By Yost H.B. No. 2677
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the requirement of water utilities to obtain a
1-3 certificate of convenience and necessity.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 13.181, Water Code, is amended to read as
1-6 follows:
1-7 Sec. 13.181. Power to Ensure Compliance; Rate Regulation.
1-8 Subject to this chapter, the commission has all authority and power
1-9 of the state to ensure compliance with the obligations of utilities
1-10 under this chapter. For this purpose the regulatory authority may
1-11 fix and regulate rates of utilities, including rules and
1-12 regulations for determining the classification of customers and
1-13 services and for determining the applicability of rates. A rule or
1-14 order of the regulatory authority may not conflict with the rulings
1-15 of any federal regulatory body. Except Section 13.192, this
1-16 subchapter shall apply only to a utility and shall not be applied
1-17 to municipalities, districts, or water supply or sewer service
1-18 corporations. The commission may adopt rules which authorize a
1-19 utility which is permitted under Section 13.242(c) to provide
1-20 service without a certificate of public convenience and necessity
1-21 to request or implement a rate increase and operate according to
1-22 rules, regulations, and standards of service other than those
1-23 otherwise required under this chapter provided that rates are just
2-1 and reasonable for customers and the utility and that service is
2-2 safe, adequate, efficient, and reasonable.
2-3 SECTION 2. Section 13.242, Water Code, is amended to read as
2-4 follows:
2-5 Sec. 13.242. Certificate Required. (a) Unless otherwise
2-6 specified, a utility or water supply or sewer service corporation
2-7 may not in any way render retail water or sewer utility service
2-8 directly or indirectly to the public without first having obtained
2-9 from the commission a certificate that the present or future public
2-10 convenience and necessity <require or> will require that
2-11 installation, operation, or extension, and except as otherwise
2-12 provided by this subchapter, a retail public utility may not
2-13 furnish, make available, render, or extend retail water or sewer
2-14 utility service to any area to which retail water or sewer utility
2-15 service is being lawfully furnished by another retail public
2-16 utility without first having obtained a certificate of public
2-17 convenience and necessity that includes the area in which the
2-18 consuming facility is located.
2-19 (b) A person that is not a retail public utility or a
2-20 utility or water supply corporation that is operating under
2-21 provisions pursuant to Subsection (c) may not construct facilities
2-22 to provide water or sewer service to more than one service
2-23 connection not on the property owned by the person and that are
2-24 within the certificated <service> area of a retail public utility
2-25 without first obtaining written consent from the retail public
3-1 utility. A person that violates this section or the reasonable and
3-2 legal terms and conditions of any written consent is subject to the
3-3 administrative penalties described <prescribed> by Section 13.4151
3-4 of this code.
3-5 (c) The commission may by rule allow a municipality or
3-6 utility or water supply corporation to render retail water service
3-7 without a certificate of public convenience and necessity if the
3-8 municipality has given notice under Section 13.255 of this code
3-9 that it intends to provide retail water service to an area or if
3-10 the utility or water supply corporation has less than 15 potential
3-11 connections and is not within the certificated area of another
3-12 retail public utility. <Not later than September 1, 1990, a
3-13 utility or water supply or sewer service corporation that has been
3-14 previously exempted from the certificate requirements because of
3-15 operations, extensions, or service in progress on September 1,
3-16 1975, shall submit to the commission a completed application to
3-17 obtain a certificate of public convenience and necessity for the
3-18 service being provided on September 1, 1975. The commission shall
3-19 grant a certificate of public convenience and necessity to the
3-20 customer locations currently being served by the utility or water
3-21 supply or sewer service corporation that were also being served on
3-22 September 1, 1975.>
3-23 SECTION 3. Section 13.250(d), Water Code, is amended to read
3-24 as follows:
3-25 (d) Except as provided by this subsection, a <A> retail
4-1 public utility that has not been granted <but is required by law to
4-2 possess> a certificate of public convenience and necessity may not
4-3 discontinue, reduce, or impair retail water or sewer service to any
4-4 ratepayer without approval of the regulatory authority. Except as
4-5 provided by this subsection, a utility or water supply corporation
4-6 that is allowed to operate without a certificate of public
4-7 convenience and necessity under Section 13.242(c) may not
4-8 discontinue, reduce, or impair retail water or sewer service to any
4-9 ratepayer without the approval of the regulatory authority.
4-10 Subject to rules of the regulatory authority, a retail public
4-11 utility, utility, or water supply corporation described in this
4-12 subsection may discontinue, reduce, or impair retail water or sewer
4-13 service <except> for:
4-14 (1) nonpayment of charges;
4-15 (2) nonuse; or
4-16 (3) other similar reasons in the usual course of
4-17 business.
4-18 SECTION 4. Section 13.254, Water Code, is amended to read as
4-19 follows:
4-20 Sec. 13.254. Revocation or Amendment of Certificate.
4-21 (a) The commission at any time after notice and hearing may revoke
4-22 or amend any certificate of public convenience and necessity with
4-23 the written consent of the certificate holder or if it finds that
4-24 the certificate holder has never provided, is no longer providing,
4-25 or has failed to provide continuous and adequate service in the
5-1 area, or part of the area, covered by the certificate.
5-2 (b) Upon written request from the certificate holder, the
5-3 executive director may cancel the certificate of a utility or water
5-4 supply corporation authorized by rule to operate without a
5-5 certificate of public convenience and necessity under Section
5-6 13.242(c).
5-7 (c) If the certificate of any public utility is revoked or
5-8 amended, the commission may require one or more public utilities to
5-9 provide service in the area in question.
5-10 SECTION 5. The importance of this legislation and the
5-11 crowded condition of the calendars in both houses create an
5-12 emergency and an imperative public necessity that the
5-13 constitutional rule requiring bills to be read on three several
5-14 days in each house be suspended, and this rule is hereby suspended.