By Oliveira                                            H.B. No. 997
          Substitute the following for H.B. No. 997:
          By Yost                                            C.S.H.B. No. 997
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to receipt of funds in the Water Assistance Fund and Water
    1-3  Development Fund, to further the implementation of the program to
    1-4  assist economically distressed areas, to enhance the economic
    1-5  development of economically distressed areas and border counties
    1-6  and 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)  that 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)  that 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 state wide 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)  that the further implementation of the Economically
   1-19  Distressed Area program can provide greater benefits to the long
   1-20  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)  that innovative science and technologies have and will
    2-1  be further advanced through the use of funds provided by the
    2-2  economically distressed area program; and
    2-3        (e)  that the state, in cooperation with local governments in
    2-4  counties with economically distressed areas, working with the water
    2-5  research and technology community and with funds that may hereafter
    2-6  be received from the federal government have used and can continue
    2-7  to use the funds made available in the economically distressed
    2-8  areas program to create innovations in the provision of water
    2-9  supply and wastewater service.
   2-10        SECTION 2.  Sections 15.001(11) and 15.012(b), Water Code,
   2-11  are amended to read as follows:
   2-12        Sec. 15.001.  Definitions.  In this chapter:
   2-13              (11)  "Economically Distressed area" means:  (A) an
   2-14  area in which water supply or sewer services are inadequate to meet
   2-15  minimal needs of residential users as defined by board rules and in
   2-16  which financial resources are inadequate to provide water supply or
   2-17  sewer services that will satisfy those needs; or (B) for purposes
   2-18  of any federal funds for colonias deposited into the Water
   2-19  Assistance Fund, an area that meets the federal criteria for use of
   2-20  such funds.
   2-21        Sec. 15.012.  Management of Fund.  (b)  Money <Revenues
   2-22  accumulated pursuant to Article VIII, Section 24(b), of the Texas
   2-23  Constitution  and money> appropriated by the legislature to the
   2-24  fund shall be deposited in this fund.  Gifts or grants from the
   2-25  United States government, local or regional governments, private
    3-1  sources or other sources may be deposited in this fund.
    3-2        SECTION 3.  Section 17.0112(a), Water Code, is amended to
    3-3  read as follows:
    3-4        Sec. 17.0112.  Authorization of Certain Bonds for Financial
    3-5  Assistance.  (a)  The board may issue not more than $25 million in
    3-6  bonds dedicated under Section 17.011 of this code during a fiscal
    3-7  <calendar> year to provide financial assistance for water supply
    3-8  and sewer services as provided under Subchapter K of this chapter.
    3-9        SECTION 4.  Section 17.072(j),  Water Code, is amended to
   3-10  read as follows:
   3-11        Sec. 17.072.  Development Fund.  (j)  Proceeds from the sale
   3-12  of bonds pursuant to Section 17.0111 of this code, together with
   3-13  proceeds, other than accrued interest, from the sale, refunding, or
   3-14  prepayment of political subdivision bonds acquired in carrying out
   3-15  the purposes provided by Subchapter K of this chapter, shall be
   3-16  deposited in a special account in the development fund designated
   3-17  as the economically distressed areas account, with other money for
   3-18  deposit in that account as provided by this chapter, the General
   3-19  Appropriations Act, or other law of this state.  Money from gifts
   3-20  or grants from the United States government, local or regional
   3-21  governments, private sources or other sources for the purposes of
   3-22  assisting economically distressed areas also may be deposited into
   3-23  the economically distressed areas account.  Within the economically
   3-24  distressed areas account, separate accounts may be created for
   3-25  bonds issued for purposes of Article III, Section 49-c, of the
    4-1  Texas Constitution, and bonds issued for purposes of Article III,
    4-2  Section 49-d-1, of the Texas Constitution.
    4-3        SECTION 5.  Sections 17.922, 17.924, 17.929(a), 17.930(b),
    4-4  and 17.933(a), (c), (d) and (e) are amended to read as follows:
    4-5        Sec. 17.922.  Financial Assistance.  (a)  The economically
    4-6  distressed areas account may be used by the board to provide
    4-7  financial assistance to political subdivisions for the
    4-8  construction, acquisition, or improvement of water supply and sewer
    4-9  services, including providing funds from the account for the
   4-10  state's participation in federal programs that provide assistance
   4-11  to political subdivisions.
   4-12        (b)  To the extent practicable, the board shall use the funds
   4-13  in the economically distressed areas account in conjunction with
   4-14  the other financial assistance available through the board to
   4-15  encourage the use of cost effective water supply and wastewater
   4-16  systems, including regional systems, to maximize the long term
   4-17  economic development of counties eligible for financial assistance
   4-18  under the economically distressed areas program.  Any savings
   4-19  derived from the construction of a regional system which includes
   4-20  or serves an economically distressed area project shall be factored
   4-21  into the board's determination of financial assistance for the
   4-22  economically distressed area in a manner that assures the
   4-23  economically distressed area receives appropriate benefits from the
   4-24  savings.  In no event shall financial assistance provided from the
   4-25  economically distressed areas account be used to provide water
    5-1  supply or wastewater service to any area not defined as an
    5-2  economically distressed area pursuant to Section 17.921(1)(A) of
    5-3  this code.
    5-4        Sec. 17.924.  Municipality Eligible for Financial Assistance.
    5-5  A municipality that is located in a county that is eligible for
    5-6  financial assistance under Section 17.923 <17.883> of this code is
    5-7  eligible for financial assistance under this subchapter if the
    5-8  municipality adopts the model rules developed under Section 16.343
    5-9  of this code.
   5-10        Sec. 17.929.  Considerations in Passing on Application.  (a)
   5-11  In passing on an application for financial assistance, the board
   5-12  shall consider:
   5-13              (1)  the need of the economically distressed area to be
   5-14  served by the water supply and sewer services in relation to the
   5-15  need of other political subdivisions requiring financial assistance
   5-16  under this subchapter and the relative costs and benefits of all
   5-17  applications;
   5-18              (2)  efforts by the residents of the economically
   5-19  distressed area to provide necessary water supply and sewer
   5-20  services;
   5-21              (3)  the proposed use of labor from inside the
   5-22  political subdivision to perform contracts for providing water
   5-23  supply and sewer services;
   5-24              (4)  the relationship of the proposed water supply and
   5-25  sewer services to minimum state standards for water supply and
    6-1  sewer services adopted under Section 16.343 of this code;
    6-2              (5)  the financing of the proposed water supply and
    6-3  sewer project including consideration of:
    6-4                    (A)  the budget and repayment schedule submitted
    6-5  under Section 17.927(b)(4) <17.887(b)(4)> of this code;
    6-6                    (B)  other items included in the application
    6-7  relating to financing; and
    6-8                    (C)  other financial information and data
    6-9  available to the board.
   6-10              (6)  whether the applicant has proposed methods for
   6-11  incorporating water conservation into the provision of water and
   6-12  sewer services to the economically distressed area;
   6-13              (7)  whether the county as adopted model rules pursuant
   6-14  to Section 16.343 of this code and the manner of enforcement of
   6-15  model rules;
   6-16              (8)  the feasibility of creating a conservation and
   6-17  reclamation district under Article XVI, Section 59, of the Texas
   6-18  Constitution, to provide the services and finance the water supply
   6-19  and sewer services covered by the application with district bonds
   6-20  issued and sold through the regular bond market; <and>
   6-21              (9)  the percentage of the total project cost that the
   6-22  financial assistance will comprise; and
   6-23              (10)  the feasibility of achieving cost savings by
   6-24  providing a regional facility for water supply and/or wastewater
   6-25  service and the feasibility of financing such facility by using
    7-1  funds from the economically distressed areas account and/or any
    7-2  other financial assistance.
    7-3        Sec. 17.930.  Approval or Disapproval of Application.  (b)
    7-4  After making the considerations provided by Section 17.929 <17.889>
    7-5  of this code, the board by resolution shall approve or disapprove
    7-6  the application and shall notify the applicant in writing of its
    7-7  decision.
    7-8        Sec. 17.933.  Terms of Financial Assistance.  (a)  The board
    7-9  may use money in the economically distressed areas account to
   7-10  provide financial assistance to a political subdivision to be
   7-11  repaid in the form, manner, and time provided by board rules and in
   7-12  the agreement between the board and the political subdivision
   7-13  taking into consideration the information provided by Section
   7-14  17.927(b)(7) <17.887(b)(7)> of this code.
   7-15        (c)  The total amount of financial assistance provided by the
   7-16  board to political subdivisions under this subchapter from
   7-17  state-issued bonds for which repayment is not required may not
   7-18  exceed at any time 75 percent of the total principal amount of
   7-19  issued and unissued bonds authorized under Article III, Section
   7-20  49-d-7, of the Texas Constitution, for purposes of this subchapter
   7-21  plus outstanding interest on those bonds.
   7-22        (d)  In determining the amount and form of financial
   7-23  assistance and the amount and form of repayment, if any, the board
   7-24  shall consider:
   7-25              (1)  rates, fees and charges that the average customer
    8-1  to be served by the project will be able to pay based on a
    8-2  comparison of what other families of similar income who are
    8-3  similarly situated pay for comparable services;
    8-4              (2)  sources of funding available to the political
    8-5  subdivision from federal and private funds and from other state
    8-6  funds; <and>
    8-7              (3)  any local funds of the political subdivision to be
    8-8  served by the project if the economically distressed area to be
    8-9  served by the board's financial assistance is within the boundary
   8-10  of the political subdivision; and
   8-11              (4)  the just, fair and reasonable charges for water
   8-12  and wastewater service as provided in this code.
   8-13        (e) In making its determination under Subsection (d)<(b)>(1)
   8-14  of this section, the board may consider any study, survey, data,
   8-15  criteria, or standard developed or prepared by any federal, state,
   8-16  or local agency, private foundation, banking or financial
   8-17  institution, or other reliable source of statistical or financial
   8-18  data or information.
   8-19        SECTION 6.  EMERGENCY.  The importance of this legislation
   8-20  and the crowded condition of the calendars in both houses create an
   8-21  emergency and imperative public necessity that the constitutional
   8-22  rule requiring bills to be read on three several days in each house
   8-23  be suspended, and this rule is hereby suspended, and that this Act
   8-24  take effect and be in force from and after its passage, and it is
   8-25  so enacted.