LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION April 19, 2025 TO: Honorable Charles Perry, Chair, Senate Committee on Water, Agriculture and Rural Affairs FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: SB2658 by Perry (relating to the production and study of brackish groundwater.), Committee Report 1st House, Substituted Estimated Two-year Net Impact to General Revenue Related Funds for SB2658, Committee Report 1st House, Substituted: a negative impact of ($500,000) through the biennium ending August 31, 2027. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill. General Revenue-Related Funds, Five- Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact toGeneral Revenue Related Funds2026($500,000)2027$02028$02029$02030$0All Funds, Five-Year Impact: Fiscal Year Probable Savings/(Cost) fromGeneral Revenue Fund12026($500,000)2027$02028$02029$02030$0 Fiscal AnalysisThe bill would amend Water Code relating to the production and study of brackish groundwater. The bill would remove an area of geologic stratum that is designated or used for wastewater injection through the use of injection or disposal wells from being designated as groundwater production zones. The bill would amend the biennial progress report on desalination activities produced by the Texas Water Development Board (TWDB) to include that when TWDB designates a brackish groundwater production zone it includes in the description an allocation of the available amounts of brackish groundwater the zone is capable of producing to each groundwater conservation district (districts) and county located in the zone.The bill amends drilling or operating a well for the withdrawal of groundwater from a designated brackish groundwater production zone to be exempt from permitting if the well operator provides the district with documentation that provides information meeting specific criteria. For groundwater wells exempted under this criteria the groundwater produced must meet a certain dissolved solids concentration amount, the well operator would be required to implement a monitoring system approved by the district, and an annual report would be required to be submitted to the district. The bill would exempt water withdrawn from these wells from being subject to a transport or export fee, and prohibit districts from assessing a production fee.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION
April 19, 2025
TO: Honorable Charles Perry, Chair, Senate Committee on Water, Agriculture and Rural Affairs FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: SB2658 by Perry (relating to the production and study of brackish groundwater.), Committee Report 1st House, Substituted
TO: Honorable Charles Perry, Chair, Senate Committee on Water, Agriculture and Rural Affairs
FROM: Jerry McGinty, Director, Legislative Budget Board
IN RE: SB2658 by Perry (relating to the production and study of brackish groundwater.), Committee Report 1st House, Substituted
Honorable Charles Perry, Chair, Senate Committee on Water, Agriculture and Rural Affairs
Honorable Charles Perry, Chair, Senate Committee on Water, Agriculture and Rural Affairs
Jerry McGinty, Director, Legislative Budget Board
Jerry McGinty, Director, Legislative Budget Board
SB2658 by Perry (relating to the production and study of brackish groundwater.), Committee Report 1st House, Substituted
SB2658 by Perry (relating to the production and study of brackish groundwater.), Committee Report 1st House, Substituted
Estimated Two-year Net Impact to General Revenue Related Funds for SB2658, Committee Report 1st House, Substituted: a negative impact of ($500,000) through the biennium ending August 31, 2027. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
Estimated Two-year Net Impact to General Revenue Related Funds for SB2658, Committee Report 1st House, Substituted: a negative impact of ($500,000) through the biennium ending August 31, 2027. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.
General Revenue-Related Funds, Five- Year Impact:
2026 ($500,000)
2027 $0
2028 $0
2029 $0
2030 $0
All Funds, Five-Year Impact:
2026 ($500,000)
2027 $0
2028 $0
2029 $0
2030 $0
Fiscal Analysis
The bill would amend Water Code relating to the production and study of brackish groundwater. The bill would remove an area of geologic stratum that is designated or used for wastewater injection through the use of injection or disposal wells from being designated as groundwater production zones. The bill would amend the biennial progress report on desalination activities produced by the Texas Water Development Board (TWDB) to include that when TWDB designates a brackish groundwater production zone it includes in the description an allocation of the available amounts of brackish groundwater the zone is capable of producing to each groundwater conservation district (districts) and county located in the zone.The bill amends drilling or operating a well for the withdrawal of groundwater from a designated brackish groundwater production zone to be exempt from permitting if the well operator provides the district with documentation that provides information meeting specific criteria. For groundwater wells exempted under this criteria the groundwater produced must meet a certain dissolved solids concentration amount, the well operator would be required to implement a monitoring system approved by the district, and an annual report would be required to be submitted to the district. The bill would exempt water withdrawn from these wells from being subject to a transport or export fee, and prohibit districts from assessing a production fee.
The bill amends drilling or operating a well for the withdrawal of groundwater from a designated brackish groundwater production zone to be exempt from permitting if the well operator provides the district with documentation that provides information meeting specific criteria. For groundwater wells exempted under this criteria the groundwater produced must meet a certain dissolved solids concentration amount, the well operator would be required to implement a monitoring system approved by the district, and an annual report would be required to be submitted to the district. The bill would exempt water withdrawn from these wells from being subject to a transport or export fee, and prohibit districts from assessing a production fee.
Methodology
Based on information provided by TWDB, a one-time cost of $500,000 in General Revenue Funds would be needed for professional service contracting to implement the provisions of the bill. The provisions of the bill which exempt remove geologic stratum for wastewater injection through wells from being designated as groundwater production zones would necessitate TWDB reanalyzing all previous zone designations. According to TWDB, assessing the new potential zone designation to account for the change in injection zone criteria would require professional services and the cost estimate is based on prior experience with contracted projects in the program area.According to the Railroad Commission, it is assumed that there would be no significant fiscal impact resulting from permitting exemptions. According to the Comptroller of Public Accounts, the number of wells now qualifying from the expanded exemptions cannot be determined at this time. According to TWDB, once the new zone designations are specified, it is assumed that any costs associated with allocating brackish groundwater volumes and consulting with districts on monitoring systems could be absorbed using existing resources.
According to the Railroad Commission, it is assumed that there would be no significant fiscal impact resulting from permitting exemptions.
According to the Comptroller of Public Accounts, the number of wells now qualifying from the expanded exemptions cannot be determined at this time.
According to TWDB, once the new zone designations are specified, it is assumed that any costs associated with allocating brackish groundwater volumes and consulting with districts on monitoring systems could be absorbed using existing resources.
Local Government Impact
There could be an impact to districts that are currently charging production, transport, or export fees that would no longer be authorized by the bill.
Source Agencies: b > td > 304 Comptroller of Public Accounts, 455 Railroad Commission, 580 Water Development Board
304 Comptroller of Public Accounts, 455 Railroad Commission, 580 Water Development Board
LBB Staff: b > td > JMc, FV, MW, AJL, CWi, BC
JMc, FV, MW, AJL, CWi, BC