1-1 By: Madla S.B. No. 1093
1-2 (In the Senate - Filed March 12, 1993; March 15, 1993, read
1-3 first time and referred to Committee on Intergovernmental
1-4 Relations; April 22, 1993, reported adversely, with favorable
1-5 Committee Substitute by the following vote: Yeas 9, Nays 0;
1-6 April 22, 1993, sent to printer.)
1-7 COMMITTEE VOTE
1-8 Yea Nay PNV Absent
1-9 Armbrister x
1-10 Leedom x
1-11 Carriker x
1-12 Henderson x
1-13 Madla x
1-14 Moncrief x
1-15 Patterson x
1-16 Rosson x
1-17 Shapiro x
1-18 Wentworth x
1-19 Whitmire x
1-20 COMMITTEE SUBSTITUTE FOR S.B. No. 1093 By: Madla
1-21 A BILL TO BE ENTITLED
1-22 AN ACT
1-23 relating to authorization for a county to create a county utility
1-24 system board to operate and manage certain utility systems.
1-25 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-26 SECTION 1. Section 1, Chapter 616, Acts of the 72nd
1-27 Legislature, Regular Session, 1991 (Article 717v, Vernon's Texas
1-28 Civil Statutes), is amended to read as follows:
1-29 Sec. 1. COUNTIES SUBJECT TO ACT. This Act applies only to a
1-30 county that on the date an order is adopted under Section 2A(a) of
1-31 this Act has <with> a population of 10,000 <1,500> or less,
1-32 according to the most recent federal census.
1-33 SECTION 2. Chapter 616, Acts of the 72nd Legislature,
1-34 Regular Session, 1991 (Article 717v, Vernon's Texas Civil
1-35 Statutes), is amended by adding Section 2A to read as follows:
1-36 Sec. 2A. COUNTY UTILITY SYSTEM BOARD. (a) Instead of being
1-37 directly responsible for the entire operation and management of the
1-38 county's wastewater collection and treatment system, water supply
1-39 and distribution system, or solid waste collection and disposition
1-40 system, the commissioners court by an order adopted at a regular
1-41 meeting may make this section applicable to the county and
1-42 establish a county utility system board.
1-43 (b) The board is responsible for the operation and
1-44 management of each utility system placed under its control by the
1-45 commissioners court's order under Subsection (a) of this section
1-46 that is owned or in the process of being acquired by the county.
1-47 (c) The board is composed of five directors. One director
1-48 must be a member of the commissioners court appointed by the court
1-49 at its first meeting of each county fiscal year. Four directors
1-50 shall serve in positions designated as positions 1, 2, 3, and 4 and
1-51 shall be elected by qualified voters in the county and shall serve
1-52 for two-year terms beginning October 1 after the election. An
1-53 election shall be held on the second Saturday of each September.
1-54 Positions 1 and 3 shall be elected in odd-numbered years and
1-55 positions 2 and 4 shall be elected in even-numbered years. A
1-56 candidate must be a qualified voter of the county. The election
1-57 shall be administered by the county election administrator or by
1-58 the county clerk if the county does not have a county election
1-59 administrator. The election shall be governed by the Election
1-60 Code.
1-61 (d) The commissioners court shall appoint members to the
1-62 board to serve until October 1 after the first election is held as
1-63 provided by Subsection (c) of this section.
1-64 (e) The directors shall organize by the selection, for a
1-65 one-year period, of a president, vice-president, secretary, and
1-66 treasurer. The offices of secretary and treasurer may be combined.
1-67 The president and vice-president must be members of the board. The
1-68 person serving as secretary, treasurer, or both need not be a
2-1 member of the board. The president shall preside at the meetings
2-2 of the board and act as the board's chief executive officer and
2-3 budget officer. The vice-president shall assume the duties of the
2-4 president if the president is incapacitated or absent from a
2-5 meeting. The secretary shall keep the records and the minutes of
2-6 the meetings of the board. The treasurer shall be responsible for
2-7 the deposit of all revenues of any system operated and managed by
2-8 the board in one or more separate accounts with the county
2-9 depository, except that any funds set aside for the payment or
2-10 security of obligations issued on behalf of the board may be
2-11 deposited with the paying agent for which provision is made in the
2-12 order authorizing the issuance of the obligations. The board shall
2-13 require the treasurer to execute a bond in an amount equal to the
2-14 estimated amount to be held, at any time, by the treasurer. The
2-15 premium of the bond shall be paid by the board.
2-16 (f) The president, with the assistance of the business
2-17 manager, shall prepare a tentative budget showing the anticipated
2-18 revenues by sources and the expenses of the utility system and the
2-19 board for the next county fiscal year and submit it to the board no
2-20 later than June 1. The board shall schedule a public hearing to
2-21 consider the budget no later than July 1. The final budget shall
2-22 be adopted by the board no later than July 15 and submitted to the
2-23 commissioners court for consideration by the commissioners court as
2-24 a part of the county budget. If a county budget has not been
2-25 adopted, the budget for the utility system or systems is the same
2-26 as for the preceding fiscal year, except that the budget is
2-27 increased proportionally if the previous budget was not for a
2-28 complete fiscal year. The board and the commissioners court shall
2-29 include in the budget an amount sufficient to provide for the
2-30 payment and security of any outstanding obligations approved by the
2-31 attorney general to the extent the obligations are payable from the
2-32 revenues of the utility system or systems.
2-33 (g) The board in its bylaws shall provide procedures for the
2-34 disbursement of funds it has deposited with the county depository
2-35 only after the board has determined that the funds for payment were
2-36 properly budgeted. However, approval of the board is not required
2-37 for the transfer of funds to a paying agent for the payment and
2-38 security of outstanding obligations approved as to legality by the
2-39 attorney general. All checks issued by the board shall be signed
2-40 by at least two persons, one of whom must be an officer of the
2-41 board.
2-42 (h) The board may establish rates and charges for services,
2-43 fees for connections and reconnections, security deposits, and
2-44 other charges required for efficient operation of each utility
2-45 system for which it has responsibility.
2-46 (i) The board may not:
2-47 (1) incur or issue any obligation payable, in whole or
2-48 in part, from ad valorem taxes; or
2-49 (2) exercise the power of eminent domain.
2-50 (j) The board may provide for extensions and improvements to
2-51 a system but may not provide for the extension of service to any
2-52 area within the boundaries or extraterritorial jurisdiction of a
2-53 municipality or conservation and reclamation district established
2-54 under Article XVI, Section 59, of the Texas Constitution without
2-55 the consent of the governing body of the municipality or district.
2-56 (k) With the approval of the commissioners court, the board
2-57 may purchase an existing privately owned wastewater collection and
2-58 treatment system or water supply and distribution system that
2-59 supplies retail utility service in the county. With the consent of
2-60 the directors of a conservation and reclamation district
2-61 established within the county, the commissioners court may assume
2-62 the outstanding obligations of the district and provide for the
2-63 abolition of the district. The area of the former district must
2-64 remain secondarily liable for the payment of any taxes pledged to
2-65 the payment of outstanding indebtedness of the former district
2-66 until the indebtedness has been paid, provision has been made for
2-67 the payment of the obligations, or the obligations have been
2-68 refunded by the county. These taxes, if required, shall be levied
2-69 against the area of the former district by the commissioners court
2-70 as the successor to the district.
3-1 (l) The board may adopt bylaws consistent with this Act to
3-2 regulate its affairs and establish the area within the county in
3-3 which it has responsibility for providing utility service. The
3-4 service area of the board may not include territory that on the
3-5 effective date of this Act is served by another utility under a
3-6 certificate of public convenience and necessity unless the
3-7 certificate ceases to be effective. The bylaws may provide for a
3-8 seal for the board.
3-9 (m) The board is subject to the open meetings law, Chapter
3-10 271, Acts of the 60th Legislature, Regular Session, 1967 (Article
3-11 6252-17, Vernon's Texas Civil Statutes), the open records law,
3-12 Chapter 424, Acts of the 63rd Legislature, Regular Session, 1973
3-13 (Article 6252-17a, Vernon's Texas Civil Statutes), Subchapter C,
3-14 Chapter 262, Local Government Code, and the Public Funds Investment
3-15 Act of 1987 (Article 842a-2, Vernon's Texas Civil Statutes) and
3-16 their subsequent amendments. The board is a governmental unit for
3-17 the purpose of Chapter 101, Civil Practice and Remedies Code, and
3-18 its subsequent amendments and all of its activities are in the
3-19 performance of an essential governmental function.
3-20 (n) The county, by the adoption of an order at a regular
3-21 meeting of the commissioners court, may authorize the issuance of
3-22 obligations payable in whole or in part from ad valorem taxes on
3-23 behalf of the board for the purpose of acquiring, improving,
3-24 repairing, or extending the county's wastewater collection system,
3-25 treatment system, water supply and distribution system, or solid
3-26 waste collection and disposition system. If the obligations are
3-27 payable from ad valorem taxes and revenues, the board must also
3-28 approve the issuance of the obligations. If obligations are to be
3-29 issued for one or more of those purposes and are to be payable
3-30 solely from the gross revenues of one or more systems, the board,
3-31 by resolution, may authorize the issuance. This section does not
3-32 prohibit an appropriation by the county of any available funds for
3-33 assistance in the maintenance or operation of a system, but an
3-34 agreement or pledge to do so beyond the then current fiscal year is
3-35 not effective unless there is compliance with Article XI, Section
3-36 7, of the Texas Constitution. The following provisions and their
3-37 subsequent amendments apply to and govern the county and the board
3-38 when operating under this section:
3-39 (1) Chapter 271, Local Government Code;
3-40 (2) the Bond Procedures Act of 1981 (Article 717k-6,
3-41 Vernon's Texas Civil Statutes);
3-42 (3) Chapter 784, Acts of the 61st Legislature, Regular
3-43 Session, 1969 (Article 717k-3, Vernon's Texas Civil Statutes);
3-44 (4) Chapter 503, Acts of the 54th Legislature, 1955
3-45 (Article 717k, Vernon's Texas Civil Statutes);
3-46 (5) Chapter 656, Acts of the 68th Legislature, Regular
3-47 Session, 1983 (Article 717q, Vernon's Texas Civil Statutes);
3-48 (6) Chapter 3, Acts of the 61st Legislature, Regular
3-49 Session, 1969 (Article 717k-2, Vernon's Texas Civil Statutes); and
3-50 (7) Sections 2 to 9 of this Act.
3-51 (o) The maturity of an obligation issued under this section
3-52 may not exceed 40 years.
3-53 (p) Each member of the board is entitled to reimbursement
3-54 for actual expenses incurred in the conduct of the business of the
3-55 board and a fee for each meeting attended as established by the
3-56 commissioners court.
3-57 SECTION 3. An action taken by or on behalf of the
3-58 commissioners court of a county in the acceptance of grants for the
3-59 construction of a water supply and distribution system or a
3-60 wastewater collection and treatment system or the acceptance of a
3-61 conveyance of such a system, or an action taken by or on behalf of
3-62 the county since the acquisition of such a system, including the
3-63 operation of the system, is ratified, confirmed, and validated.
3-64 This section does not validate an action that is the subject of
3-65 litigation on the effective date of this Act.
3-66 SECTION 4. After the effective date of this Act and before
3-67 the beginning of the next county fiscal year, the board shall
3-68 operate with the budget applicable to the utility systems for the
3-69 current fiscal year.
3-70 SECTION 5. At the first election following the creation of a
4-1 county utility system board, four directors shall be elected.
4-2 After taking office the directors shall draw lots to determine
4-3 which directors serve one-year terms and which directors serve
4-4 two-year terms.
4-5 SECTION 6. The importance of this legislation and the
4-6 crowded condition of the calendars in both houses create an
4-7 emergency and an imperative public necessity that the
4-8 constitutional rule requiring bills to be read on three several
4-9 days in each house be suspended, and this rule is hereby suspended,
4-10 and that this Act take effect and be in force from and after its
4-11 passage, and it is so enacted.
4-12 * * * * *
4-13 Austin,
4-14 Texas
4-15 April 22, 1993
4-16 Hon. Bob Bullock
4-17 President of the Senate
4-18 Sir:
4-19 We, your Committee on Intergovernmental Relations to which was
4-20 referred S.B. No. 1093, have had the same under consideration, and
4-21 I am instructed to report it back to the Senate with the
4-22 recommendation that it do not pass, but that the Committee
4-23 Substitute adopted in lieu thereof do pass and be printed.
4-24 Armbrister,
4-25 Chairman
4-26 * * * * *
4-27 WITNESSES
4-28 No witnesses appeared on S.B. No. 1093.