S.B. No. 1093
AN ACT
1-1 relating to authorization for a county to create a county utility
1-2 system board to operate and manage certain utility systems.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 1, Chapter 616, Acts of the 72nd
1-5 Legislature, Regular Session, 1991 (Article 717v, Vernon's Texas
1-6 Civil Statutes), is amended to read as follows:
1-7 Sec. 1. COUNTIES SUBJECT TO ACT. This Act applies only to a
1-8 county that on the date an order is adopted under Section 2A(a) of
1-9 this Act has <with> a population of 10,000 <1,500> or less,
1-10 according to the most recent federal census.
1-11 SECTION 2. Chapter 616, Acts of the 72nd Legislature,
1-12 Regular Session, 1991 (Article 717v, Vernon's Texas Civil
1-13 Statutes), is amended by adding Section 2A to read as follows:
1-14 Sec. 2A. COUNTY UTILITY SYSTEM BOARD. (a) Instead of being
1-15 directly responsible for the entire operation and management of the
1-16 county's wastewater collection and treatment system, water supply
1-17 and distribution system, or solid waste collection and disposition
1-18 system, the commissioners court by an order adopted at a regular
1-19 meeting may make this section applicable to the county and
1-20 establish a county utility system board.
1-21 (b) The board is responsible for the operation and
1-22 management of each utility system placed under its control by the
1-23 commissioners court's order under Subsection (a) of this section
2-1 that is owned or in the process of being acquired by the county.
2-2 (c) The board is composed of five directors. One director
2-3 must be a member of the commissioners court appointed by the court
2-4 at its first meeting of each county fiscal year. Four directors
2-5 shall serve in positions designated as positions 1, 2, 3, and 4 and
2-6 shall be elected by qualified voters in the county and shall serve
2-7 for two-year terms beginning October 1 after the election. An
2-8 election shall be held on the second Saturday of each September.
2-9 Positions 1 and 3 shall be elected in odd-numbered years and
2-10 positions 2 and 4 shall be elected in even-numbered years. A
2-11 candidate must be a qualified voter of the county. The election
2-12 shall be administered by the county election administrator or by
2-13 the county clerk if the county does not have a county election
2-14 administrator. The election shall be governed by the Election
2-15 Code.
2-16 (d) The commissioners court shall appoint members to the
2-17 board to serve until October 1 after the first election is held as
2-18 provided by Subsection (c) of this section.
2-19 (e) The directors shall organize by the selection, for a
2-20 one-year period, of a president, vice-president, secretary, and
2-21 treasurer. The offices of secretary and treasurer may be combined.
2-22 The president and vice-president must be members of the board. The
2-23 person serving as secretary, treasurer, or both need not be a
2-24 member of the board. The president shall preside at the meetings
2-25 of the board and act as the board's chief executive officer and
3-1 budget officer. The vice-president shall assume the duties of the
3-2 president if the president is incapacitated or absent from a
3-3 meeting. The secretary shall keep the records and the minutes of
3-4 the meetings of the board. The treasurer shall be responsible for
3-5 the deposit of all revenues of any system operated and managed by
3-6 the board in one or more separate accounts with the county
3-7 depository, except that any funds set aside for the payment or
3-8 security of obligations issued on behalf of the board may be
3-9 deposited with the paying agent for which provision is made in the
3-10 order authorizing the issuance of the obligations. The board shall
3-11 require the treasurer to execute a bond in an amount equal to the
3-12 estimated amount to be held, at any time, by the treasurer. The
3-13 premium of the bond shall be paid by the board.
3-14 (f) The president, with the assistance of the business
3-15 manager, shall prepare a tentative budget showing the anticipated
3-16 revenues by sources and the expenses of the utility system and the
3-17 board for the next county fiscal year and submit it to the board no
3-18 later than June 1. The board shall schedule a public hearing to
3-19 consider the budget no later than July 1. The final budget shall
3-20 be adopted by the board no later than July 15 and submitted to the
3-21 commissioners court for consideration by the commissioners court as
3-22 a part of the county budget. If a county budget has not been
3-23 adopted, the budget for the utility system or systems is the same
3-24 as for the preceding fiscal year, except that the budget is
3-25 increased proportionally if the previous budget was not for a
4-1 complete fiscal year. The board and the commissioners court shall
4-2 include in the budget an amount sufficient to provide for the
4-3 payment and security of any outstanding obligations approved by the
4-4 attorney general to the extent the obligations are payable from the
4-5 revenues of the utility system or systems.
4-6 (g) The board in its bylaws shall provide procedures for the
4-7 disbursement of funds it has deposited with the county depository
4-8 only after the board has determined that the funds for payment were
4-9 properly budgeted. However, approval of the board is not required
4-10 for the transfer of funds to a paying agent for the payment and
4-11 security of outstanding obligations approved as to legality by the
4-12 attorney general. All checks issued by the board shall be signed
4-13 by at least two persons, one of whom must be an officer of the
4-14 board.
4-15 (h) The board may establish rates and charges for services,
4-16 fees for connections and reconnections, security deposits, and
4-17 other charges required for efficient operation of each utility
4-18 system for which it has responsibility.
4-19 (i) The board may not:
4-20 (1) incur or issue any obligation payable, in whole or
4-21 in part, from ad valorem taxes; or
4-22 (2) exercise the power of eminent domain.
4-23 (j) The board may provide for extensions and improvements to
4-24 a system but may not provide for the extension of service to any
4-25 area within the boundaries or extraterritorial jurisdiction of a
5-1 municipality or conservation and reclamation district established
5-2 under Article XVI, Section 59, of the Texas Constitution without
5-3 the consent of the governing body of the municipality or district.
5-4 (k) With the approval of the commissioners court, the board
5-5 may purchase an existing privately owned wastewater collection and
5-6 treatment system or water supply and distribution system that
5-7 supplies retail utility service in the county. With the consent of
5-8 the directors of a conservation and reclamation district
5-9 established within the county, the commissioners court may assume
5-10 the outstanding obligations of the district and provide for the
5-11 abolition of the district. The area of the former district must
5-12 remain secondarily liable for the payment of any taxes pledged to
5-13 the payment of outstanding indebtedness of the former district
5-14 until the indebtedness has been paid, provision has been made for
5-15 the payment of the obligations, or the obligations have been
5-16 refunded by the county. These taxes, if required, shall be levied
5-17 against the area of the former district by the commissioners court
5-18 as the successor to the district.
5-19 (l) The board may adopt bylaws consistent with this Act to
5-20 regulate its affairs and establish the area within the county in
5-21 which it has responsibility for providing utility service. The
5-22 service area of the board may not include territory that on the
5-23 effective date of this Act is served by another utility under a
5-24 certificate of public convenience and necessity unless the
5-25 certificate ceases to be effective. The bylaws may provide for a
6-1 seal for the board.
6-2 (m) The board is subject to the open meetings law, Chapter
6-3 271, Acts of the 60th Legislature, Regular Session, 1967 (Article
6-4 6252-17, Vernon's Texas Civil Statutes), the open records law,
6-5 Chapter 424, Acts of the 63rd Legislature, Regular Session, 1973
6-6 (Article 6252-17a, Vernon's Texas Civil Statutes), Subchapter C,
6-7 Chapter 262, Local Government Code, and the Public Funds Investment
6-8 Act of 1987 (Article 842a-2, Vernon's Texas Civil Statutes) and
6-9 their subsequent amendments. The board is a governmental unit for
6-10 the purpose of Chapter 101, Civil Practice and Remedies Code, and
6-11 its subsequent amendments and all of its activities are in the
6-12 performance of an essential governmental function.
6-13 (n) The county, by the adoption of an order at a regular
6-14 meeting of the commissioners court, may authorize the issuance of
6-15 obligations payable in whole or in part from ad valorem taxes on
6-16 behalf of the board for the purpose of acquiring, improving,
6-17 repairing, or extending the county's wastewater collection system,
6-18 treatment system, water supply and distribution system, or solid
6-19 waste collection and disposition system. If the obligations are
6-20 payable from ad valorem taxes and revenues, the board must also
6-21 approve the issuance of the obligations. If obligations are to be
6-22 issued for one or more of those purposes and are to be payable
6-23 solely from the gross revenues of one or more systems, the board,
6-24 by resolution, may authorize the issuance. This section does not
6-25 prohibit an appropriation by the county of any available funds for
7-1 assistance in the maintenance or operation of a system, but an
7-2 agreement or pledge to do so beyond the then current fiscal year is
7-3 not effective unless there is compliance with Article XI, Section
7-4 7, of the Texas Constitution. The following provisions and their
7-5 subsequent amendments apply to and govern the county and the board
7-6 when operating under this section:
7-7 (1) Chapter 271, Local Government Code;
7-8 (2) the Bond Procedures Act of 1981 (Article 717k-6,
7-9 Vernon's Texas Civil Statutes);
7-10 (3) Chapter 784, Acts of the 61st Legislature, Regular
7-11 Session, 1969 (Article 717k-3, Vernon's Texas Civil Statutes);
7-12 (4) Chapter 503, Acts of the 54th Legislature, 1955
7-13 (Article 717k, Vernon's Texas Civil Statutes);
7-14 (5) Chapter 656, Acts of the 68th Legislature, Regular
7-15 Session, 1983 (Article 717q, Vernon's Texas Civil Statutes);
7-16 (6) Chapter 3, Acts of the 61st Legislature, Regular
7-17 Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes); and
7-18 (7) Sections 2 to 9 of this Act.
7-19 (o) The maturity of an obligation issued under this section
7-20 may not exceed 40 years.
7-21 (p) Each member of the board is entitled to reimbursement
7-22 for actual expenses incurred in the conduct of the business of the
7-23 board and a fee for each meeting attended as established by the
7-24 commissioners court.
7-25 SECTION 3. An action taken by or on behalf of the
8-1 commissioners court of a county in the acceptance of grants for the
8-2 construction of a water supply and distribution system or a
8-3 wastewater collection and treatment system or the acceptance of a
8-4 conveyance of such a system, or an action taken by or on behalf of
8-5 the county since the acquisition of such a system, including the
8-6 operation of the system, is ratified, confirmed, and validated.
8-7 This section does not validate an action that is the subject of
8-8 litigation on the effective date of this Act.
8-9 SECTION 4. After the effective date of this Act and before
8-10 the beginning of the next county fiscal year, the board shall
8-11 operate with the budget applicable to the utility systems for the
8-12 current fiscal year.
8-13 SECTION 5. At the first election following the creation of a
8-14 county utility system board, four directors shall be elected.
8-15 After taking office the directors shall draw lots to determine
8-16 which directors serve one-year terms and which directors serve
8-17 two-year terms.
8-18 SECTION 6. The importance of this legislation and the
8-19 crowded condition of the calendars in both houses create an
8-20 emergency and an imperative public necessity that the
8-21 constitutional rule requiring bills to be read on three several
8-22 days in each house be suspended, and this rule is hereby suspended,
8-23 and that this Act take effect and be in force from and after its
8-24 passage, and it is so enacted.