By:  Armbrister                                        S.B. No. 626
                                 A BILL TO BE ENTITLED
                                        AN ACT
    1-1  relating to certain laws governing water districts and nonprofit
    1-2  water or sewer service corporations; creating penalties; granting
    1-3  authority to issue bonds and levy a tax; granting the power of
    1-4  eminent domain.
    1-5        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-6        SECTION 1.  Section 1.002, Water Code, is amended to read as
    1-7  follows:
    1-8        Sec. 1.002.  Construction of Code.  (a)  The Code
    1-9  Construction Act (Chapter 311, Government Code) applies to the
   1-10  construction of each provision in this code, except as otherwise
   1-11  expressly provided by this code.
   1-12        (b)  In this code:
   1-13              (1)  a reference to a title, chapter, or section
   1-14  without further identification is a reference to a title, chapter,
   1-15  or section of this code; and
   1-16              (2)  a reference to a subtitle, subchapter, subsection,
   1-17  subdivision, paragraph, or other numbered or lettered unit without
   1-18  further identification is a reference to a unit of the next larger
   1-19  unit of this code in which the reference appears.
   1-20        (c)  A reference in a law to a statute or part of a statute
   1-21  revised by this code is considered to be a reference to the part of
   1-22  this code that revises that statute or part of the statute.
   1-23        SECTION 2.  Title 4, Water Code, is amended by adding Chapter
    2-1  49 to read as follows:
    2-2          CHAPTER 49.  PROVISIONS APPLICABLE TO ALL DISTRICTS
    2-3                   SUBCHAPTER A.  GENERAL PROVISIONS
    2-4        Sec. 49.001.  DEFINITIONS.  (a)  As used in this chapter:
    2-5              (1)  "District" means any district or authority created
    2-6  by authority of either Sections 52(b)(1) and (2), Article III, or
    2-7  Section 59, Article XVI, Texas Constitution, regardless of how
    2-8  created.  The term "district" shall not include any navigation
    2-9  district or port authority created under general or special law.
   2-10              (2)  "Commission" means the Texas Natural Resource
   2-11  Conservation Commission.
   2-12              (3)  "Board" means the governing body of a district.
   2-13              (4)  "Executive director" means the executive director
   2-14  of the commission.
   2-15              (5)  "Water supply corporation" means a nonprofit water
   2-16  supply or sewer service corporation created or operating under
   2-17  Chapter 76, Acts of the 43rd Legislature, 1st Called Session, 1933
   2-18  (Article 1434a, Vernon's Texas Civil Statutes).
   2-19              (6)  "Director" means either a supervisor or director
   2-20  appointed or elected to the board.
   2-21              (7)  "Municipal solid waste" has the same meaning
   2-22  assigned by Section 361.003, Health and Safety Code.
   2-23              (8)  "Special water authority" means a river authority
   2-24  as that term is defined in Section 30.003, or a district created by
   2-25  a special Act of the legislature that:
    3-1                    (A)  is a provider of water or wastewater service
    3-2  to two or more municipalities; and
    3-3                    (B)  is governed by a board of directors
    3-4  appointed or designated in whole or in part by the governor, the
    3-5  Texas Water Development Board, or municipalities within its service
    3-6  area.
    3-7              (9)  "Potable water" means water that has been treated
    3-8  for public drinking water supply purposes.
    3-9        (b)  These definitions are for use in this chapter only and
   3-10  have no effect on any other statute or code unless specifically
   3-11  referenced by that statute or code.
   3-12        Sec. 49.002.  APPLICABILITY.  This chapter applies to all
   3-13  general and special law districts to the extent that the provisions
   3-14  of this chapter do not directly conflict with a provision in any
   3-15  other chapter of this code or any Act creating or affecting a
   3-16  special law district.  In the event of such conflict, the specific
   3-17  provisions in such other chapter or Act shall control.
   3-18        Sec. 49.003.  PENALTY.  A district that fails to comply with
   3-19  the filing provisions of this code may be subject to a civil
   3-20  penalty of up to $100 per day for each day the district wilfully
   3-21  continues to violate these provisions after receipt of written
   3-22  notice of violation from the executive director by certified mail,
   3-23  return receipt requested.  The state may sue to recover the
   3-24  penalty.
   3-25        Sec. 49.004.  PENALTY FOR VIOLATION OF DISTRICT RULES.
    4-1  (a)  The board may set reasonable civil penalties for the breach of
    4-2  any rule of the district that shall not exceed the jurisdiction of
    4-3  a justice court as provided by Section 27.031, Government Code.
    4-4        (b)  A penalty under this section is in addition to any other
    4-5  penalty provided by the law of this state and may be enforced by
    4-6  complaints filed in the appropriate court of jurisdiction in the
    4-7  county in which the district's principal office or meeting place is
    4-8  located.
    4-9        (c)  If the district prevails in any suit to enforce its
   4-10  rules, it may, in the same action, recover reasonable fees for
   4-11  attorneys, expert witnesses, and other costs incurred by the
   4-12  district before the court.  The amount of the attorney's fees shall
   4-13  be fixed by the court.
   4-14          (Sections 49.005 to 49.009 reserved for expansion
   4-15                        SUBCHAPTER B.  CREATION
   4-16        Sec. 49.010.  ORDER OR ACT CREATING DISTRICT.  Within 60 days
   4-17  after the date a district is created, the district shall file with
   4-18  the executive director a certified copy of the order or legislative
   4-19  Act creating the district or authorizing its creation, unless the
   4-20  district was created by order of the commission.
   4-21          (Sections 49.011 to 49.050 reserved for expansion
   4-22               SUBCHAPTER C.  ADMINISTRATIVE PROVISIONS
   4-23        Sec. 49.051.  BOARD OF DIRECTORS. A district shall be
   4-24  governed by its board, the number of which is otherwise provided by
   4-25  law.
    5-1        Sec. 49.052.  DISQUALIFICATION OF DIRECTORS.  (a)  A person
    5-2  is disqualified from serving as a member of a board of a district
    5-3  that includes less than all the territory in at least one county
    5-4  and which, if located within the corporate area of a city or
    5-5  cities, includes within its boundaries less than 75 percent of the
    5-6  incorporated area of the city or cities, if that person:
    5-7              (1)  is related within the third degree of affinity or
    5-8  consanguinity to a developer of property in the district, any other
    5-9  member of the board, or the manager, engineer, attorney, or other
   5-10  person providing professional services to the district;
   5-11              (2)  is an employee of any developer of property in the
   5-12  district or any director, manager, engineer, attorney, or other
   5-13  person providing professional services to the district or a
   5-14  developer of property in the district in connection with the
   5-15  district or property located in the district;
   5-16              (3)  is a developer of property in the district;
   5-17              (4)  is serving as an attorney, consultant, engineer,
   5-18  manager, architect, or in some other professional capacity for the
   5-19  district or a developer of property in the district in connection
   5-20  with the district or property located in the district;
   5-21              (5)(A)  is a party to a contract with or along with the
   5-22  district except for the purchase of public services furnished by
   5-23  the district to the public generally; or
   5-24                    (B)  is a party to a contract with or along with
   5-25  a developer of property in the district relating to the district or
    6-1  to property within the district, other than a contract limited
    6-2  solely to the purpose of purchasing or conveying real property in
    6-3  the district for the purpose of either establishing a permanent
    6-4  residence, establishing a commercial business within the district,
    6-5  or qualifying as a director; or
    6-6              (6)  during the term of office, fails to maintain the
    6-7  qualifications required by law to serve as a director.
    6-8        (b)  Within 60 days after the board determines a relationship
    6-9  or employment exists which constitutes a disqualification under
   6-10  Subsection (a), it shall replace the person serving as a member of
   6-11  the board with a person who would not be disqualified.
   6-12        (c)  Any person who wilfully occupies an office as a member
   6-13  of a board and exercises the powers and duties of that office when
   6-14  disqualified under the provisions of Subsection (a) is guilty of a
   6-15  misdemeanor and, on conviction, shall be fined not less than $100
   6-16  nor more than $1,000.
   6-17        (d)  As used in this section, "developer of property in the
   6-18  district" means any person who owns land located within a district
   6-19  covered under this section and who has divided or proposes to
   6-20  divide the land into two or more parts for the purpose of laying
   6-21  out any subdivision or any tract of land or any addition to any
   6-22  town or city, or for laying out suburban lots or building lots, or
   6-23  any lots, streets, alleys, or parks or other portions intended for
   6-24  public use, or the use of purchasers or owners of lots fronting
   6-25  thereon or adjacent thereto.
    7-1        (e)  Any rights obtained by any third party through official
    7-2  action of a board covered by this section are not impaired or
    7-3  affected by the disqualification under this section of any member
    7-4  of the board to serve, provided that the third party had no
    7-5  knowledge at the time the rights were obtained of the fact that the
    7-6  member of the board was disqualified to serve.
    7-7        (f)  This section shall not apply to special water
    7-8  authorities, districts described in Section 49.181(h)(4) or a
    7-9  district where the principal function of the district is to provide
   7-10  irrigation water to agricultural lands or to provide nonpotable
   7-11  water for any purpose.
   7-12        (g)  A board by unanimous vote of its remaining members may
   7-13  remove a board member only if that board member has missed one-half
   7-14  or more of the regular meetings scheduled during the prior 12
   7-15  months.  Any board member so removed may file a written appeal with
   7-16  the commission within 30 days after receiving written notice of the
   7-17  board action.  The commission may reinstate a removed director if
   7-18  the commission finds that the removal was unwarranted under the
   7-19  circumstances, including the reasons for absences, the time and
   7-20  place of the meetings missed, the business conducted at the
   7-21  meetings missed, and any other facts or circumstances the
   7-22  commission may deem relevant.
   7-23        Sec. 49.053.  QUORUM.  A majority of the membership of the
   7-24  board constitutes a quorum for any meeting, and a concurrence of a
   7-25  majority of the entire membership of the board is sufficient for
    8-1  transacting any business of the district.  This section does not
    8-2  apply to special water authorities.
    8-3        Sec. 49.054.  OFFICERS.  (a)  After a district is created and
    8-4  the directors have qualified, the board shall meet, elect a
    8-5  president, vice-president, secretary, and any other officers or
    8-6  assistant officers as the board may deem necessary, and begin the
    8-7  discharge of its duties.
    8-8        (b)  After each directors election, the board shall meet and
    8-9  elect officers.
   8-10        (c)  The president is the chief executive officer of the
   8-11  district, presides at all meetings of the board, and shall execute
   8-12  all documents on behalf of the district.  The vice-president shall
   8-13  act as president in case of the absence or disability of the
   8-14  president.  The secretary is responsible for seeing that all
   8-15  records and books of the district are properly kept and shall
   8-16  attest the president's signature on all documents.
   8-17        (d)  The board may appoint another director, the general
   8-18  manager, or any employee as assistant or deputy secretary to assist
   8-19  the secretary, and any such person shall be entitled to certify as
   8-20  to the authenticity of any record of the district, including but
   8-21  not limited to all proceedings relating to bonds, contracts, or
   8-22  indebtedness of the district.
   8-23        (e)  After any election or appointment of a director, a
   8-24  district shall notify the executive director within 30 days after
   8-25  the date of the election or appointment of the name and mailing
    9-1  address of the director chosen and the date that director's term of
    9-2  office expires.  The executive director shall provide forms to the
    9-3  district for such purpose.
    9-4        (f)  This section does not apply to special water
    9-5  authorities.
    9-6        Sec. 49.055.  SWORN STATEMENT, BOND, AND OATH OF OFFICE.
    9-7  (a)  As soon as practicable after a director is elected or
    9-8  appointed, that director shall make the sworn statement prescribed
    9-9  by the constitution for public office.
   9-10        (b)  As soon as practicable after a director has made the
   9-11  sworn statement, and before beginning to perform the duties of
   9-12  office, that director shall take the oath of office prescribed by
   9-13  the constitution for public officers.
   9-14        (c)  Before beginning to perform the duties of office, each
   9-15  director shall execute a bond for $10,000 payable to the district
   9-16  and conditioned on the faithful performance of that director's
   9-17  duties.  All bonds of the directors shall be approved by the board
   9-18  and paid for by the district.
   9-19        (d)  The sworn statement, bond, and oath shall be filed with
   9-20  the district and retained in its records.  A duplicate original of
   9-21  the sworn statement and the oath shall also be filed with the
   9-22  secretary of state within 10 days after their execution and need
   9-23  not be filed before the new director begins to perform the duties
   9-24  of office.
   9-25        (e)  This section does not apply to special water
   10-1  authorities.
   10-2        Sec. 49.056.  GENERAL MANAGER.  (a)  The board may employ or
   10-3  contract with a person to perform such services as general manager
   10-4  for the district as the board may from time to time specify.  The
   10-5  board may delegate to the general manager full authority to manage
   10-6  and operate the affairs of the district subject only to orders of
   10-7  the board.
   10-8        (b)  The board may delegate to the general manager the
   10-9  authority to employ all persons necessary for the proper handling
  10-10  of the business and operation of the district and to determine the
  10-11  compensation to be paid all employees other than the general
  10-12  manager.
  10-13        (c)  Except as provided by Section 49.052, a director may be
  10-14  employed as general manager of the district, but the compensation
  10-15  of a general manager who also serves as a director shall be
  10-16  established by the other directors.
  10-17        Sec. 49.057.  MANAGEMENT OF DISTRICT.  (a)  The board shall
  10-18  be responsible for the management of all the affairs of the
  10-19  district.  The district shall employ or contract with all persons,
  10-20  firms, partnerships, corporations, or other entities, public or
  10-21  private, deemed necessary by the board for the conduct of the
  10-22  affairs of the district, including but not limited to engineers,
  10-23  attorneys, financial advisors, operators, bookkeepers, tax
  10-24  assessors and collectors, auditors, and administrative staff.
  10-25        (b)  The board shall adopt an annual budget.  All district
   11-1  employees are employed at the will of the district unless the
   11-2  district and employee execute a written employment contract.
   11-3        (c)  The board shall set the compensation and terms for
   11-4  consultants.
   11-5        (d)  In selecting attorneys, engineers, auditors, financial
   11-6  advisors, or other professional consultants, the district shall
   11-7  follow the procedures provided in Subchapter A, Chapter 2254,
   11-8  Government Code (Professional Services Procurement Act).
   11-9        (e)  The board shall require an officer, employee, or
  11-10  consultant who collects, pays, or handles any funds of the district
  11-11  to furnish good and sufficient bond, payable to the district, in an
  11-12  amount determined by the board to be sufficient to safeguard the
  11-13  district.  The bond shall be conditioned on the faithful
  11-14  performance of that person's duties and on accounting for all funds
  11-15  and property of the district.  Such bond shall be signed or
  11-16  endorsed by a surety company authorized to do business in the
  11-17  state.
  11-18        (f)  The board may pay the premium on surety bonds required
  11-19  of officials, employees, or consultants of the district out of any
  11-20  available funds of the district, including proceeds from the sale
  11-21  of bonds.
  11-22        (g)  The board may adopt bylaws to govern the affairs of the
  11-23  district to perform its purposes.  The board by resolution may
  11-24  authorize its general manager or other employee to execute
  11-25  documents on behalf of the district.
   12-1        (h)  The board shall also have the right to purchase all
   12-2  materials, supplies, equipment, vehicles, and machinery needed by
   12-3  the district to perform its purposes.
   12-4        Sec. 49.058.  CONFLICTS OF INTEREST.  A director of a
   12-5  district is subject to the provisions of Chapter 171, Local
   12-6  Government Code, relating to the regulation of conflicts of
   12-7  interest of officers of local governments.
   12-8        Sec. 49.059.  DISQUALIFICATION OF TAX ASSESSOR AND COLLECTOR.
   12-9  (a)  No person may serve as tax assessor and collector of a
  12-10  district providing potable water or sewer utility services to
  12-11  household users if that person:
  12-12              (1)  is related within the third degree of affinity or
  12-13  consanguinity to any developer of property in the district, a
  12-14  member of the board, or the manager, engineer, or attorney for the
  12-15  district;
  12-16              (2)  is or was within two years immediately preceding
  12-17  the assumption of assessment and collection duties with the
  12-18  district an employee of any developer of property in the district
  12-19  or any director, manager, engineer, or attorney for the district;
  12-20              (3)  owns an interest in or is employed by any
  12-21  corporation organized for the purpose of tax assessment and
  12-22  collection services, a substantial portion of the stock of which is
  12-23  owned by a developer of property within the district or any
  12-24  director, manager, engineer, or attorney for the district; or
  12-25              (4)  is directly or through a corporation developing
   13-1  land in the district or is a director, engineer, or attorney for
   13-2  the district.
   13-3        (b)  Within 60 days after the board determines a relationship
   13-4  or employment exists which constitutes a disqualification under
   13-5  Subsection (a), it shall replace the person serving as tax assessor
   13-6  and collector with a person who would not be disqualified.
   13-7        (c)  Any person who wilfully violates the provisions of
   13-8  Subsection (a) is guilty of a misdemeanor and on conviction shall
   13-9  be fined not less than $100 nor more than $1,000.
  13-10        (d)  As used in this section, "developer of property in the
  13-11  district" has the same meaning as in Section 49.052(d).
  13-12        Sec. 49.060.  FEES OF OFFICE; REIMBURSEMENT.  (a)  A director
  13-13  is entitled to receive fees of office of not more than $100  a day
  13-14  for each day the director actually spends performing the duties of
  13-15  a director.  The fees of office may not exceed $6,000 per annum
  13-16  except for directors of a special water authority which is engaged
  13-17  in the distribution and sale of electric energy to the public.
  13-18        (b)  Each director is also entitled to receive reimbursement
  13-19  of actual expenses reasonably and necessarily incurred while
  13-20  engaging in activities on behalf of the district.
  13-21        (c)  In order to receive fees of office and to receive
  13-22  reimbursement for expenses, each director shall file with the
  13-23  district a verified statement showing the number of days actually
  13-24  spent in the service of the district and a general description of
  13-25  the duties performed for each day of service.
   14-1        (d)  Section 49.002 notwithstanding, in all areas of conflict
   14-2  the provisions of this section shall take precedence over all prior
   14-3  statutory enactments.  If the enactment of this section results in
   14-4  an increase in the fees of office for any district, that district's
   14-5  fees of office shall not increase unless the board adopts a
   14-6  resolution authorizing payment of the higher fees.
   14-7        Sec. 49.061.  SEAL.  The directors shall adopt a seal for the
   14-8  district.
   14-9        Sec. 49.062.  OFFICES AND MEETING PLACES.  (a)  The board
  14-10  shall designate from time to time and maintain one or more regular
  14-11  offices for conducting the business of the district and maintaining
  14-12  the records of the district.  Such offices may be located either
  14-13  inside or outside the district's boundaries as determined in the
  14-14  discretion of the board.
  14-15        (b)  The board shall designate one or more places inside or
  14-16  outside the district for conducting the meetings of the board.  The
  14-17  meeting place may be a private residence or office, provided that
  14-18  the board, in its order establishing the meeting place, declares
  14-19  the same to be a public place and invites the public to attend any
  14-20  meeting of the board.  If the board establishes a meeting place or
  14-21  places outside the district, it shall give notice of the location
  14-22  or locations by filing a true copy of the resolution establishing
  14-23  the location or locations of the meeting place or places with the
  14-24  commission and also by publishing notice of the location or
  14-25  locations in a newspaper of general circulation in the district.
   15-1  If the location of any of the meeting places outside the district
   15-2  is changed, notice of the change shall be given in the same manner.
   15-3        (c)  After at least 25 qualified electors are residing in a
   15-4  district, on written request of at least five of those electors,
   15-5  the board shall designate a meeting place and hold meetings within
   15-6  the district if it determines that the meeting place used by the
   15-7  district deprives the residents of a reasonable opportunity to
   15-8  attend district meetings.  On the failure to designate the location
   15-9  of the meeting place within the district, five electors may
  15-10  petition the commission to designate a location.  If it determines
  15-11  that the meeting place used by the district deprives the residents
  15-12  of a reasonable opportunity to attend district meetings, the
  15-13  commission may designate a meeting place inside or outside the
  15-14  district which is reasonably available to the public and require
  15-15  that the meetings be held at such place.  After the next election,
  15-16  the board may designate different meeting places, including one
  15-17  located outside the boundaries of the district.
  15-18        (d)  Two or more districts may designate and share offices
  15-19  and meeting places.  This section does not apply to special water
  15-20  authorities.
  15-21        Sec. 49.063.  NOTICE OF MEETINGS.  Notice of meetings of the
  15-22  board shall be given as set forth in the open meetings law, Chapter
  15-23  551, Government Code, except that if a district does not have a
  15-24  meeting place within the district, the district shall post notice
  15-25  of its meeting at a public place within the district specified by
   16-1  the board in a written resolution, rather than at its
   16-2  administrative office.  The board shall specify such public place
   16-3  to be a bulletin board or other place within the district which is
   16-4  reasonably available to the public.  Neither failure to provide
   16-5  notice of a regular meeting nor an insubstantial defect in notice
   16-6  of any meeting shall affect the validity of any action taken at the
   16-7  meeting.
   16-8        Sec. 49.064.  MEETINGS.  The board shall hold such regular
   16-9  and special meetings as may be necessary for the proper conduct of
  16-10  the district's business.  All meetings shall be conducted in
  16-11  accordance with the open meetings law, Chapter 551, Government
  16-12  Code.   A meeting of a committee of the board, or a committee
  16-13  composed of representatives of more than one board, where less than
  16-14  a quorum of any one board is present is not subject to the
  16-15  provisions of the open meetings law, Chapter 551, Government Code.
  16-16        Sec. 49.065.  RECORDS.  (a)  The board shall keep a complete
  16-17  account of all its meetings and proceedings and shall preserve its
  16-18  minutes, contracts, records, notices, accounts, receipts, and other
  16-19  records in a safe place.
  16-20        (b)  The records of each district are the property of the
  16-21  district and are subject to the open records law, Chapter 552,
  16-22  Government Code.
  16-23        (c)  The preservation, microfilming, destruction, or other
  16-24  disposition of the records of each district is subject to the
  16-25  requirements of Chapter 201, Local Government Code, and rules
   17-1  adopted under that chapter.
   17-2        Sec. 49.066.  SUITS.  (a)  A district may sue and be sued in
   17-3  the courts of this state in the name of the district by and through
   17-4  its board.  All courts shall take judicial notice of the creation
   17-5  of the district and of its boundaries.
   17-6        (b)  Any court in the state rendering judgment for debt
   17-7  against a district may order the board to levy, assess, and collect
   17-8  taxes or assessments to pay the judgment.
   17-9        (c)  The president or the general manager of any district
  17-10  shall be the agent of the district on whom process, notice, or
  17-11  demand required or permitted by law to be served upon the district
  17-12  may be served.
  17-13        (d)  Except as provided in Subsection (e), no suit may be
  17-14  instituted in any court of this state contesting:
  17-15              (1)  the validity of the creation and boundaries of a
  17-16  district created under this code;
  17-17              (2)  any bonds or other obligations created under this
  17-18  code; or
  17-19              (3)  the validity or the authorization of a contract
  17-20  with the United States by the district.
  17-21        (e)  The matters listed in Subsection (d) may be judicially
  17-22  inquired into at any time and determined in any suit brought by the
  17-23  State of Texas through the attorney general.  The action shall be
  17-24  brought on good cause shown, except where otherwise provided by
  17-25  other provisions of this code or by the Texas Constitution.  It is
   18-1  specifically provided, however, that no such proceeding shall
   18-2  affect the validity of or security for any bonds or other
   18-3  obligations theretofore issued by a district if such bonds or other
   18-4  obligations have been approved by the attorney general as provided
   18-5  by Section 49.184.
   18-6        (f)  A district or water supply corporation shall not be
   18-7  required to give bond for appeal, injunction, or costs in any suit
   18-8  to which it is a party and shall not be required to deposit more
   18-9  than the amount of any award in any eminent domain proceeding.
  18-10        Sec. 49.067.  CONTRACTS.  A district shall contract, and be
  18-11  contracted with, in the name of the district.
  18-12        Sec. 49.068.  CONTRACTS WITH GOVERNMENTAL AGENCIES.  The
  18-13  provisions of this chapter pertaining to bids and the Local
  18-14  Government Code notwithstanding, a district may purchase property
  18-15  from any governmental entity by negotiated contract without the
  18-16  necessity of securing appraisals or advertising for bids.
  18-17        Sec. 49.069.  EMPLOYEE BENEFITS.  (a)  The board may provide
  18-18  for and administer retirement, disability, and death compensation
  18-19  funds for the employees of the district.
  18-20        (b)  The board may establish a public retirement system in
  18-21  accordance with the provisions of Chapter 810, Government Code.
  18-22  The board may also provide for a deferred compensation plan
  18-23  described by Section 457, Internal Revenue Code of 1986 (26 U.S.C.
  18-24  Section 457).
  18-25        (c)  The board may include hospitalization and medical
   19-1  benefits to its employees as part of the compensation paid to the
   19-2  officers and employees and may adopt any plan, rule, or regulation
   19-3  in connection with it and amend or change the plan, rule, or
   19-4  regulation as it may determine.
   19-5        Sec. 49.070.  WORKERS' COMPENSATION.  The board may become a
   19-6  subscriber under Title 5, Labor Code (Texas Workers' Compensation
   19-7  Act), with any insurance company authorized to write the policies
   19-8  in the State of Texas.
   19-9        Sec. 49.071.  DISTRICT NAME CHANGE.  (a)  On petition by a
  19-10  district showing reasonable grounds for a name change, the
  19-11  commission by order may change the name of the district to the name
  19-12  requested by the district.  The new name must be generally
  19-13  descriptive of the location of the district followed by the type of
  19-14  district as provided by the title of the chapter of the Water Code
  19-15  governing the district.  If a district is located wholly within one
  19-16  county that contains more than one district of that type, the
  19-17  district may be differentiated, if necessary, by adding to the new
  19-18  name the proper consecutive number.  The new name may not be the
  19-19  same as the name of any other district in the county.
  19-20        (b)  A name change takes effect on the date of issuance of
  19-21  the commission order making the name change.
  19-22        (c)  Not later than the 30th day after the date of issuance
  19-23  of the commission order making the name change, the district shall
  19-24  publish notice of the name change in a newspaper or newspapers of
  19-25  general circulation in the county or counties in which the district
   20-1  is located.  Within that same period, the district shall also give
   20-2  notice of the name change by mail to utility customers or
   20-3  permittees, if any, and, to the extent practicable, to the holders
   20-4  of bonds, obligations, and other indebtedness of the district.
   20-5  Failure of the district to comply with this subsection does not
   20-6  affect the validity of the name change.
   20-7        (d)  A change in the name of a district does not affect
   20-8  bonds, obligations, or other indebtedness of the district existing
   20-9  before the name change occurred.
  20-10          (Sections 49.072 to 49.100 reserved for expansion
  20-11                  SUBCHAPTER D.  ELECTION PROVISIONS
  20-12        Sec. 49.101.  GENERAL.  All elections shall be generally
  20-13  conducted in accordance with the Election Code except as otherwise
  20-14  provided for by this code.  Write-in candidacies for any district
  20-15  office shall be governed by Subchapter C, Chapter 146, Election
  20-16  Code.
  20-17        Sec. 49.102.  CONFIRMATION AND DIRECTOR ELECTION.
  20-18  (a)  Before issuing any bonds or other obligations, an election
  20-19  shall be held within the boundaries of the proposed district to
  20-20  determine if the proposed district shall be established and, if the
  20-21  directors of the district are required by law to be elected, to
  20-22  elect permanent directors.
  20-23        (b)  Notice of a confirmation or director election shall
  20-24  state the day and place or places for holding the election, the
  20-25  propositions to be voted on, and the number of directors to be
   21-1  voted on.
   21-2        (c)  The ballots for a confirmation election shall be printed
   21-3  to provide for voting "For District" and "Against District."
   21-4  Ballots for a directors election shall provide the names of the
   21-5  persons appointed by the governing body who qualified and are
   21-6  serving as temporary directors at the time the election is called.
   21-7  The ballots shall also have blank places after the names of the
   21-8  temporary directors in which a voter may write the names of other
   21-9  persons for directors.
  21-10        (d)  Immediately after the confirmation and director
  21-11  election, the presiding judge shall take returns of the results to
  21-12  the temporary board.  The temporary board shall canvass the returns
  21-13  and declare the results at the earliest practicable time.
  21-14        (e)  If a majority of the votes cast in the election favor
  21-15  the creation of the district, then the temporary board shall
  21-16  declare that the district is created and enter the result in its
  21-17  minutes.  If a majority of the votes cast in the election are
  21-18  against the creation of the district, the temporary board shall
  21-19  declare that the district was defeated and enter the result in its
  21-20  minutes.  A copy of the order shall be filed with the commission.
  21-21        (f)  The order canvassing the results of the confirmation
  21-22  election shall contain a description of the district's boundaries
  21-23  and shall be filed with the executive director and in the deed
  21-24  records of the county or counties in which the district is located.
  21-25        (g)  The temporary board shall also declare the persons
   22-1  receiving the highest number of votes for directors to have been
   22-2  elected as permanent directors.
   22-3        (h)  Unless otherwise agreed, the directors shall decide the
   22-4  initial terms of office by lot, with a simple majority of directors
   22-5  serving until the second succeeding directors election and the
   22-6  remaining directors serving until the next directors election.
   22-7        (i)  The provisions of this section shall not be applicable
   22-8  to any district exercising the powers of Chapter 375, Local
   22-9  Government Code, or any district created by a special Act of the
  22-10  legislature that does not require a confirmation election.
  22-11        Sec. 49.103.  TERMS OF OFFICE OF DIRECTORS.  (a)  Except as
  22-12  provided by Section 49.102, the members of the board of a district
  22-13  shall serve for four-year terms.
  22-14        (b)  An election shall be held on the uniform election date,
  22-15  established by the Election Code, in either January or May of each
  22-16  even-numbered year to elect the appropriate number of directors.
  22-17        (c)  The permanent directors may assign a position number to
  22-18  each director's office, in which case directors shall thereafter be
  22-19  elected by position and not at large.
  22-20        (d)  A district may provide for the election of all
  22-21  directors, or a majority of directors, from single-member
  22-22  districts, which shall be geographically described within the
  22-23  boundaries of the district in a manner that is equitable for the
  22-24  electors within such districts and within the district generally.
  22-25        (e)  Section 49.002 notwithstanding, in all areas of conflict
   23-1  the provisions of Subsection (b) shall take precedence over all
   23-2  prior statutory enactments.
   23-3        (f)  This section does not apply to any special law district
   23-4  or authority that is not required by the law creating the district
   23-5  or authority to elect its directors by the public.
   23-6        Sec. 49.104.  ALTERNATIVE ELECTION PROCEDURES.
   23-7  (a)  Notwithstanding the provisions and requirements of the
   23-8  Election Code and general laws, any two or more districts situated
   23-9  in the same county and in which substantially all of the land is
  23-10  being or has been developed as part of a single community
  23-11  development plan and which are served by common water supply and
  23-12  waste disposal systems may by mutual agreement designate a common
  23-13  election office and common early and regular polling places within
  23-14  one or more of the districts, but outside the boundaries of one or
  23-15  more of the districts, for the conduct of director election
  23-16  proceedings and early and regular balloting in director elections.
  23-17  This alternative election procedure may only be used if the common
  23-18  election office and polling places so designated:
  23-19              (1)  are within buildings open to the public;
  23-20              (2)  are within the boundaries of at least one of the
  23-21  districts;
  23-22              (3)  meet the requirements of the Election Code and
  23-23  general laws as polling places; and
  23-24              (4)  are located not more than five miles from any
  23-25  portion of the boundaries of any of the participating districts.
   24-1        (b)  Such districts may also agree on and designate a common
   24-2  election officer and common early and regular voting officials for
   24-3  some or all of the director elections to be simultaneously
   24-4  conducted at a common location, any of whom may be nonelective
   24-5  employees of one or more of the districts, so long as the early and
   24-6  regular voting officials are qualified voters within at least one
   24-7  of the districts.
   24-8        Sec. 49.105.  VACANCIES.  (a)  Except as otherwise provided
   24-9  in this code, all vacancies on the board and in other offices shall
  24-10  be filled for the unexpired term by appointment of the board.
  24-11        (b)  If the number of directors is reduced to fewer than a
  24-12  majority, the vacancies shall be filled by appointment by the
  24-13  commission or the county commissioners court if the district was
  24-14  created by the county commissioners court.  An appointed director
  24-15  shall serve for the unexpired term of the director he or she is
  24-16  replacing.
  24-17        (c)  In the event of a failure to elect one or more members
  24-18  of the board of a district resulting from the absence of, or
  24-19  failure to vote by, the qualified voters in the district, the
  24-20  current members of the board holding the positions not filled at
  24-21  such election shall be deemed to have been reelected and shall
  24-22  serve an additional term of office.
  24-23        Sec. 49.106.  BOND ELECTIONS.  (a)  Before an election is
  24-24  held to authorize the issuance of bonds, other than refunding
  24-25  bonds, there shall be filed in the office of the district and open
   25-1  to inspection by the public an engineer's report covering the land,
   25-2  improvements, facilities, plants, equipment, and appliances to be
   25-3  purchased or constructed and their estimated cost, together with
   25-4  maps, plats, profiles, and data fully showing and explaining the
   25-5  report.
   25-6        (b)  Notice of a bond election shall contain the proposition
   25-7  or propositions to be voted on, which includes the  estimate of the
   25-8  probable cost of design, construction, purchase, and acquisition of
   25-9  improvements and additions thereto, and incidental expenses
  25-10  connected with such improvements and the issuance of bonds.
  25-11        (c)  A bond election may be held on the same day as any other
  25-12  district election.  The bond election may be called by a separate
  25-13  election order or as a part of any other election order.  The board
  25-14  may submit multiple purposes in a single proposition at an
  25-15  election.
  25-16        Sec. 49.107.  OPERATION AND MAINTENANCE TAX.  (a)  A district
  25-17  may levy and collect a tax for operation and maintenance purposes,
  25-18  including funds for planning, constructing, acquiring, maintaining,
  25-19  repairing, and operating all necessary land, plants, works,
  25-20  facilities, improvements, appliances, and equipment of the district
  25-21  and for paying costs of proper services, engineering and legal
  25-22  fees, and organization and administrative expenses.
  25-23        (b)  An operation and maintenance tax may not be levied by a
  25-24  district until it is approved by a majority of the electors voting
  25-25  at an election held for that purpose.  After such a tax has been
   26-1  authorized by the district's voters, the board shall be authorized
   26-2  to levy the tax and have it assessed and collected as other
   26-3  district taxes.
   26-4        (c)  An operation and maintenance tax election may be held at
   26-5  the same time and in conjunction with any other district election.
   26-6  The election may be called by a separate election order or as part
   26-7  of any other election order.
   26-8        (d)  The proposition in an operation and maintenance tax
   26-9  election may be for a specific maximum rate or for an unlimited
  26-10  rate.
  26-11        (e)  If a district has any surplus operation and maintenance
  26-12  tax funds that are not needed for the purposes for which they were
  26-13  collected, the funds may be used for any lawful purpose.
  26-14        (f)  Before a district reimburses a developer of property in
  26-15  the district, as that term is defined in Section 49.052(d), or its
  26-16  assigns, from operation and maintenance tax funds, for planning,
  26-17  constructing, or acquiring facilities, the district shall obtain
  26-18  approval by the executive director.
  26-19        Sec. 49.108.  CONTRACT ELECTIONS.  (a)  A contract may
  26-20  provide that the district will make payment under the contract from
  26-21  proceeds from the sale of notes or bonds, from taxes, or from any
  26-22  other income of the district or any combination of these.
  26-23        (b)  A district may make payments under a contract from taxes
  26-24  other than operation and maintenance taxes after the provisions of
  26-25  the contract have been approved by a majority of the electors
   27-1  voting at an election held for that purpose.
   27-2        (c)  A contract election may be held at the same time and in
   27-3  conjunction with any other district election.  The election may be
   27-4  called by a separate election order or as part of any other
   27-5  election order.
   27-6        (d)  A contract approved by the voters will constitute an
   27-7  obligation against the taxing power of the district to the extent
   27-8  provided in the contract.
   27-9          (Sections 49.109 to 49.150 reserved for expansion
  27-10                   SUBCHAPTER E.  FISCAL PROVISIONS
  27-11        Sec. 49.151.  EXPENDITURES.  (a)  Except as otherwise
  27-12  provided by this chapter, a district's money may be disbursed only
  27-13  by check, draft, order, or other instrument that shall be signed by
  27-14  at least a majority of the directors.
  27-15        (b)  The board may by resolution allow the general manager,
  27-16  treasurer, bookkeeper, or other employee of the district to sign
  27-17  disbursements.
  27-18        (c)  The board may by resolution allow disbursements to be
  27-19  transferred by federal reserve wire system to accounts in the name
  27-20  of the district.
  27-21        Sec. 49.152.  PURPOSES FOR BORROWING MONEY.  The district may
  27-22  borrow money for any corporate purpose or combination of corporate
  27-23  purposes only in compliance with the methods and procedures
  27-24  specifically provided by this chapter or by general law.
  27-25        Sec. 49.153.  REVENUE NOTES.  (a)  The board, without the
   28-1  necessity of an election, may borrow money on negotiable notes of
   28-2  the district to be paid solely from the revenues derived from the
   28-3  ownership of all or any designated part of the district's works,
   28-4  plants, improvements, facilities, or equipment after deduction of
   28-5  the reasonable cost of maintaining and operating the facilities.
   28-6        (b)  The notes may be first or subordinate lien notes within
   28-7  the discretion of the board, but no obligation may ever be a charge
   28-8  on the property of the district or on taxes levied or collected by
   28-9  the district but shall be solely a charge on the revenues pledged
  28-10  for the payment of the obligation.  No part of the obligation may
  28-11  ever be paid from taxes levied or collected by the district.
  28-12        (c)  A district may not execute a note for a term longer than
  28-13  three years unless the commission issues an order approving the
  28-14  note.
  28-15        (d)  This section does not apply to special water
  28-16  authorities.
  28-17        Sec. 49.154.  BOND ANTICIPATION NOTES; TAX ANTICIPATION
  28-18  NOTES.  (a)  The board may declare an emergency in the matter of
  28-19  funds not being available to pay principal of and interest on any
  28-20  bonds of the district payable in whole or in part from taxes or to
  28-21  meet any other needs of the district and may issue negotiable tax
  28-22  anticipation notes or negotiable bond anticipation notes to borrow
  28-23  the money needed by the district without advertising or giving
  28-24  notice of the sale.  Bond anticipation notes and tax anticipation
  28-25  notes shall mature within one year of their date.
   29-1        (b)  Tax anticipation notes may be issued for any purpose for
   29-2  which the district is authorized to levy taxes, and tax
   29-3  anticipation notes shall be secured with the proceeds of taxes to
   29-4  be levied by the district in the succeeding 12-month period.  The
   29-5  board may covenant with the purchasers of the notes that the board
   29-6  will levy a sufficient tax to pay the principal of and interest on
   29-7  the notes and pay the costs of collecting the taxes.
   29-8        (c)  Bond anticipation notes may be issued for any purpose
   29-9  for which bonds of the district may have previously been voted or
  29-10  may be issued for the purpose of refunding previously issued bond
  29-11  anticipation notes.  A district may covenant with the purchasers of
  29-12  the bond anticipation notes that the district will use the proceeds
  29-13  of sale of any bonds in the process of issuance for the purpose of
  29-14  refunding the bond anticipation notes, in which case the board will
  29-15  be required to use the proceeds received from sale of the bonds in
  29-16  the process of issuance to pay principal, interest, or redemption
  29-17  price on the bond anticipation notes.
  29-18        (d)  Districts required to seek commission approval of bonds
  29-19  must have an application for such approval on file with the
  29-20  commission prior to the issuance of bond anticipation notes.
  29-21        Sec. 49.155.  REPAYMENT OF EXPENSES.  (a)  The district may
  29-22  pay all costs and expenses necessarily incurred in the organization
  29-23  and operation of a district during creation and construction
  29-24  periods including but not limited to the following:
  29-25              (1)  organizational, administrative, and operating
   30-1  expenses;
   30-2              (2)  the cost of investigation and making plans;
   30-3              (3)  the cost of the engineer's report;
   30-4              (4)  legal fees; and
   30-5              (5)  any other incidental expenses.
   30-6        (b)  For purposes of this section, construction periods shall
   30-7  mean any periods during which the district is constructing its
   30-8  facilities or there is construction by third parties of above
   30-9  ground improvements within the district, but in no event longer
  30-10  than five years.
  30-11        (c)  The district may reimburse any person for money advanced
  30-12  for the purposes in Subsection (a) and may be charged interest on
  30-13  such funds.
  30-14        (d)  These payments may be made from money obtained from the
  30-15  issuance of notes or the sale of bonds issued by the district or
  30-16  out of maintenance taxes or other revenues of the district.
  30-17        Sec. 49.156.  DEPOSITORY.  (a)  The board, by order or
  30-18  resolution, shall designate one or more banks or savings
  30-19  associations within the state to serve as the depository for the
  30-20  funds of the district.  The board shall not be required to
  30-21  advertise or solicit bids in selecting its depositories.
  30-22        (b)  To the extent that funds in the depository banks or
  30-23  savings associations are not insured by the Federal Deposit
  30-24  Insurance Corporation, they shall be secured in the manner provided
  30-25  by law for the security of funds by Chapter 2257, Government Code
   31-1  (Public Funds Collateral Act).
   31-2        (c)  The board may authorize a designated representative to
   31-3  supervise the substitution of securities pledged to secure the
   31-4  district's funds.
   31-5        Sec. 49.157.  INVESTMENTS.  (a)  All district deposits and
   31-6  investments shall be governed by Subchapter A, Chapter 2256,
   31-7  Government Code (Public Funds Investment Act).
   31-8        (b)  The board may provide that an authorized representative
   31-9  of the district may invest and reinvest the funds of the district
  31-10  and provide for money to be withdrawn from the appropriate accounts
  31-11  of the district for the investments on such terms as the board
  31-12  considers advisable.
  31-13        Sec. 49.158.  FISCAL YEAR.  Within 30 days after a district
  31-14  becomes financially active, the board shall adopt a fiscal year by
  31-15  a formal board resolution.  The district shall notify the executive
  31-16  director of the adopted fiscal year within 30 days after adoption.
  31-17  The district may change its fiscal year at any time; provided,
  31-18  however, it may not be changed more than once in any 24-month
  31-19  period.  After any change in the district's fiscal year, the
  31-20  district shall notify the executive director of the changed fiscal
  31-21  year within 30 days after adoption.
  31-22          (Sections 49.159 to 49.180 reserved for expansion
  31-23                   SUBCHAPTER F.  ISSUANCE OF BONDS
  31-24        Sec. 49.181.  AUTHORITY OF COMMISSION OVER ISSUANCE OF
  31-25  DISTRICT BONDS.  (a)  A district may not issue bonds unless the
   32-1  commission determines that the project to be financed by the bonds
   32-2  is feasible and issues an order approving the issuance of the
   32-3  bonds.  This section does not apply to refunding bonds or bonds
   32-4  issued to and approved by the Farmers Home Administration, the
   32-5  United States Department of Agriculture, or the Texas Water
   32-6  Development Board.
   32-7        (b)  A district may submit to the commission a written
   32-8  application for investigation of feasibility.  An engineer's report
   32-9  describing the project, including the data, profiles, maps, plans,
  32-10  and specifications prepared in connection with the report, must be
  32-11  submitted with the application.
  32-12        (c)  The executive director shall examine the application and
  32-13  the report and shall inspect the project area.  The district shall,
  32-14  on request, supply the executive director with additional data and
  32-15  information necessary for an investigation of the application, the
  32-16  engineer's report, and the project.
  32-17        (d)  The executive director shall prepare a written report on
  32-18  the project and include suggestions, if any, for changes or
  32-19  improvements in the project.  The executive director shall retain a
  32-20  copy of the report and send a copy of the report to both the
  32-21  commission and the district.
  32-22        (e)  The commission shall consider the application, the
  32-23  engineer's report, the executive director's report, and any other
  32-24  evidence allowed by commission rule to be considered in determining
  32-25  the feasibility of the project.
   33-1        (f)  The commission shall determine whether the project to be
   33-2  financed by the bonds is feasible and issue an order either
   33-3  approving or disapproving, as appropriate, the issuance of the
   33-4  bonds.  The commission shall retain a copy of the order and send a
   33-5  copy of the order to the district.
   33-6        (g)  Notwithstanding any provision of this code to the
   33-7  contrary, the commission may approve the issuance of bonds of a
   33-8  district without the submission of plans and specifications of the
   33-9  improvements to be financed with the bonds.  The commission may
  33-10  condition the approval on any terms or conditions considered
  33-11  appropriate by the commission.
  33-12        (h)  This section does not apply to a district if:
  33-13              (1)  the district's boundaries include one entire
  33-14  county;
  33-15              (2)  the district was created by a special Act of the
  33-16  legislature and:
  33-17                    (A)  the district is located entirely within one
  33-18  county;
  33-19                    (B)  entirely within one or more home-rule
  33-20  municipalities;
  33-21                    (C)  the total taxable value of the real property
  33-22  and improvements to the real property zoned by one or more
  33-23  home-rule municipalities for residential purposes and located
  33-24  within the district does not exceed 25 percent of the total taxable
  33-25  value of all taxable property in the district, as shown by the most
   34-1  recent certified appraisal tax roll prepared by the appraisal
   34-2  district for the county; and
   34-3                    (D)  the district was not required by law to
   34-4  obtain commission approval of its bonds before the effective date
   34-5  of this section;
   34-6              (3)  the district is a special water authority; or
   34-7              (4)  the district is governed by a board of directors
   34-8  appointed in whole or in part by the governor, a state agency, or
   34-9  the governing body or chief elected official of a municipality or
  34-10  county and does not provide water and sewer services to residential
  34-11  retail customers as its principal function.
  34-12        Sec. 49.182.  COMMISSION SUPERVISION OF PROJECTS AND
  34-13  IMPROVEMENTS.  (a)  During construction of projects and
  34-14  improvements approved by the commission under this subchapter, no
  34-15  substantial alterations may be made in the plans and specifications
  34-16  without the approval of the commission in accordance with
  34-17  commission rules.
  34-18        (b)  The executive director may inspect the improvements at
  34-19  any time during construction to determine if the project is being
  34-20  constructed in accordance with the plans and specifications
  34-21  approved by the commission.
  34-22        (c)  If the executive director finds that the project is not
  34-23  being constructed in accordance with the approved plans and
  34-24  specifications, the executive director shall give written notice
  34-25  immediately by certified mail to the district's manager and to each
   35-1  board member.
   35-2        (d)  If within 10 days after the notice is mailed the board
   35-3  does not take steps to ensure that the project is being constructed
   35-4  in accordance with the approved plans and specifications, the
   35-5  executive director shall give written notice of this fact to the
   35-6  attorney general.
   35-7        (e)  After receiving this notice, the attorney general may
   35-8  bring an action for injunctive relief or quo warranto proceedings
   35-9  against the directors.  Venue for either suit is exclusively in a
  35-10  district court in Travis County.
  35-11        Sec. 49.183.  BOND SALES.  (a)  Except for refunding bonds,
  35-12  or bonds sold to a state or federal agency, bonds issued by a
  35-13  district shall be sold after advertising for and receiving
  35-14  competitive sealed bids and shall be awarded to the bidder whose
  35-15  bid produces the lowest net effective interest rate to the
  35-16  district.
  35-17        (b)  Except for refunding bonds, or bonds sold to a state or
  35-18  federal agency, after any bonds are finally approved and before
  35-19  they are sold by a district, the board shall publish an appropriate
  35-20  notice of the sale:
  35-21              (1)  at least one time not less than 10 days before the
  35-22  date of sale in a newspaper of general circulation in the county or
  35-23  counties in which the district is located; and
  35-24              (2)  at least one time in one or more recognized
  35-25  financial publications of general circulation in the state as
   36-1  approved by the state attorney general.
   36-2        (c)  If the district is issuing bonds and refunding bonds as
   36-3  one issue and if the initial principal amount of refunding bonds is
   36-4  50 percent or more of the total initial principal amount of bonds
   36-5  being issued, for the purposes of this section, the issue shall be
   36-6  considered to be refunding bonds and competitive bids shall not be
   36-7  required.
   36-8        (d)  A district's bonds are negotiable instruments within the
   36-9  meaning and purposes of the Business & Commerce Code.  A district's
  36-10  bonds may be issued and bear interest in accordance with Chapter
  36-11  503, Acts of the 54th Legislature, 1955 (Article 717k, Vernon's
  36-12  Texas Civil Statutes); Chapter 3, Acts of the 61st Legislature,
  36-13  Regular Session, 1969 (Article 717k-2, Vernon's Texas Civil
  36-14  Statutes); the Bond Procedures Act of 1981 (Article 717k-6,
  36-15  Vernon's Texas Civil Statutes); and Chapter 656, Acts of the 68th
  36-16  Legislature, Regular Session, 1983 (Article 717q, Vernon's Texas
  36-17  Civil Statutes).  Except for this subsection, this section does not
  36-18  apply to special water authorities or districts described in
  36-19  Section 49.181(h)(4).
  36-20        (e)  Subsections (a) and (b) do not apply to district bonds
  36-21  issued pursuant to Chapter 656, Acts of the 68th Legislature,
  36-22  Regular Session, 1983 (Article 717q, Vernon's Texas Civil
  36-23  Statutes).
  36-24        Sec. 49.184.  APPROVAL OF BONDS BY ATTORNEY GENERAL;
  36-25  REGISTRATION OF BONDS.  (a)  Before bonds issued by a district are
   37-1  delivered to the purchasers, a certified copy of all proceedings
   37-2  relating to organization of the district for first bond issues and
   37-3  issuance of the bonds and other relevant information shall be sent
   37-4  to the attorney general.
   37-5        (b)  The attorney general shall carefully examine the bonds,
   37-6  with regard to the record and the constitution and laws of this
   37-7  state governing the issuance of bonds, and the attorney general
   37-8  shall officially approve and certify the bonds if he or she finds
   37-9  that they conform to the record and the constitution and laws of
  37-10  this state and are valid and binding obligations of the district.
  37-11        (c)  After the attorney general approves and certifies the
  37-12  bonds, the comptroller shall register them in a book kept for that
  37-13  purpose and shall record the certificate of the attorney general.
  37-14        (d)  After the approval and registration of the bonds by the
  37-15  comptroller, they shall be incontestable in any court or other
  37-16  forum, for any reason, and shall be valid and binding obligations
  37-17  in accordance with their terms for all purposes.
  37-18        (e)  A contract or lease may be submitted to the attorney
  37-19  general along with the bond records, and, if submitted, the
  37-20  approval by the attorney general of the bonds shall constitute an
  37-21  approval of the contract or lease and the contract or lease shall
  37-22  be incontestable.
  37-23        Sec. 49.185.  EXEMPTIONS.  This subchapter shall not apply to
  37-24  districts engaged in the distribution and  sale of electric energy
  37-25  to the public.
   38-1          (Sections 49.186 to 49.190 reserved for expansion
   38-2                      SUBCHAPTER G.  AUDIT OF DISTRICTS
   38-3        Sec. 49.191.  DUTY TO AUDIT.  (a)  The board shall have the
   38-4  district's fiscal accounts and records audited annually at the
   38-5  expense of the district.
   38-6        (b)  In all areas of conflict, the provisions of this
   38-7  subchapter shall take precedence over all prior statutory
   38-8  enactments.
   38-9        (c)  The person who performs the audit shall be a certified
  38-10  public accountant or public accountant holding a permit from the
  38-11  Texas State Board of Public Accountancy.
  38-12        (d)  The audit required by this section shall be completed
  38-13  within 120 days after the close of the district's fiscal year.
  38-14        Sec. 49.192.  FORM OF AUDIT.  The executive director shall
  38-15  adopt accounting and auditing manuals and, except as otherwise
  38-16  provided by the manuals, the district audit shall be performed
  38-17  according to the generally accepted auditing standards adopted by
  38-18  the American Institute of Certified Public Accountants.  Financial
  38-19  statements shall be prepared in accordance with generally accepted
  38-20  accounting principles as adopted by the American Institute of
  38-21  Certified Public Accountants.
  38-22        Sec. 49.193.  FINANCIAL REPORTS.  The district's depository,
  38-23  the district's treasurer, and the district's bookkeeper, if any,
  38-24  who receives or has control over any district funds shall keep a
  38-25  full and itemized account of district funds in its, his, or her
   39-1  possession.  Such itemized accounts and records shall be available
   39-2  for audit.
   39-3        Sec. 49.194.  FILING OF AUDITS, AFFIDAVITS, AND FINANCIAL
   39-4  REPORTS.  (a)  After the board has approved the audit, it shall
   39-5  submit a copy of the report to the executive director for filing
   39-6  within 135 days after the close of the district's fiscal year.
   39-7        (b)  If the board refuses to approve the annual audit report,
   39-8  the board shall submit a copy of the report to the executive
   39-9  director for filing within 135 days after the close of the
  39-10  district's fiscal year, accompanied by a statement from the board
  39-11  explaining the reasons for its failure to approve the report.
  39-12        (c)  Copies of the audit, the annual financial dormancy
  39-13  affidavit, or annual financial report described in Sections 49.197
  39-14  and 49.198 shall be filed annually in the office of the district.
  39-15        (d)  Each district shall file with the executive director an
  39-16  annual filing affidavit in a format prescribed by the executive
  39-17  director, executed by a duly authorized representative of the
  39-18  board, stating that all copies of the annual audit report, annual
  39-19  financial dormancy affidavit, or annual financial report have been
  39-20  filed under this section.
  39-21        (e)  The annual filing affidavit shall be submitted with the
  39-22  applicable annual document when it is submitted to the executive
  39-23  director for filing as prescribed by this subchapter.
  39-24        (f)  The executive director shall file with the attorney
  39-25  general the names of any districts that do not comply with the
   40-1  provisions of this subchapter.
   40-2        Sec. 49.195.  REVIEW BY EXECUTIVE DIRECTOR.  (a)  The
   40-3  executive director may review the audit report of each district.
   40-4        (b)  The commission may request that the state auditor assist
   40-5  in the establishment of standards and procedures for review of
   40-6  district audits by the executive director.
   40-7        (c)  If the executive director has any objections or
   40-8  determines any violations of generally accepted auditing standards
   40-9  or accounting principles, statutes, or board rules, or if the
  40-10  executive director has any recommendations, he or she shall notify
  40-11  the board and the district's auditor.
  40-12        (d)  Before the audit report may be accepted by the executive
  40-13  director as being in compliance with the provisions of this
  40-14  subchapter, the board and the auditor shall remedy objections and
  40-15  correct violations of which they have been notified by the
  40-16  executive director.
  40-17        (e)  If the audit report indicates that any penal law has
  40-18  been violated, the executive director shall notify the appropriate
  40-19  county or district attorney and the attorney general.
  40-20        Sec. 49.196.  ACCESS TO AND MAINTENANCE OF DISTRICT RECORDS.
  40-21  (a)  The executive director shall have access to all vouchers,
  40-22  receipts, district fiscal and financial records, and other district
  40-23  records the executive director considers necessary.
  40-24        (b)  All district fiscal records shall be prepared on a
  40-25  timely basis and maintained in an orderly manner in accordance with
   41-1  generally accepted accounting principles.  The fiscal records shall
   41-2  be available for public inspection during regular business hours.
   41-3  A district's fiscal records may be removed from the district's
   41-4  office for the purposes of recording its fiscal affairs and
   41-5  preparing an audit, during which time the fiscal records are under
   41-6  the control of the district's auditor.
   41-7        Sec. 49.197.  FINANCIALLY DORMANT DISTRICTS.  (a)  A
   41-8  financially dormant district is a district that had:
   41-9              (1)  $500 or less of receipts from operations, tax
  41-10  assessments, loans, contributions, or any other sources during the
  41-11  calendar year;
  41-12              (2)  $500 or less of disbursements of funds during the
  41-13  calendar year;
  41-14              (3)  no bonds or other long-term (more than one year)
  41-15  liabilities outstanding during the calendar year; and
  41-16              (4)  no cash or investments that exceeded $5,000 at any
  41-17  time during the calendar year.
  41-18        (b)  A financially dormant district may elect to submit to
  41-19  the executive director a financial dormancy affidavit instead of
  41-20  complying with the audit requirements of Section 49.191.
  41-21        (c)  The annual financial dormancy affidavit shall be
  41-22  prepared in a format prescribed by the executive director and shall
  41-23  be submitted for filing by a duly authorized representative of the
  41-24  district.
  41-25        (d)  The affidavit must be filed annually on or before
   42-1  January 31 with the executive director until such time as the
   42-2  district becomes financially active and the board adopts a fiscal
   42-3  year; thereafter, the district shall file annual audit reports as
   42-4  prescribed by this subchapter.
   42-5        (e)  A district that becomes financially dormant after having
   42-6  been financially active shall be required to file annual financial
   42-7  dormancy affidavits on or before January 31, until the district is
   42-8  either dissolved or again becomes financially active.
   42-9        (f)  Districts governed by this section are subject to
  42-10  periodic audits by the executive director.
  42-11        Sec. 49.198.  AUDIT REPORT EXEMPTION.  (a)  A district that
  42-12  is not collecting taxes may elect to file annual financial reports
  42-13  with the executive director in lieu of the district's compliance
  42-14  with Section 49.191 provided:
  42-15              (1)  the district had no bonds or other long-term (more
  42-16  than one year) liabilities outstanding during the fiscal period;
  42-17              (2)  the district did not have gross receipts from
  42-18  operations, loans, or contributions in excess of $100,000 during
  42-19  the fiscal period; and
  42-20              (3)  the district's cash and temporary investments were
  42-21  not in excess of $100,000 at any time during the fiscal period.
  42-22        (b)  The annual financial report must be accompanied by an
  42-23  affidavit attesting to the accuracy and authenticity of the
  42-24  financial report signed by a duly authorized representative of the
  42-25  district.
   43-1        (c)  The annual financial report and affidavit in a format
   43-2  prescribed by the executive director must be on file with the
   43-3  executive director within 45 days after the close of the district's
   43-4  fiscal year.
   43-5        (d)  Districts governed by this section are subject to
   43-6  periodic audits by the executive director.
   43-7        Sec. 49.199.  POLICIES AND AUDITS OF DISTRICTS.  (a)  Subject
   43-8  to the law governing the district, the board shall adopt the
   43-9  following in writing:
  43-10              (1)  a code of ethics for district directors, officers,
  43-11  employees, and persons who are engaged in handling investments for
  43-12  the district;
  43-13              (2)  a policy relating to travel expenditures;
  43-14              (3)  a policy relating to district investments that
  43-15  ensures that:
  43-16                    (A)  purchases and sales of investments are
  43-17  initiated by authorized individuals, conform to investment
  43-18  objectives and regulations, and are properly documented and
  43-19  approved; and
  43-20                    (B)  periodic review is made of district
  43-21  investments to evaluate investment performance and security;
  43-22              (4)  policies and procedures for selection, monitoring,
  43-23  or review and evaluation of professional services;
  43-24              (5)  a uniform method of accounting and reporting for
  43-25  industrial development bonds and pollution control bonds that
   44-1  complies with requirements of the commission; and
   44-2              (6)  policies that ensure a better use of management
   44-3  information including:
   44-4                    (A)  budgets for use in planning and controlling
   44-5  cost;
   44-6                    (B)  an audit committee of the board; and
   44-7                    (C)  uniform reporting requirements that use
   44-8  "Audits of State and Local Governmental Units" as a guide on audit
   44-9  working papers and that use "Governmental Accounting and Financial
  44-10  Reporting Standards."
  44-11        (b)  The state auditor may audit the financial transactions
  44-12  of any district if the state auditor determines that the audit is
  44-13  necessary.
  44-14        Sec. 49.200.  REVIEW AND COMMENT ON BUDGET OF CERTAIN
  44-15  DISTRICTS.  A district that provides wholesale potable water and
  44-16  wastewater services shall adopt a program that provides such
  44-17  wholesale customers an opportunity to review and comment on the
  44-18  district's annual budget that applies to their services before that
  44-19  budget is adopted by the board.
  44-20          (Sections 49.201 to 49.210 reserved for expansion
  44-21                   SUBCHAPTER H.  POWERS AND DUTIES
  44-22        Sec. 49.211.  POWERS.  (a)  A district shall have the
  44-23  functions, powers, authority, rights, and duties that will permit
  44-24  accomplishment of the purposes for which it was created or the
  44-25  purposes authorized by the constitution, this code, or any other
   45-1  law.
   45-2        (b)  A district is authorized to purchase, construct,
   45-3  acquire, own, operate, maintain, repair, improve, or extend inside
   45-4  and outside its boundaries any and all land, works, improvements,
   45-5  facilities, plants, equipment, and appliances necessary to
   45-6  accomplish the purposes of its creation or the purposes authorized
   45-7  by this code or any other law.
   45-8        Sec. 49.212.  FEES AND CHARGES.  (a)  A district may adopt
   45-9  and enforce all necessary charges, fees, or rentals, in addition to
  45-10  taxes, for providing or making available any district facility or
  45-11  service.
  45-12        (b)  A district may require a deposit for any services or
  45-13  facilities furnished and the district may or may not provide that
  45-14  the deposit will bear interest.
  45-15        (c)  Subject to observance of the procedure appropriate to
  45-16  the circumstances, a district may discontinue any or all facilities
  45-17  or services to prevent an abuse or to enforce payment of an unpaid
  45-18  charge, fee, or rental due the district, including taxes that have
  45-19  been delinquent for not less than six months.
  45-20        (d)  Notwithstanding any provision of law to the contrary, a
  45-21  district that charges a fee that is an impact fee as described in
  45-22  Section 395.001(4), Local Government Code, must comply with Chapter
  45-23  395, Local Government Code.  A charge or fee by a district for
  45-24  construction, installation, or inspection of a tap or connection to
  45-25  district water, sanitary sewer, or drainage facilities, including
   46-1  all necessary service lines and meters, that (i) does not exceed
   46-2  three times the actual and reasonable costs to the district for
   46-3  such work or (ii) if made to a nontaxable entity, does not exceed
   46-4  the actual costs to the district for such work and for all
   46-5  facilities that are necessary to provide district services to such
   46-6  entity and that are financed or are to be financed in whole or in
   46-7  part by tax-supported bonds of the district, shall not be deemed or
   46-8  considered to be an impact fee under Chapter 395, Local Government
   46-9  Code.
  46-10        Sec. 49.213.  AUTHORITY TO ISSUE CONTRACTS.  (a)  A district
  46-11  may contract with a person or any public or private entity for the
  46-12  joint construction, financing, ownership, and operation of any
  46-13  works, improvements, facilities, plants, equipment, and appliances
  46-14  necessary to accomplish any purpose or function permitted by a
  46-15  district, or a district may purchase an interest in any project
  46-16  used for any purpose or function permitted by a district.
  46-17        (b)  A district may enter into contracts with any person or
  46-18  any public or private entity in the performance of any purpose or
  46-19  function permitted by a district.
  46-20        (c)  A district may enter into contracts, which may be of
  46-21  unlimited duration, with persons or any public or private entities
  46-22  on the terms and conditions the board may consider desirable, fair,
  46-23  and advantageous for:
  46-24              (1)  the purchase or sale of water;
  46-25              (2)  the collection, transportation, treatment, and
   47-1  disposal of its domestic, industrial, and communal wastes or the
   47-2  collection, transportation, treatment, and disposal of domestic,
   47-3  industrial, and communal wastes of other persons;
   47-4              (3)  the gathering, diverting, and control of local
   47-5  storm water, or other local harmful excesses of water;
   47-6              (4)  the continuing and orderly development of the land
   47-7  and property within the district through the purchase,
   47-8  construction, or installation of works, improvements, facilities,
   47-9  plants, equipment, and appliances that the district may otherwise
  47-10  be empowered and authorized to do or perform so that, to the
  47-11  greatest extent reasonably possible, considering sound engineering
  47-12  and economic practices, all of the land and property may be placed
  47-13  in a position to ultimately receive the services of the works,
  47-14  improvements, plants, facilities, equipment, and appliances;
  47-15              (5)  the maintenance and operation of any works,
  47-16  improvements, facilities, plants, equipment, and appliances of the
  47-17  district or of another person or public or private entity;
  47-18              (6)  the collection, treatment, and disposal of
  47-19  municipal solid wastes; and
  47-20              (7)  the exercise of any other rights, powers, and
  47-21  duties granted to a district.
  47-22        Sec. 49.214.  CONFLICTS OF INTEREST IN CONTRACTS.  The
  47-23  provisions of Chapter 171, Local Government Code, shall apply to
  47-24  the award of district contracts.
  47-25        Sec. 49.215.  SERVICE TO AREAS OUTSIDE THE DISTRICT.  (a)  A
   48-1  district may purchase, construct, acquire, own, operate, repair,
   48-2  improve, or extend all works, improvements, facilities, plants,
   48-3  equipment, and appliances necessary to provide any services or
   48-4  facilities authorized to be provided by the district to areas
   48-5  contiguous to or in the vicinity of the district provided the
   48-6  district does not duplicate a service or facility of another public
   48-7  entity.  A district providing potable water and sewer utility
   48-8  services to household users shall not provide services or
   48-9  facilities to serve areas outside the district that are also within
  48-10  the corporate limits of a city without securing a resolution or
  48-11  ordinance of the city granting consent for the district to serve
  48-12  the area within the city.
  48-13        (b)  To secure money for this purpose, a district is
  48-14  authorized to issue and sell negotiable bonds and notes payable
  48-15  from the levy and collection of ad valorem taxes on all taxable
  48-16  property within the district or from all or any designated part of
  48-17  the revenues received from the operation of the district's works,
  48-18  improvements, facilities, plants, equipment, and appliances or from
  48-19  a combination of taxes and revenues.
  48-20        (c)  Any bonds and notes may be issued upon the terms and
  48-21  conditions set forth in this code.
  48-22        (d)  A district shall not be required to hold a certificate
  48-23  of convenience and necessity as a precondition for providing retail
  48-24  water or sewer service to any customer or service area,
  48-25  notwithstanding the fact that such customer or service area may be
   49-1  located either within or outside the boundaries of the district or
   49-2  has previously received water or sewer service from an entity
   49-3  required by law to hold a certificate of convenience and necessity
   49-4  as a precondition for such service.  This subsection does not
   49-5  authorize a district to provide services within an area for which a
   49-6  retail public utility holds a certificate of convenience and
   49-7  necessity or within the boundaries of another district without that
   49-8  district's consent, unless the district has a valid certificate of
   49-9  convenience and necessity to provide services to that area.
  49-10        (e)  A district is authorized to establish, maintain, revise,
  49-11  charge, and collect the rates, fees, rentals, tolls, or other
  49-12  charges for the use, services, and facilities that provide service
  49-13  to areas outside the district that are considered necessary and may
  49-14  be higher than those charged for comparable service to users within
  49-15  the district.
  49-16        (f)  The rates, fees, rentals, tolls, or other charges shall
  49-17  be at least sufficient to meet the expense of operating and
  49-18  maintaining the services and facilities for a water and sanitary
  49-19  sewer system serving areas outside the district and to pay the
  49-20  principal of and interest and redemption price on bonds issued to
  49-21  purchase, construct, acquire, own, operate, repair, improve, or
  49-22  extend the services or facilities.
  49-23        Sec. 49.216.  ENFORCEMENT BY PEACE OFFICERS.  (a)  A district
  49-24  may contract for or employ its own peace officers with power to
  49-25  make arrests when necessary to prevent or abate the commission of:
   50-1              (1)  any offense against the rules of the district when
   50-2  the offense or threatened offense occurs on any land, water, or
   50-3  easement owned or controlled by the district;
   50-4              (2)  any offense involving injury or detriment to any
   50-5  property owned or controlled by the district; and
   50-6              (3)  any offense against the laws of the state.
   50-7        (b)  A district may appoint reserve peace officers who may be
   50-8  called to serve as peace officers by the district during the actual
   50-9  discharge of their official duties.
  50-10        (c)  A reserve peace officer serves at the discretion of the
  50-11  district and may be called into service if the district considers
  50-12  it necessary to have additional officers to preserve the peace in
  50-13  or enforce the law of the district.
  50-14        (d)  A reserve peace officer on active duty and actively
  50-15  engaged in assigned duties has the same rights, privileges, and
  50-16  duties as any other peace officer of the district.
  50-17        (e)  Any peace officer, before beginning to perform any
  50-18  duties and at the time of appointment, must take an oath and
  50-19  execute a bond conditioned on faithful performance of such
  50-20  officer's duties in the amount of $1,000 payable to the district.
  50-21  The oath and the bond shall be filed in the district office.
  50-22        Sec. 49.217.  OPERATION OF CERTAIN MOTOR VEHICLES ON OR NEAR
  50-23  PUBLIC FACILITIES.  (a)  In this section, "motor vehicle" means a
  50-24  self-propelled device in, upon, or by which a person or property is
  50-25  or may be transported or drawn on a road or highway.
   51-1        (b)  Except as provided in Subsections (c) and (d), a person
   51-2  may not operate a motor vehicle on a levee, in a drainage ditch, or
   51-3  on land adjacent to a levee, canal, ditch, exposed conduit,
   51-4  pipeline, pumping plant, storm water facility, or other facility
   51-5  for the transmission, storage, treatment, or distribution of water,
   51-6  sewage, or storm water owned or controlled by a district.
   51-7        (c)  A district may authorize the use of motor vehicles on
   51-8  land that it owns or controls by posting signs on the property.
   51-9        (d)  This section does not prohibit a person from:
  51-10              (1)  driving on a public road or highway; or
  51-11              (2)  operating a motor vehicle used for repair or
  51-12  maintenance of public water, sewer, or storm water facilities.
  51-13        (e)  A person who operates a motor vehicle in violation of
  51-14  Subsection (b) commits an offense.  An offense under this section
  51-15  is a Class C misdemeanor, except that if a person has been
  51-16  convicted of an offense under this section, a subsequent offense is
  51-17  a Class B misdemeanor.
  51-18        Sec. 49.218.  Acquisition of Property.  (a)  A district or a
  51-19  water supply corporation may acquire land, materials, waste
  51-20  grounds, easements, rights-of-way, equipment, contract or permit
  51-21  rights or interests, and other property, real or personal,
  51-22  considered necessary for the purpose of accomplishing any one or
  51-23  more of the district's or water supply corporation's purposes
  51-24  provided in this code or in any other law.
  51-25        (b)  A district or water supply corporation shall have the
   52-1  right to acquire property by gift, grant, or purchase, and the
   52-2  right to acquire property shall include property considered
   52-3  necessary for the construction, improvement, extension,
   52-4  enlargement, operation, or maintenance of the plants, works,
   52-5  improvements, facilities, equipment, or appliances of a district or
   52-6  a water supply corporation.
   52-7        (c)  A district or water supply corporation may acquire
   52-8  either the fee simple title to or an easement on all land, both
   52-9  public and private, either inside or outside its boundaries and may
  52-10  acquire the title to or an easement on property other than land
  52-11  held in fee.
  52-12        (d)  A district or water supply corporation may also lease
  52-13  property from others for its use on such terms and conditions as
  52-14  the board of the district or the board of directors of the water
  52-15  supply corporation may determine to be advantageous.
  52-16        Sec. 49.219.  ACQUISITION OF EXISTING FACILITIES.  Any
  52-17  district may acquire by agreement all or any part of existing
  52-18  water, sanitary sewer, or drainage systems of any water supply
  52-19  corporation, including works, improvements, facilities, plants,
  52-20  equipment, appliances, contract rights, and other assets and rights
  52-21  that are completed, partially completed, or under construction, and
  52-22  in connection therewith a district may assume all or any part of
  52-23  the contracts, indebtedness, or obligations of the corporation
  52-24  related to said systems, including any contracts, indebtedness, or
  52-25  obligations related to or payable from the revenues of said
   53-1  systems, and may perform all or any part of the obligations of said
   53-2  corporation in the same manner and to the same extent that any
   53-3  other purchaser or assignee could be bound on any such contracts,
   53-4  indebtedness, or obligations.  Before assuming any indebtedness or
   53-5  obligations of such corporation related to any such system, a
   53-6  district other than a special water authority shall obtain the
   53-7  approval of the commission of such assumption.
   53-8        Sec. 49.220.  Right to Use Existing RightS-of-Way.  All
   53-9  districts or water supply corporations are given rights-of-way
  53-10  within, along, under, and across all public, state, county, city,
  53-11  town, or village roads, highways, and rights-of-way and other
  53-12  public rights-of-way without the requirement for surety bond or
  53-13  security.
  53-14        Sec. 49.221.  Right to Enter Land.  (a)  The directors,
  53-15  engineers, attorneys, agents, operators, and employees of a
  53-16  district or water supply corporation may go on any land to inspect,
  53-17  make surveys, or perform tests to determine the condition, value,
  53-18  and usability of the property, with reference to the proposed
  53-19  location of works, improvements, plants, facilities, equipment, or
  53-20  appliances.  The cost of restoration shall be borne by the district
  53-21  or the water supply corporation.
  53-22        (b)  District employees and agents are entitled to enter any
  53-23  public or private property within the boundaries of the district or
  53-24  adjacent to any reservoir or other property owned by the district
  53-25  at any reasonable time for the purpose of inspecting and
   54-1  investigating conditions relating to the quality of water in the
   54-2  state or the compliance with any rule, regulation, permit, or other
   54-3  order of the district.  District employees or agents acting under
   54-4  this authority who enter private property shall observe the
   54-5  establishment's rules and regulations concerning safety, internal
   54-6  security, and fire protection and shall notify any occupant or
   54-7  management of their presence and shall exhibit proper credentials.
   54-8        Sec. 49.222.  Eminent Domain.  (a)  A district or water
   54-9  supply corporation may acquire by condemnation any land, easements,
  54-10  or other property inside or outside the district boundaries or the
  54-11  boundaries of the certificated service area for a water supply
  54-12  corporation, necessary for water, sanitary sewer, storm drainage,
  54-13  or flood drainage or control purposes or for any other of its
  54-14  projects or purposes, and may elect to condemn either the fee
  54-15  simple title or a lesser property interest.
  54-16        (b)  The right of eminent domain shall be exercised in the
  54-17  manner provided in Chapter 21, Property Code, except that a
  54-18  district or a water supply corporation shall not be required to
  54-19  give bond for appeal or bond for costs in any condemnation suit or
  54-20  other suit to which it is a party and shall not be required to
  54-21  deposit more than the amount of any award in any suit.
  54-22        (c)  The power of eminent domain may not be used for the
  54-23  condemnation of land for the purpose of acquiring rights to
  54-24  underground water or of water or water rights.
  54-25        Sec. 49.223.  Costs of Relocation of Property.  (a)  In the
   55-1  event that the district or the water supply corporation, in the
   55-2  exercise of the power of eminent domain or power of relocation or
   55-3  any other power makes necessary the relocation, raising, lowering,
   55-4  rerouting, or change in grade of or alteration in construction of
   55-5  any road, bridge, highway, railroad, electric transmission line,
   55-6  telegraph, or telephone properties, facilities, or pipelines, all
   55-7  necessary relocations, raising, lowering, rerouting, or change in
   55-8  grade or alteration of construction shall be done at the sole
   55-9  expense of the district or the water supply corporation unless
  55-10  otherwise agreed to in writing.  Such relocation shall be
  55-11  accomplished in a timely manner so that the project of the district
  55-12  or the water supply corporation is not delayed.
  55-13        (b)  "Sole expense" means the actual cost of the relocation,
  55-14  raising, lowering, rerouting, or change in grade or alteration of
  55-15  construction and providing comparable replacement without enhancing
  55-16  the facilities after deducting from it the net salvage value
  55-17  derived from the old facility.
  55-18        Sec. 49.224.  POWER TO CONDEMN CEMETERIES.  (a)  The use of
  55-19  land for the construction of district dams and creation of lakes
  55-20  and reservoirs for the purpose of conservation and development of
  55-21  the natural resources of this state is hereby declared to be
  55-22  superior to all other uses, and for these purposes only a district
  55-23  has the power of eminent domain to acquire land, improvements, and
  55-24  other property owned and held for cemeteries or burial places
  55-25  necessary for the construction of a dam or that lies inside the
   56-1  area to be covered by the lake or reservoir or within 300 feet of
   56-2  the high water line of the lake or reservoir.
   56-3        (b)  Except as otherwise provided by this subchapter, the
   56-4  procedure in condemnation proceedings is governed by Chapter 21,
   56-5  Property Code.
   56-6        (c)  Notice shall be served on the title owner of the land on
   56-7  which the cemetery is situated as provided in Chapter 21, Property
   56-8  Code.  General notice to persons having relatives interred in the
   56-9  cemetery shall be given by publication for two consecutive weeks in
  56-10  a newspaper circulated in the county in which the cemetery is
  56-11  situated.
  56-12        (d)  The measure of damages in these eminent domain
  56-13  proceedings shall be assessed as in other condemnation cases.  An
  56-14  additional amount of damages shall be assessed to cover the cost of
  56-15  removing and reinterring the bodies interred in the cemetery or
  56-16  burial place and the cost of removing and resetting the monuments
  56-17  or markers erected at the graves.
  56-18        (e)  The additional assessment shall be deposited in the
  56-19  registry of the county court and disbursed only for the purpose of
  56-20  removing and reinterring the bodies in other cemeteries in Texas
  56-21  agreed on between the district and the relatives of the deceased
  56-22  persons.
  56-23        (f)  If in any case the district and the relatives of a
  56-24  deceased person cannot agree within 30 days on a cemetery for
  56-25  reinterment, or no relatives appear within that time, then the
   57-1  county judge shall designate the cemetery for reinterment.
   57-2        (g)  Instead of depositing the additional assessment in the
   57-3  registry of the court, the district may execute a bond sufficient
   57-4  to cover costs of removing and reinterring the bodies.  The bond
   57-5  shall be payable to and approved by the county judge and
   57-6  conditioned that the bodies will be removed and reinterred as
   57-7  provided by this section.
   57-8        Sec. 49.225.  Leases.  A district may lease any of its
   57-9  property, real or personal, to any person.  The lease may contain
  57-10  the terms and provisions that the board determines to be
  57-11  advantageous to the district.
  57-12        Sec. 49.226.  Sale or Exchange of Surplus Land or Personal
  57-13  Property.  (a)  Any land, interest in land, or personal property
  57-14  owned by the district which is found by the board to be surplus and
  57-15  is not needed by the district may be sold under order of the board
  57-16  either by public or private sale, or the land, interest in land, or
  57-17  personal property may be exchanged for other land, interest in
  57-18  land, or personal property needed by the district.  Except as
  57-19  provided in Subsection (b), land, interest in land, or personal
  57-20  property must be exchanged for like fair market value, which value
  57-21  may be determined by the district.
  57-22        (b)  Any property dedicated to or acquired by the district
  57-23  without expending district funds may be abandoned or released to
  57-24  the original grantor, the grantor's heirs, assigns, executors, or
  57-25  successors upon terms and conditions deemed necessary or
   58-1  advantageous to the district and without receiving compensation for
   58-2  such abandonment or release.  District property may also be
   58-3  abandoned, released, exchanged, or transferred to another district,
   58-4  municipality, county, countywide agency, or authority upon terms
   58-5  and conditions deemed necessary or advantageous to the district.
   58-6  Narrow strips of property resulting from boundary or surveying
   58-7  conflicts or similar causes, or from insubstantial encroachments by
   58-8  abutting property owners, may be abandoned, released, exchanged, or
   58-9  transferred to such abutting owners upon terms and conditions
  58-10  deemed necessary or advantageous to the district.  Chapter 272,
  58-11  Local Government Code, shall not apply to this subsection.
  58-12        (c)  Before either a public or a private sale of real
  58-13  property not required by the district, the district shall give
  58-14  notice of the intent to sell by publishing notice once a week for
  58-15  two consecutive weeks in one or more newspapers with general
  58-16  circulation in the district.
  58-17        (d)  If the district has outstanding bonds secured by a
  58-18  pledge of tax revenues, the proceeds of the sale of property not
  58-19  required by the district shall be applied to retire outstanding
  58-20  bonds of the district when required by the district's applicable
  58-21  bond resolutions.
  58-22        (e)  If the district does not have any outstanding bonds, the
  58-23  proceeds derived from the sale of the personal property or land not
  58-24  required by the district may be used for any lawful purpose.
  58-25        Sec. 49.227.  Authority to Act Jointly.  A district or water
   59-1  supply corporation may act jointly with any other person or entity,
   59-2  private or public, whether within the State of Texas or the United
   59-3  States, in the performance of any of the powers and duties
   59-4  permitted by this code or any other laws.
   59-5        Sec. 49.228.  Damage to Property.  A person who wilfully
   59-6  destroys, defaces, damages, or interferes with district or water
   59-7  supply corporation property is guilty of a Class B misdemeanor.
   59-8        Sec. 49.229.  Grants and Gifts.  A district may accept
   59-9  grants, gratuities, advances, and loans in any form from any source
  59-10  approved by the board, including any governmental entity, any
  59-11  private or public corporation, and any other person and may make
  59-12  and enter into contracts, agreements, and covenants the board
  59-13  considers appropriate in connection with acceptance of grants,
  59-14  gratuities, advances, and loans.
  59-15        Sec. 49.230.  Area-Wide Wastewater Treatment.  The powers and
  59-16  duties conferred on the district are granted subject to the policy
  59-17  of the state to encourage the development and use of integrated
  59-18  area-wide wastewater collection, treatment, and disposal systems to
  59-19  serve the wastewater disposal needs of the citizens of the state
  59-20  whenever economically feasible and competitive to do so, it being
  59-21  an objective of the policy to avoid the economic burden to the
  59-22  people and the impact on the quality of the water in the state that
  59-23  result from the construction and operation of numerous small
  59-24  wastewater collection, treatment, and disposal facilities to serve
  59-25  an area when an integrated area-wide wastewater collection,
   60-1  treatment, and disposal system for the area can be reasonably
   60-2  provided.
   60-3        Sec. 49.231.  STANDBY FEES.  (a)  In this section:
   60-4              (1)  "Standby fee" means a charge, other than a tax,
   60-5  imposed on undeveloped property for the availability of potable
   60-6  water, sanitary sewer, or drainage facilities and services.
   60-7              (2)  "Undeveloped property" means a tract, lot, or
   60-8  reserve in the district to which no potable water, sanitary sewer,
   60-9  or drainage connections have been made for which:
  60-10                    (A)  water, sanitary sewer, or drainage
  60-11  facilities and services are available;
  60-12                    (B)  water supply, wastewater treatment plant
  60-13  capacity, or drainage capacity sufficient to serve the property is
  60-14  available; or
  60-15                    (C)  major water supply lines, wastewater
  60-16  collection lines, or drainage facilities with capacity sufficient
  60-17  to serve the property are available.
  60-18        (b)  A district that proposes to provide or actually provides
  60-19  retail potable water or sewer utility services, or drainage
  60-20  services as the principal function of the district, may, with the
  60-21  approval of the commission, adopt and impose on the owners of
  60-22  undeveloped property in the district a standby fee in addition to
  60-23  taxes levied by the district.  A district may not impose a standby
  60-24  fee for debt service purposes on undeveloped property unless the
  60-25  facilities and services available to the property have been
   61-1  financed by the district; however, a district may impose a standby
   61-2  fee for operating and maintaining facilities that it has not
   61-3  financed.  The district may impose standby fees in different
   61-4  amounts to fairly reflect the level and type of services and
   61-5  facilities available to serve different property.  The intent of
   61-6  the standby fee is to distribute a fair portion of the cost burden
   61-7  for operating and maintaining the facilities and for financing
   61-8  capital costs of the facilities to owners of property who have not
   61-9  constructed improvements but have potable water, sewer, or drainage
  61-10  capacity available.  Any revenues collected from the standby fees
  61-11  shall be used to pay operation and maintenance expenses, to pay
  61-12  debt service on the bonds, or both.
  61-13        (c)  If a district described in Subsection (b) desires to
  61-14  adopt and impose a standby fee, the district shall submit to the
  61-15  commission an application for authority to adopt and impose the
  61-16  standby fee.  The application must describe the tracts of
  61-17  undeveloped property in the district and state the amount of the
  61-18  proposed fee.
  61-19        (d)  The executive director shall examine an application
  61-20  submitted under Subsection (c) and shall investigate the financial
  61-21  condition of the district, including the district's assets,
  61-22  liabilities, sources of revenue, level of utility service rates,
  61-23  and level of debt service and maintenance tax rates.  On the
  61-24  request of the executive director, the district shall submit any
  61-25  information the executive director considers relevant to the
   62-1  examination and investigation.  The executive director shall
   62-2  prepare a written report on the application and the district's
   62-3  financial condition, retain a copy of the report, and send a copy
   62-4  of the report to the commission and the district.
   62-5        (e)  The commission shall hold a hearing on an application
   62-6  submitted under Subsection (c).  Notice of the hearing shall be
   62-7  published in a newspaper of general circulation in the county or
   62-8  counties in which the district is located once a week for two
   62-9  consecutive weeks.  The first publication must occur not later than
  62-10  the 30th day before the date of the hearing.  The district shall
  62-11  send, not later than the 30th day before the date of the hearing,
  62-12  notice of the hearing by certified mail, return receipt requested,
  62-13  to each owner of undeveloped property in the district.  On the date
  62-14  the application is filed, the district's tax assessor and collector
  62-15  shall certify to the district the names of the persons owning
  62-16  undeveloped land in the district as reflected by the most recent
  62-17  certified tax roll of the district.  Notice of the hearing must be
  62-18  sent by certified mail, return receipt requested, to each mortgagee
  62-19  of record that has submitted a written request to be informed of
  62-20  any hearings.  To be effective, the written request must be
  62-21  received by the district not later than the 60th day before the
  62-22  date of the hearing.  The written request for notice must include
  62-23  the name and address of the mortgagee, the name of the property
  62-24  owner in the district, and a brief property description.
  62-25        (f)  The commission shall consider the application, the
   63-1  report of the executive director, and any other evidence allowed by
   63-2  commission rule.  The commission may approve the application only
   63-3  if the commission finds that the fee is necessary to maintain the
   63-4  financial integrity and stability of the district and fairly
   63-5  allocates the costs of district facilities and services among
   63-6  property owners of the district.
   63-7        (g)  After a hearing on an application under Subsection (e),
   63-8  the commission shall issue an order approving or disapproving the
   63-9  application.  The commission shall retain a copy of the order and
  63-10  send a copy of the order to the district.
  63-11        (h)  The commission may approve the adoption and imposition
  63-12  of the standby fee for a period of not more than three years.  The
  63-13  imposition of a standby fee may be renewed for additional periods
  63-14  of not more than three years each in the same manner provided in
  63-15  this section for initial approval of the standby fee.
  63-16        (i)  If approved by the commission, the board by resolution
  63-17  or order may impose an annual standby fee on undeveloped land in
  63-18  the district.
  63-19        (j)  The board may:
  63-20              (1)  charge interest, at the rate of one percent a
  63-21  month, on a standby fee not paid in a timely manner in accordance
  63-22  with the resolution or order imposing the standby fee; and
  63-23              (2)  refuse to provide potable water, sanitary sewer,
  63-24  or drainage service to the property for which the fee was assessed
  63-25  until all delinquent standby fees on the property and interest on
   64-1  those fees are fully paid.
   64-2        (k)  A standby fee imposed under this section is a personal
   64-3  obligation of the person owning the undeveloped property on January
   64-4  1 of the year for which the fee is assessed.  A person is not
   64-5  relieved of the obligation on transfer of title to the property.
   64-6  On January 1 of each year, a lien attaches to undeveloped property
   64-7  to secure payment of any standby fee imposed under this section and
   64-8  the interest, if any, on the fee.  The lien has the same priority
   64-9  as a lien for taxes of the district.
  64-10        (l)  If a standby fee imposed under this section is not paid
  64-11  in a timely manner, a district may file suit to foreclose the lien
  64-12  securing payment of the fee and interest or to enforce the personal
  64-13  obligation for the fee and interest, or both.  The district may
  64-14  recover, in addition to the fee and interest, reasonable costs,
  64-15  including attorney's fees, incurred by the district in enforcing
  64-16  the lien or obligation not to exceed 20 percent of the delinquent
  64-17  fee and interest.  A suit authorized by this subsection must be
  64-18  filed not later than the fourth anniversary of the date the fee
  64-19  became due.  A fee delinquent for more than four years and interest
  64-20  on the fee are considered paid unless a suit is filed before the
  64-21  expiration of the four-year period.
  64-22        (m)  Chapter 395, Local Government Code, does not apply to a
  64-23  standby fee imposed under this section.
  64-24        (n)  For purposes of title insurance policies issued under
  64-25  the authority of Chapter 9, Insurance Code, standby fees are
   65-1  considered taxes.
   65-2        Sec. 49.232.  LABORATORY SERVICES.  A district may contract
   65-3  with any person, within or without the boundaries of the district,
   65-4  to provide or receive laboratory services related to environmental,
   65-5  health, or drinking water testing.
   65-6          (Sections 49.233 to 49.270 reserved for expansion
   65-7                 SUBCHAPTER I.  CONSTRUCTION CONTRACTS
   65-8        Sec. 49.271.  CONTRACTS FOR CONSTRUCTION WORK.  (a)  Any
   65-9  contract made by the board for construction work shall conform to
  65-10  the provisions of this chapter.
  65-11        (b)  The contract shall contain, incorporate by reference, or
  65-12  have attached to it the specifications, plans, and details for work
  65-13  included in the contract.  All work shall be done in accordance
  65-14  with these plans and specifications and any authorized change
  65-15  orders under the supervision of the board or its designee.
  65-16        (c)  The district may adopt minimum criteria for the
  65-17  qualifications of bidders on its construction contracts and for
  65-18  sureties issuing payment and performance bonds.  For contracts over
  65-19  $25,000, the district shall require a person who bids to submit a
  65-20  certified or cashier's check on a responsible bank in the state
  65-21  equal to at least two percent of the total amount of the bid, or a
  65-22  bid bond of at least two percent of the total amount of the bid
  65-23  issued by a surety legally authorized to do business in this state,
  65-24  as a good faith deposit to ensure execution of the contract.  If
  65-25  the successful bidder fails or refuses to enter into a proper
   66-1  contract with the district, or fails or refuses to furnish the bond
   66-2  required by law, the bidder forfeits the deposit.
   66-3        (d)  The district may also require attendance by a principal
   66-4  of each prospective bidder at mandatory pre-bid conferences and may
   66-5  make any reasonable additional requirements regarding the taking of
   66-6  bids the district may deem appropriate in order to obtain
   66-7  competitive bids from responsible contractors and to minimize
   66-8  contract disputes.
   66-9        Sec. 49.272.  REPORTS FURNISHED TO PROSPECTIVE BIDDERS.  The
  66-10  board shall furnish to any person who desires to bid on
  66-11  construction work, and who makes a request in writing, a copy of
  66-12  the engineer's report or plans and specifications showing the
  66-13  details of the work to be done.  The board may charge for each copy
  66-14  of the engineer's report or plans and specifications an amount
  66-15  sufficient to cover the cost of making the copy.
  66-16        Sec. 49.273.  CONSTRUCTION CONTRACT AWARD.  (a)  The board
  66-17  shall contract for construction in accordance with this section.
  66-18  The bidding documents, plans, specifications, and other data needed
  66-19  to bid on the project must be available at the time of the first
  66-20  advertisement and the advertisement shall state the location at
  66-21  which these documents may be reviewed.
  66-22        (b)  A construction contract may cover all the work to be
  66-23  provided by the district or the various elements of the work may be
  66-24  segregated for the purpose of receiving bids and awarding
  66-25  contracts.  A contract may provide that the work will be
   67-1  constructed in stages over a period of years.
   67-2        (c)  A construction contract may provide for the payment of a
   67-3  total sum that is the completed cost of the work or may be based on
   67-4  bids to cover cost of units of the various elements entering into
   67-5  the work as estimated and approximately specified by the district's
   67-6  engineers, or a contract may be let and awarded in any other form
   67-7  or composite of forms and to any responsible person or persons
   67-8  that, in the board's judgment, will be most advantageous to the
   67-9  district and result in the best and most economical completion of
  67-10  the district's proposed plants, improvements, facilities, works,
  67-11  equipment, and appliances.
  67-12        (d)  For construction contracts for $25,000 or more, the
  67-13  board shall advertise the letting of the contract, including the
  67-14  general conditions, time, and place of opening of sealed bids.  The
  67-15  notice shall be published in one or more newspapers circulated in
  67-16  each county in which part of the district is located.  If one
  67-17  newspaper meets both of these requirements, publication in such
  67-18  newspaper is sufficient.  If there are more than four counties in
  67-19  the district, notice may be published in any newspaper with general
  67-20  circulation in the district.  The notice shall be published once a
  67-21  week for three consecutive weeks before the date that the bids are
  67-22  opened, and the first publication shall be not later than the 21st
  67-23  day before the date of the opening of the sealed bids.
  67-24        (e)  For construction contracts for $15,000 or more but less
  67-25  than $25,000, the board shall solicit written competitive bids on
   68-1  uniform written specifications from at least three bidders.
   68-2        (f)  For construction contracts of less than $15,000, the
   68-3  board is not required to advertise or seek competitive bids.
   68-4        (g)  The board may not subdivide work to avoid the
   68-5  advertising requirements specified in this section.
   68-6        (h)  The board may not accept bids that include substituted
   68-7  items unless the substituted items were included in the original
   68-8  bid proposal and all bidders had the opportunity to bid on the
   68-9  substituted items or unless notice is given to all bidders at a
  68-10  mandatory pre-bid conference.
  68-11        (i)  Change orders to contracts may be issued only as a
  68-12  result of unanticipated conditions encountered during construction
  68-13  or changes in regulatory criteria or to facilitate project
  68-14  coordination with other political entities.
  68-15        (j)  The provisions of this subchapter do not apply to
  68-16  contracts for personal or professional services or for a utility
  68-17  service operator or to contracts made by a district engaged in the
  68-18  distribution and sale of electric energy to the public.
  68-19        (k)  The provisions of this subchapter do not apply to high
  68-20  technology procurements.  The provisions of Sections 252.021(a) and
  68-21  252.042, Local Government Code, shall apply to high technology
  68-22  procurements.
  68-23        Sec. 49.274.  EMERGENCY APPROVAL OF DISTRICT PROJECTS.  If a
  68-24  district experiences an emergency condition that may create a
  68-25  serious health hazard or unreasonable economic loss to the district
   69-1  that requires immediate corrective action, the district may
   69-2  negotiate limited duration contracts to make the necessary repairs.
   69-3  The district shall submit to the executive director details
   69-4  describing the specific serious health hazard or unreasonable
   69-5  economic loss as soon as practicable following the issuance of the
   69-6  contracts.  Whenever possible, the district should obtain prior
   69-7  approval of the executive director before authorizing the contract,
   69-8  but failure to obtain prior approval shall not void the contract.
   69-9  This section does not apply to special water authorities.
  69-10        Sec. 49.275.  CONTRACTOR'S BOND.  Any person, firm,
  69-11  partnership, or corporation to whom a contract is let must give
  69-12  good and sufficient performance and payment bonds in accordance
  69-13  with Chapter 2253, Government Code, and any minimum criteria for
  69-14  sureties issuing such bonds adopted by a district in accordance
  69-15  with Section 49.271.
  69-16        Sec. 49.276.  PAYMENT FOR CONSTRUCTION WORK.  (a)  The
  69-17  district shall pay the contract price of construction contracts
  69-18  only as provided in this section.
  69-19        (b)  The district will make progress payments under
  69-20  construction contracts monthly as the work proceeds, or at more
  69-21  frequent intervals as determined by the board or its designee, on
  69-22  estimates approved by the board or its designee.
  69-23        (c)  If requested by the district or district engineer, the
  69-24  contractor shall furnish a breakdown of the total contract price
  69-25  showing the amount included for each principal category of the
   70-1  work, in such detail as requested, to provide a basis for
   70-2  determining progress payments.  In the preparation of estimates,
   70-3  the district engineer may authorize material delivered on the site
   70-4  and preparatory work done to be considered if the consideration is
   70-5  specifically authorized by the contract and if the contractor
   70-6  furnishes satisfactory evidence that he has acquired title to the
   70-7  material and that it will be utilized on the work covered by the
   70-8  contract.
   70-9        (d)  In making progress payments, 10 percent of the estimated
  70-10  amount shall be retained until final completion and acceptance of
  70-11  the contract work.  However, if the board at any time after 50
  70-12  percent of the work has been completed finds that satisfactory
  70-13  progress is being made, it may authorize any of the remaining
  70-14  progress payments to be made in full.  Also, if the work is
  70-15  substantially complete, the board, if it finds the amount retained
  70-16  to be in excess of the amount adequate for the protection of the
  70-17  district, at its discretion may release to the contractor all or a
  70-18  portion of the excess amount.  The district is not obligated to pay
  70-19  interest on amounts retained except as provided herein.  The
  70-20  district shall not be obligated to pay any interest on the 10
  70-21  percent retainage held on the first 50 percent of work completed.
  70-22  If the district holds any retainage on the remaining 50 percent of
  70-23  the work completed, the district shall pay interest on such
  70-24  retainage from the date the retainage is withheld to the date of
  70-25  payment to the contractor.  The interest rate to be paid on such
   71-1  retainage shall be the rate of interest paid by the district's
   71-2  depository bank on interest bearing accounts of similar amounts
   71-3  during the period of time interest accrues as provided herein.
   71-4        (e)  On completion and acceptance of each separate project,
   71-5  public work, or other division of the contract, on which the price
   71-6  is stated separately in the contract, payment may be made without
   71-7  retention of a percentage.
   71-8        Sec. 49.277.  INSPECTION OF AND REPORTS ON CONSTRUCTION WORK.
   71-9  (a)  The board shall have control of construction work being done
  71-10  for the district under contract to determine whether or not the
  71-11  contract is being fulfilled and shall have the construction work
  71-12  inspected by the district engineer or other designated person.
  71-13        (b)  During the progress of the construction work, the
  71-14  district engineer or other designated person shall submit to the
  71-15  board detailed written reports showing whether or not the
  71-16  contractor is complying with the contract, and when the work is
  71-17  completed the district engineer shall submit to the board a final
  71-18  detailed report including as-built plans of the facilities showing
  71-19  whether or not the contractor has fully complied with the contract.
  71-20          (Sections 49.278 to 49.300 reserved for expansion
  71-21            SUBCHAPTER J.  ANNEXATION OR EXCLUSION OF LAND
  71-22        Sec. 49.301.  ADDING LAND BY PETITION OF LANDOWNER.  (a)  In
  71-23  addition to any other provision provided by law, the owner or
  71-24  owners of land whether or not contiguous to the district or
  71-25  otherwise may file with the board a petition requesting that there
   72-1  be included in the district the land described in the petition by
   72-2  metes and bounds or by lot and block number if there is a recorded
   72-3  plat of the area to be included in the district.  The petition may
   72-4  request the district to condition the annexation on certain
   72-5  conditions, including the voter authorization of bonds to serve the
   72-6  area to be annexed.
   72-7        (b)  If the district has bonds, notes, or other obligations
   72-8  outstanding or bonds payable in whole or in part from taxes that
   72-9  have been voted but are unissued, the board may require the
  72-10  petitioner or petitioners to assume their share of the outstanding
  72-11  bonds, notes, or other obligations and the voted but unissued tax
  72-12  bonds of the district and authorize the board to levy a tax on
  72-13  their property in each year while any of the bonds, notes, or other
  72-14  obligations payable in whole or in part from taxation are
  72-15  outstanding to pay their share of the indebtedness.
  72-16        (c)  The petition of the landowner to add land to the
  72-17  district shall be signed and executed in the manner provided by law
  72-18  for the conveyance of real estate.
  72-19        (d)  The board shall hear and consider the petition and may
  72-20  add to the district the land described in the petition if it is
  72-21  feasible, practicable, and to the advantage of the district and if
  72-22  the district's system and other improvements of the district are
  72-23  sufficient or will be sufficient to supply the added land without
  72-24  injuring land already in the district.
  72-25        (e)  If the district has bonds payable in whole or in part
   73-1  from taxation that are voted but unissued at the time of an
   73-2  annexation and the petitioners assume the bonds and authorize the
   73-3  district to levy a tax on their property to pay the bonds, then the
   73-4  board may issue the voted but unissued bonds even though the
   73-5  boundaries of the district have been altered since the
   73-6  authorization of the bonds.
   73-7        (f)  Granted petitions shall be filed for record and shall be
   73-8  recorded in the office of the county clerk of the county or
   73-9  counties in which the added land is located.
  73-10        Sec. 49.302.  ADDING LAND BY PETITION OF LESS THAN ALL THE
  73-11  LANDOWNERS.  (a)  In addition to the method of adding land to a
  73-12  district described in Section 49.301, defined areas of land,
  73-13  whether or not they are contiguous to the district, may be annexed
  73-14  to the district in the manner set forth in this section.
  73-15        (b)  A petition requesting the annexation of a defined area
  73-16  signed by a majority in value of the owners of land in the defined
  73-17  area, as shown by the tax rolls of the county or counties in which
  73-18  such area is located, or signed by 50 landowners if the number of
  73-19  landowners is more than 50, shall describe the land by metes and
  73-20  bounds or by lot and block number if there is a recorded plat of
  73-21  the area and shall be filed with the secretary of the board.
  73-22        (c)  It shall be the duty of the board to pass an order
  73-23  fixing a time and place at which the petition for annexation shall
  73-24  be heard that shall not be less than 30 days from the day of the
  73-25  order calling the hearing.
   74-1        (d)  The secretary of the board shall issue a notice setting
   74-2  forth the time and place of the hearing and describing the area
   74-3  proposed to be annexed.  Notice of the hearing shall be given by
   74-4  posting copies of the notice in three public places in the district
   74-5  and in one public place in the area proposed to be annexed for at
   74-6  least 14 days before the day of the hearing and by publishing a
   74-7  copy of the notice in a newspaper of general circulation in the
   74-8  county or counties in which the area proposed to be annexed is
   74-9  located one time at least 14 days before the day of the hearing.
  74-10        (e)  If upon the hearing of the petition it is found by the
  74-11  board that the proposed annexation of the area to the district is
  74-12  feasible, practicable, and to the advantage of the district and if
  74-13  the district's system and other improvements of the district are
  74-14  sufficient or will be sufficient to supply the added land without
  74-15  injuring land already in the district, then the board, by order
  74-16  entered in its minutes, may receive the proposed area as an
  74-17  addition to and to become a part of the district.  The order adding
  74-18  the proposed territory to the district need not include all of the
  74-19  land described in the petition if at the hearing a modification or
  74-20  change is found necessary or desirable by the board.
  74-21        (f)  A copy of the order annexing land to the district,
  74-22  signed by a majority of the members of the board and attested by
  74-23  the secretary of the board, shall be filed and recorded in the deed
  74-24  records of the county or counties in which the district is located
  74-25  if the land is finally annexed to the district.
   75-1        (g)  After the order is recorded the area shall be a
   75-2  component part of the district.
   75-3        (h)  The annexed area shall bear its pro rata share of all
   75-4  bonds, notes, or other obligations or taxes that may be owed,
   75-5  contracted, or authorized by the district to which it has been
   75-6  added.
   75-7        (i)  Before the added area shall be subject to all or any
   75-8  part of the bonds, notes, obligations, or taxes created before the
   75-9  annexation of the area to the district, the board shall order an
  75-10  election to be held in the district, as enlarged by reason of the
  75-11  annexation of the area, on the question of the assumption of the
  75-12  bonds, notes, obligations, and taxes by the annexed area.
  75-13        (j)  At the same election, the board may also submit a
  75-14  proposition on the question of whether the annexed area should
  75-15  assume its part of the bonds of the district payable in whole or in
  75-16  part from taxes that have been voted previously but not yet issued
  75-17  or sold and the levy of an ad valorem tax on all taxable property
  75-18  within the area annexed along with a tax on the rest of the
  75-19  district for the payment of the bonds.
  75-20        (k)  If the election results favorably, the district shall be
  75-21  authorized to issue its voted but unissued tax bonds even though
  75-22  the boundaries of the district have been changed since the original
  75-23  election approving the bonds.
  75-24        (l)  At the election called for the purpose of determining
  75-25  whether the annexed area shall assume the bonds, notes, or other
   76-1  obligations or taxes of the district, the board in a separate
   76-2  proposition may also submit the question of whether the board
   76-3  should be authorized to issue bonds payable in whole or in part
   76-4  from taxes to provide service to the area annexed.
   76-5        (m)  In the event that the district has bonds, notes, or
   76-6  obligations or taxes that may be owed, contracted, or authorized at
   76-7  the time an area is annexed or if the district has voted but
   76-8  unissued bonds payable in whole or in part from taxes at the time
   76-9  of an annexation, the board may provide in its order annexing an
  76-10  area to the district that the annexation will not be complete or
  76-11  final unless the indebtedness, tax or bond, note, or other
  76-12  obligation assumption election results favorably to the assumption
  76-13  of the district's outstanding bonds, notes, or other obligations
  76-14  and voted but unissued bonds.
  76-15        (n)  If the board elects to submit the question of whether
  76-16  the board should be authorized to issue bonds to provide service to
  76-17  the area annexed, the board may also provide in its order annexing
  76-18  an area to the district that the annexation will not be complete
  76-19  unless the election results favorably to the issuance of bonds to
  76-20  serve the annexed area.
  76-21        (o)  Whenever an election is ordered to be held in the
  76-22  district for the purpose of the assumption of bonds, notes, or
  76-23  other obligations or taxes or the assumption of voted but unissued
  76-24  bonds by reason of the annexation of any area, then the election
  76-25  shall be held and notice given as provided for bond elections held
   77-1  by the district.
   77-2        (p)  The district has the same right and duty to furnish
   77-3  service to the annexed land that it previously had to furnish
   77-4  service to other land in the district, and the board shall endeavor
   77-5  to serve all land in the district without discrimination.
   77-6        Sec. 49.303.  EXCLUDING LAND FROM DISTRICT.  (a)  Before a
   77-7  district orders an election for the authorization of bonds payable
   77-8  in whole or in part from taxes, the board may, on its own motion,
   77-9  call a hearing on the question of the exclusion of land from the
  77-10  district under the provisions of this section and Sections 49.304
  77-11  through 49.307, if the exclusions are practicable, just, or
  77-12  desirable.
  77-13        (b)  The board must call a hearing on the exclusion of land
  77-14  or other property from the district on the written petition of any
  77-15  landowner or property owner in the district filed with the
  77-16  secretary of the board before the first election on the question of
  77-17  whether bonds should be issued payable in whole or in part from
  77-18  taxes is ordered.
  77-19        (c)  The board may hold a hearing on the exclusion of land or
  77-20  other property from the district if the district has not issued
  77-21  bonds payable in whole or in part from taxes, and if a landowner or
  77-22  property owner submits a signed petition to the secretary of the
  77-23  board evidencing the consent of the owners of a majority of the
  77-24  acreage proposed to be excluded and a majority of the taxable
  77-25  property in the district, as reflected by the most recent certified
   78-1  tax roll of the district.
   78-2        (d)  A district that has previously held an election at which
   78-3  approval was given for the issuance of bonds payable in whole or in
   78-4  part from taxes may not rely on that election for the issuance of
   78-5  the bonds if after the bond election, but before the bonds are
   78-6  issued, land is excluded from the district as provided by this
   78-7  subchapter.  The board must call and hold another bond election and
   78-8  receive voter approval as provided by this subchapter before
   78-9  issuing those bonds.
  78-10        Sec. 49.304.  HEARING TO ANNOUNCE PROPOSED EXCLUSIONS AND TO
  78-11  RECEIVE PETITIONS.  (a)  If the board determines that an exclusion
  78-12  hearing should be held or if a written petition requesting an
  78-13  exclusion hearing is filed with the secretary of the board as
  78-14  provided in Section 49.303, the board shall give notice of the time
  78-15  and place of a hearing to announce its own conclusions relating to
  78-16  land or other property to be excluded and to receive petitions for
  78-17  exclusion of land or other property.
  78-18        (b)  The board shall publish notice of the hearing once a
  78-19  week for two consecutive weeks in one or more newspapers with
  78-20  general circulation in the district.  The first publication shall
  78-21  appear at least 14 days before the day of the hearing.
  78-22        (c)  The notice shall advise all interested property owners
  78-23  of their right to present petitions for exclusions of land or other
  78-24  property and to offer evidence in support of the petitions and
  78-25  their right to contest any proposed exclusion based on either a
   79-1  petition or the board's own conclusions and to offer evidence in
   79-2  support of the contest.
   79-3        Sec. 49.305.  PETITION.  (a)  A petition for exclusion of
   79-4  land must accurately describe by metes and bounds or lot and block
   79-5  number the land to be excluded.  A petition for exclusion of other
   79-6  property must describe the property to be excluded.
   79-7        (b)  A petition for exclusion shall be filed with the
   79-8  district at least seven days before the hearing and shall state
   79-9  clearly the particular grounds on which the exclusion is sought.
  79-10  Only the stated grounds shall be considered.
  79-11        Sec. 49.306.  GROUNDS FOR EXCLUSION.  Exclusions from the
  79-12  district may be made on the grounds that:
  79-13              (1)  to retain certain land or other property within
  79-14  the district's taxing power would be arbitrary and unnecessary to
  79-15  conserve the public welfare, would impair or destroy the value of
  79-16  the property desired to be excluded, and would constitute the
  79-17  arbitrary imposition of a confiscatory burden;
  79-18              (2)  to retain any given land or other property in the
  79-19  district and to extend to it, either presently or in the future,
  79-20  the benefits, service, or protection of the district's facilities
  79-21  would create an undue and uneconomical burden on the remainder of
  79-22  the district; or
  79-23              (3)  the land desired to be excluded cannot be bettered
  79-24  as to conditions of living and health, provided with water or sewer
  79-25  service, protected from flood, drained, freed from interruption of
   80-1  traffic caused by excess of water on the roads, highways, or other
   80-2  means of transportation serving the land, or otherwise benefited by
   80-3  the district's proposed improvements.
   80-4        Sec. 49.307.  HEARING AND ORDER EXCLUDING LAND.  (a)  The
   80-5  board may adjourn the hearing from one day to another and until all
   80-6  persons desiring to be heard are heard.  The board immediately
   80-7  shall specifically describe all property it proposes to exclude on
   80-8  its own motion and shall hear first any protests and evidence
   80-9  against exclusions proposed on the board's own motion.
  80-10        (b)  After considering all engineering data and other
  80-11  evidence presented to it, the board shall determine whether the
  80-12  facts disclose the affirmative of the propositions stated in
  80-13  Subdivision (1) or (2) or, if appropriate, in Subdivision (3) of
  80-14  Section 49.306.  If the affirmative exists, the board shall enter
  80-15  an order excluding all land or other property falling within the
  80-16  conditions defined by the respective subdivisions and shall
  80-17  redefine in the order the boundaries of the district to embrace all
  80-18  land not excluded.  A copy of the order excluding land and
  80-19  redefining the boundaries of the district shall be filed in the
  80-20  deed records of the county or counties in which the district is
  80-21  situated.
  80-22        Sec. 49.308.  SUIT TO REVIEW EXCLUSION.  (a)  Any person
  80-23  owning an interest in land affected by the order may file a
  80-24  petition within 20 days after the effective date of the order to
  80-25  review, set aside, modify, or suspend the order.
   81-1        (b)  The venue in any action shall be in any district court
   81-2  that has jurisdiction in the county in which the district is
   81-3  located.  If the district includes land in more than one county,
   81-4  the venue shall be in the district court having jurisdiction in the
   81-5  county in which the major portion of the acreage of the land sought
   81-6  to be excluded from the district is located.
   81-7        (c)  A person may appeal from the judgment or order of a
   81-8  district court in a suit brought under the provisions of this
   81-9  section to the court of civil appeals and supreme court as in other
  81-10  civil cases in which the district court has original jurisdiction.
  81-11  The appeal is subject to the statutes and rules of practice and
  81-12  procedure in civil cases.
  81-13        Sec. 49.309.  EXCLUSION OF NONIRRIGATED PROPERTY.  For the
  81-14  purposes of this section and Sections 49.310 through 49.314, the
  81-15  following definitions shall apply:
  81-16              (1)(A)  "Nonirrigated property" means land that:
  81-17                          (i)  is not irrigable;
  81-18                          (ii)  the owners of a majority of the
  81-19  acreage of which no longer intend to irrigate; or
  81-20                          (iii)  has been subdivided into:
  81-21                                         (aa)  town lots, or town
  81-22  lots and blocks, or small parcels of the same general nature as
  81-23  town lots; or
  81-24                                         (bb)  town blocks and lots
  81-25  designed, intended, or suitable for residential, commercial, or
   82-1  other nonagricultural purposes, as distinguished from farm acreage
   82-2  whether subdivided into a subdivision or not; and
   82-3                                         (cc)  including streets,
   82-4  alleys, parkways, parks, and railroad property and rights-of-way
   82-5  located in the subdivided land.
   82-6                    (B)  The property described in Paragraph (A)
   82-7  shall be considered nonirrigated property regardless of whether the
   82-8  land is within or near a municipality and regardless of whether a
   82-9  plat or map of the subdivision has been duly filed for record and
  82-10  recorded in the office of the county clerk of the county in which
  82-11  the land or any part of the land is situated.
  82-12                    (C)  The term does not include land that within
  82-13  the year preceding the date of the hearing under Section 49.310 was
  82-14  used for farming or agricultural purposes.
  82-15              (2)  "District" means a water control and improvement,
  82-16  water improvement, or irrigation district the principal purpose of
  82-17  which is furnishing water for the irrigation of agricultural lands
  82-18  or that is principally engaged in furnishing water for the
  82-19  irrigation of agricultural lands.
  82-20        Sec. 49.310.  AUTHORITY TO EXCLUDE LAND.  (a)  A petition for
  82-21  exclusion may be filed by the owner or owners, or their authorized
  82-22  agent, of a majority in acreage of nonirrigated property included
  82-23  within the boundaries of a district.
  82-24        (b)  Upon receipt of a petition for exclusion, or upon its
  82-25  own motion, a district shall issue an order excluding the property
   83-1  if, after notice and hearing, the board finds that:
   83-2              (1)  the described property is nonirrigated property;
   83-3              (2)  the applicable requirements of Section 49.311 have
   83-4  been satisfied;
   83-5              (3)  the owner or owners do not object to the exclusion
   83-6  of their nonirrigated property; and
   83-7              (4)  it is in the best interest of the district and of
   83-8  the described property to exclude that property from the district.
   83-9        (c)  The district shall follow the notice and hearing
  83-10  provisions and other procedural requirements for excluding
  83-11  territory applicable to that district as set out in Sections 49.303
  83-12  through 49.307.
  83-13        Sec. 49.311.  CONSENT FROM HOLDERS OF INDEBTEDNESS.  If the
  83-14  district has outstanding bonded indebtedness, or indebtedness under
  83-15  a loan from a governmental agency, a written consent from an
  83-16  authorized representative of the holder or holders of the
  83-17  indebtedness consenting to the exclusion shall be obtained and
  83-18  filed with the district before the hearing.
  83-19        Sec. 49.312.  RESULTS OF EXCLUSION.  (a)  Upon issuance of an
  83-20  order excluding property, that property is no longer a part of the
  83-21  district and is not entitled to water service from the district.
  83-22        (b)  Any taxes, assessments, or other charges owed to the
  83-23  district at the time of exclusion remain the obligation of the
  83-24  owner of the  excluded property and continue to be secured by
  83-25  statutory liens on the property, if any.
   84-1        (c)  Once excluded, the landowner has no further liability to
   84-2  the district for future taxes, assessments, or other charges of the
   84-3  district.
   84-4        (d)  A copy of the order excluding the property from the
   84-5  district certified and acknowledged by the secretary of the board
   84-6  shall be recorded by the district in the real property records of
   84-7  the county in which the excluded property is located as evidence of
   84-8  the exclusion.
   84-9        Sec. 49.313.  DISTRICT FACILITIES ON EXCLUDED PROPERTY.  If
  84-10  any canals, ditches, pipelines, pumps, or other facilities of the
  84-11  district are located on lands excluded by the resolution of the
  84-12  board, the exclusion does not affect or interfere with any rights
  84-13  that the district has to maintain and continue operation of the
  84-14  facilities as located for the purpose of servicing lands remaining
  84-15  in the district.
  84-16        Sec. 49.314.  WATER ALLOCATIONS.  (a)  After the district
  84-17  adopts an order excluding nonirrigated property, a city or other
  84-18  water supply corporation that serves the excluded land with a
  84-19  potable water supply may petition the district to apply to the
  84-20  commission to convert the proportionate irrigation water allocation
  84-21  of the land excluded as nonirrigated property, as determined by the
  84-22  district, from irrigation use to municipal use allocation.
  84-23        (b)  The district shall make such application to the
  84-24  commission within 30 days of the filing of a petition by the city
  84-25  or water supply corporation that serves the land with a potable
   85-1  water supply, provided the city or other water supply corporation
   85-2  pays the district the amount the district estimates will be its
   85-3  reasonable expenses and attorney's fees incurred in the commission
   85-4  conversion proceedings and enters into an agreement with the
   85-5  district setting forth the basis on which the water allocation
   85-6  shall be delivered, or made available, to the city or water supply
   85-7  corporation covering such terms as the entities may agree to, and
   85-8  in the event the parties cannot agree, such dispute shall not be
   85-9  subject to the jurisdiction of the commission, or its successors,
  85-10  under this code but subject to resolution through alternative
  85-11  dispute resolution.  In such commission proceeding, the city or
  85-12  water supply corporation shall provide evidence to the commission
  85-13  of the current or projected need within a five year period for the
  85-14  municipal-use water allocation after such conversion as a condition
  85-15  of such conversion of use of the district's water rights from
  85-16  irrigation use to municipal use.
  85-17          (Sections 49.315 to 49.320 reserved for expansion
  85-18                      SUBCHAPTER K.  DISSOLUTION
  85-19        Sec. 49.321.  DISSOLUTION AUTHORITY.  After notice and
  85-20  hearing, the commission may dissolve any district that is inactive
  85-21  for a period of five consecutive years and has no outstanding
  85-22  bonded indebtedness.
  85-23        Sec. 49.322.  NOTICE OF HEARING.  (a)  The commission shall
  85-24  give notice of the dissolution hearing that briefly describes the
  85-25  reasons for the proceeding.
   86-1        (b)  The notice shall be published once each week for two
   86-2  consecutive weeks before the day of hearing in a newspaper having
   86-3  general circulation in the county or counties in which the district
   86-4  is located.  The first publication shall be 30 days before the day
   86-5  of the hearing.
   86-6        (c)  The commission shall give notice of the hearing by first
   86-7  class mail addressed to the directors of the district according to
   86-8  the last record on file with the executive director.
   86-9        Sec. 49.323.  INVESTIGATION.  The executive director shall
  86-10  investigate the facts and circumstances of the district to be
  86-11  dissolved and the result of the investigation shall be included in
  86-12  a written report.
  86-13        Sec. 49.324.  ORDER OF DISSOLUTION.  The commission may enter
  86-14  an order dissolving the district at the conclusion of the hearing
  86-15  if it finds that the district has performed none of the functions
  86-16  for which it was created for a period of five consecutive years
  86-17  before the day of the proceeding and that the district has no
  86-18  outstanding bonded indebtedness.
  86-19        Sec. 49.325.  CERTIFIED COPY OF ORDER.  The commission shall
  86-20  file a certified copy of the order of dissolution of the district
  86-21  in the deed records of the county or counties in which the district
  86-22  is located.  If the particular district was created by a special
  86-23  Act of the legislature, the commission shall file a certified copy
  86-24  of the order of dissolution with the secretary of state.
  86-25        Sec. 49.326.  APPEALS.  (a)  Appeals from a commission order
   87-1  dissolving a district shall be filed and heard in the district
   87-2  court of any of the counties in which the land is located.
   87-3        (b)  The trial on appeal shall be de novo and the substantial
   87-4  evidence rule shall not apply.
   87-5        Sec. 49.327.  ASSETS ESCHEAT TO STATE.  Upon the dissolution
   87-6  of a district by the commission, all assets of the district shall
   87-7  escheat to the State of Texas.  The assets shall be administered by
   87-8  the state treasurer and shall be disposed of in the manner provided
   87-9  by Chapter 74, Property Code.
  87-10          (Sections 49.328 to 49.350 reserved for expansion
  87-11                    SUBCHAPTER L.  FIRE DEPARTMENTS
  87-12        Sec. 49.351.  FIRE DEPARTMENTS.  (a)  A district providing
  87-13  potable water or sewer service to household users may establish,
  87-14  operate, and maintain a fire department to perform all
  87-15  fire-fighting activities within the district as provided in this
  87-16  subchapter and may issue, with voter approval, bonds for financing
  87-17  the establishment of the fire department including the construction
  87-18  and purchase of necessary buildings, facilities, and equipment and
  87-19  the provision of an adequate water supply.
  87-20        (b)  After approval of the district electors of a plan to
  87-21  operate or jointly operate a fire department, the district or
  87-22  districts shall provide an adequate system and water supply for
  87-23  fire-fighting purposes, may construct and purchase necessary
  87-24  buildings, facilities, and equipment, and may employ all necessary
  87-25  personnel including supervisory personnel to operate the fire
   88-1  department.
   88-2        (c)  Bonds issued for establishment of the fire department
   88-3  shall be authorized and issued, and a district shall be authorized
   88-4  to levy a tax to pay the principal of and interest on such bonds,
   88-5  as provided by law for authorization and issuance of other bonds of
   88-6  the district.
   88-7        (d)  Two or more districts may contract to operate a joint
   88-8  fire department for their districts and shall include in the
   88-9  contract a system for joint administration and operation of the
  88-10  fire department, the extent of services to be provided, a method
  88-11  for funding the department from funds of each district, and any
  88-12  other terms and conditions the parties consider necessary.
  88-13        (e)  A district may contract with any other person to perform
  88-14  fire-fighting services within the district.
  88-15        (f)  Before a district establishes a fire department,
  88-16  contracts to operate a joint fire department, or contracts with
  88-17  another person to perform fire-fighting services within the
  88-18  district, the district must comply with the provisions of
  88-19  Subsections (g), (h), and (i).
  88-20        (g)  A district or districts proposing to act jointly shall
  88-21  develop a detailed plan for the establishment, operation, and
  88-22  maintenance of the proposed department, including a detailed
  88-23  presentation of all financial requirements.  If a district is
  88-24  entering into a contract under Subsection (e), the district shall
  88-25  develop a plan that describes in detail the facilities and
   89-1  equipment to be devoted to service to the district and all
   89-2  proposals for providing the service and that includes a
   89-3  presentation of the financial requirements under the contract.
   89-4  Before adoption of a plan and any contract by the district, the
   89-5  board shall hold a hearing at which any person residing in the
   89-6  district may present testimony for and against the proposed plan
   89-7  and any proposed contract.  Notice of the hearing and the place at
   89-8  which the plan and any contract may be examined shall be posted in
   89-9  two public places within the district at least 10 days before the
  89-10  date of the hearing.
  89-11        (h)  After adoption of the plan and any contract by the
  89-12  board, the plan and financial presentation, together with any
  89-13  contract and a written report in a form prescribed by the executive
  89-14  director describing existing fire departments and fire-fighting
  89-15  services available within 25 miles of the boundaries of the
  89-16  district, shall be submitted to the executive director for
  89-17  consideration by the commission under rules adopted by the
  89-18  commission.  Before approval or disapproval, the commission shall
  89-19  hold a hearing.  Notice of the hearing before the commission shall
  89-20  be posted by the board in at least two public places in the
  89-21  district at least five days before the hearing.  Before the
  89-22  commission approves the application, it must find that it is
  89-23  economically feasible for the district to implement the plan and
  89-24  meet the provisions of any contract and shall take into
  89-25  consideration in giving its approval the general financial
   90-1  condition of the district and the economic feasibility of the
   90-2  district carrying out the plan or meeting the obligations of the
   90-3  contract.
   90-4        (i)  After approval by the commission, the district shall
   90-5  submit to the electors of the district at the election to approve
   90-6  bonds for financing the plan, or if no bonds are to be approved, at
   90-7  an election called for approval of the plan, the proposition of
   90-8  whether or not the plan should be implemented or entered into by
   90-9  the district.  The ballots at the election shall be printed, as
  90-10  applicable, to provide for voting for or against the proposition:
  90-11  "The implementation of the plan for (operation/joint operation) of
  90-12  a fire department"; or "The plan and contract to provide
  90-13  fire-fighting services for the district."
  90-14        (j)  No funds of the district may be used to establish a fire
  90-15  department, to enter into joint operation of a fire department, or
  90-16  to contract for fire-fighting services without the approval of a
  90-17  plan by the electors as provided in this section.  However, the
  90-18  district may use available funds for preparation of a plan and any
  90-19  contract.  The operation of a fire department or provision of
  90-20  fire-fighting services is an essential public necessity, and a
  90-21  district may discontinue any and all services, including water and
  90-22  sewer service, to any person who fails to timely pay fire
  90-23  department service fees or any other assessment adopted by the
  90-24  district to support the fire department or the provision of
  90-25  fire-fighting services.
   91-1          (Sections 49.352 to 49.450 reserved for expansion
   91-2            SUBCHAPTER M.  NOTICES, REPORTS, AND BANKRUPTCY
   91-3        Sec. 49.451.  POSTING SIGNS IN THE DISTRICT. (a)  A district
   91-4  subject to the notice requirements of Section 49.452 shall, within
   91-5  30 days after the effective date of this section or the creation of
   91-6  the district, post signs indicating the existence of the district
   91-7  at two principal entrances to the district.
   91-8        (b)  The size and exact location of the information contained
   91-9  on the signs shall be determined by the executive director.
  91-10        Sec. 49.452.  NOTICE TO PURCHASERS.  (a)(1)  Any person who
  91-11  proposes to sell or convey real property located in a district
  91-12  created under this title or by a special Act of the legislature
  91-13  that is providing or proposing to provide, as the district's
  91-14  principal function, water, sanitary sewer, drainage, and flood
  91-15  control or protection facilities or services, or any of these
  91-16  facilities or services that have been financed or are proposed to
  91-17  be financed with bonds of the district payable in whole or part
  91-18  from taxes of the district, or by imposition of a standby fee, if
  91-19  any, to household or commercial users, other than agricultural,
  91-20  irrigation, or industrial users, and which district includes less
  91-21  than all the territory in at least one county and which, if located
  91-22  within the corporate area of a city, includes less than 75 percent
  91-23  of the incorporated area of the city or which is located outside
  91-24  the corporate area of a city in whole or in substantial part, must
  91-25  first give to the purchaser the written notice provided in this
   92-1  section.
   92-2              (2)  The provisions of this section shall not be
   92-3  applicable to:
   92-4                    (A)  transfers of title under any type of lien
   92-5  foreclosure;
   92-6                    (B)  transfers of title by deed in cancellation
   92-7  of indebtedness secured by a lien upon the property conveyed; or
   92-8                    (C)  transfers of title by reason of a will or
   92-9  probate proceedings.
  92-10        (b)  The prescribed notice for all districts shall be
  92-11  executed by the seller and shall read as follows:
  92-12        "The real property, described below, that you are about to
  92-13  purchase is located in the ___________________ District.  The
  92-14  district has taxing authority separate from any other taxing
  92-15  authority and may, subject to voter approval, issue an unlimited
  92-16  amount of bonds and levy an unlimited rate of tax in payment of
  92-17  such bonds.  As of this date, the rate of taxes levied by the
  92-18  district on real property located in the district is $__________ on
  92-19  each $100 of assessed valuation.  If the district has not yet
  92-20  levied taxes, the most recent projected rate of debt service tax,
  92-21  as of this date, is $__________ on each $100 of assessed valuation.
  92-22  The total amount of bonds approved by the voters and which have
  92-23  been or may, at this date, be issued is $__________, and the
  92-24  aggregate initial principal amounts of all bonds issued for one or
  92-25  more of the specified facilities of the district and payable in
   93-1  whole or in part from property taxes is $__________.
   93-2        "The district has the authority to adopt and impose a standby
   93-3  fee on property in the district that has water, sanitary sewer, or
   93-4  drainage facilities and services available but not connected and
   93-5  which does not have a house, building, or other improvement located
   93-6  thereon and does not substantially utilize the utility capacity
   93-7  available to the property.  The district may exercise the authority
   93-8  without holding an election on the matter.  As of this date, the
   93-9  most recent amount of the standby fee is $__________.  An unpaid
  93-10  standby fee is a personal obligation of the person that owned the
  93-11  property at the time of imposition and is secured by a lien on the
  93-12  property.  Any person may request a certificate from the district
  93-13  stating the amount, if any, of unpaid standby fees on a tract of
  93-14  property in the district.
  93-15        "The purpose of this district is to provide water, sewer,
  93-16  drainage, or flood control facilities and services within the
  93-17  district through the issuance of bonds payable in whole or in part
  93-18  from property taxes.  The cost of these utility facilities is not
  93-19  included in the purchase price of your property, and these utility
  93-20  facilities are owned or to be owned by the district.  The legal
  93-21  description of the property you are acquiring is as follows:
  93-22  ___________________________________________________________________
  93-23                                        ______________________ (Date)
  93-24                                        _____________________________
  93-25                                             Signature of Seller
   94-1        PURCHASER IS ADVISED THAT THE INFORMATION SHOWN ON THIS FORM
   94-2  IS SUBJECT TO CHANGE BY THE DISTRICT AT ANY TIME.  THE DISTRICT
   94-3  ROUTINELY ESTABLISHES TAX RATES DURING THE MONTHS OF SEPTEMBER
   94-4  THROUGH DECEMBER OF EACH YEAR, EFFECTIVE FOR THE YEAR IN WHICH THE
   94-5  TAX RATES ARE APPROVED BY THE DISTRICT.  PURCHASER IS ADVISED TO
   94-6  CONTACT THE DISTRICT TO DETERMINE THE STATUS OF ANY CURRENT OR
   94-7  PROPOSED CHANGES TO THE INFORMATION SHOWN ON THIS FORM.
   94-8        "The undersigned purchaser hereby acknowledges receipt of the
   94-9  foregoing notice at or prior to execution of a binding contract for
  94-10  the purchase of the real property described in such notice or at
  94-11  closing of purchase of the real property.
  94-12                                        ______________________ (Date)
  94-13                                        _____________________________
  94-14                                         Signature of Purchaser
  94-15        "(Note:  Correct district name, tax rate, bond amounts, and
  94-16  legal description are to be placed in the appropriate space.)
  94-17  Except for notices included as an addendum or paragraph of a
  94-18  purchase contract, the notice shall be executed by the seller and
  94-19  purchaser, as indicated.  If the district does not propose to
  94-20  provide one or more of the specified facilities and services, the
  94-21  appropriate purpose may be eliminated.  If the district has not yet
  94-22  levied taxes, a statement of the district's most recent projected
  94-23  rate of debt service tax is to be placed in the appropriate space.
  94-24  If the district does not have approval from the commission to adopt
  94-25  and impose a standby fee, the second paragraph of the notice may be
   95-1  deleted.  For the purposes of the notice form required to be given
   95-2  to the prospective purchaser prior to execution of a binding
   95-3  contract of sale and purchase, a seller and any agent,
   95-4  representative, or person acting on the seller's behalf may modify
   95-5  the notice by substitution of the words 'January 1, ______' for the
   95-6  words 'this date' and place the correct calendar year in the
   95-7  appropriate space."
   95-8        (c)  The notice required by this section shall be given to
   95-9  the prospective purchaser prior to execution of a binding contract
  95-10  of sale and purchase either separately or as an addendum or
  95-11  paragraph of a purchase contract.  In the event a contract of
  95-12  purchase and sale is entered into without the seller providing the
  95-13  notice required by this subsection, the purchaser shall be entitled
  95-14  to terminate the contract.  If, however, the seller furnishes the
  95-15  required notice at or prior to closing the purchase and sale
  95-16  contract and the purchaser elects to close even though such notice
  95-17  was not timely furnished prior to execution of the contract, it
  95-18  shall be conclusively presumed that the purchaser has waived all
  95-19  rights to terminate the contract and recover damages or other
  95-20  remedies or rights under the provisions of this section.
  95-21  Notwithstanding any provision of this subchapter to the contrary,
  95-22  all sellers, title companies, and examining attorneys, and any
  95-23  agent, representative, or person acting on their behalf, shall not
  95-24  be liable for damages under the provisions of either Subsection (l)
  95-25  or (m) or liable for any other damages to any person for failure to
   96-1  provide the notice required by this section to a purchaser prior to
   96-2  execution of a binding contract of a purchase and sale when the
   96-3  district has not filed the information form and map or plat as
   96-4  required under Section 49.455.
   96-5        (d)  The purchaser shall sign the notice or purchase contract
   96-6  including such notice to evidence the receipt of notice.
   96-7        (e)  At the closing of purchase and sale, a separate copy of
   96-8  such notice with current information shall be executed by the
   96-9  seller and purchaser, acknowledged, and thereafter recorded in the
  96-10  deed records of the county in which the property is located.  For
  96-11  the purposes of this section, all sellers, title companies, and
  96-12  examining attorneys, and any agent, representative, or person
  96-13  acting on their behalf, shall be entitled to rely on the accuracy
  96-14  of the information form and map or plat as last filed by each
  96-15  district under Section 49.455 or the information contained in or
  96-16  shown on the notice form issued by the district under Section
  96-17  49.453 in completing the notice form to be executed by the seller
  96-18  and purchaser at the closing of purchase and sale.  Any information
  96-19  taken from the information form or map or plat as last filed by
  96-20  each district and the information contained in or shown on the
  96-21  notice form issued by the district under Section 49.453 shall be,
  96-22  for purposes of this section, conclusively presumed as a matter of
  96-23  law to be correct.  All subsequent sellers, purchasers, title
  96-24  insurance companies, examining attorneys, and lienholders shall be
  96-25  entitled to rely upon the information form and map or plat filed by
   97-1  the district or the notice form issued by the district under
   97-2  Section 49.453.
   97-3        (f)  For the purposes of this section, an executory contract
   97-4  of purchase and sale having a performance period of more than six
   97-5  months shall be considered a sale under Subsection (a).
   97-6        (g)  For the purposes of the notice form to be given to the
   97-7  prospective purchaser prior to execution of a binding contract of
   97-8  sale and purchase, a seller and any agent, representative, or
   97-9  person acting in the seller's behalf may modify the notice by
  97-10  substitution of the words "January 1, ____" for the words "this
  97-11  date" and place the correct calendar year in the appropriate space.
  97-12  All sellers, and all persons completing the prescribed notice in
  97-13  the sellers' behalf, shall be entitled to rely on the information
  97-14  contained in or shown on the information form and map or plat filed
  97-15  of record by the district under Section 49.455 in completing the
  97-16  prescribed form to be given to the prospective purchaser prior to
  97-17  execution of a binding contract of sale and purchase.  Except as
  97-18  otherwise provided in Subsection (e), any information taken from
  97-19  the information form or map or plat filed of record by the district
  97-20  in effect as of January 1 of each year shall be, for purposes of
  97-21  the notice to be given to the prospective purchaser prior to
  97-22  execution of a binding contract of sale and purchase, conclusively
  97-23  presumed as a matter of law to be correct for the period January 1
  97-24  through December 31 of such calendar year.  A seller and any
  97-25  persons completing the prescribed notice in the seller's behalf may
   98-1  provide more recent information, if available, than the information
   98-2  contained in or shown on the information form and map or plat filed
   98-3  of record by the district under Section 49.455 in effect as of
   98-4  January 1 of each year in completing the prescribed form to be
   98-5  given to the purchaser prior to execution of a binding contract of
   98-6  sale and purchase.  Nothing contained in the preceding sentence
   98-7  shall be construed to create an affirmative duty on the part of a
   98-8  seller or any persons completing the prescribed notice in the
   98-9  seller's behalf to provide more recent information than the
  98-10  information taken from the information form and map or plat filed
  98-11  of record by the district as of January 1 of each year in
  98-12  completing the prescribed notice to be given to the purchaser prior
  98-13  to execution of a binding contract of sale and purchase.  All
  98-14  subsequent sellers, purchasers, title insurance companies,
  98-15  examining attorneys, and lienholders shall be entitled to rely upon
  98-16  the information form and map or plat filed by the district.
  98-17        (h)  If such notice is given at closing as provided in
  98-18  Subsection (e), a purchaser, or the purchaser's heirs, successors,
  98-19  or assigns, shall not be entitled to maintain any action for
  98-20  damages or maintain any action against a seller, title insurance
  98-21  company, or lienholder, or any agent, representative, or person
  98-22  acting in their behalf, by reason of use by the seller of the
  98-23  information filed for record by the district or reliance by the
  98-24  seller on the filed plat and filed legal description of the
  98-25  district in determining whether the property to be sold and
   99-1  purchased is within the district.  No action may be maintained
   99-2  against any title company for failure to disclose the inclusion of
   99-3  the described real property within a district when the district has
   99-4  not filed for record the information form, map, or plat with the
   99-5  clerk of the county or counties in which the district is located.
   99-6        (i)  Any purchaser who purchases any real property in a
   99-7  district and who thereafter sells or conveys the same shall on
   99-8  closing of such subsequent sale be conclusively considered as
   99-9  having waived any prior right to damages under this section.
  99-10        (j)  It is the express intent of this section that all
  99-11  sellers, title insurance companies, examining attorneys, vendors of
  99-12  property and tax information, real estate brokers, and lienholders,
  99-13  and any agent, representative, or person acting on their behalf,
  99-14  shall be entitled to rely on the accuracy of the information form
  99-15  and map or plat as last filed by each district or the information
  99-16  contained in or shown on the notice form issued by the district
  99-17  under Section 49.453, or for the purposes of the notice to be given
  99-18  the purchaser prior to execution of a binding contract of sale and
  99-19  purchase the information contained in or shown on the information
  99-20  form and map or plat filed of record by the district in effect as
  99-21  of January 1 of each year for the period January 1 through December
  99-22  31 of such calendar year.
  99-23        (k)  Except as otherwise provided in Subsection (c), if any
  99-24  sale or conveyance of real property within a district is not made
  99-25  in compliance with the provisions of this section, the purchaser
  100-1  may institute a suit for damages under the provisions of either
  100-2  Subsection (l) or (m).
  100-3        (l)  A purchaser of real property covered by the provisions
  100-4  of this section, if the sale or conveyance of the property is not
  100-5  made in compliance with this section, may institute a suit for
  100-6  damages in the amount of all costs relative to the purchase of the
  100-7  property plus interest and reasonable attorney's fees.  The suit
  100-8  for damages may be instituted jointly or severally against the
  100-9  person, firm, corporation, partnership, organization, business
 100-10  trust, estate, trust, association, or other legal entity that sold
 100-11  or conveyed the property to the purchaser.  Following the recovery
 100-12  of damages under this subsection, the amount of the damages shall
 100-13  first be paid to satisfy all unpaid obligations on each outstanding
 100-14  lien or liens on the property and the remainder of the damage
 100-15  amount shall be paid to the purchaser.  On payment of all damages
 100-16  respectively to the lienholders and purchaser, the purchaser shall
 100-17  reconvey the property to the seller.
 100-18        (m)  A purchaser of real property covered by the provisions
 100-19  of this section, if the sale or conveyance of the property is not
 100-20  made in compliance with this section, may institute a suit for
 100-21  damages in an amount not to exceed $5,000, plus reasonable
 100-22  attorney's fees.
 100-23        (n)  A purchaser is not entitled to recover damages under
 100-24  both Subsections (l) and (m), and entry of a final decision
 100-25  awarding damages to the purchaser under either Subsection (l) or
  101-1  (m) shall preclude the purchaser from recovering damages under the
  101-2  other subsection.  Notwithstanding any part or provision of the
  101-3  general or special laws or the common law of the state to the
  101-4  contrary, the relief provided under Subsections (l) and (m) shall
  101-5  be the exclusive remedies for a purchaser aggrieved by the seller's
  101-6  failure to comply with the provisions of this section.  Any action
  101-7  for damages shall not, however, apply to, affect, alter, or impair
  101-8  the validity of any existing vendor's lien, mechanic's lien, or
  101-9  deed of trust lien on the property.
 101-10        (o)  A suit for damages under the provisions of this section
 101-11  must be brought within 90 days after the purchaser receives the
 101-12  first district tax notice or within four years after the property
 101-13  is sold or conveyed to the purchaser, whichever time occurs first,
 101-14  or the purchaser loses the right to seek damages under this
 101-15  section.
 101-16        (p)  Notwithstanding any provisions of this subchapter to the
 101-17  contrary, a purchaser may not recover damages of any kind under
 101-18  this section if that person:
 101-19              (1)  purchases an equity in real property and in
 101-20  conjunction with the purchase assumes any liens, whether purchase
 101-21  money or otherwise; and
 101-22              (2)  does not require proof of title by abstract, title
 101-23  policy, or any other proof of title.
 101-24        Sec. 49.453.  NOTICE FORM FROM DISTRICT.  (a)  A district
 101-25  covered by Section 49.452 shall also maintain in the district
  102-1  office the particular form of Notice to Purchasers required by
  102-2  Section 49.452 to be furnished by a seller to a purchaser of real
  102-3  property in that district and shall, upon written request of any
  102-4  person, issue the notice form completed by a district with all
  102-5  information required to be furnished by the district.  A notice
  102-6  form issued by a district under the provisions of this section
  102-7  shall include a written statement that the notice form is being
  102-8  issued by the district, the date of its issuance, and the
  102-9  district's telephone number.  A district shall not be required to
 102-10  orally provide the information.
 102-11        (b)  A district may charge a reasonable fee as determined by
 102-12  the district not to exceed $10 for the issuance of a notice form
 102-13  pursuant to Subsection (a).  The notice form shall be delivered by
 102-14  regular mail or made available at the district's office.  If a
 102-15  district is requested to deliver the notice form to a person by an
 102-16  alternative method, the district may impose a charge not to exceed
 102-17  the actual cost of such delivery.
 102-18        (c)  A district may delegate the responsibility for issuance
 102-19  of the particular form of Notice to Purchasers to an employee or
 102-20  agent of the district.  A district shall file with the commission
 102-21  the name, address, and telephone number of the employee or agent of
 102-22  the district responsible for issuance of the notice forms and shall
 102-23  notify the commission in writing within seven days after there is a
 102-24  change to the information required to be filed with the commission
 102-25  under the provisions of this subsection.
  103-1        (d)  Any notice issued by the district shall contain the
  103-2  information effective as of the date of its issuance.
  103-3        Sec. 49.454.  NOTICE OF UNPAID STANDBY FEES.  (a)  A district
  103-4  covered by Section 49.452 shall, on the written request of any
  103-5  person, issue a certificate stating the amount of any unpaid
  103-6  standby fees, including interest on the fees, that have been
  103-7  assessed against a tract of property in the district.  The district
  103-8  may charge a fee not to exceed $10 for each certificate.  A
  103-9  certificate issued through fraud or collusion is void.
 103-10        (b)  If the district issues a certificate containing an
 103-11  erroneous statement under Subsection (a) and the owner of the
 103-12  property transfers the property to a good faith purchaser for
 103-13  value, the lien on the property provided by Section 49.231(k) is
 103-14  extinguished to the extent of the error.
 103-15        (c)  This section does not affect the liability for any
 103-16  unpaid standby fees of the former owner of the undeveloped property
 103-17  under Section 49.231(k).
 103-18        Sec. 49.455.  FILING INFORMATION.  (a)  The board covered by
 103-19  the provisions of Section 49.452 shall file with the county clerk
 103-20  in each of the counties in which all or part of the district is
 103-21  located a duly affirmed and acknowledged information form that
 103-22  includes the information required in Subsection (b), and a complete
 103-23  and accurate map or plat showing the boundaries of the district.
 103-24        (b)  The information form filed by a district under this
 103-25  section shall include:
  104-1              (1)  the name of the district;
  104-2              (2)  the complete and accurate legal description of the
  104-3  boundaries of the district;
  104-4              (3)  the most recent rate of district taxes on property
  104-5  located in the district;
  104-6              (4)  the total amount of bonds that have been approved
  104-7  by the voters and which may be issued by the district (excluding
  104-8  refunding bonds and any bonds or portion of bonds payable solely
  104-9  from revenues received or expected to be received pursuant to a
 104-10  contract with a governmental entity);
 104-11              (5)  the aggregate initial principal amount of all
 104-12  bonds of the district payable in whole or part from taxes
 104-13  (excluding refunding bonds and any bonds or portion of bonds
 104-14  payable solely from revenues received or expected to be received
 104-15  pursuant to a contract with a governmental entity) that have been
 104-16  previously issued and remain outstanding;
 104-17              (6)  whether a standby fee is imposed by the district
 104-18  and, if so, the amount of the standby fee;
 104-19              (7)  the date on which the election to confirm the
 104-20  creation of the district was held if such was required;
 104-21              (8)  a statement of the functions performed or to be
 104-22  performed by the district; and
 104-23              (9)  the particular form of Notice to Purchasers
 104-24  required by Section 49.452 to be furnished by a seller to a
 104-25  purchaser of real property in that district completed by the
  105-1  district with all information required to be furnished by the
  105-2  district.
  105-3        If a district has not yet levied taxes, a statement to such
  105-4  effect together with the district's most recent projected rate of
  105-5  debt service tax shall be substituted for Subdivisions (3) and (4).
  105-6        (c)  The information form and map or plat required by this
  105-7  section shall be signed by a majority of the members of the board
  105-8  and by each such officer affirmed and acknowledged before it is
  105-9  filed with the county clerk, and each amendment made to an
 105-10  information form or map shall also be signed by the members of the
 105-11  board and by each such officer affirmed and acknowledged before it
 105-12  is filed with the county clerk.
 105-13        (d)  The information form required by this section shall be
 105-14  filed with the county clerk within 48 hours after the effective
 105-15  date of this section or within 48 hours after the district is
 105-16  officially created, whichever time comes first.  For purposes of
 105-17  this section, the words "officially created" mean the date and hour
 105-18  in which the results of the election to confirm the creation of the
 105-19  district are declared.
 105-20        (e)  Within seven days after there is a change in any of the
 105-21  information contained in the district information form, map, or
 105-22  plat, the district shall file an amendment to the information form,
 105-23  map, or plat setting forth the changes made.
 105-24        (f)  Any person who affirms the corrections and accuracy of
 105-25  and acknowledges an information form, map, or plat, or any
  106-1  amendment to an information form, map, or plat that includes
  106-2  information that is inaccurate or incorrect shall be guilty of a
  106-3  misdemeanor and shall be fined not less than $100 nor more than
  106-4  $1,000 for each violation.
  106-5        (g)  If a district fails to file the information required by
  106-6  this section in the time required, the executive director may
  106-7  request the state attorney general or the district or county
  106-8  attorney of the county in which the district is located to seek a
  106-9  writ of mandamus to force the board to prepare and file the
 106-10  necessary information.
 106-11        (h)  Any member of a governing board who wilfully fails or
 106-12  refuses to join in filing an information form, map, or plat or an
 106-13  amendment to an information form, map, or plat under this section
 106-14  shall be guilty of a misdemeanor and shall be fined not less than
 106-15  $100 nor more than $1,000 for each violation.  A member of a
 106-16  governing board is presumed to have wilfully failed or refused to
 106-17  join in the filing of an information form, map, or plat or an
 106-18  amendment to an information form, map, or plat if that member was
 106-19  present at the meeting at which the information included in the
 106-20  information form, map, or plat or amendment to the information
 106-21  form, map, or plat was adopted.
 106-22        (i)  If a district covered by this section is dissolved,
 106-23  annexed to another local government, or consolidated with another
 106-24  district, the members of the board shall file a statement of this
 106-25  fact together with the effective date of the dissolution,
  107-1  annexation, or consolidation with the information form.  After a
  107-2  district is dissolved and the statement is filed under this
  107-3  subsection, a person who sells or conveys property within the
  107-4  dissolved district is no longer required to give notice under
  107-5  Section 49.452.
  107-6        (j)  A copy of all information forms, maps, or plats and
  107-7  amendments to these filed under this section shall also be filed
  107-8  with the executive director.
  107-9        Sec. 49.456.  BANKRUPTCY OF DISTRICTS; AUTHORITY OF
 107-10  COMMISSION.  (a)  Notwithstanding Section 140.001, Local Government
 107-11  Code, or any other law of this state, a district created under
 107-12  Sections 52(b)(1) and (2), Article III, or Section 59, Article XVI,
 107-13  Texas Constitution, that is subject to the continuing supervision
 107-14  of the commission may not proceed under Chapter 9 of the Federal
 107-15  Bankruptcy Code (11 U.S.C. Sections 901-946) or any other law
 107-16  enacted by the Congress of the United States under federal
 107-17  bankruptcy authority until the commission authorizes the district
 107-18  to proceed under those laws by written order.
 107-19        (b)  A district requesting the commission's authorization to
 107-20  proceed under Chapter 9 of the Federal Bankruptcy Code (11 U.S.C.
 107-21  Sections 901-946) or any other federal bankruptcy law shall file an
 107-22  application with the commission requesting authorization.
 107-23        (c)  The commission shall investigate the financial condition
 107-24  of a district submitting an application under Subsection (b),
 107-25  including its assets, liabilities, and sources of revenues and may
  108-1  require a district to submit any information that the commission
  108-2  considers material to a determination of whether authorization to
  108-3  proceed in bankruptcy should be granted.
  108-4        (d)  The commission may not authorize a district to proceed
  108-5  in bankruptcy unless the commission determines that the district
  108-6  cannot, through the full exercise of its rights and powers under
  108-7  the laws of this state, reasonably expect to meet its debts and
  108-8  other obligations as they mature.
  108-9        (e)  The commission shall adopt and assess reasonable and
 108-10  necessary fees adequate to recover the costs of the commission in
 108-11  administering this section.
 108-12        SECTION 3.  Title 4, Water Code, is amended by adding Chapter
 108-13  59 to read as follows:
 108-14                    CHAPTER 59.  REGIONAL DISTRICTS
 108-15                   SUBCHAPTER A.  DISTRICT CREATION
 108-16        Sec. 59.001.  PURPOSE AND APPLICATION.  (a)  The purpose of
 108-17  this chapter is to authorize creation and operation of regional
 108-18  districts for water, sanitary sewer, drainage, and municipal solid
 108-19  waste disposal under Section 59, Article XVI, Texas Constitution.
 108-20        (b)  This chapter applies only in counties with a population
 108-21  of at least 2.2 million, according to the most recent federal
 108-22  census, or bordering a county with a population of at least 2.2
 108-23  million, according to the most recent federal census.
 108-24        Sec. 59.002.  DEFINITIONS.  (a)  In this chapter:
 108-25              (1)  "District" means a district created or operating
  109-1  under this chapter.
  109-2              (2)  "Municipal district" means a district created
  109-3  under general law or a special Act operating under Chapter 51, 53,
  109-4  or 54.
  109-5              (3)  "Bond" means bonds, coupons, notes, or any other
  109-6  evidence of indebtedness.
  109-7        (b)  Other terms not defined by this chapter have the same
  109-8  meaning assigned to those terms by Section 49.001.
  109-9        Sec. 59.003.  CREATION OF DISTRICT.  (a)  A district may be
 109-10  created by:
 109-11              (1)  The boards of at least 20 percent of the total
 109-12  number of municipal districts to be included in the proposed
 109-13  district may jointly petition the commission for creation of a
 109-14  district.  The petition must describe the territory to be included
 109-15  in the district and must include resolutions endorsing creation of
 109-16  the district adopted by each municipal district to be included in
 109-17  the district.
 109-18              (2)  The owner or owners of 2,000 or more contiguous
 109-19  acres may petition the commission for creation of a district.
 109-20              (3)  The commissioners courts of one or more counties
 109-21  may petition the commission for creation of a district in any
 109-22  territory within the county.
 109-23              (4)  The governing body of any city may petition the
 109-24  commission for creation of a district in any territory within the
 109-25  city or its extraterritorial jurisdiction.
  110-1        (b)  Petitions for the creation of a district must:
  110-2              (1)  describe the boundaries of the proposed district
  110-3  by metes and bounds that adequately and completely circumscribe the
  110-4  property so that there is complete closure of the property or by
  110-5  lot and block numbers if there is a recorded map or plat or
  110-6  subdivision survey of the area;
  110-7              (2)  state the general nature of the work proposed to
  110-8  be done, the necessity of the work, and the cost of any projects of
  110-9  the district as estimated by those filing the petition;
 110-10              (3)  state the name of each petitioner; and
 110-11              (4)  include a name of the district generally
 110-12  descriptive of the locale of the district followed by the words
 110-13  "Regional District."
 110-14        (c)  A proposed district may not have the same name as any
 110-15  other district in the state.
 110-16        (d)  Section 54.013 applies to the composition of districts
 110-17  created under this chapter.
 110-18        Sec. 59.004.  PURPOSES OF DISTRICT.  A district shall be
 110-19  created:
 110-20              (1)  to purchase, own, hold, lease, and otherwise
 110-21  acquire sources of water supply;
 110-22              (2)  to build, operate, and maintain facilities for the
 110-23  transportation of water;
 110-24              (3)  to sell water to cities, to political subdivisions
 110-25  of this state, to water supply corporations, to private business
  111-1  entities, and to individuals;
  111-2              (4)  to purchase, own, hold, lease, and otherwise
  111-3  acquire equipment and mechanisms necessary for sanitary sewer and
  111-4  wastewater treatment;
  111-5              (5)  to build, operate, and maintain facilities for
  111-6  sanitary sewer and wastewater treatment;
  111-7              (6)  to transport and treat sanitary sewer and
  111-8  wastewater effluent of cities and political subdivisions of this
  111-9  state and for private business entities or individuals;
 111-10              (7)  to purchase, own, hold, lease, and otherwise
 111-11  acquire equipment and mechanisms for the drainage of storm water
 111-12  and floodwater; and
 111-13              (8)  for the purposes outlined in Section 54.012.
 111-14        Sec. 59.005.  MATCHING FUNDS GUARANTEES.  If the Texas Water
 111-15  Development Board requires that matching funds be provided as a
 111-16  condition for receiving a loan or grant from the Texas Water
 111-17  Development Board from research and planning funds, the matching
 111-18  funds may not be provided through a guarantee of matching funds by
 111-19  any individual who has a financial interest in the regional
 111-20  district or who will receive any direct financial benefit from a
 111-21  regional district project.
 111-22        Sec. 59.006.  CONSENT OF CITY.  (a)  Land in the corporate
 111-23  limits of a city or in the extraterritorial jurisdiction of a city
 111-24  may not be included in a district unless the city grants its
 111-25  written consent by resolution or ordinance to the inclusion of the
  112-1  land in the district.
  112-2        (b)  If the governing body of a city fails or refuses to
  112-3  grant permission for the inclusion of land in its extraterritorial
  112-4  jurisdiction in a district within 120 days after receipt of a
  112-5  written request, the person or entity desiring to create the
  112-6  district may petition the governing body of the city to make
  112-7  available the water, sewer, or drainage service contemplated to be
  112-8  provided by the district.
  112-9        (c)  Failure of the governing body of the city and the
 112-10  requesting district to execute a mutually agreeable contract
 112-11  providing for the service requested within six months after receipt
 112-12  of a request for consent constitutes authorization for the
 112-13  inclusion of land in the district under this section.
 112-14  Authorization for the inclusion of the land in the district under
 112-15  this section means only authorization to initiate proceedings to
 112-16  include the land in the district as otherwise provided by this
 112-17  chapter.
 112-18        (d)  Sections 54.016(e), (f), (g), and (h) apply under this
 112-19  chapter.
 112-20        Sec. 59.007.  GRANTING OR REFUSING PETITION; EXCLUSION OF
 112-21  TERRITORY.  (a)  If after the hearing of the petition the
 112-22  commission finds that the petition conforms to the requirements of
 112-23  this chapter and that the creation of the district would be of
 112-24  benefit to the territory to be included in the district, the
 112-25  commission shall issue an order granting the petition for creation.
  113-1  If the commission finds that part of the territory included in the
  113-2  proposed district will not benefit from the creation of the
  113-3  district, the commission shall exclude that territory from the
  113-4  proposed district and redefine the proposed district's boundaries
  113-5  accordingly.
  113-6        (b)  If the commission finds that the petition does not
  113-7  conform to the requirements of this chapter or that the proposed
  113-8  projects are not of benefit to the territory in the proposed
  113-9  district, the commission shall issue an order either denying the
 113-10  petition or requiring petitioners to amend their petition.
 113-11        (c)  A copy of the order of the commission granting or
 113-12  denying a petition shall be mailed to each city having
 113-13  extraterritorial jurisdiction in the county or counties in which
 113-14  the district is to be located that has requested notice of hearings
 113-15  as provided by Section 54.019.
 113-16          (Sections 59.008 to 59.020 reserved for expansion
 113-17               SUBCHAPTER B.  ADMINISTRATIVE PROVISIONS
 113-18        Sec. 59.021.  DIRECTORS.  (a)  The commission shall appoint
 113-19  temporary directors who shall serve until permanent directors are
 113-20  elected.
 113-21        (b)  A petition requesting creation filed in accordance with
 113-22  Section 59.006 may provide that directors be elected by precinct as
 113-23  provided by Subsection (h).
 113-24        (c)  The board of directors is composed of five members
 113-25  unless the petition requesting creation of the district requests
  114-1  and the commission approves a board that consists of seven members.
  114-2        (d)  Permanent directors shall be elected in accordance with
  114-3  Chapter 49.
  114-4        (e)  If the petition for creation has requested the election
  114-5  of seven directors as provided by Subsection (c), unless otherwise
  114-6  agreed, the three directors elected who received the fewest number
  114-7  of votes, whether their election is by precinct or at large, shall
  114-8  serve until the next directors election following the confirmation
  114-9  election and the four who received the highest number of votes
 114-10  shall serve until the second directors election after the
 114-11  confirmation election.
 114-12        (f)  After the creation of the district, the persons or
 114-13  entities that petitioned for creation or 50 qualified voters of the
 114-14  district may file a petition with the commission requesting to
 114-15  expand the district's board to seven members.  If the commission
 114-16  grants the petition, the commission shall appoint two temporary
 114-17  directors.  One temporary director shall serve until the next
 114-18  directors election and one shall serve until the next succeeding
 114-19  directors election.  At each election one director shall be elected
 114-20  to serve for a four-year term.
 114-21        (g)  If the board of directors of the district is expanded to
 114-22  seven members, four directors shall constitute a quorum and a
 114-23  concurrence of four directors is necessary in all matters
 114-24  pertaining to the business of the district.
 114-25        (h)  A petition for the creation of a district may request
  115-1  that the board be elected to represent a geographic area.  If the
  115-2  petition requesting creation of the district is granted, the
  115-3  commission shall establish precincts from which the directors are
  115-4  to be elected.  In establishing the precincts the commission shall
  115-5  attempt to have directors represent geographic areas with equal
  115-6  numbers of people and shall comply with the federal Voting Rights
  115-7  Act of 1965 (42 U.S.C. Sections 1971, 1973 et seq.).  Thereafter,
  115-8  the board of directors of the district shall revise the precincts
  115-9  from time to time to cause them to comply with the provisions of
 115-10  this subsection.
 115-11        Sec. 59.022.  ABILITY TO SET RATES.  The district may charge
 115-12  rates to persons and entities located outside the district's
 115-13  boundaries on terms, rates, and charges the board of directors may
 115-14  determine to be advisable.  In setting rates for out-of-district
 115-15  customers, the board shall set rates sufficient to enable it to
 115-16  meet operation and maintenance expenses and to pay the principal of
 115-17  and interest on debt issued in connection with providing service
 115-18  and to provide a reasonable reserve for replacements to the
 115-19  district.  In setting rates, the district may take into
 115-20  consideration past operation and debt service expenses.
 115-21        Sec. 59.023.  ISSUANCE OF BONDS.  The district may issue
 115-22  bonds for the purpose of purchasing, constructing, acquiring,
 115-23  owning, operating, repairing, improving, or extending any district
 115-24  works, improvements, facilities, plants, equipment, and appliances
 115-25  needed to accomplish the purposes of the district, including works,
  116-1  improvements, facilities, plants, equipment, and appliances needed
  116-2  to provide a waterworks system, sanitary sewer system, storm sewer
  116-3  system, solid waste disposal system, and parks and recreational
  116-4  facilities.  Prior to issuing bonds or other obligations, a
  116-5  confirmation election must be held in accordance with Chapter 49,
  116-6  and a majority of voters must approve the establishment of the
  116-7  district.
  116-8        Sec. 59.024.  EXCLUSION OF CERTAIN MUNICIPAL DISTRICTS.
  116-9  (a)  A municipal district may be excluded from the district as
 116-10  provided by this section.
 116-11        (b)  To be excluded, the board of directors of the municipal
 116-12  district may adopt a resolution requesting exclusion by a majority
 116-13  vote of its board of directors and shall file the petition with the
 116-14  directors of the proposed district before the first confirmation
 116-15  election.
 116-16        (c)  At the time of the district's confirmation election, a
 116-17  separate voting precinct shall be used for the qualified voters in
 116-18  each municipal district that has filed a petition requesting
 116-19  exclusion.  The votes in each precinct shall be tallied separately
 116-20  to determine whether that municipal district will be excluded from
 116-21  the district boundaries.
 116-22        (d)  If a majority of the votes cast in a municipal district
 116-23  requesting exclusion vote against confirmation of the district, the
 116-24  votes cast in the confirmation election shall not be counted for
 116-25  the confirmation election, bond election, or maintenance tax
  117-1  election, and that municipal district must be excluded from the
  117-2  boundaries of the district by the board of directors of the
  117-3  district at the time the results of the election are canvassed.
  117-4        (e)  After a confirmation election at which the district is
  117-5  authorized to be created, the board of directors of the district
  117-6  shall adopt an order redefining the boundaries of the district to
  117-7  exclude those municipal districts petitioning for exclusion that
  117-8  have voted not to confirm creation of the district.
  117-9        (f)  Before the creation hearing, any municipal district
 117-10  located within the proposed district may petition the commission
 117-11  for a separate voting precinct to be used within the boundaries of
 117-12  the petitioning district at the time of the district's confirmation
 117-13  election.  If the commission grants the petition requesting a
 117-14  separate voting precinct, Subsections (c) through (e) apply.
 117-15        Sec. 59.025.  CONFIRMATION ELECTION.  (a)  Before a district
 117-16  may be created pursuant to a petition granted by the commission, a
 117-17  confirmation election must be held within the boundaries of the
 117-18  proposed district.
 117-19        (b)  The directors appointed by the commission shall call and
 117-20  hold the confirmation election in the manner provided for
 117-21  conducting elections under Chapter 49.  The provisions of those
 117-22  sections relating to a directors election do not apply to an
 117-23  election held under this section.
 117-24        (c)  If the creation of the district is defeated, subsequent
 117-25  confirmation elections may not be held to confirm the creation of
  118-1  the district.
  118-2        (d)  A bond election, maintenance tax election, and any other
  118-3  election may be held at the same time and in conjunction with a
  118-4  confirmation election.
  118-5          (Sections 59.026 to 59.050 reserved for expansion
  118-6       SUBCHAPTER C.  ADDING OR EXCLUDING TERRITORY; DISSOLUTION
  118-7        Sec. 59.051.  ADDING LAND BY PETITION OF LESS THAN ALL
  118-8  LANDOWNERS.  In addition to the method of adding land to a district
  118-9  described in Section 59.052, defined areas of land, regardless of
 118-10  whether they are contiguous to the district, may be annexed to the
 118-11  district in the manner provided in Chapter 49.
 118-12        Sec. 59.052.  FILING OF PETITION.  A petition requesting the
 118-13  annexation of a defined area that is signed by a majority in value
 118-14  of the owners of land in the defined area, as shown by the tax
 118-15  rolls of the county or counties in which that area is located, that
 118-16  is signed by 50 landowners if the number of landowners is more than
 118-17  50, that is signed by the single landowner of 2,000 or more acres
 118-18  of land in the area, or that is signed by a majority of the
 118-19  governing body of a municipal district, a county, or a city
 118-20  requesting annexation shall be filed with the secretary of the
 118-21  board.
 118-22        Sec. 59.053.  DISSOLUTION OF DISTRICT BEFORE ISSUANCE OF
 118-23  BONDS.  (a)  If the board considers it advisable before the
 118-24  issuance of any bonds, the board may dissolve the district and
 118-25  liquidate the affairs of the district as provided by Sections
  119-1  54.734 through 54.738.
  119-2        (b)  If a majority of the board finds at any time before the
  119-3  authorization of bonds that the proposed district and its proposed
  119-4  activities are for any reason impracticable or apparently cannot be
  119-5  successfully and beneficially accomplished, the board may issue
  119-6  notice of a hearing on a proposal to dissolve the district.
  119-7        Sec. 59.054.  JUDICIAL REVIEW OF BOARD'S ORDER.  The board's
  119-8  order to dissolve the district may be judicially reviewed as
  119-9  provided in Chapter 49.
 119-10          (Sections 59.055 to 59.070 reserved for expansion
 119-11                     SUBCHAPTER D.  MISCELLANEOUS
 119-12        Sec. 59.071.  ANNEXATION OR INCORPORATION BY CITY.  (a)  If a
 119-13  city annexes all or any part of the territory within a district, or
 119-14  incorporates all or any part of any territory within a district,
 119-15  the city shall succeed to the powers, duties, assets, and
 119-16  obligations of the district as provided by this chapter.
 119-17        (b)  On annexation of any part of the territory of a district
 119-18  by a city or incorporation by a city of any part of the territory
 119-19  of a district, the city shall assume a pro rata share of all debt
 119-20  of the district payable in whole or in part by ad valorem taxes
 119-21  incurred for water, sewer, or drainage purposes or any combination
 119-22  of the three purposes.  The percentage of the assumption shall be
 119-23  determined by multiplying the total debt of the district payable in
 119-24  whole or in part from taxes incurred for the stated purposes by a
 119-25  fraction, the numerator of which is the assessed value of the
  120-1  property to be annexed or incorporated based on the most recent
  120-2  certified county property tax rolls at the time of annexation or
  120-3  incorporation and the denominator of which is the total assessed
  120-4  value of the property of the district based on the most recent
  120-5  certified county property tax rolls at the time of annexation or
  120-6  incorporation.
  120-7        (c)  After annexation by a city of a portion of the territory
  120-8  of a district or incorporation over any part of the territory of a
  120-9  district, the district may not levy taxes on that territory, and
 120-10  the territory is no longer considered a part of the district for
 120-11  any purpose.
 120-12        (d)  If any district's debt payable in whole or in part from
 120-13  ad valorem taxes is assumed by a city, the governing body of the
 120-14  city shall levy and cause to be collected taxes on all taxable
 120-15  property within the city or provide other funds sufficient to pay
 120-16  the city's pro rata share of the principal of and interest on that
 120-17  debt as it becomes due and payable.
 120-18        (e)  If a city annexes or incorporates the entire territory
 120-19  of the district, the district shall be dissolved in accordance with
 120-20  Sections 43.074, 43.075, and 43.081, Local Government Code, if the
 120-21  district is located in one city or Sections 43.076 through 43.079,
 120-22  Local Government Code, if the district is located in more than one
 120-23  city.
 120-24        (f)  Section 43.071, Local Government Code, does not apply to
 120-25  the annexation of a district created pursuant to this chapter.
  121-1        Sec. 59.072.  OTHER LAWS.  (a)  This chapter prevails over
  121-2  any other law in conflict with or inconsistent with this chapter.
  121-3        (b)  Except as specifically provided by this chapter, Chapter
  121-4  49 and Sections 54.018, 54.019(a), (b), (c), and (d), 54.020,
  121-5  54.021, 54.023, 54.024, 54.201, 54.205, 54.207, 54.208, 54.502
  121-6  through 54.505, 54.507(b) and (c), 54.510 through 54.512, 54.514,
  121-7  54.515, 54.518, 54.520, 54.521, 54.601 through 54.604, and 54.735
  121-8  through 54.737 apply under this chapter.
  121-9        (c)  Section 54.019(e) does not apply to a district governed
 121-10  by this chapter.
 121-11        SECTION 4.  Subsection (a), Section 51.0711, Water Code, is
 121-12  amended to read as follows:
 121-13        (a)  The governing body of a municipality that enters a
 121-14  contract or agreement with a district located in more than one
 121-15  county to jointly construct, acquire, operate, or maintain a
 121-16  regional wastewater system is entitled to appoint a special
 121-17  director to the board of the district.  Section 51.072 <of this
 121-18  code> does not apply to a special director.
 121-19        SECTION 5.  Section 51.072, Water Code, is amended to read as
 121-20  follows:
 121-21        Sec. 51.072.  QUALIFICATIONS FOR DIRECTOR.  To be qualified
 121-22  for election as a director, a person must be a resident of the
 121-23  state, own land subject to taxation in the district, and be at
 121-24  least 18 <21> years of age.  Section 49.052 does not apply to a
 121-25  district governed by this chapter whose principal purpose is
  122-1  providing water for irrigation.
  122-2        SECTION 6.  Subsection (a), Section 51.076, Water Code, is
  122-3  amended to read as follows:
  122-4        (a)  In a district created after June 18, 1967, with
  122-5  boundaries coterminous with the boundaries of a county, the
  122-6  commissioners court may provide in the order granting the petition
  122-7  for creation that the directors are to be selected either as
  122-8  provided in Section 49.102 <51.073 of this code> or by the
  122-9  "commissioners precinct method," which provides for the election of
 122-10  two directors from each commissioners precinct in the county and
 122-11  the election of one director from the county at large.
 122-12        SECTION 7.  Subsection (d), Section 51.750, Water Code, is
 122-13  amended to read as follows:
 122-14        (d)  The temporary directors of each of the resulting
 122-15  districts must qualify as directors of the district pursuant to
 122-16  Section <Sections> 51.072 <and 51.073 of this code> within the
 122-17  period of 90 days after the election approving the division of the
 122-18  original district and shall assume their offices at the expiration
 122-19  of the 90-day period.
 122-20        SECTION 8.  Section 52.005, Water Code, is amended by adding
 122-21  Subsection (c) to read as follows:
 122-22        (c)  Sections 49.052, 49.216, and 49.301 through 49.308 do
 122-23  not apply to districts governed by this chapter.
 122-24        SECTION 9.  Section 52.115, Water Code, is amended to read as
 122-25  follows:
  123-1        Sec. 52.115.  MEETINGS.  <(a)>  The board shall hold regular
  123-2  quarterly meetings.  It may hold meetings at other times as
  123-3  required for the business of the district.
  123-4        <(b)  Any person may attend a meeting of the board and may
  123-5  present in an orderly manner matters for the board's consideration.>
  123-6        <(c)  Meetings shall be conducted and notice of meetings
  123-7  shall be posted in accordance with the open meetings law, Chapter
  123-8  271, Acts of the 60th Legislature, Regular Session, 1967 (Article
  123-9  6252-17, Vernon's Texas Civil Statutes).>
 123-10        SECTION 10.  Subsections (c), (d), and (e), Section 52.294,
 123-11  Water Code, are amended to read as follows:
 123-12        (c)  <Notice of an election must be given as provided by
 123-13  Section 52.059(c) of this code for creation elections.>
 123-14        <(d)>  At an election to authorize bonds or notes payable
 123-15  wholly from ad valorem taxes, the ballots must be printed to
 123-16  provide for voting for or against the proposition:  "The issuance
 123-17  of (bonds or notes) and the levy of taxes for payment of the (bonds
 123-18  or notes)."  At any election to authorize bonds or notes payable
 123-19  from both ad valorem taxes and revenues, the ballots must be
 123-20  printed to provide for voting for or against:  "The issuance of
 123-21  (bonds or notes) and the pledge of net revenues and the levy of ad
 123-22  valorem taxes adequate to provide for the payment of the (bonds or
 123-23  notes)."
 123-24        (d) <(e)>  The board shall canvass the returns and declare
 123-25  the results of the election.  If a majority of the votes cast at
  124-1  the election favor the issuance of the bonds or notes, the bonds or
  124-2  notes may be issued by the board, but if a majority of the votes
  124-3  cast at the election do not favor issuance of the bonds or notes,
  124-4  the bonds or notes may not be issued.
  124-5        SECTION 11.  Section 53.040, Water Code, is amended to read
  124-6  as follows:
  124-7        Sec. 53.040.  Elected Supervisors Take Office.  If the
  124-8  election results in a division of the district, the five candidates
  124-9  receiving the most votes in each new district shall be declared
 124-10  elected.  They shall immediately qualify in accordance with Section
 124-11  49.055 <by taking the constitutional oath of office and shall file
 124-12  the oath with the county clerk>.
 124-13        SECTION 12.  Section 53.042, Water Code, is amended to read
 124-14  as follows:
 124-15        Sec. 53.042.  Newly Elected Supervisors--Term of Office.  The
 124-16  newly elected supervisors hold office until the new district's next
 124-17  supervisors election <first general election and then until their
 124-18  successors are elected and have qualified>.
 124-19        SECTION 13.  Section 53.062, Water Code, is amended to read
 124-20  as follows:
 124-21        Sec. 53.062.  Board of Supervisors.  A district created under
 124-22  this chapter is governed by a board of five elected supervisors.
 124-23  <Specific provisions for the election of supervisors are found in
 124-24  Section 53.021, Section 53.086, and Section 53.0861 of this code.>
 124-25        SECTION 14.  Section 53.088, Water Code, is amended to read
  125-1  as follows:
  125-2        Sec. 53.088.  Status of the District.  <(a)>  A district is:
  125-3              (1)  a governmental agency;
  125-4              (2)  a body politic and corporate; and
  125-5              (3)  a defined district within the meaning of Article
  125-6  XVI, Section 59, of the Texas Constitution.
  125-7        <(b)  A district may, through its board, sue and be sued in
  125-8  any court of this state in the name of the district.  All courts of
  125-9  this state shall take judicial notice of the creation of a
 125-10  district.  A district shall contract and be contracted with in the
 125-11  name of the district.>
 125-12        SECTION 15.  Section 53.172, Water Code, is amended to read
 125-13  as follows:
 125-14        Sec. 53.172.  Ordering Bond Election.  After the creation of
 125-15  a district and the qualification of the supervisors, the board may
 125-16  order an election in the district to authorize a bond issue.  <The
 125-17  board shall set the day for the election, which must be held during
 125-18  the period beginning on the 20th day and ending with the 30th day
 125-19  after the day of the order.>  At this election, the board shall
 125-20  submit only a proposition authorizing the issuance of bonds and the
 125-21  levy of a tax to pay the bonds.  The ballots shall be printed to
 125-22  allow for voting for or against the proposition:  "The issuance of
 125-23  bonds and the levy of taxes to pay the bonds."
 125-24        SECTION 16.  Section 54.025, Water Code, is amended to read
 125-25  as follows:
  126-1        Sec. 54.025.  Qualification of Temporary Directors.  After a
  126-2  district has been organized, each temporary director shall execute
  126-3  a <his> bond in accordance with the provisions of Section 49.055
  126-4  <54.116 of this code> and shall take the <his> oath of office, and
  126-5  the board shall meet and organize.
  126-6        SECTION 17.  Section 54.036, Water Code, is amended to read
  126-7  as follows:
  126-8        Sec. 54.036.  Directors to Continue Serving.  The existing
  126-9  board of a district converted to a municipal utility district under
 126-10  the provisions of this chapter shall continue to serve as the board
 126-11  of the converted district <until the first Saturday in April
 126-12  following conversion of the district, at which time five directors
 126-13  shall be elected to serve for such period of time and in the same
 126-14  manner as provided in Section 54.029 of this code for directors
 126-15  first elected for a district>.
 126-16        SECTION 18.  Section 54.203, Water Code, is amended to read
 126-17  as follows:
 126-18        Sec. 54.203.  MUNICIPAL Solid Waste.  A district is
 126-19  authorized to purchase, construct, acquire, own, operate, maintain,
 126-20  repair, improve, extend, or establish a municipal solid waste
 126-21  collection and disposal system, including recycling, inside and
 126-22  outside the district and make proper charges for it.  A district
 126-23  may require use of such services as a condition for receiving other
 126-24  district services.  A district may enter into an exclusive contract
 126-25  with a private entity to provide such services to all land and
  127-1  persons within its boundaries.
  127-2        SECTION 19.  Subsection (a), Section 54.729, Water Code, is
  127-3  amended to read as follows:
  127-4        (a)  After the board of each district has agreed on the terms
  127-5  and conditions of consolidation, which may include the assumption
  127-6  by each district of the <other district's> bonds, notes, or other
  127-7  obligations and voted but unissued bonds of the other consolidating
  127-8  districts payable in whole or in part from taxation, the levy of
  127-9  taxes to pay for the bonds, and adoption of a name for the
 127-10  consolidated district, the board shall order an election in each
 127-11  district to determine whether the districts should be consolidated.
 127-12        SECTION 20.  Subsection (a), Section 54.730, Water Code, is
 127-13  amended to read as follows:
 127-14        (a)  After two or more districts are consolidated, they
 127-15  become one district and are governed as one district, except for
 127-16  the payment of debts created before consolidation if the conditions
 127-17  of consolidation do not provide for the assumption by each district
 127-18  of the <other's> bonds, notes, or other obligations and voted but
 127-19  unissued bonds of the other consolidating districts.
 127-20        SECTION 21.  Section 54.732, Water Code, is amended to read
 127-21  as follows:
 127-22        Sec. 54.732.  ASSESSMENT AND COLLECTION OF TAXES.  After
 127-23  consolidation, the district shall assess and collect taxes on
 127-24  property in the original districts to pay debts created by the
 127-25  original districts unless each district has assumed the <other
  128-1  district's> bonds, notes, or other indebtedness payable in whole or
  128-2  in part from taxation of the other consolidating districts.
  128-3        SECTION 22.  Section 54.733, Water Code, is amended to read
  128-4  as follows:
  128-5        Sec. 54.733.  VOTED BUT UNISSUED BONDS.  In the event any
  128-6  consolidating <either> district has voted but unissued bonds
  128-7  payable in whole or in part from taxation and the consolidated
  128-8  district assumed the voted but unissued bonds and the consolidated
  128-9  district was authorized to levy taxes to pay for the bonds, then
 128-10  the consolidated district shall be authorized to issue the voted
 128-11  but unissued bonds in the name of the consolidated district and
 128-12  levy a uniform tax on all taxable property in the consolidated
 128-13  district to pay for the bonds.
 128-14        SECTION 23.  Chapter 54, Water Code, is amended by adding
 128-15  Sections 54.739 through 54.748 to read as follows:
 128-16        Sec. 54.739.  ANNEXATION OF CERTAIN DISTRICTS.  (a)  Before a
 128-17  municipality may institute proceedings to annex a district, the
 128-18  municipality shall give the district not less than 24 months
 128-19  advance written notice of its intention to do so.  After such
 128-20  written notice is given, the district may not issue any additional
 128-21  bonded indebtedness, extend any of its services to additional areas
 128-22  outside its boundaries, or institute any new type of service
 128-23  without the prior written approval of the governing body of the
 128-24  municipality, which approval may not be unreasonably withheld or
 128-25  delayed.
  129-1        (b)  The board of directors of the district by resolution may
  129-2  waive the giving of notice required under this section or agree to
  129-3  a shorter notice period.
  129-4        Sec. 54.740.  Substituting Land of Equal Acreage and Value.
  129-5  After the district is organized and acquires facilities with which
  129-6  to function for the purposes for which it was organized, and votes,
  129-7  issues and sells bonds for such purposes, land within the district
  129-8  boundaries subject to taxation that does not need or utilize the
  129-9  services of the district may be excluded and other land not within
 129-10  the boundaries of the district may be included within the
 129-11  boundaries of the district as provided by the provisions of this
 129-12  section and Sections 54.742 through 54.748 subject to commission
 129-13  approval.
 129-14        Sec. 54.741.  Requisites for Application for Exclusion.  An
 129-15  owner of land in the district not receiving services from the
 129-16  district may apply for its exclusion from the district boundaries
 129-17  if all taxes levied and assessed by the district on the land to be
 129-18  excluded have been fully paid.  The application shall set forth
 129-19  facts concerning the land proposed for exclusion, including
 129-20  evidence of the reasonable market value of the land, and state that
 129-21  the other requisites for the exclusion of the land and substitution
 129-22  of other land have been fulfilled or will be fulfilled at the
 129-23  hearing on the application.  The application shall be verified and
 129-24  acknowledged in a recordable form as conveyances of real property.
 129-25        Sec. 54.742.  Inclusion of Substitute Land Required.  An
  130-1  application for exclusion can only be considered by the board if an
  130-2  application is filed by an owner of other land lying outside the
  130-3  boundaries of the district seeking inclusion of land that can be
  130-4  served in a practical manner by the district of at least equal
  130-5  value to the land proposed for exclusion.  Such land must be
  130-6  included within the district boundaries and taxing jurisdiction of
  130-7  the district simultaneously with the exclusion of the land proposed
  130-8  for exclusion.  Such included land must be of sufficient acreage to
  130-9  avoid an impairment of the security for payment of voted and issued
 130-10  bonds and any other contract obligations payable or secured, in
 130-11  whole or in part, from ad valorem taxes or revenues of the
 130-12  district.
 130-13        Sec. 54.743.  Application for Inclusion.  The application
 130-14  submitted by an owner of land proposed for inclusion shall set
 130-15  forth that the owner of the new land assumes the payment of all
 130-16  taxes, assessments, and fees levied on the land and assessed by the
 130-17  district after the date the land is included in the district.  The
 130-18  application shall also set forth an agreement by the owner of the
 130-19  land proposed for inclusion that the land will be subject to future
 130-20  taxes for bond tax and other assessments and fees levied and
 130-21  assessed by the district and be subject to the same liens and
 130-22  provisions and statutes governing all other lands in the district
 130-23  as though the land had been incorporated originally in the
 130-24  district.  The application for inclusion shall be verified and
 130-25  acknowledged in a recordable form as conveyances of real property.
  131-1        Sec. 54.744.  Notice of Hearing and Hearing Procedures.  The
  131-2  board shall give notice of the hearing on the applications for
  131-3  exclusion and inclusion in conformity with the notice and hearing
  131-4  requirements otherwise applicable to exclusions or additions of
  131-5  land.  The board at such hearing shall hear all interested parties
  131-6  and all evidence in connection with the applications.
  131-7        Sec. 54.745.  Impairment of Security.  For purposes of the
  131-8  board's consideration of the applications, the lands proposed for
  131-9  inclusion shall be deemed to be sufficient to avoid an impairment
 131-10  of the security for payment of obligations of the district if:
 131-11              (1)  according to the county tax rolls, the taxable
 131-12  value of such included lands equals or exceeds the taxable value of
 131-13  the excluded lands;
 131-14              (2)  the estimated costs of providing district
 131-15  facilities and services to such included lands is equal to or less
 131-16  than the estimated costs of providing district facilities and
 131-17  services to the excluded lands; and
 131-18              (3)  the district's outstanding bonds or contract
 131-19  obligations are payable in whole or in part by a pledge of net
 131-20  revenues from the ownership or operation of the district's
 131-21  facilities, and the projected net revenues to be derived from the
 131-22  lands to be included during the succeeding 12-month period, as
 131-23  determined by the district's engineer, equals or exceeds the
 131-24  projected net revenues that would otherwise have been derived from
 131-25  the lands to be excluded during the same period.
  132-1        Sec. 54.746.  Board's Resolution to Substitute.  If the board
  132-2  finds that all the conditions provided for the exclusion of land
  132-3  and inclusion of other land in the district exist and that it is in
  132-4  the best interest of the district to grant such applications, it
  132-5  may adopt and enter in its minutes a resolution and order excluding
  132-6  all or part of the land proposed for exclusion and including all or
  132-7  part of the land proposed for inclusion.  Prior to the effective
  132-8  date of the exclusion and inclusion of lands, the district shall
  132-9  have received payment of all fees, charges, assessments, taxes,
 132-10  together with any associated penalties and interest due or overdue
 132-11  in respect to the lands excluded, and if no ad valorem taxes or
 132-12  fees have yet been established by the district for the current
 132-13  year, an amount determined by the district to equal the estimated
 132-14  ad valorem taxes and standby fees to be established by the district
 132-15  for the current year, prorated to the date of exclusion with
 132-16  respect to such excluded lands, shall also be paid.
 132-17        Sec. 54.747.  Liability of Excluded and Included Land.  The
 132-18  land excluded from the district is free from any lien or liability
 132-19  created on the excluded land by reason of its having been included
 132-20  in the district.  Land included in the district is subject to all
 132-21  laws, liens, and provisions governing the district and the land in
 132-22  the district.
 132-23        Sec. 54.748.  Service to Included Land.  The district has the
 132-24  same right and obligation to furnish services to the included land
 132-25  that it previously had to furnish to the excluded land.
  133-1        SECTION 24.  Section 55.101, Water Code, is amended to read
  133-2  as follows:
  133-3        Sec. 55.101.  Board of Directors.  The governing body of a
  133-4  district is a <the> board of five directors.
  133-5        SECTION 25.  Section 55.102, Water Code, is amended to read
  133-6  as follows:
  133-7        Sec. 55.102.  Qualifications of Directors.  To be qualified
  133-8  for election as a director, a person must be a resident of the
  133-9  state, own land subject to taxation in the district, and be at
 133-10  least 18 <more than 21> years of age at the time of the election.
 133-11  Section 49.052 does not apply to a district governed by this
 133-12  chapter whose principal purpose is providing water for irrigation.
 133-13        SECTION 26.  Section 55.721, Water Code, is amended to read
 133-14  as follows:
 133-15        Sec. 55.721.  Exclusion of Nonagricultural and Nonirrigable
 133-16  Land From District.  Land located in the district which is
 133-17  classified as nonagricultural and nonirrigable may be excluded from
 133-18  the district in the manner provided in Subchapter J, Chapter 49
 133-19  <Sections 51.702-51.713 of this code>.
 133-20        SECTION 27.  Section 56.064, Water Code, is amended to read
 133-21  as follows:
 133-22        Sec. 56.064.  Election of Directors.  (a)  On petition of a
 133-23  majority of the real property taxpayers of a district requesting an
 133-24  election of district directors, the commissioners court shall
 133-25  immediately order an election to be held at the earliest legal
  134-1  time.  The election shall be held as other elections under Chapter
  134-2  49 <this chapter>.
  134-3        (b)  <The commissioners court shall declare the three persons
  134-4  receiving the highest number of votes elected, and if two or more
  134-5  persons tie for the third highest vote, the commissioners court
  134-6  shall elect the third director from those tying for the place.>
  134-7        <(c)  On qualifying for office, directors elected under this
  134-8  section are the legal and rightful directors of the district within
  134-9  the full meaning and purpose of this law.>
 134-10        <(d)  The first elected directors of the district hold office
 134-11  until the next regular directors' election, and subsequent
 134-12  directors of the district are elected every four years except as
 134-13  provided by Subsection (e) of this section.>
 134-14        <(e)>  The first elected directors of the districts in
 134-15  Calhoun, Matagorda, and Victoria Counties hold office until May 15
 134-16  of the next succeeding odd-numbered year.  Subsequent directors of
 134-17  the district are elected every two years on the first Saturday in
 134-18  May in each odd-numbered year, for a term of two years beginning on
 134-19  May 15 following the election.
 134-20        SECTION 28.  Section 57.053, Water Code, is amended to read
 134-21  as follows:
 134-22        Sec. 57.053.  Term of Office, Removal, and Succession.
 134-23  (a)  <Each director shall hold office for a period of two years and
 134-24  until his successor is appointed and has qualified.>
 134-25        <(b)>  A vacancy on the board shall be filled by majority
  135-1  vote of the commissioners court <of jurisdiction>, and the court
  135-2  shall appoint directors so that the board will always have full
  135-3  membership.
  135-4        (b) <(c)>  The commissioners court <of jurisdiction>, by
  135-5  majority vote, may remove an appointed <a> member of the board.
  135-6        SECTION 29.  Section 57.060, Water Code, is amended to read
  135-7  as follows:
  135-8        Sec. 57.060.  Petition.  Before an election is held under
  135-9  Section 57.057 <of this code>, a petition, signed by at least 100
 135-10  <25> electors in the district <each county commissioners precinct>
 135-11  who are qualified to vote <at an election for directors if a
 135-12  countywide election, or by 50 electors if less than countywide>,
 135-13  shall be presented to the district <county judge> requesting that
 135-14  an election be held in the district to determine whether or not
 135-15  directors for the district should be elected and, if so, to elect
 135-16  directors to serve until the next regular director election <for
 135-17  state and county officers>.  The petition shall include the name of
 135-18  one or more nominees for each director's position.
 135-19        SECTION 30.  Section 57.061, Water Code, is amended to read
 135-20  as follows:
 135-21        Sec. 57.061.  Procedure for Election.  <(a)>  After the
 135-22  petition is presented under Section 57.060 <of this code>, the
 135-23  board <county judge> shall order an election <to determine the
 135-24  propositions presented in the petition.  The election shall be held
 135-25  not less than 30 days from the date of the order calling the
  136-1  election, or the propositions may be determined at a general
  136-2  election>.
  136-3        <(b)  The election order shall designate the polling places
  136-4  which shall be the same as the polling places used in the last
  136-5  general election in the county, if a countywide election is held.>
  136-6        <(c)  The county clerk shall issue notice of the election and
  136-7  shall have the notice published in a newspaper of general
  136-8  circulation in the county once a week for two consecutive weeks.
  136-9  The first publication must be not less than 14 days before the day
 136-10  of the election.>
 136-11        <(d)  The sheriff shall post a copy of the notice at least 20
 136-12  days before the day of the election at each polling place
 136-13  designated in the election order.>
 136-14        <(e)  The district shall pay all expenses incident to calling
 136-15  and holding the election.>
 136-16        SECTION 31.  Section 57.207, Water Code, is amended to read
 136-17  as follows:
 136-18        Sec. 57.207.  Declaring Result of Election.
 136-19  <(a)  Immediately after an election under this chapter, the
 136-20  officials holding the election shall return the result to the
 136-21  commissioners court of jurisdiction.>
 136-22        <(b)  The election officials shall return the ballot boxes to
 136-23  the clerk of the commissioners court of jurisdiction, who shall
 136-24  safely keep the boxes and deliver them with the returns of the
 136-25  election to the commissioners court of jurisdiction at its next
  137-1  regular or special session.>
  137-2        <(c)  The commissioners court of jurisdiction at its first
  137-3  session after the election shall canvass the vote and the returns.
  137-4  If the proposition submitted has been approved by a majority of the
  137-5  electors of the district voting at the election, the commissioners
  137-6  court of jurisdiction shall declare the result in favor of the
  137-7  proposition, but if the proposition is not approved by the electors
  137-8  of the district, the commissioners court of jurisdiction shall
  137-9  declare the result to be against the proposition.>
 137-10        <(d)>  The board <commissioners court of jurisdiction> shall
 137-11  enter an order declaring the election result in its minutes.
 137-12        SECTION 32.  Section 58.072, Water Code, is amended to read
 137-13  as follows:
 137-14        Sec. 58.072.  QUALIFICATIONS.  To be qualified for election
 137-15  as a director, a person must be a resident of the state, be the
 137-16  owner of record of fee simple title to land in the district, <and>
 137-17  be at least 18 years of age, and owe no delinquent taxes or
 137-18  assessments to the district.  Section 49.052 does not apply to a
 137-19  district governed by this chapter.
 137-20        SECTION 33.  Subchapter A, Chapter 60, Water Code, is amended
 137-21  by adding Section 60.002 to read as follows:
 137-22        Sec. 60.002.  AUDIT.  Subchapter G, Chapter 49, related to
 137-23  audit of districts, shall apply to districts governed by this
 137-24  chapter.
 137-25        SECTION 34.  Subchapter M, Chapter 60, Water Code, is amended
  138-1  by adding Section 60.350 to read as follows:
  138-2        Sec. 60.350.  BONDS.  Section 49.181, related to the
  138-3  authority of commission over issuance of district bonds, and
  138-4  Section 49.183, related to bond sales, shall apply to bonds
  138-5  supported by taxes and issued by districts governed by this
  138-6  chapter.
  138-7        SECTION 35.  Section 65.103, Water Code, is amended to read
  138-8  as follows:
  138-9        Sec. 65.103.  Election of Directors; Terms of Office.
 138-10  (a)  The persons receiving the highest number of votes at each
 138-11  election shall serve as directors of the district.
 138-12        (b)  The terms of the directors may run concurrently, or may
 138-13  be staggered, but in any event, the term of office of a director
 138-14  may not exceed three years.
 138-15        (c)  The method for determining the initial terms for each of
 138-16  the directors constituting the initial board shall be determined by
 138-17  the temporary directors, and the terms must be clearly stated on
 138-18  the ballot for the confirmation and directors' election.  At
 138-19  subsequent elections in each following year in which there is an
 138-20  election, the election must be held on the same uniform election
 138-21  date as the confirmation and directors' election, and the terms of
 138-22  the directors being elected must be stated on the ballot.
 138-23        <(d)  The election of directors must be held in a district on
 138-24  one of the dates provided by Section 9b, Texas Election Code
 138-25  (Article 2.01b, Vernon's Texas Election Code).>
  139-1        <(e)  The permanent directors may assign a position number to
  139-2  each director's office, and each director subsequently shall be
  139-3  elected by position and not at large.>
  139-4        SECTION 36.  Chapter 65, Water Code, is amended by adding
  139-5  Section 65.235 to read as follows:
  139-6        Sec. 65.235.  Prohibition on Assessment or Collection of
  139-7  Taxes.  Section 49.107 does not apply to a district created under
  139-8  this chapter.
  139-9        SECTION  37.  Section 66.101, Water Code, is amended to read
 139-10  as follows:
 139-11        Sec. 66.101.  Board of Directors.  A district shall be
 139-12  governed by a board of directors composed of five members, who are
 139-13  elected as provided in Chapter 49 <by this chapter>.
 139-14        SECTION 38.  Subsection (b), Section 66.310, Water Code, is
 139-15  amended to read as follows:
 139-16        (b)  Bonds issued by a district and projects and improvements
 139-17  of the district that are provided through the issuance of bonds are
 139-18  governed by Chapter 49 <Sections 54.516 and 54.517 of this code>.
 139-19        SECTION 39.  Chapter 50, Water Code, is repealed, except that
 139-20  Subchapter H is continued in effect for the sole purpose of the
 139-21  administration and operation of contracts created or issued under
 139-22  those laws.
 139-23        SECTION 40.  The following sections of Chapter 51, Water
 139-24  Code, are repealed:  Sections 51.033, 51.034, 51.073 through
 139-25  51.074, 51.077 through 51.084, 51.0851, 51.087 through 51.089,
  140-1  51.091 through 51.101, 51.122 through 51.124, 51.126, 51.131,
  140-2  51.132, 51.136 through 51.138, 51.140 through 51.146, 51.149,
  140-3  51.183, 51.191 through 51.193, 51.221 through 51.224, 51.231
  140-4  through 51.279, 51.354 through 51.363, 51.371 through 51.374,
  140-5  51.412, 51.416 through 51.418, 51.421, 51.422, 51.4321, 51.4371,
  140-6  51.691 through 51.701, 51.714 through 51.731, and 51.737 through
  140-7  51.747.
  140-8        SECTION 41.  The following sections of Chapter 52, Water
  140-9  Code, are repealed:  Sections 52.104, 52.107 through 52.114, 52.116
 140-10  through 52.118, 52.119 through 52.121, 52.157, 52.251 through
 140-11  52.253, 52.259 through 52.262, and 52.297.
 140-12        SECTION 42.  The following sections of Chapter 53, Water
 140-13  Code, are repealed:  Sections 53.020, 53.022, 53.023, 53.025
 140-14  through 53.028, 53.035 through 53.039, 53.064, 53.065, 53.067
 140-15  through 53.070, 53.0721, 53.076, 53.077, 53.084 through 53.087,
 140-16  53.089, 53.090, 53.105, 53.106, 53.108 through 53.111, 53.114,
 140-17  53.117 through 53.120, 53.123 through 53.125, 53.141 through
 140-18  53.144, 53.147, 53.148, 53.173 through 53.175, 53.1791, 53.197,
 140-19  53.198, and 53.231 through 53.273.
 140-20        SECTION 43.  The following sections of Chapter 54, Water
 140-21  Code, are repealed:  Sections 54.026 through 54.029, 54.103 through
 140-22  54.126, 54.202, 54.204, 54.209 through 54.233, 54.301 through
 140-23  54.312, 54.506, 54.507(a), 54.509, 54.5121, 54.513, 54.516, 54.517,
 140-24  54.519, 54.701 through 54.727.
 140-25        SECTION 44.  The following sections of Chapter 55, Water
  141-1  Code, are repealed:  Sections 55.030, 55.033 through 55.036,
  141-2  55.052, 55.104 through 55.106, 55.109, 55.111 through 55.116,
  141-3  55.118 through 55.128, 55.162, 55.164, 55.168 through 55.184,
  141-4  55.189 through 55.191, 55.199, 55.203, 55.252, 55.291 through
  141-5  55.304, 55.331, 55.423 through 55.430, 55.451, 55.453, 55.492
  141-6  through 55.496, 55.503, 55.506, 55.711 through 55.720, and 55.722
  141-7  through 55.749.
  141-8        SECTION 45.  The following sections of Chapter 56, Water
  141-9  Code, are repealed:  Sections 56.027 through 56.031, 56.062,
 141-10  56.063, 56.065 through 56.068, 56.076 through 56.081, 56.083,
 141-11  56.113, 56.114, 56.119, 56.129 through 56.134, 56.136, 56.138,
 141-12  56.139, 56.183, 56.184, 56.2045, and 56.714 through 56.725.
 141-13        SECTION 46.  The following sections of Chapter 57, Water
 141-14  Code, are repealed:  Sections 57.052, 57.054 through 57.056, 57.062
 141-15  through 57.070, 57.095 through 57.099, 57.106, 57.107, 57.109,
 141-16  57.110, 57.112 through 57.115, 57.119, 57.120, 57.171 through
 141-17  57.174, 57.178, 57.202 through 57.206, 57.2075, 57.209 through
 141-18  57.211, and 57.276 through 57.278.
 141-19        SECTION 47.  The following sections of Chapter 58, Water
 141-20  Code, are repealed:  Sections 58.033, 58.034, 58.073, 58.074
 141-21  through 58.083, 58.085 through 58.088, 58.090 through 58.100,
 141-22  58.123, 58.124, 58.131, 58.132, 58.135, 58.139 through 58.149,
 141-23  58.151, 58.152, 58.169, 58.179, 58.187 through 58.189, 58.221
 141-24  through 58.224, 58.261, 58.317, 58.354 through 58.362, 58.442,
 141-25  58.451, 58.452, 58.601, 58.691 through 58.701, and 58.714 through
  142-1  58.725.
  142-2        SECTION 48.  The following sections of Chapter 65, Water
  142-3  Code, are repealed:  Sections 65.024 through 65.029, 65.104 through
  142-4  65.122, 65.202, 65.204, 65.209 through 65.234, 65.301, 65.401
  142-5  through 65.409, 65.509, 65.512, 65.514, and 65.701 through 65.722.
  142-6        SECTION 49.  The following sections of Chapter 66, Water
  142-7  Code, are repealed:  Sections 66.022 through 66.029, 66.103 through
  142-8  66.117, 66.119, 66.120, 66.203 through 66.205, 66.208 through
  142-9  66.215, 66.301, 66.302, 66.305 through 66.309, 66.312, and 66.323.
 142-10        SECTION 50.  (a)  This Act takes effect as provided by this
 142-11  section.
 142-12        (b)  Subsection (b), Section 49.103, Water Code, as added by
 142-13  this Act, shall govern all elections held after December 31, 1995.
 142-14  Directors elected at any election held between January 1, 1992, and
 142-15  April 30, 1992, shall serve until the January, 1996, election.
 142-16  Directors elected at any election held between May 1, 1992, and
 142-17  December 31, 1992, shall serve until the May, 1996, election.
 142-18  Directors elected at any election held between January 1, 1993, and
 142-19  April 30, 1993, shall serve until the January, 1996, election.
 142-20  Directors elected at any election held between May 1, 1993, and
 142-21  July 31, 1993, shall serve until the May, 1996, election.
 142-22  Directors elected at any election held between August 1, 1993, and
 142-23  December 31, 1993, shall serve until the May, 1998, election.
 142-24  Directors elected at any election held between January 1, 1994, and
 142-25  April 30, 1994, shall serve until the January, 1998, election.
  143-1  Directors elected at any election held between May 1, 1994, and
  143-2  December 31, 1994, shall serve until the May, 1998, election.
  143-3  Directors elected at any election held between January 1, 1995, and
  143-4  April 30, 1995, shall serve until the January, 1998, election.
  143-5  Directors elected at any election held between May 1, 1995, and
  143-6  July 31, 1995, shall serve until the May, 1998, election.
  143-7  Directors elected at any election held between August 1, 1995, and
  143-8  December 31, 1995, shall serve until the May, 1998, election.
  143-9  Directors whose terms expire prior to the election date set by this
 143-10  section shall continue to serve until their successors have been
 143-11  elected and qualified.
 143-12        (c)  All other provisions of this Act take effect September
 143-13  1, 1995.
 143-14        SECTION 51.  The importance of this legislation and the
 143-15  crowded condition of the calendars in both houses create an
 143-16  emergency and an imperative public necessity that the
 143-17  constitutional rule requiring bills to be read on three several
 143-18  days in each house be suspended, and this rule is hereby suspended,
 143-19  and that this Act take effect and be in force according to its
 143-20  terms, and it is so enacted.