LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION April 16, 2025 TO: Honorable Charles Perry, Chair, Senate Committee on Water, Agriculture and Rural Affairs FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: SB2692 by Hancock (relating to the filing of an appeal regarding certain water, drainage, or sewer rates with the Public Utility Commission of Texas.), Committee Report 1st House, Substituted Estimated Two-year Net Impact to General Revenue Related Funds for SB2692, Committee Report 1st House, Substituted: a negative impact of ($1,200,778) 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($600,389)2027($600,389)2028($600,389)2029($600,389)2030($600,389)All Funds, Five-Year Impact: Fiscal Year Probable Savings/(Cost) fromGeneral Revenue Fund1 Change in Number of State Employees from FY 20252026($600,389)4.02027($600,389)4.02028($600,389)4.02029($600,389)4.02030($600,389)4.0 Fiscal AnalysisThis bill would amend the Water Code for water/sewer entities, for which the Public Utility Commission of Texas (PUC) has existing appellate jurisdiction, to allows a single class of customers to appeal changed water/sewer rates if at least 10% of the impacted ratepayers in that customer class sign a petition.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION
April 16, 2025
TO: Honorable Charles Perry, Chair, Senate Committee on Water, Agriculture and Rural Affairs FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: SB2692 by Hancock (relating to the filing of an appeal regarding certain water, drainage, or sewer rates with the Public Utility Commission of Texas.), 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: SB2692 by Hancock (relating to the filing of an appeal regarding certain water, drainage, or sewer rates with the Public Utility Commission of Texas.), 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
SB2692 by Hancock (relating to the filing of an appeal regarding certain water, drainage, or sewer rates with the Public Utility Commission of Texas.), Committee Report 1st House, Substituted
SB2692 by Hancock (relating to the filing of an appeal regarding certain water, drainage, or sewer rates with the Public Utility Commission of Texas.), Committee Report 1st House, Substituted
Estimated Two-year Net Impact to General Revenue Related Funds for SB2692, Committee Report 1st House, Substituted: a negative impact of ($1,200,778) 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 SB2692, Committee Report 1st House, Substituted: a negative impact of ($1,200,778) 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 ($600,389)
2027 ($600,389)
2028 ($600,389)
2029 ($600,389)
2030 ($600,389)
All Funds, Five-Year Impact:
2026 ($600,389) 4.0
2027 ($600,389) 4.0
2028 ($600,389) 4.0
2029 ($600,389) 4.0
2030 ($600,389) 4.0
Fiscal Analysis
This bill would amend the Water Code for water/sewer entities, for which the Public Utility Commission of Texas (PUC) has existing appellate jurisdiction, to allows a single class of customers to appeal changed water/sewer rates if at least 10% of the impacted ratepayers in that customer class sign a petition.
Methodology
Under current law ratepayers that wish to appeal water/sewer rates to the PUC must file a petition containing either 10,000 signatures or that contains signatures of 10 percent of impacted ratepayers. Under the provisions of the bill, the appeal threshold would change to at least 10 percent of a single impacted customer class. According to the PUC, this change would increase the number of instances where signatures from one or two customers of a certain class would be enough to meet the 10% threshold for a specific class. This would increase the number of petitions each year that would be eligible for a contested case and that the agency would be required to hear. To meet this workload increase and based on the analysis of the PUC, this estimate assumes the agency would require 4.0 additional full time equivalents (FTE) positions to implement the provisions of the bill due to the threshold of impacted ratepayers within a customer class being to reach 10% is easier within specific customer classes. Two Attorney III-IV ($115,500 per year with estimated benefits of $32,825), an Engineer III-V($115,500 per year with estimated benefits of $32,825), and a Financial Examiner IV-V ($105,000 per year with estimated benefits of $29,841) would be needed for additional rate appeal contested cases. Other associated costs include $9,773 per year for payroll contributions, travel and other operating expenses.
Under current law ratepayers that wish to appeal water/sewer rates to the PUC must file a petition containing either 10,000 signatures or that contains signatures of 10 percent of impacted ratepayers. Under the provisions of the bill, the appeal threshold would change to at least 10 percent of a single impacted customer class. According to the PUC, this change would increase the number of instances where signatures from one or two customers of a certain class would be enough to meet the 10% threshold for a specific class. This would increase the number of petitions each year that would be eligible for a contested case and that the agency would be required to hear.
To meet this workload increase and based on the analysis of the PUC, this estimate assumes the agency would require 4.0 additional full time equivalents (FTE) positions to implement the provisions of the bill due to the threshold of impacted ratepayers within a customer class being to reach 10% is easier within specific customer classes.
Two Attorney III-IV ($115,500 per year with estimated benefits of $32,825), an Engineer III-V($115,500 per year with estimated benefits of $32,825), and a Financial Examiner IV-V ($105,000 per year with estimated benefits of $29,841) would be needed for additional rate appeal contested cases. Other associated costs include $9,773 per year for payroll contributions, travel and other operating expenses.
Technology
PUC anticipates information technology expenditures of $10,800 per year.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.
Source Agencies: b > td > 473 Public Utility Commission of Texas
473 Public Utility Commission of Texas
LBB Staff: b > td > JMc, FV, JBel, GDZ
JMc, FV, JBel, GDZ