
41	41	partnership, and association and any other legal entity that is not
42	42	a governmental body or agency.
43	43	(7) "Sponsor" means:
44	44	(A) the City of Kyle;
45	45	(B) the City of San Marcos;
46	46	(C) the City of Buda;
47	47	(D) the Canyon Regional Water Authority; and
48	48	(E) any other local government or private entity
49	49	added to the authority as a sponsor under Section 11010.005.
50	50	(8) "Water" includes:
51	51	(A) groundwater, percolating or otherwise,
52	52	notwithstanding the quality of the groundwater;
53	53	(B) any surface water, naturally or artificially
54	54	impounded or in a navigable or nonnavigable watercourse; and
55	55	(C) municipal wastewater or industrial
56	56	wastewater, including municipal wastewater or industrial
57	57	wastewater that has been treated to a quality suitable for reuse for
58	58	a beneficial use.
59	59	Sec. 11010.002. NATURE OF AUTHORITY. The authority is a
60	60	regional water authority in Bexar, Caldwell, Comal, Guadalupe, and
61	61	Hays Counties created under and essential to accomplish the
62	62	purposes of Section 59, Article XVI, Texas Constitution.
63	63	Sec. 11010.003. FINDINGS OF PUBLIC PURPOSE AND BENEFIT.
64	64	(a) The authority is created to serve a public use and benefit.
65	65	(b) All land and other property included in the territory of
66	66	the authority will benefit from the works and projects to be
67	67	accomplished by the authority under powers conferred by Section 59,
68	68	Article XVI, Texas Constitution, and powers granted under this
69	69	chapter.
70	70	Sec. 11010.004. AUTHORITY TERRITORY. (a) The authority is
71	71	composed of the territory:
72	72	(1) of the sponsors, including territory within the
73	73	municipal boundaries of a sponsor that is a municipality;
74	74	(2) located in the service areas of the sponsors as
75	75	provided by the sponsors' respective certificates of convenience
76	76	and necessity; and
77	77	(3) added to and not excluded from the authority in
78	78	accordance with applicable law.
79	79	(b) Territory added to the authority may be in a county
80	80	other than a county listed in Section 11010.002.
81	81	Sec. 11010.005. METHOD OF ADDING SPONSORS. (a) The
82	82	governing body of a local government or a private entity, including
83	83	a water supply corporation, may petition the board to add that local
84	84	government or private entity as a sponsor.
85	85	(b) A petition under Subsection (a) must be submitted in the
86	86	manner and form required by board rule.
87	87	(c) On receipt of a petition under Subsection (a), the board
88	88	shall set a hearing on the petition and provide notice of the date,
89	89	time, place, and purpose of the hearing to:
90	90	(1) the sponsors of the authority; and
91	91	(2) the petitioning local government or private
92	92	entity.
93	93	(d) At the hearing, the board shall make a determination on
94	94	whether:
95	95	(1) the local government or private entity will
96	96	benefit from being added to the authority as a sponsor; and
97	97	(2) it is in the best interest of the authority to add
98	98	the local government or private entity to the authority as a
99	99	sponsor.
100	100	(e) If, after a hearing on the petition, the board decides
101	101	that the local government or private entity should be added to the
102	102	authority as a sponsor, the board shall issue an order:
103	103	(1) adding the local government or private entity to
104	104	the authority;
105	105	(2) adding the local government's or private entity's
106	106	territory or service area to the territory of the authority; and
107	107	(3) making the local government's or private entity's
108	108	territory or service area subject to the privileges, duties,
109	109	assets, and financial obligations of the authority to the same
110	110	degree as other sponsors already included in the authority.
111	111	(f) After the addition of a sponsor to the authority, the
112	112	board shall adopt rules that reapportion the directors of the
113	113	authority among the sponsors in accordance with the rules adopted
114	114	under Section 11010.051(c)(2) and may increase or decrease the
115	115	number of directors on the board within the range provided by
116	116	Section 11010.051(a).
117	117	Sec. 11010.006. LIBERAL CONSTRUCTION OF CHAPTER. This
118	118	chapter shall be liberally construed to effect its purposes.
119	119	SUBCHAPTER B. BOARD OF DIRECTORS
120	120	Sec. 11010.051. DIRECTORS. (a) The authority is governed
121	121	by a board of directors consisting of at least 7 and not more than 17
122	122	members.
123	123	(b) The board is responsible for the management, operation,
124	124	and control of the authority.
125	125	(c) The board shall adopt rules that:
126	126	(1) establish the number of directors of the
127	127	authority; and
128	128	(2) determine the apportionment of directors for each
129	129	sponsor based on the amount of water contracted to be supplied to
130	130	the sponsor under the terms of the authority's water supply
131	131	contract with the sponsor.
132	132	Sec. 11010.052. ELIGIBILITY TO SERVE AS DIRECTOR. (a) To
133	133	be eligible to serve as a director, a person must be:
134	134	(1) at least 18 years of age; and
135	135	(2) a resident of the territory located in the
136	136	authority or an employee of a sponsor.
137	137	(b) A director who also serves on the governing body of a
138	138	sponsor is not a dual officeholder and is not prohibited by the
139	139	common law doctrine of incompatibility from serving on both the
140	140	board and the governing body.
141	141	(c) Service on the board by a public officeholder is an
142	142	additional duty of that person's office.
143	143	Sec. 11010.053. APPOINTMENT OF DIRECTORS. (a) Each
144	144	sponsor is entitled to appoint at least one director.
145	145	(b) Each director must be appointed by the governing body of
146	146	a sponsor in accordance with the rules adopted under Section
147	147	11010.051 that govern the apportionment of directors among the
148	148	sponsors.
149	149	(c) Directors must be appointed not earlier than April 1 and
150	150	not later than April 30 of each year.
151	151	Sec. 11010.054. TERMS OF OFFICE. (a) Directors serve
152	152	staggered three-year terms, with one-third or as near as possible
153	153	to one-third of the members' terms expiring April 30 of each year.
154	154	(b) A director's term begins on May 1 of the year the
155	155	director is appointed.
156	156	(c) A director may not serve more than five consecutive
157	157	terms as a director.
158	158	Sec. 11010.055. REMOVAL OF DIRECTOR. A sponsor that
159	159	appoints a director may remove the director from office at any time,
160	160	with or without cause.
161	161	Sec. 11010.056. BOARD VACANCY. If there is a vacancy on the
162	162	board, the governing body of the sponsor that appointed the
163	163	director who vacated the office shall appoint a director to serve
164	164	the remainder of the term.
165	165	Sec. 11010.057. VOTING AUTHORITY. Each director is
166	166	entitled to one vote on any issue before the board.
167	167	Sec. 11010.058. OFFICERS. At the first meeting of the board
168	168	after May 1 of each year, the board shall elect officers for the
169	169	authority, including a chair, vice chair, secretary, and treasurer.
170	170	Sec. 11010.059. MEETINGS AND ACTIONS OF BOARD; QUORUM. (a)
171	171	The board may meet as many times each year as the board considers
172	172	appropriate.
173	173	(b) A majority of the membership of the board constitutes a
174	174	quorum at a meeting of the board.
175	175	(c) A concurrence of a majority of the directors present and
176	176	voting is sufficient for transacting any business of the authority
177	177	unless other applicable law, or the authority by rule, requires a
178	178	concurrence of a greater number of directors for a specific type of
179	179	decision.
180	180	(d) Directors of the authority are public officials and are
181	181	entitled to governmental immunity for their actions in their
182	182	capacity as directors and officers of the authority.
183	183	SUBCHAPTER C. POWERS AND DUTIES
184	184	Sec. 11010.101. GENERAL POWERS AND DUTIES. (a) The
185	185	authority may:
186	186	(1) acquire, purchase, own, hold, lease, construct,
187	187	improve, and maintain a reservoir, groundwater well, or other
188	188	source of water supply, including:
189	189	(A) groundwater, surface water, and wastewater
190	190	reused directly or indirectly; and
191	191	(B) aquifer storage and recovery facilities;
192	192	(2) acquire, own, construct, operate, repair,
193	193	improve, maintain, or extend, inside or outside the authority's
194	194	boundaries, water and wastewater works, improvements, facilities,
195	195	plants, pipelines, equipment, and appliances for:
196	196	(A) the treatment and transportation of water and
197	197	wastewater;
198	198	(B) the direct or indirect reuse of wastewater;
199	199	(C) aquifer storage and recovery projects; and
200	200	(D) the provision of wholesale water and
201	201	wastewater services to authority customers, municipalities,
202	202	districts, water supply corporations, and other persons in this
203	203	state;
204	204	(3) acquire, purchase, own, hold, lease, and maintain
205	205	interests, including capacity rights and other contractual rights,
206	206	in sources of water supply, reservoirs, groundwater wells, water
207	207	and wastewater systems, treatment works, improvements, facilities,
208	208	plants, equipment, appliances, aquifer storage and recovery
209	209	projects, and the direct or indirect reuse of wastewater;
210	210	(4) finance any purchase or acquisition through a
211	211	bond, note, or other obligation under Subchapter E, or through a
212	212	lease-purchase agreement; and
213	213	(5) sell, lease, convey, or otherwise dispose of any
214	214	right, interest, or property the authority considers to be
215	215	unnecessary for the efficient operation or maintenance of the
216	216	authority's facilities.
217	217	(b) In addition to the powers specifically provided by this
218	218	chapter, the authority may exercise the powers provided by Section
219	219	65.201, Water Code.
220	220	Sec. 11010.102. AUTHORITY POLICIES, RULES, AND BYLAWS. The
221	221	authority may adopt and enforce policies, rules, and bylaws
222	222	reasonably required to implement this chapter, including rules
223	223	governing procedures before the board and rules regarding
224	224	implementation, enforcement, and any other matters related to the
225	225	exercise of the rights, powers, privileges, and functions conferred
226	226	on the authority by this chapter for the provision of water and
227	227	wastewater service.
228	228	Sec. 11010.103. EMINENT DOMAIN. (a) The authority may
229	229	exercise the power of eminent domain to acquire a fee simple or
230	230	other interest in property if the interest is necessary for the
231	231	authority to exercise the rights or authority conferred by this
232	232	chapter.
233	233	(b) The authority shall exercise the right of eminent domain
234	234	in the manner provided by Chapter 21, Property Code. The authority
235	235	is not required to give bond for appeal or bond for costs in a
236	236	condemnation suit or other suit to which it is a party.
237	237	(c) The authority may not use the power of eminent domain
238	238	for the condemnation of land for the purpose of acquiring rights to
239	239	groundwater or for the purpose of acquiring water or water rights.
240	240	Sec. 11010.104. WATER CONSERVATION OR DROUGHT CONTINGENCY
241	241	PLANS. The authority by rule may develop, prepare, revise, adopt,
242	242	implement, enforce, and manage water conservation or drought
243	243	contingency plans for the authority or any portion of the
244	244	authority.
245	245	Sec. 11010.105. SERVICE OUTSIDE AUTHORITY. The authority
246	246	may contract to provide the authority's services outside the
247	247	boundaries of the authority.
248	248	Sec. 11010.106. SPONSOR CONVEYANCES AND ACQUISITIONS. (a)
249	249	In this section, "utility system" has the meaning assigned by
250	250	Section 1502.001, Government Code.
251	251	(b) A sponsor may convey a utility system facility or asset
252	252	or the sponsor's interest in a utility system facility or asset to
253	253	the authority without holding an election to approve the
254	254	conveyance.
255	255	(c) A sponsor is exempt from the provisions of Chapter 1502,
256	256	Government Code, regarding the conveyance, sale, or acquisition of
257	257	a utility system, or any related works, improvements, facilities,
258	258	plants, equipment, or appliances.
259	259	Sec. 11010.107. CONTRACTS. (a) The authority may contract
260	260	with any person to carry out a power authorized by this chapter.
261	261	(b) A person who enters into a contract with the authority
262	262	may pledge to the payment of the contract any source of revenue that
263	263	may be available to the person, including ad valorem taxes, if the
264	264	person has the authority to impose those taxes.
265	265	(c) Payments made under a contract with the authority
266	266	constitute an operating expense of the person served under the
267	267	contract, unless otherwise prohibited by a previously outstanding
268	268	obligation of the person. To the extent a person pledges funds to
269	269	the payment of the contract that are to be derived from the person's
270	270	own water system, the payments constitute an operating expense of
271	271	that system.
272	272	Sec. 11010.108. COOPERATIVE CONTRACTS. The authority may
273	273	enter into an interlocal contract with a local government under
274	274	Chapter 791, Government Code, to carry out a power of the authority.
275	275	Sec. 11010.109. RATES AND FEES. (a) The authority shall
276	276	establish rates and fees to be assessed against sponsors and
277	277	customers of the authority. The rates and fees may be established
278	278	by classes of customers, by project, or by area of service.
279	279	(b) A sponsor, local government, water supply corporation,
280	280	private entity, or other person that contracts with the authority
281	281	shall establish, charge, and collect fees, rates, charges, rentals,
282	282	and other amounts for any service or facility provided under or in
283	283	connection with a contract with the authority and shall pledge
284	284	sufficient amounts to make all payments required under the
285	285	contract.
286	286	SUBCHAPTER D. GENERAL FINANCIAL PROVISIONS
287	287	Sec. 11010.151. AD VALOREM TAXES PROHIBITED. The authority
288	288	may not impose an ad valorem tax.
289	289	Sec. 11010.152. GIFTS, GRANTS, LOANS, AND OTHER FUNDS. The
290	290	authority may apply for, accept, receive, and administer gifts,
291	291	grants, loans, and other funds available from any source.
292	292	SUBCHAPTER E. BONDS, NOTES, AND OTHER OBLIGATIONS
293	293	Sec. 11010.201. REVENUE BONDS, NOTES, AND OTHER
294	294	OBLIGATIONS. (a) In addition to bonds, notes, and other
295	295	obligations that the authority is authorized to issue under other
296	296	law, to accomplish the purposes of the authority, the authority may
297	297	issue bonds, notes, or other obligations payable solely from and
298	298	secured by all or part of any funds or any revenue from any source or
299	299	sources, including:
300	300	(1) fees, rates, and other charges the authority
301	301	imposes or collects;
302	302	(2) the sale of:
303	303	(A) water;
304	304	(B) water or wastewater services;
305	305	(C) water rights or capacity;
306	306	(D) water transmission rights, capacity, or
307	307	services;
308	308	(E) water pumping;
309	309	(F) wastewater reused directly or indirectly;
310	310	(G) aquifer storage and recovery services;
311	311	(H) sewer services; or
312	312	(I) any other service or product of the authority
313	313	provided inside or outside the boundaries of the authority;
314	314	(3) grants or gifts;
315	315	(4) the ownership or operation of all or a designated
316	316	part of the authority's works, improvements, facilities, plants, or
317	317	equipment; and
318	318	(5) the proceeds of contracts.
319	319	(b) Bonds, notes, or other obligations issued by the
320	320	authority may be first or subordinate lien obligations at the
321	321	board's discretion.
322	322	(c) In connection with any bonds, notes, or other
323	323	obligations of the authority, the authority may exercise any power
324	324	of an issuer under Chapter 1371, Government Code.
325	325	(d) The authority may conduct a public, private, or
326	326	negotiated sale of the bonds, notes, or other obligations.
327	327	(e) The authority may enter into one or more indentures of
328	328	trust to further secure its bonds, notes, or other obligations.
329	329	(f) The authority may issue bonds, notes, or other
330	330	obligations in more than one series as necessary to carry out the
331	331	purposes of this chapter. In issuing bonds, notes, or other
332	332	obligations secured by revenue of the authority, the authority may
333	333	reserve the right to issue additional bonds, notes, or other
334	334	obligations secured by the authority's revenue that are on parity
335	335	with or are senior or subordinate to the bonds, notes, or other
336	336	obligations issued earlier.
337	337	(g) A resolution of the board or a trust indenture securing
338	338	the bonds, notes, or other obligations may specify additional
339	339	provisions that constitute a contract between the authority and the
340	340	authority's bondholders, noteholders, or other obligation holders.
341	341	(h) Bonds, notes, or other obligations may be additionally
342	342	secured by deed of trust or mortgage on any or all of the
343	343	authority's facilities.
344	344	(i) Bonds, notes, or other obligations issued by the
345	345	authority are not subject to approval by the Texas Commission on
346	346	Environmental Quality, and commission rules regarding bonds,
347	347	notes, or other obligations do not apply to bonds, notes, or other
348	348	obligations issued by the authority.
349	349	(j) The authority provided by this chapter for the
350	350	authorization and issuance of bonds, notes, and other obligations
351	351	is in addition to, and not in lieu of, the authority otherwise
352	352	established under general law and may not be construed as a
353	353	limitation on, or a modification of, general law providing for
354	354	authorization and issuance of bonds, notes, and other forms of
355	355	obligations. Nothing in this chapter may be construed as affecting
356	356	any existing contract, bond, note, or other obligation of the
357	357	authority or any indenture, covenant, mortgage, or other agreement
358	358	relating to them.
359	359	Sec. 11010.202. ELECTION NOT REQUIRED. The authority is
360	360	not required to hold an election to approve the issuance of revenue
361	361	bonds or notes or of other obligations under this subchapter.
362	362	Sec. 11010.203. USE OF REVENUE AND GROWTH PROJECTIONS. For
363	363	the purposes of attorney general review and approval and in lieu of
364	364	any other manner of demonstrating the ability to pay debt service
365	365	and satisfy any other pecuniary obligations relating to bonds,
366	366	notes, or other obligations, the authority may demonstrate the
367	367	authority's ability to satisfy the debt service and those
368	368	obligations using accumulated funds of the authority and revenue
369	369	and growth projections prepared by a professional utility rate
370	370	consultant at the direction of the authority. If the resolution
371	371	authorizing the issuance of the bonds, notes, or other obligations
372	372	provides that the authority intends to increase rates to the extent
373	373	necessary to pay debt service and satisfy any other pecuniary
374	374	obligations arising under the bonds, notes, or other obligations,
375	375	the revenue projections prepared by a professional utility rate
376	376	consultant may include forecast rate increases and accumulated and
377	377	available fund balances as determined by the authority.
378	378	Sec. 11010.204. REFUNDING BONDS. The authority may issue
379	379	refunding bonds, notes, and other obligations to refund any of its
380	380	bonds, notes, or other obligations in any manner provided by law,
381	381	including Chapter 1207, Government Code.
382	382	Sec. 11010.205. BONDS, NOTES, AND OTHER OBLIGATIONS EXEMPT
383	383	FROM TAXATION. A bond, note, or other obligation issued under this
384	384	chapter, a transaction related to the bond, note, or other
385	385	obligation, the interest on the bond, note, or other obligation,
386	386	and the profit from the sale of the bond, note, or other obligation
387	387	are exempt from taxation by this state or a political subdivision of
388	388	this state.
389	389	SECTION 3. On the effective date of this Act:
390	390	(1) the Alliance Regional Water Authority shall assume
391	391	all assets, liabilities, bonds, notes, and other obligations of the
392	392	Hays Caldwell Public Utility Agency;
393	393	(2) all contracts and written agreements of the Hays
394	394	Caldwell Public Utility Agency are assigned to and assumed by the
395	395	Alliance Regional Water Authority; and
396	396	(3) the Alliance Regional Water Authority may refund
397	397	all or a portion of the bonds, notes, or other obligations issued by
398	398	the Hays Caldwell Public Utility Agency in any manner provided by
399	399	law, including Chapter 1207, Government Code.
400	400	SECTION 4. (a) The sponsors of the Alliance Regional Water
401	401	Authority shall appoint the initial directors under Section
402	402	11010.053, Special District Local Laws Code, as added by this Act,
403	403	not earlier than April 1, 2018, and not later than April 30, 2018.
404	404	Directors of the Hays Caldwell Public Utility Agency serving on the
405	405	effective date of this Act shall serve as the temporary directors of
406	406	the Alliance Regional Water Authority until the initial directors
407	407	take office on May 1, 2018.
408	408	(b) As soon as practicable after the initial directors have
409	409	been appointed under Section 11010.053, Special District Local Laws
410	410	Code, as added by this Act, the initial directors shall draw lots to
411	411	determine which directors serve a one-year term expiring April 30,
412	412	2019, which directors serve a two-year term expiring April 30,
413	413	2020, and which directors serve a three-year term expiring April
414	414	30, 2021. The lots must be split into thirds or as near to thirds as
415	415	possible.
416	416	(c) This section expires January 1, 2022.
417	417	SECTION 5. (a) The legal notice of the intention to
418	418	introduce this Act, setting forth the general substance of this
419	419	Act, has been published as provided by law, and the notice and a
420	420	copy of this Act have been furnished to all persons, agencies,
421	421	officials, or entities to which they are required to be furnished
422	422	under Section 59, Article XVI, Texas Constitution, and Chapter 313,
423	423	Government Code.
424	424	(b) The governor, one of the required recipients, has
425	425	submitted the notice and Act to the Texas Commission on
426	426	Environmental Quality.
427	427	(c) The Texas Commission on Environmental Quality has filed
428	428	its recommendations relating to this Act with the governor, the
429	429	lieutenant governor, and the speaker of the house of
430	430	representatives within the required time.
431	431	(d) All requirements of the constitution and laws of this
432	432	state and the rules and procedures of the legislature with respect
433	433	to the notice, introduction, and passage of this Act are fulfilled
434	434	and accomplished.
435	435	SECTION 6. This Act takes effect immediately if it receives
436	436	a vote of two-thirds of all the members elected to each house, as
437	437	provided by Section 39, Article III, Texas Constitution. If this
438	438	Act does not receive the vote necessary for immediate effect, this
439	439	Act takes effect September 1, 2017.