86R4517 SLB-F
By: Thompson of Brazoria H.B. No. 1958
A BILL TO BE ENTITLED
AN ACT
relating to the territory, powers, and administration of the Gulf
Coast Water Authority.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 2 and 3, Chapter 712, Acts of the 59th
Legislature, Regular Session, 1965, are amended to read as follows:
Sec. 2. The District's territory is [District shall be
comprised of all of the territory contained within Galveston
County, Texas, and its boundaries shall be the same as and]
coextensive with the boundaries of Brazoria, Fort Bend, and
Galveston Counties [County, Texas].
Sec. 3. Except as expressly limited by this Act, the
District shall have and exercise and is hereby vested with all
rights, powers, privileges, and authority conferred by the General
Laws of this State now in force or hereafter enacted applicable to
municipal utility districts created under authority of Section 59
of Article XVI, Constitution of Texas including without limitation
those conferred by Chapters 49 and [Chapter] 54, Water Code, as
amended, but to the extent that the provisions of such General Laws
may be in conflict or inconsistent with the provisions of this Act,
the provisions of this Act shall prevail. All such General Laws are
hereby adopted and incorporated by reference with the same effect
as if incorporated in full in this Act. Without in any way limiting
the generalization of the foregoing, it is expressly provided that
the District shall have, and is hereby authorized to exercise, the
following rights, powers, privileges and functions:
(a) the power to make, construct, or otherwise acquire
improvements either within or without the boundaries thereof
necessary to carry out the powers and authority granted by this Act
and said General Laws and to exercise the power of eminent domain
for such purposes; provided, however, that the District shall not
have the power of eminent domain as to all or any part of the water
supply, property, works or facilities of any private person or
persons, or of any private or public corporation or association
engaged in the business of supplying water in Brazoria County, Fort
Bend County, or Galveston County, Texas, to any class of consumers
for any use upon the effective date of this Act, but this provision
shall not restrict the power of the District to acquire necessary
crossing easements and rights-of-way;
(b) to conserve, store, transport, treat and purify,
distribute, sell and deliver water, both surface and underground,
to persons, corporations, both public and private, political
subdivisions of the State and others, and to purchase, construct or
lease all property, works and facilities, both within and without
the District, necessary or useful for such purposes;
(c) to acquire water supplies from sources both within or
without the boundaries of the District and to sell, transport and
deliver water to customers situated within or without the District
and to acquire all properties and facilities necessary or useful
for such purposes, and for any or all of such purposes to enter into
contracts with persons, corporations, both public and private, and
political subdivisions of the State for such periods of time and on
such terms and conditions as the Board of Directors may deem
desirable;
(d) subject to the provisions of this Act, to sell, lease,
or exchange any property of any kind, or any interest therein, which
is not necessary to the carrying on of the business of the District
or the sale, lease, or exchange of which, in the judgment of the
Board of Directors, is necessary for the exercise of the powers,
rights, privileges, and functions conferred upon the District by
this Act or by Chapters 49 and [Chapter] 54, Water Code, as amended;
(e) subject to the provisions of this Act, to acquire by
purchase, lease, gift, or otherwise, and to maintain, use, and
operate any and all property of any kind, or any interest therein,
within or without the boundaries of the District, necessary to the
exercise of the powers, rights, privileges, and functions conferred
by this Act or by Chapters 49 and [Chapter] 54, Water Code, as
amended;
(f) to construct, extend, improve, maintain, and
reconstruct, to cause to be constructed, extended, improved,
maintained, and reconstructed, and to use and operate, any and all
facilities of any kind necessary to the exercise of such powers,
rights, privileges, and functions;
(g) to sue and be sued in its corporate name;
(h) to adopt, use, and alter a corporate seal;
(i) to invest and reinvest its funds;
(j) to make bylaws for management and regulation of its
affairs;
(k) to appoint officers, agents, and employees, to
prescribe their duties and fix their compensation;
(l) to make contracts and to execute instruments convenient
or necessary to the exercise of the powers, rights, privileges, and
functions conferred by this Act or Chapters 49 and [Chapter] 54,
Water Code, as amended, for such term and with such provisions as
the Board of Directors may determine to be in the best interests of
the District, including, without in any way limiting the generality
of the foregoing, contracts with persons including the State of
Texas, the United States of America and any corporation or agency
thereof and districts, cities, towns, persons, organizations,
firms, corporations or other entities as the Board of Directors may
deem necessary or proper for or in connection with any of its
corporate purposes;
(m) to borrow money for its corporate purposes and, without
limiting the generality of the foregoing, to borrow money, apply
for and receive loans, and accept grants or contributions, directly
or indirectly, from persons, including the State of Texas, the
United States of America, or from any corporation, agency, or
entity created or designated by the State of Texas or the United
States of America, and in connection with any such loan, [or] grant,
or contribution, to enter into such agreements as the State of
Texas, the United States of America, or any such corporation,
agency, or entity may require; and to make and issue its negotiable
bonds or notes for money borrowed, in the manner and to the extent
provided in this Act, and to refund or refinance any outstanding
bonds, [or] notes, or loans, and to make and issue its negotiable
bonds or notes therefor in the manner provided in this Act.
SECTION 2. Chapter 712, Acts of the 59th Legislature,
Regular Session, 1965, is amended by adding Sections 3B and 3C to
read as follows:
Sec. 3B. (a) In this section, "person" includes an
individual, entity, partnership, and corporation. The term does
not include a political subdivision or public agency.
(b) Competitive bidding and contract procurement or
delivery requirements otherwise applicable to the District do not
apply to a contract or agreement made by the District with a person
if:
(1) the contract or agreement relates to a project for
the acquisition or construction of equipment or facilities for the
production, treatment, transmission, or delivery of water; and
(2) payments made under the contract or agreement are
for amounts substantially sufficient to finance a project described
in Subdivision (1).
Sec. 3C. (a) The Board by resolution may authorize the
creation of a nonprofit corporation to assist and act for the
district in implementing a project or providing a service
authorized by this chapter.
(b) The nonprofit corporation:
(1) has each power of and is considered to be a local
government corporation created under Subchapter D, Chapter 431,
Transportation Code; and
(2) may implement any project and provide any service
authorized by this chapter.
(c) The Board shall appoint the board of directors of the
nonprofit corporation. The board of directors of the nonprofit
corporation shall serve at the will of the district and in the same
manner as the board of directors of a local government corporation
created under Subchapter D, Chapter 431, Transportation Code.
(d) The nonprofit corporation may not:
(1) exercise the powers of a municipality or county;
(2) participate in a project that the District is not
authorized to participate in;
(3) impose taxes; or
(4) acquire, construct, or operate parks or
recreational facilities.
SECTION 3. Sections 4(a), (c), and (f), Chapter 712, Acts of
the 59th Legislature, Regular Session, 1965, are amended to read as
follows:
(a) The District shall have no power or authority to levy
and collect taxes on any property real, personal or mixed, within
the boundaries of said District, nor shall the District have power
or authority to issue bonds or create indebtedness which would in
any way be payable from ad valorem taxes levied by the District upon
property within said District; and provided further that said
District shall have none of the powers conferred by General Law for
the purposes of the collection, transportation, processing,
disposal and control of domestic, industrial or communal wastes,
and the gathering, conducting, directing and controlling of local
storm waters, or other local harmful excesses of water except as
directly related to the production and purification of water for
agricultural, municipal, or industrial purposes, including the
ownership, lease, or operation of a municipal wastewater treatment
facility in which the effluent is used by the District for water
reuse supply.
(c) In the event that the District in the exercise of the
power of eminent domain or power of relocation, or any other power
granted hereunder, makes necessary the relocation, raising,
rerouting or changing the grade of, or altering the construction
of, any cemetery, highway, railroad, electric transmission line,
telephone or telegraph properties and facilities, or pipeline, all
such necessary relocation, raising, rerouting, changing of grade or
alteration of construction shall be accomplished at the sole
expense of the District. The term "sole expense" shall mean the
actual cost of such relocation, raising, rerouting, or change in
grade or alteration of construction in providing comparable
replacement without enhancement of such facilities after deducting
therefrom the net salvage value derived from the old facility.
(f) The powers, rights, privileges, and functions conferred
upon the District shall be subject to the continuing rights of
supervision by the State, [which shall be exercised by the Texas
Department of Water Resources, and the District shall obtain
approval of its projects and they shall be supervised] as provided
by the [Sections 54.516 and 54.517,] Water Code, as amended.
SECTION 4. Section 5, Chapter 712, Acts of the 59th
Legislature, Regular Session, 1965, is amended to read as follows:
Sec. 5. (a) The management and control of the District is
hereby vested in a Board of 10 directors.
(b) Each director must be a resident of this state.
(c) Vacancies on the Board of Directors, whether by death,
resignation or termination of the term of office, shall be filled by
appointment by the commissioners court that appointed the director
for the unexpired term of the director.
(d) A director may be removed by the commissioners court
that appointed the director for inefficiency, neglect of duty, or
misconduct of office. The Board must provide a director removed
under this section written notice not later than the 30th day after
the date the decision to remove is made and an opportunity to be
heard in person or by counsel in a public hearing.
(e) All terms of office shall be for a period of two (2)
years. Terms shall be staggered ending on August 31 of the
appropriate year.
(f) Six directors constitute a quorum. Except as otherwise
provided, a majority of those directors present and qualified to
vote is sufficient for final action on a matter before the Board.
SECTION 5. Chapter 712, Acts of the 59th Legislature,
Regular Session, 1965, is amended by adding Sections 5C, 5D, 5E, 5F,
and 5G to read as follows:
Sec. 5C. (a) Chapter 171, Local Government Code, does not
apply to a director appointed to represent agricultural or
industrial interests.
(b) A director who has a financial interest in a contract
considered by the District for the purchase of property or the
construction of a facility must disclose the interest to the other
directors and may not vote on the contract.
Sec. 5D. (a) The Board may hold an open or closed meeting by
telephone conference call if at least five directors are present at
the location where the meeting of the Board is held. A meeting held
by telephone conference call is subject to the same notice
requirements as other Board meetings and must be recorded. Each
person who speaks in a meeting held by telephone conference call
must be clearly identified. A director participating in a meeting
held by telephone conference call is considered absent from any
part of the meeting during which audio communication is lost.
(b) The authority to hold a meeting held by telephone
conference call described by this section is in addition to
authority described by Chapter 551, Government Code.
Sec. 5E. If the Board employs a general manager, the general
manager is the chief executive officer of the District.
Sec. 5F. The District is not required to provide notice for
the sale or disposal of District personal property if the personal
property has a value of less than $25,000.
Sec. 5G. (a) The District may enter into a contract related
to a water project located outside the District. The District may
enter into a local agreement with a political subdivision for a
purpose related to a water project.
(b) A contract under this section may use money appropriated
by a political subdivision that is a party to the contract to pay
for pre-development costs, engineering, surveys, and the
collection and compilation of data relating to conditions
influencing determinations about the character and extent of
proposed improvements, works, and facilities for the
accomplishment of District purposes.
(c) The District may contract or agree with an entity
appropriating money under this section to receive a loan or money
from other sources in return for services described by Subsection
(a). The contract or agreement may provide for the repayment by the
District of money advanced as a loan from project revenues, bond
proceeds, or other available money.
(d) The District and a state agency or political subdivision
may enter into a contract to jointly pay all or part of the cost of a
water project or the operation of a water project in the same way
that a political subdivision may contract with a state agency or
political subdivision under Chapter 472, Transportation Code, to
jointly pay all or part of the cost associated with a state or local
highway, turnpike, road, or street project.
SECTION 6. Sections 7 and 8, Chapter 712, Acts of the 59th
Legislature, Regular Session, 1965, are amended to read as follows:
Sec. 7. The District shall have power and is hereby
authorized to issue, from time to time, bonds as herein authorized
for any of its corporate purposes. Such bonds may either be (1)
sold for cash, at public or private sale, at such price or prices as
the Board shall determine, provided that the net effective interest
rate, calculated in accordance with Chapter 1204, Government Code
[3, Acts of the 61st Legislature, Regular Session, 1969, as amended
(Article 717k-2, Vernon's Texas Civil Statutes), as now or
hereafter amended shall not exceed ten (10) percent], or (2) issued
on such terms as the Board of Directors shall determine in exchange
for property of any kind, real, personal or mixed or any interest
therein which the Board shall deem necessary for any such corporate
purposes, or (3) issued in exchange for like principal amounts of
other obligations of the District, matured or unmatured. The
proceeds of sale of such bonds shall be deposited in such bank or
banks or trust company or trust companies, and shall be paid out
pursuant to such terms and conditions, as may be agreed upon between
the District and the purchasers of such bonds. All such bonds shall
be authorized by resolution or resolutions of the Board of
Directors, and shall bear such date or dates, mature at such time or
times, bear interest payable annually, semiannually, or otherwise,
be in such denominations, be in such form, either coupon or
registered, carry such registration privileges as to principal only
or as to both principal and interest, and as to exchange of coupon
bonds for registered bonds or vice versa, and exchange of bonds of
one denomination for bonds of other denominations, be executed in
such manner and be payable at such place or places within or without
the State of Texas, as such resolution or resolutions may provide.
Any resolution or resolutions authorizing any bonds may contain
provisions, which shall be part of the contract between the
District and the holders thereof from time to time:
(a) reserving the right to redeem such bonds or requiring
the redemption of such bonds, at such time or times, in such amounts
and at such prices, [not exceeding 105 percent of the principal
amount thereof, plus accrued interest,] as may be provided;
(b) providing for the setting aside of sinking funds or
reserve funds and the regulation and disposition thereof;
(c) pledging to secure the payment of the principal of and
interest on such bonds and of the sinking fund or reserve fund
payments agreed to be made in respect of such bonds all or any part
of the gross or net revenues thereafter received by the District in
respect of the property, real, personal, or mixed, to be acquired
and/or constructed with such bonds or the proceeds thereof, or all
or any part of the gross or net revenues thereafter received by the
District from whatever source derived;
(d) prescribing the purposes to which such bonds or any
bonds thereafter to be issued, or the proceeds thereof, may be
applied;
(e) agreeing to fix and collect rates and charges sufficient
to produce revenues adequate to pay (1) all expenses necessary to
the operation and maintenance and replacements and additions to the
properties and facilities of the District; (2) the principal of,
and the interest and premium, if any, on bonds issued under this Act
as and when the same became due and payable; (3) all sinking fund
and/or reserve fund payments agreed to be made in respect of any
such bonds out of such revenues as and when the same became due and
payable, and to fulfill the terms of any agreements made with the
holders of such bonds and/or with any person on their behalf and to
discharge all other lawful obligations of the District as and when
the same become due;
(f) prescribing limitations upon the issuance of additional
bonds and subordinate lien bonds and upon the agreements which may
be made with the purchasers and successive holders thereof;
(g) with regard to the construction, extension,
improvement, reconstruction, operation, maintenance, and repair of
the properties of the District and carrying of insurance upon all or
any part of said properties covering loss or damage or loss of use
and occupancy resulting from specified risks;
(h) fixing the procedure, if any, by which, if the District
shall so desire, the terms of any contract with the holders of such
bonds may be amended or abrogated, the amount of bonds the holders
of which must consent thereto, and the manner in which such consent
may be given;
(i) for the execution and delivery by the District to a bank
or trust company authorized by law to accept trusts, or to the
United States of America or any officer or agency thereof, of
indentures and agreements for the benefit of the holders of such
bonds and such other provisions as may be customary in such
indentures or agreements; and
(j) such other provisions, [not inconsistent with the
provisions of this Act,] as the Board may approve.
(k) The Board may declare an emergency in the matter of
funds not being available to pay principal of and interest on any
bonds of the District or to meet any other needs of the District and
may issue bond anticipation notes or enter into a loan to pay the
costs to meet the emergency need. A loan under this section may be
payable from district revenues or the proceeds of a future series of
bonds. Bond anticipation notes may bear interest at any rate or
rates not to exceed 10 percent and shall mature within one (1) year
of their date. The bond anticipation notes so issued will be taken
up with the proceeds of bonds, or the bonds may be issued and
delivered in exchange for and in substitution of such notes.
(l) Before any bonds shall be sold or exchanged or
substituted by the District, a certified copy of the proceedings of
the issuance thereof, including the form of such bonds, together
with any other information which the Attorney General of the State
of Texas may require, shall be submitted to the Attorney General,
and if he shall find that such bonds have been issued in accordance
with law, and if he shall approve such bonds, he shall execute a
certificate to that effect which shall be filed in the office of the
Comptroller of the State of Texas and be recorded in a record kept
for that purpose. No bonds shall be issued until the same shall
have been registered by the Comptroller, who shall so register the
same if the Attorney General shall have filed with the Comptroller
his certificate approving the bonds and the proceedings for the
issuance thereof as hereinabove provided.
(m) All bonds approved by the Attorney General as aforesaid,
and registered by the Comptroller as aforesaid, and issued in
accordance with the proceedings so approved shall be valid and
binding obligations of the District and shall be incontestable for
any cause from and after the time of such registration.
(n) If any bonds recite that they are secured by a pledge of
the proceeds of a contract, lease, sale or other agreement (herein
called "contract"), a copy of such contract and the proceedings of
the contracting parties will also be submitted to the Attorney
General. If such bonds have been authorized and such contracts made
in compliance with law, the Attorney General shall approve the
bonds and contracts, and the bonds shall then be registered by the
Comptroller of Public Accounts. When so approved, such bonds and
the contracts shall be valid and binding and shall be incontestable
for any cause from and after the time of such registration.
(o) The District is authorized to make and issue bonds
(herein called "refunding bonds") for the purpose of refunding or
refinancing any outstanding bonds or notes authorized and issued by
the District pursuant to this Act or other law (herein called
"bonds") and the interest and premium, if any, thereon to maturity
or on any earlier redemption date specified in the resolution
authorizing the issuance of the refunding bonds. Such refunding
bonds may be issued to refund more than one series of outstanding
bonds, may combine the pledges of the outstanding bonds for the
security of the refunding bonds, or may be secured by other or
additional revenues. All provisions of this Act with reference to
the issuance of bonds, the terms and provisions thereof, their
approval by the Attorney General, and the remedies of the
bondholders shall be applicable to refunding bonds. Refunding
bonds shall be registered by the Comptroller upon surrender and
cancellation of the bonds to be refunded, but in lieu thereof, the
resolution authorizing the issuance of refunding bonds may provide
that they shall be sold and the proceeds thereof deposited at the
places at which the original bonds are payable, in which case the
refunding bonds may be issued in an amount sufficient to pay the
interest and premium, if any, on the original bonds to their
maturity date or specified earlier redemption date, and the
Comptroller will register them without concurrent surrender and
cancellation of the original bonds. The District may also refund
any outstanding bonds in the manner provided by any applicable
General Law.
(p) All bonds issued by the District pursuant to the
provisions of this Act shall constitute investment securities
within the meaning of the Uniform Commercial Code.
(q) This Act, without reference to other statutes of the
State of Texas, shall constitute full authority for the
authorization and issuance of bonds hereunder, and no other Act or
law with regard to the authorization or issuance of obligations or
the deposit of the proceeds thereof, or in any impeding or
restricting the carrying out of the acts herein authorized to be
done shall be construed as applying to any proceedings taken
hereunder or acts done pursuant hereto.
Sec. 8. (a) When any of such revenues are pledged to the
payment of any bonds issued by said District or loans received by
the District, it shall be the right and duty of the District's Board
of Directors to cause to be fixed, maintained and enforced charges,
fees or tolls for services rendered by properties and facilities,
the revenues of which have been pledged, at rates and amounts at
least sufficient to comply with and carry out the covenants and
provisions contained in the order or orders authorizing the
issuance of said bonds.
(b) Regardless of whether the revenues are pledged to the
payment of bonds, the [The] District shall have the right to impose
penalties for failure to pay, when due, such charges, fees or tolls.
SECTION 7. (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 to all persons, agencies,
officials, or entities to which they are required to be furnished
under Section 59, Article XVI, Texas Constitution, and Chapter 313,
Government Code.
(b) The governor, one of the required recipients, 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 8. 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, 2019.