By: Cortez H.B. No. 5370
A BILL TO BE ENTITLED
AN ACT
relating to the requirements for interlocal contracts.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 791.011(d), Government Code, is amended
to read as follows:
(d) An interlocal contract must:
(1) be authorized by the governing body of each party
to the contract unless a party to the contract is a water utility
owned by a municipality containing more than 75 percent of the
population of a county with a population of 2 million or more or a
municipally owned electric utility, in which event the governing
body may establish procedures for entering into interlocal
contracts that do not exceed $100,000 without requiring the
approval of the governing body;
(2) state the purpose, terms, rights, and duties of
the contracting parties; and
(3) specify that each party paying for the performance
of governmental functions or services must make those payments from
current revenues available to the paying party.
SECTION 2. The changes in law made by this Act apply only to
an interlocal contract entered into on or after the effective date
of this Act. An interlocal contract entered into before the
effective date of this Act is governed by the law in effect on the
date the contract was entered into, and the former law is continued
in effect for that purpose.
SECTION 3. This Act takes effect September 1, 2025.