BILL ANALYSIS S.B. 1462 By: Armbrister (McCoulskey) May 18, 1995 Committee Report (Unamended) BACKGROUND Currently, unincorporated areas in Texas have limited access to an adequate water supply and sanitary sewer facilities. Current law does not allow counties to incur debt to construct water and sewer facilities. PURPOSE As proposed, S.B. 1462 authorizes a county commissioners court to own, operate, and maintain water and sewer systems for unincorporated areas inside and outside the county and grants the county the power of eminent domain. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. Amends Chapter 412B, Local Government Code, by adding Section 412.015, as follows: Sec. 412.015. COUNTY WATER AND SEWER SYSTEM. (a) Authorizes a county to acquire, own, or operate a water or sewer utility system to serve an unincorporated area of the county in the same manner, and under the same regulations, as a municipality under Chapter 402. (b) Provides that a county may issue bonds payable solely from the revenue generated by the water or sewer utility system and such revenue bonds and notes of the county shall not be deemed an indebtedness, liability, general, special, or moral obligation or pledge or loan of the faith or credit or taxing power of the state, the county, or any other political subdivision or governmental unit, nor shall such revenue bonds and notes constitute an indebtedness within the meaning of any constitutional or statutory debt limitation or restriction or an agreement, obligation, or indebtedness of the county or the state within the meaning of any constitutional or statutory provision. Provides that nothing in this subsection shall be construed to mean that a county is authorized to issue general obligation bonds payable from ad valorem taxes for the purpose of acquiring, owning, or operating a water or sewer utility system to serve an unincorporated area of the county, a county being specifically prohibited from issuing general obligation bonds payable from ad valorem taxes for such purposes. (c) Authorizes a county to acquire any interest in property necessary to operate a system authorized by this section through any means, including eminent domain. A county shall not exercise the power of eminent domain inside the corporate limits of a municipality. (d) Prohibits a county from providing water or sewer service to an area in the extraterritorial jurisdiction of a municipality or an area to which a holder of a certificate of public convenience and necessity must provide service under Section 13.250, Water Code, without the consent of the municipality or the holder of the certificate. SECTION 2. Effective date: September 1, 1995. SECTION 3. Emergency clause. SUMMARY OF COMMITTEE ACTION SB 1462 was considered by the County Affairs Committee in a formal meeting on 5/19/95. SB 1462 was reported favorably with the recommendation that it do pass and be printed, by the record vote of 7 ayes, 0 nays, 0 pnv, 2 absent.