H.B. No. 997
    1-1                                AN ACT
    1-2  relating to receipt of funds in the water assistance fund and water
    1-3  development fund, to furthering the implementation of the program
    1-4  to assist economically distressed areas, and to enhancing the
    1-5  economic development of economically distressed areas and border
    1-6  counties; declaring an emergency.
    1-7        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-8        SECTION 1.  The legislature finds that:
    1-9              (a)  an adequate water supply and wastewater
   1-10  infrastructure is necessary and integral to the long-term economic
   1-11  growth and industrial development in the counties eligible for
   1-12  funding under the economically distressed areas program;
   1-13              (b)  economically distressed areas, by definition, are
   1-14  located in counties where unemployment over the most recent three
   1-15  consecutive years averages 25 percent above the statewide average
   1-16  and where the per capita income for the most recent three
   1-17  consecutive years averaged 25 percent below the state average;
   1-18              (c)  the further implementation of the economically
   1-19  distressed areas program can provide greater benefits to the
   1-20  long-term economic growth of the areas eligible for such funding by
   1-21  considering the feasibility of regional facilities for water supply
   1-22  and wastewater service;
   1-23              (d)  innovative science and technologies have and will
    2-1  be further advanced through the use of funds provided by the
    2-2  economically distressed areas program; and
    2-3              (e)  the state, in cooperation with local governments
    2-4  in counties with economically distressed areas, working with the
    2-5  water research and technology community and with funds that may be
    2-6  received from the federal government has used and can continue to
    2-7  use the funds made available in the economically distressed areas
    2-8  program to create innovations in the provision of water supply and
    2-9  wastewater service.
   2-10        SECTION 2.  Section 15.001(11), Water Code, is amended to
   2-11  read as follows:
   2-12              (11)  "Economically distressed area" means:
   2-13                    (A)  an area in which water supply or sewer
   2-14  services are inadequate to meet minimal needs of residential users
   2-15  as defined by board rules and in which financial resources are
   2-16  inadequate to provide water supply or sewer services that will
   2-17  satisfy those needs; or
   2-18                    (B)  for purposes of any federal funds for
   2-19  colonias deposited in the water assistance fund, an area that meets
   2-20  the federal criteria for use of such funds.
   2-21        SECTION 3.  Section 15.012(b), Water Code, is amended to read
   2-22  as follows:
   2-23        (b)  Money <Revenues accumulated pursuant to Article VIII,
   2-24  Section 24(b), of the Texas Constitution and money> appropriated by
   2-25  the legislature to the fund shall be deposited in this fund.  Gifts
    3-1  or grants from the United States government, local or regional
    3-2  governments, private sources, or other sources may be deposited in
    3-3  this fund.
    3-4        SECTION 4.  Section 17.0112(a), Water Code, is amended to
    3-5  read as follows:
    3-6        (a)  The board may issue not more than $25 million in bonds
    3-7  dedicated under Section 17.0111 of this code during a fiscal
    3-8  <calendar> year to provide financial assistance for water supply
    3-9  and sewer services as provided under Subchapter K of this chapter.
   3-10        SECTION 5.  Section 17.072(j), Water Code, is amended to read
   3-11  as follows:
   3-12        (j)  Proceeds from the sale of bonds pursuant to Section
   3-13  17.0111 of this code, together with proceeds, other than accrued
   3-14  interest, from the sale, refunding, or prepayment of political
   3-15  subdivision bonds acquired in carrying out the purposes provided by
   3-16  Subchapter K of this chapter, shall be deposited in a special
   3-17  account in the development fund designated as the economically
   3-18  distressed areas account, with other money for deposit in that
   3-19  account as provided by this chapter, the General Appropriations
   3-20  Act, or other law of this state.  Money from gifts or grants from
   3-21  the United States government, local or regional governments,
   3-22  private sources, or other sources for the purposes of assisting
   3-23  economically distressed areas also may be deposited in the
   3-24  economically distressed areas account.  Within the economically
   3-25  distressed areas account, separate accounts may be created for
    4-1  bonds issued for purposes of Article III, Section 49-c, of the
    4-2  Texas Constitution, and bonds issued for purposes of Article III,
    4-3  Section 49-d-1, of the Texas Constitution.
    4-4        SECTION 6.  Sections 17.922 and 17.924, Water Code, are
    4-5  amended to read as follows:
    4-6        Sec. 17.922.  Financial Assistance.  (a)  The economically
    4-7  distressed areas account may be used by the board to provide
    4-8  financial assistance to political subdivisions for the
    4-9  construction, acquisition, or improvement of water supply and sewer
   4-10  services, including providing funds from the account for the
   4-11  state's participation in federal programs that provide assistance
   4-12  to political subdivisions.
   4-13        (b)  To the extent practicable, the board shall use the funds
   4-14  in the economically distressed areas account in conjunction with
   4-15  the other financial assistance available through the board to
   4-16  encourage the use of cost-effective water supply and wastewater
   4-17  systems, including regional systems, to maximize the long-term
   4-18  economic development of counties eligible for financial assistance
   4-19  under the economically distressed areas program.  Any savings
   4-20  derived from the construction of a regional system that includes or
   4-21  serves an economically distressed area project shall be factored
   4-22  into the board's determination of financial assistance for the
   4-23  economically distressed area in a manner that assures the
   4-24  economically distressed area receives appropriate benefits from the
   4-25  savings.  In no event shall financial assistance provided from the
    5-1  economically distressed areas account be used to provide water
    5-2  supply or wastewater service to any area not defined as an
    5-3  economically distressed area pursuant to Section 17.921(1)(A) of
    5-4  this code.
    5-5        Sec. 17.924.  Municipality Eligible for Financial Assistance.
    5-6  A municipality that is located in a county that is eligible for
    5-7  financial assistance under Section 17.923 <17.883> of this code is
    5-8  eligible for financial assistance under this subchapter if the
    5-9  municipality adopts the model rules developed under Section 16.343
   5-10  of this code.
   5-11        SECTION 7.  Section 17.929(a), Water Code, is amended to read
   5-12  as follows:
   5-13        (a)  In passing on an application for financial assistance,
   5-14  the board shall consider:
   5-15              (1)  the need of the economically distressed area to be
   5-16  served by the water supply and sewer services in relation to the
   5-17  need of other political subdivisions requiring financial assistance
   5-18  under this subchapter and the relative costs and benefits of all
   5-19  applications;
   5-20              (2)  efforts by the residents of the economically
   5-21  distressed area to provide necessary water supply and sewer
   5-22  services;
   5-23              (3)  the proposed use of labor from inside the
   5-24  political subdivision to perform contracts for providing water
   5-25  supply and sewer services;
    6-1              (4)  the relationship of the proposed water supply and
    6-2  sewer services to minimum state standards for water supply and
    6-3  sewer services adopted under Section 16.343 of this code;
    6-4              (5)  the financing of the proposed water supply and
    6-5  sewer project including consideration of:
    6-6                    (A)  the budget and repayment schedule submitted
    6-7  under Section 17.927(b)(4) <17.887(b)(4)> of this code;
    6-8                    (B)  other items included in the application
    6-9  relating to financing; and
   6-10                    (C)  other financial information and data
   6-11  available to the board;<.>
   6-12              (6)  whether the applicant has proposed methods for
   6-13  incorporating water conservation into the provision of water and
   6-14  sewer services to the economically distressed area;
   6-15              (7)  whether the county has adopted model rules
   6-16  pursuant to Section 16.343 of this code and the manner of
   6-17  enforcement of model rules;
   6-18              (8)  the feasibility of creating a conservation and
   6-19  reclamation district under Article XVI, Section 59, of the Texas
   6-20  Constitution, to provide the services and finance the water supply
   6-21  and sewer services covered by the application with district bonds
   6-22  issued and sold through the regular bond market; <and>
   6-23              (9)  the percentage of the total project cost that the
   6-24  financial assistance will comprise; and
   6-25              (10)  the feasibility of achieving cost savings by
    7-1  providing a regional facility for water supply or wastewater
    7-2  service and the feasibility of financing the facility by using
    7-3  funds from the economically distressed areas account or any other
    7-4  financial assistance.
    7-5        SECTION 8.  Section 17.930(b), Water Code, is amended to read
    7-6  as follows:
    7-7        (b)  After making the considerations provided by Section
    7-8  17.929 <17.889> of this code, the board by resolution shall approve
    7-9  or disapprove the application and shall notify the applicant in
   7-10  writing of its decision.
   7-11        SECTION 9.  Sections 17.933(a), (c), (d), and (e), Water
   7-12  Code, are amended to read as follows:
   7-13        (a)  The board may use money in the economically distressed
   7-14  areas account to provide financial assistance to a political
   7-15  subdivision to be repaid in the form, manner, and time provided by
   7-16  board rules and in the agreement between the board and the
   7-17  political subdivision taking into consideration the information
   7-18  provided by Section 17.927(b)(7) <17.887(b)(7)> of this code.
   7-19        (c)  The total amount of financial assistance provided by the
   7-20  board to political subdivisions under this subchapter from
   7-21  state-issued bonds for which repayment is not required may not
   7-22  exceed at any time 90 <75> percent of the total principal amount of
   7-23  issued and unissued bonds authorized under Article III, Section
   7-24  49-d-7, of the Texas Constitution, for purposes of this subchapter
   7-25  plus outstanding interest on those bonds.
    8-1        (d)  In determining the amount and form of financial
    8-2  assistance and the amount and form of repayment, if any, the board
    8-3  shall consider:
    8-4              (1)  rates, fees, and charges that the average customer
    8-5  to be served by the project will be able to pay based on a
    8-6  comparison of what other families of similar income who are
    8-7  similarly situated pay for comparable services;
    8-8              (2)  sources of funding available to the political
    8-9  subdivision from federal and private funds and from other state
   8-10  funds; <and>
   8-11              (3)  any local funds of the political subdivision to be
   8-12  served by the project if the economically distressed area to be
   8-13  served by the board's financial assistance is within the boundary
   8-14  of the political subdivision; and
   8-15              (4)  the just, fair, and reasonable charges for water
   8-16  and wastewater service as provided in this code.
   8-17        (e)  In making its determination under Subsection (d)(1)
   8-18  <(b)(1)> of this section, the board may consider any study, survey,
   8-19  data, criteria, or standard developed or prepared by any federal,
   8-20  state, or local agency, private foundation, banking or financial
   8-21  institution, or other reliable source of statistical or financial
   8-22  data or information.
   8-23        SECTION 10.  The importance of this legislation and the
   8-24  crowded condition of the calendars in both houses create an
   8-25  emergency and an imperative public necessity that the
    9-1  constitutional rule requiring bills to be read on three several
    9-2  days in each house be suspended, and this rule is hereby suspended,
    9-3  and that this Act take effect and be in force from and after its
    9-4  passage, and it is so enacted.