By Cook H.B. No. 2925
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the sale or transfer of Water Supply or Sewer Service
1-3 Corporation stock, membership or other right of participation of
1-4 the person or entity to whom the membership is transferred.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Section 9A, Chapter 572, Acts of the 71st
1-7 Legislature, Regular Session, 1989 (Article 1434a Vernon's Texas
1-8 Civil Statutes), is amended to read as follows:
1-9 Sec. 9A. (a) A person or entity that owns any stock of, is
1-10 a member of, or has some other right of participation in a
1-11 corporation may not sell or transfer that stock, membership, or
1-12 other right of participation to another person or entity except:
1-13 (1) by will to a transferee who is a person related to
1-14 the testator within the second degree of consanguinity;
1-15 (2) by transfer without compensation to a transferee
1-16 who is a person related to the owner of the stock or other interest
1-17 within the second degree by consanguinity; or
1-18 (3) by transfer without compensation or sale to the
1-19 corporation.
1-20 (b) Subsection (a) of this section does not apply to a
1-21 person or entity that transfers the membership or other right of
1-22 participation to another person or entity that transfers the
1-23 membership or other right of participation to another person or
2-1 entity as part of the conveyance of real estate from which the
2-2 membership or other right of participation arose.
2-3 (c) The transfer of stock, a membership, or other right of
2-4 participation under this section does not entitle the transferee to
2-5 water or sewer service unless each condition for water or sewer
2-6 service is met as provided in the corporation's published rates,
2-7 charges, and conditions of service, but the conditions of service
2-8 may not require a personal appearance in the office of the
2-9 corporation if the transferee certifies in writing to the
2-10 corporation that the transferee accepts and agrees to abide by such
2-11 rates, charges and conditions of service. Water or sewer service
2-12 provided by the corporation as a result of stock, membership or
2-13 other right of participation may be conditioned on ownership of the
2-14 real estate designated to receive service and from which the
2-15 membership or other right of participation arose.
2-16 (d) The corporation may cancel a person's or other entity's
2-17 stock, membership, or other right of participation if the person or
2-18 other entity fails to meet the conditions for water or sewer
2-19 service prescribed by the corporation's published rates, charges,
2-20 and conditions of service, or fails to comply with any other
2-21 condition placed on the receipt of water or sewer service under the
2-22 stock, membership, or other right of participation authorized under
2-23 Subsection (c) of this section. The corporation may, consistent
2-24 with the limitations prescribed by Subsection (a) of this section,
2-25 reassign canceled stock, or canceled membership or other right of
3-1 participation to any person or entity that has legal title to the
3-2 real estate from which the canceled membership or other right of
3-3 participation arose and for which water or sewer service is
3-4 requested, subject to compliance with the conditions for water or
3-5 sewer service prescribed by the corporation's published rates,
3-6 charges, and conditions of service.
3-7 (e) The corporation shall reassign, without limitation under
3-8 Subsection (a), canceled stock, or a canceled membership or other
3-9 right of participation to a person or entity that acquires the real
3-10 estate from which the membership or other right of participation
3-11 arose through judicial or non-judicial foreclosure, subject to
3-12 compliance with the conditions for water or sewer service
3-13 prescribed by the corporation's published rates, charges, and
3-14 conditions of service.
3-15 SECTION 2. The importance of this legislation and the
3-16 crowded condition of the calendars in both houses create an
3-17 emergency and an imperative public necessity that the
3-18 constitutional rule requiring bills to be read on three several
3-19 days in each house be suspended, and this rule is hereby suspended,
3-20 and that this Act shall take effect and be in force from and after
3-21 its passage, and it is so enacted.