89R15877 JRR-F By: Phelan H.B. No. 4400 A BILL TO BE ENTITLED AN ACT relating to supplemental environmental projects authorized by the Texas Commission on Environmental Quality. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Section 7.067, Water Code, is amended by adding Subsections (d), (e), and (f) to read as follows: (d) The commission may determine the types of projects that may be approved as a supplemental environmental project. For a respondent that is a local government, those types of projects must include: (1) purchasing, operating, or maintaining: (A) alternative fuel vehicles, including passenger cars, light trucks, heavy trucks, and buses; and (B) alternative fuel heavy equipment, including tractors, bulldozers, front-end loaders, and motor graders; (2) constructing, operating, or maintaining alternative fuel refueling infrastructure necessary to operate an alternative fuel fleet; and (3) providing energy efficiency upgrades to buildings and facilities owned by the local government, including heating, ventilation, air conditioning, lighting, and building envelope upgrades. (e) For a supplemental environmental project involving alternative fuel vehicles, the commission: (1) must allow the project to include: (A) the entire cost of the vehicle; and (B) any alternative fuel equipment or upgrades involved; and (2) may not limit the project to including only the difference in cost between conventional fuel vehicles, equipment, or upgrades and the alternative fuel counterparts. (f) The commission: (1) may not require a contract associated with a supplemental environmental project to be for a term of less than five years; and (2) must allow a contract associated with a supplemental environmental project to be renewable for periods of at least five years. SECTION 2. This Act takes effect September 1, 2025.