By: Creighton, et al. S.B. No. 7
(In the Senate - Filed March 6, 2019; March 7, 2019, read
first time and referred to Committee on Water & Rural Affairs;
March 14, 2019, reported adversely, with favorable Committee
Substitute by the following vote: Yeas 7, Nays 0; March 14, 2019,
sent to printer.)
Click here to see the committee vote
COMMITTEE SUBSTITUTE FOR S.B. No. 7 By: Creighton
A BILL TO BE ENTITLED
AN ACT
relating to flood control planning and the funding of flood
planning, mitigation, and infrastructure projects.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 16, Water Code, is amended by adding
Subchapter L to read as follows:
SUBCHAPTER L. FLOOD PROJECT FUNDING
Sec. 16.451. DEFINITIONS. In this subchapter:
(1) "Advisory committee" means the Texas
Infrastructure Resiliency Fund Advisory Committee.
(2) "Eligible political subdivision" means a district
or authority created under Section 52, Article III, or Section 59,
Article XVI, Texas Constitution, a municipality, or a county.
(3) "Flood project" means a drainage, flood
mitigation, or flood control project, including:
(A) planning and design activities;
(B) work to obtain regulatory approval to provide
structural and nonstructural flood mitigation and drainage; and
(C) construction of structural flood mitigation
and drainage infrastructure.
(4) "Resiliency fund" means the Texas infrastructure
resiliency fund.
Sec. 16.452. TEXAS INFRASTRUCTURE RESILIENCY FUND.
(a) The Texas infrastructure resiliency fund is a special fund in
the state treasury outside the general revenue fund.
(b) The resiliency fund shall be administered by the board
in accordance with this subchapter.
(c) The board may invest, reinvest, and direct the
investment of any available money in the resiliency fund as
provided by law for the investment of money under Section 404.024,
Government Code.
Sec. 16.453. FLOODPLAIN MANAGEMENT ACCOUNT. (a) The
floodplain management account is an account of the resiliency fund.
(b) The account consists of:
(1) money deposited to the credit of the account under
Section 251.004, Insurance Code;
(2) money directly appropriated to the board; and
(3) money from gifts or grants from the United States
government, local or regional governments, private sources, or
other sources.
(c) The board may use the account to provide financing for:
(1) the board's functions under Section 16.316; or
(2) any other activities related to:
(A) the collection and analysis of flood-related
information;
(B) flood planning, protection, mitigation, or
adaptation;
(C) the provision of flood-related information
to the public through educational or outreach programs; or
(D) evaluating the response to and mitigation of
flood incidents affecting residential property, including
multifamily units, located in floodplains.
Sec. 16.454. HURRICANE HARVEY ACCOUNT. (a) The Hurricane
Harvey account is an account in the resiliency fund.
(b) The board may use the account only to provide financing
for flood projects related to Hurricane Harvey. Financing under
this section includes making a:
(1) grant, low-interest loan, or zero-interest loan to
an eligible political subdivision:
(A) for a flood project; or
(B) to provide matching funds to enable the
subdivision to participate in a federal program for a flood
project;
(2) loan to an eligible political subdivision at or
below market interest rates for the subdivision's planning or
design costs, permitting costs, or other costs associated with
state or federal regulatory activities with respect to a flood
project; and
(3) grant to an eligible political subdivision to
provide matching funds to enable the subdivision to participate in
a federal program for the development of a hazard mitigation plan,
under guidelines issued by the Federal Emergency Management Agency
or the Texas Division of Emergency Management or the successor in
function to those entities.
(c) A grant or a loan awarded under this section may not
provide more than 75 percent of the portion of the cost of the
project that is paid with money other than money from a federal
program.
(d) The board shall establish a point system for
prioritizing flood projects for which money from the Hurricane
Harvey account is sought. The system must include a standard for
the board to apply in determining whether a flood project qualifies
for funding at the time the application for funding is filed with
the board.
(e) The board shall give the highest consideration in
awarding points to a flood project that will have a substantial
effect, including a flood project that:
(1) is recommended or approved by the director of the
Texas Division of Emergency Management or the successor in function
to that entity; and
(2) meets an emergency need in a county where the
governor has declared a state of disaster.
(f) After review and recommendation by the executive
administrator and with input from the director of the Texas
Division of Emergency Management or the successor in function to
that entity, the board may approve an application for financial
assistance under this section only if the board finds that:
(1) the application and assistance applied for meet
the requirements of this subchapter and board rules;
(2) the application demonstrates a sufficient level of
cooperation among applicable political subdivisions and includes
all of the political subdivisions substantially affected by the
flood project; and
(3) the taxes or other revenue, or both the taxes and
other revenue, pledged by the applicant, if applicable, will be
sufficient to meet all the obligations assumed by the applicant.
(g) Principal and interest payments on loans made under
Subsection (b)(2) may be deferred for not more than 10 years or
until construction of the flood project is completed, whichever is
earlier.
(h) Money from the account may be awarded to several
eligible political subdivisions for a single flood project.
(i) An eligible political subdivision that receives a grant
for a flood project also may receive a loan from the account.
(j) This section expires September 1, 2031. The remaining
balance of the account on that date is transferred to the flood plan
implementation account.
Sec. 16.455. FLOOD PLAN IMPLEMENTATION ACCOUNT. (a) The
flood plan implementation account is an account in the resiliency
fund.
(b) The board may use the account only to make:
(1) a grant, low-interest loan, or zero-interest loan
to an eligible political subdivision:
(A) for a flood project; or
(B) to provide matching funds to enable the
subdivision to participate in a federal program for a flood
project;
(2) a loan to an eligible political subdivision at or
below market interest rates for the subdivision's planning or
design costs, permitting costs, or other costs associated with
state or federal regulatory activities with respect to a flood
project; and
(3) a grant to an eligible political subdivision to
provide matching funds to enable the subdivision to participate in
a federal program for the development of a hazard mitigation plan,
under guidelines issued by the Federal Emergency Management Agency
or the Texas Division of Emergency Management or the successor in
function to those entities.
(c) The board shall establish a point system for
prioritizing flood projects for which money from the flood plan
implementation account is sought. The system must include a
standard for the board to apply in determining whether a flood
project qualifies for funding at the time the application for
funding is filed with the board.
(d) The board shall give the highest consideration in
awarding points to a flood project that will have a substantial
effect, including a flood project that:
(1) is recommended or approved by the director of the
Texas Division of Emergency Management or the successor in function
to that entity;
(2) meets an emergency need in a county where the
governor has declared a state of disaster;
(3) is funded partially through federal matching
funds;
(4) includes a component that will increase water
supply; and
(5) contains any other factor the board determines is
relevant to the purposes of resiliency.
(e) After review and recommendation by the executive
administrator and with input from the director of the Texas
Division of Emergency Management or the successor in function to
that entity, the board may approve an application under this
section only if the board finds that:
(1) the application and the assistance applied for
meet the requirements of this subchapter and board rules;
(2) the application demonstrates a sufficient level of
cooperation among eligible political subdivisions and includes all
of the political subdivisions substantially affected by the flood
project; and
(3) the taxes or other revenue, or both the taxes and
other revenue, pledged by the applicant, if applicable, will be
sufficient to meet all the obligations assumed by the applicant.
(f) Principal and interest payments on loans made under
Subsection (b)(2) may be deferred for not more than 10 years or
until construction of the flood project is completed, whichever is
earlier.
(g) Money from the account may be awarded to several
eligible political subdivisions for a single flood project.
(h) An award issued as a grant may finance not more than 75
percent of the total cost of a flood project.
(i) An eligible political subdivision that receives a grant
for a flood project also may receive a loan from the account.
Sec. 16.456. FEDERAL MATCHING ACCOUNT. (a) The federal
matching account is an account in the resiliency fund.
(b) The board may use the account only to meet matching
requirements for projects funded partially by federal money,
including projects funded by the United States Army Corps of
Engineers.
Sec. 16.457. TEXAS INFRASTRUCTURE RESILIENCY FUND ADVISORY
COMMITTEE. (a) The Texas Infrastructure Resiliency Fund Advisory
Committee is composed of the seven members that serve on the State
Water Implementation Fund for Texas Advisory Committee described by
Section 15.438, with the co-presiding officers of that committee
serving as presiding officers of the advisory committee. The
director of the Texas Division of Emergency Management or the
successor in function to that entity serves as a nonvoting member of
the advisory committee, as an additional duty of the director's
office.
(b) The advisory committee may hold public hearings, formal
meetings, or work sessions. Either co-presiding officer of the
advisory committee may call a public hearing, formal meeting, or
work session of the advisory committee at any time. The advisory
committee may not take formal action at a public hearing, formal
meeting, or work session unless a quorum of the committee is
present.
(c) Except as otherwise provided by this subsection, a
member of the advisory committee is not entitled to receive
compensation for service on the committee or reimbursement for
expenses incurred in the performance of official duties as a member
of the committee. Service on the advisory committee by a member of
the senate or house of representatives is considered legislative
service for which the member is entitled to reimbursement and other
benefits in the same manner and to the same extent as for other
legislative service.
(d) The advisory committee may submit comments and
recommendations to the board regarding the use of money in the
resiliency fund and for use by the board in adopting rules.
(e) The advisory committee shall review the overall
operation, function, and structure of the resiliency fund at least
semiannually and may provide comments and recommendations to the
board on any matter.
(f) The advisory committee may adopt rules, procedures, and
policies as needed to administer this section and implement its
responsibilities.
(g) The advisory committee shall make recommendations to
the board regarding information on the resiliency fund to be posted
on the board's Internet website.
(h) The advisory committee may evaluate and may provide
comments or recommendations on the feasibility of the state owning,
constructing, operating, and maintaining flood projects, including
reservoirs and coastal barriers.
(i) The board shall provide an annual report to the advisory
committee on:
(1) the board's compliance with statewide annual goals
relating to historically underutilized businesses; and
(2) the participation level of historically
underutilized businesses in flood projects that receive money from
the resiliency fund.
(j) If the aggregate level of participation by historically
underutilized businesses in flood projects that receive money from
the resiliency fund does not meet statewide annual goals adopted
under Chapter 2161, Government Code, the advisory committee shall
make recommendations to the board to improve the participation
level.
(k) The board shall supply staff support to the advisory
committee.
(l) Chapter 2110, Government Code, does not apply to the
size, composition, or duration of the advisory committee.
Sec. 16.458. REPORT REQUIRED. (a) In this section, "state
agency" means:
(1) a department, commission, board, office, or other
agency in the executive branch of state government created by the
state constitution or a state statute; and
(2) a general academic teaching institution as defined
by Section 61.003, Education Code.
(b) A state agency that uses or disburses federal money for
flood research, planning, or mitigation projects shall submit a
report to the board on a quarterly basis.
(c) The report must include the following information about
federal money used or disbursed for flood research, planning, or
mitigation projects:
(1) the original total of federal money received;
(2) the amount of the federal money spent or disbursed
to date; and
(3) the eligibility requirements for receiving the
federal money.
Sec. 16.459. APPLICABLE LAW. Subchapter E, Chapter 17,
applies to financial assistance made available from the resiliency
fund, except that the board may execute contracts as necessary to
evidence grant agreements.
Sec. 16.460. TRANSPARENCY REQUIREMENTS. The board shall
post the following information on the board's Internet website
regarding the use of the resiliency fund and regularly update the
information posted:
(1) the progress made in developing flood projects
statewide;
(2) a description of each flood project that receives
money from the resiliency fund, including:
(A) the expected date of completion of the flood
project;
(B) the current status of the flood project;
(C) the proposed benefit of the flood project;
(D) the initial total cost estimate of the flood
project and variances to the initial cost estimate exceeding five
percent;
(E) a listing of the eligible political
subdivisions receiving money from the resiliency fund;
(F) a listing of each political subdivision
served by each flood project;
(G) an estimate of matching funds that will be
available for the flood project resulting from the use of the
resiliency fund; and
(H) the status of repayment of each loan provided
in connection with a flood project, including an assessment of the
risk of default based on a standard risk rating system;
(3) a description of the point system for prioritizing
flood projects established by the board under Sections 16.454 and
16.455 and the number of points awarded by the board for each flood
project;
(4) any nonconfidential information submitted to the
board as part of an application for funding under this subchapter
that is approved by the board;
(5) the administrative and operating expenses
incurred by the board in administering the resiliency fund; and
(6) any other information required by board rule.
Sec. 16.461. RULES. The board shall adopt rules necessary
to carry out this subchapter, including rules:
(1) that establish procedures for an application for
and for the award of financial assistance;
(2) that establish the prioritization system for flood
projects that receive money from the resiliency fund;
(3) for the repayment of a loan from the resiliency
fund; and
(4) for the administration of the resiliency fund.
SECTION 2. Section 251.004(b), Insurance Code, is amended
to read as follows:
(b) Each state fiscal year, the comptroller shall
reallocate to the floodplain management account established under
Section 16.453 [16.3161], Water Code, the first $3.05 million of
the maintenance taxes collected under Chapter 252 and deposited in
the general revenue fund.
SECTION 3. Section 16.3161, Water Code, is repealed.
SECTION 4. On the effective date of this Act, the Floodplain
Management Account No. 0330 is transferred to the Texas
infrastructure resiliency fund as an account of that fund and the
balance of the Floodplain Management Account No. 0330 is
transferred to the floodplain management account of the Texas
infrastructure resiliency fund.
SECTION 5. (a) Not later than the 90th day after the
effective date of this Act, the Texas Infrastructure Resiliency
Fund Advisory Committee shall submit recommendations to the Texas
Water Development Board on the rules to be adopted by the board
under Section 16.461, Water Code, as added by this Act.
(b) Not later than the 90th day after the date the Texas
Water Development Board receives the recommendations described by
Subsection (a) of this section, the board shall adopt rules under
Section 16.461, Water Code, as added by this Act.
SECTION 6. Contingent on legislation of the 86th
Legislature, Regular Session, 2019, that requires the creation of a
state flood plan passing and becoming law, on the date that the
Texas Water Development Board adopts the initial state flood plan
in accordance with that law:
(1) Section 16.455, Water Code, as added by this Act,
expires; and
(2) Subchapter L, Chapter 16, Water Code, is amended
by adding Section 16.4551 to read as follows:
Sec. 16.4551. FLOOD PLAN IMPLEMENTATION ACCOUNT. (a) The
flood plan implementation account is an account in the resiliency
fund.
(b) The board may use the account only to provide financing
for projects included in the state flood plan.
(c) Money from the account may be awarded to several
eligible political subdivisions for a single flood project.
SECTION 7. 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.
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