74R12528 E
          By Armbrister                                          S.B. No. 626
          Substitute the following for S.B. No. 626:
          By Counts                                          C.S.S.B. No. 626
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to certain laws governing water districts and nonprofit
    1-3  water or sewer service corporations; creating penalties; granting
    1-4  authority to issue bonds; granting the power of 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
   1-24  49 to read as follows:
    2-1          CHAPTER 49.  PROVISIONS APPLICABLE TO ALL DISTRICTS
    2-2                   SUBCHAPTER A.  GENERAL PROVISIONS
    2-3        Sec. 49.001.  DEFINITIONS.  (a)  As used in this chapter:
    2-4              (1)  "District" means any district or authority created
    2-5  by authority of either Sections 52(b)(1) and (2), Article III, or
    2-6  Section 59, Article XVI, Texas Constitution, regardless of how
    2-7  created.  The term "district" shall not include any navigation
    2-8  district or port authority created under general or special law.
    2-9              (2)  "Commission" means the Texas Natural Resource
   2-10  Conservation Commission.
   2-11              (3)  "Board" means the governing body of a district.
   2-12              (4)  "Executive director" means the executive director
   2-13  of the commission.
   2-14              (5)  "Water supply corporation" means a nonprofit water
   2-15  supply or sewer service corporation created or operating under
   2-16  Chapter 76, Acts of the 43rd Legislature, 1st Called Session, 1933
   2-17  (Article 1434a, Vernon's Texas Civil Statutes).
   2-18              (6)  "Director" means either a supervisor or director
   2-19  appointed or elected to the board.
   2-20              (7)  "Municipal solid waste" has the same meaning
   2-21  assigned by Section 361.003, Health and Safety Code.
   2-22              (8)  "Special water authority" means a river authority
   2-23  as that term is defined in Section 30.003, or a district created by
   2-24  a special Act of the legislature that:
   2-25                    (A)  is a provider of water or wastewater service
   2-26  to two or more municipalities; and
   2-27                    (B)  is governed by a board of directors
    3-1  appointed or designated in whole or in part by the governor, the
    3-2  Texas Water Development Board, or municipalities within its service
    3-3  area.
    3-4              (9)  "Potable water" means water that has been treated
    3-5  for public drinking water supply purposes.
    3-6        (b)  These definitions are for use in this chapter only, and
    3-7  have no effect on any other statute or code unless specifically
    3-8  referenced by that statute or code.
    3-9        Sec. 49.002.  APPLICABILITY.  This chapter applies to all
   3-10  general and special law districts to the extent that the provisions
   3-11  of this chapter do not directly conflict with a provision in any
   3-12  other chapter of this code or any Act creating or affecting a
   3-13  special law district.  In the event of such conflict, the specific
   3-14  provisions in such other chapter or Act shall control.
   3-15        Sec. 49.003.  PENALTY.  A district that fails to comply with
   3-16  the filing provisions of this code may be subject to a civil
   3-17  penalty of up to $100 per day for each day the district wilfully
   3-18  continues to violate these provisions after receipt of written
   3-19  notice of violation from the executive director by certified mail,
   3-20  return receipt requested.  The state may sue to recover the
   3-21  penalty.
   3-22        Sec. 49.004.  PENALTY FOR VIOLATION OF DISTRICT RULES.  (a)
   3-23  The board may set reasonable civil penalties for the breach of any
   3-24  rule of the district that shall not exceed the jurisdiction of a
   3-25  justice court as provided by Section 27.031, Government Code.
   3-26        (b)  A penalty under this section is in addition to any other
   3-27  penalty provided by the law of this state and may be enforced by
    4-1  complaints filed in the appropriate court of jurisdiction in the
    4-2  county in which the district's principal office or meeting place is
    4-3  located.
    4-4        (c)  If the district prevails in any suit to enforce its
    4-5  rules, it may, in the same action, recover reasonable fees for
    4-6  attorneys, expert witnesses, and other costs incurred by the
    4-7  district before the court.  The amount of the attorney's fees shall
    4-8  be fixed by the court.
    4-9            (Sections 49.005-49.009 reserved for expansion
   4-10                        SUBCHAPTER B.  CREATION
   4-11        Sec. 49.010.  ORDER OR ACT CREATING DISTRICT.  Within 60 days
   4-12  after the date a district is created, the district shall file with
   4-13  the executive director a certified copy of the order or legislative
   4-14  Act creating the district or authorizing its creation, unless the
   4-15  district was created by order of the commission.
   4-16            (Sections 49.011-49.050 reserved for expansion
   4-17               SUBCHAPTER C.  ADMINISTRATIVE PROVISIONS
   4-18        Sec. 49.051.  BOARD OF DIRECTORS.  A district shall be
   4-19  governed by its board, the number of which is otherwise provided by
   4-20  law.
   4-21        Sec. 49.052.  DISQUALIFICATION OF DIRECTORS.  (a)  A person
   4-22  is disqualified from serving as a member of a board of a district
   4-23  that includes less than all the territory in at least one county
   4-24  and which, if located within the corporate area of a city or
   4-25  cities, includes within its boundaries less than 75 percent of the
   4-26  incorporated area of the city or cities, if that person:
   4-27              (1)  is related within the third degree of affinity or
    5-1  consanguinity to a developer of property in the district, any other
    5-2  member of the board, or the manager, engineer, attorney, or other
    5-3  person providing professional services to the district;
    5-4              (2)  is an employee of any developer of property in the
    5-5  district or any director, manager, engineer, attorney, or other
    5-6  person providing professional services to the district or a
    5-7  developer of property in the district in connection with the
    5-8  district or property located in the district;
    5-9              (3)  is a developer of property in the district;
   5-10              (4)  is serving as an attorney, consultant, engineer,
   5-11  manager, architect, or in some other professional capacity for the
   5-12  district or a developer of property in the district in connection
   5-13  with the district or property located in the district;
   5-14              (5)(A)  is a party to a contract with or along with the
   5-15  district except for the purchase of public services furnished by
   5-16  the district to the public generally; or
   5-17                    (B)  is a party to a contract with or along with
   5-18  a developer of property in the district relating to the district or
   5-19  to property within the district, other than a contract limited
   5-20  solely to the purpose of purchasing or conveying real property in
   5-21  the district for the purpose of either establishing a permanent
   5-22  residence, establishing a commercial business within the district,
   5-23  or qualifying as a director; or
   5-24              (6)  during the term of office, fails to maintain the
   5-25  qualifications required by law to serve as a director.
   5-26        (b)  Within 60 days after the board determines a relationship
   5-27  or employment exists which constitutes a disqualification under
    6-1  Subsection (a), it shall replace the person serving as a member of
    6-2  the board with a person who would not be disqualified.
    6-3        (c)  Any person who wilfully occupies an office as a member
    6-4  of a board and exercises the powers and duties of that office when
    6-5  disqualified under the provisions of Subsection (a) is guilty of a
    6-6  misdemeanor and, on conviction, shall be fined not less than $100
    6-7  nor more than $1,000.
    6-8        (d)  As used in this section, "developer of property in the
    6-9  district" means any person who owns land located within a district
   6-10  covered under this section and who has divided or proposes to
   6-11  divide the land into two or more parts for the purpose of laying
   6-12  out any subdivision or any tract of land or any addition to any
   6-13  town or city, or for laying out suburban lots or building lots, or
   6-14  any lots, streets, alleys, or parks or other portions intended for
   6-15  public use, or the use of purchasers or owners of lots fronting
   6-16  thereon or adjacent thereto.
   6-17        (e)  Any rights obtained by any third party through official
   6-18  action of a board covered by this section are not impaired or
   6-19  affected by the disqualification under this section of any member
   6-20  of the board to serve, provided that the third party had no
   6-21  knowledge at the time the rights were obtained of the fact that the
   6-22  member of the board was disqualified to serve.
   6-23        (f)  This section shall not apply to special water
   6-24  authorities, districts defined in Section 49.181(h)(4), or a
   6-25  district where the principal function of the district is to provide
   6-26  irrigation water to agricultural lands or to provide nonpotable
   6-27  water for any purpose.
    7-1        (g)  A board by unanimous vote of its remaining members may
    7-2  remove a board member only if that board member has missed one-half
    7-3  or more of the regular meetings scheduled during the prior 12
    7-4  months.  Any board member so removed may file a written appeal with
    7-5  the commission within 30 days after receiving written notice of the
    7-6  board action.  The commission may reinstate a removed director if
    7-7  the commission finds that the removal was unwarranted under the
    7-8  circumstances, including the reasons for absences, the time and
    7-9  place of the meetings missed, the business conducted at the
   7-10  meetings missed, and any other facts or circumstances the
   7-11  commission may deem relevant.
   7-12        Sec. 49.053.  QUORUM.  A majority of the membership of the
   7-13  board constitutes a quorum for any meeting, and a concurrence of a
   7-14  majority of the entire membership of the board is sufficient for
   7-15  transacting any business of the district.  This section does not
   7-16  apply to special water authorities.
   7-17        Sec. 49.054.  OFFICERS.  (a)  After a district is created and
   7-18  the directors have qualified, the board shall meet, elect a
   7-19  president, vice-president, secretary, and any other officers or
   7-20  assistant officers as the board may deem necessary, and begin the
   7-21  discharge of its duties.
   7-22        (b)  After each directors election, the board shall meet and
   7-23  elect officers.
   7-24        (c)  The president is the chief executive officer of the
   7-25  district, presides at all meetings of the board, and shall execute
   7-26  all documents on behalf of the district.  The vice-president shall
   7-27  act as president in case of the absence or disability of the
    8-1  president.  The secretary is responsible for seeing that all
    8-2  records and books of the district are properly kept and shall
    8-3  attest the president's signature on all documents.
    8-4        (d)  The board may appoint another director, the general
    8-5  manager, or any employee as assistant or deputy secretary to assist
    8-6  the secretary, and any such person shall be entitled to certify as
    8-7  to the authenticity of any record of the district, including but
    8-8  not limited to all proceedings relating to bonds, contracts, or
    8-9  indebtedness of the district.
   8-10        (e)  After any election or appointment of a director, a
   8-11  district shall notify the executive director within 30 days after
   8-12  the date of the election or appointment of the name and mailing
   8-13  address of the director chosen and the date that director's term of
   8-14  office expires.  The executive director shall provide forms to the
   8-15  district for such purpose.
   8-16        (f)  This section does not apply to special water
   8-17  authorities.
   8-18        Sec. 49.055.  SWORN STATEMENT, BOND, AND OATH OF OFFICE.  (a)
   8-19  As soon as practicable after a director is elected or appointed,
   8-20  that director shall make the sworn statement prescribed by the
   8-21  constitution for public office.
   8-22        (b)  As soon as practicable after a director has made the
   8-23  sworn statement, and before beginning to perform the duties of
   8-24  office, that director shall take the oath of office prescribed by
   8-25  the constitution for public officers.
   8-26        (c)  Before beginning to perform the duties of office, each
   8-27  director shall execute a bond for $10,000 payable to the district
    9-1  and conditioned on the faithful performance of that director's
    9-2  duties.  All bonds of the directors shall be approved by the board
    9-3  and paid for by the district.
    9-4        (d)  The sworn statement, bond, and oath shall be filed with
    9-5  the district and retained in its records.  A duplicate original of
    9-6  the sworn statement and the oath shall also be filed with the
    9-7  secretary of state within 10 days after their execution and need
    9-8  not be filed before the new director begins to perform the duties
    9-9  of office.
   9-10        (e)  This section does not apply to special water
   9-11  authorities.
   9-12        Sec. 49.056.  GENERAL MANAGER.  (a)  The board may employ or
   9-13  contract with a person to perform such services as general manager
   9-14  for the district as the board may from time to time specify.  The
   9-15  board may delegate to the general manager full authority to manage
   9-16  and operate the affairs of the district subject only to orders of
   9-17  the board.
   9-18        (b)  The board may delegate to the general manager the
   9-19  authority to employ all persons necessary for the proper handling
   9-20  of the business and operation of the district and to determine the
   9-21  compensation to be paid all employees other than the general
   9-22  manager.
   9-23        (c)  Except as provided by Section 49.052, a director may be
   9-24  employed as general manager of the district, but the compensation
   9-25  of a general manager who also serves as a director shall be
   9-26  established by the other directors.
   9-27        Sec. 49.057.  MANAGEMENT OF DISTRICT.  (a)  The board shall
   10-1  be responsible for the management of all the affairs of the
   10-2  district.  The district shall employ or contract with all persons,
   10-3  firms, partnerships, corporations, or other entities, public or
   10-4  private, deemed necessary by the board for the conduct of the
   10-5  affairs of the district, including, but not limited to, engineers,
   10-6  attorneys, financial advisors, operators, bookkeepers, tax
   10-7  assessors and collectors, auditors, and administrative staff.
   10-8        (b)  The board shall adopt an annual budget.  All district
   10-9  employees are employed at the will of the district unless the
  10-10  district and employee execute a written employment contract.
  10-11        (c)  The board shall set the compensation and terms for
  10-12  consultants.
  10-13        (d)  In selecting attorneys, engineers, auditors, financial
  10-14  advisors, or other professional consultants, the district shall
  10-15  follow the procedures provided in Subchapter A, Chapter 2254,
  10-16  Government Code (Professional Services Procurement Act).
  10-17        (e)  The board shall require an officer, employee, or
  10-18  consultant who collects, pays, or handles any funds of the district
  10-19  to furnish good and sufficient bond, payable to the district, in an
  10-20  amount determined by the board to be sufficient to safeguard the
  10-21  district.  The bond shall be conditioned on the faithful
  10-22  performance of that person's duties and on accounting for all funds
  10-23  and property of the district.  Such bond shall be signed or
  10-24  endorsed by a surety company authorized to do business in the
  10-25  state.
  10-26        (f)  The board may pay the premium on surety bonds required
  10-27  of officials, employees, or consultants of the district out of any
   11-1  available funds of the district, including proceeds from the sale
   11-2  of bonds.
   11-3        (g)  The board may adopt bylaws to govern the affairs of the
   11-4  district to perform its purposes.  The board may, by resolution,
   11-5  authorize its general manager or other employee to execute
   11-6  documents on behalf of the district.
   11-7        (h)  The board shall also have the right to purchase all
   11-8  materials, supplies, equipment, vehicles, and machinery needed by
   11-9  the district to perform its purposes.
  11-10        Sec. 49.058.  CONFLICTS OF INTEREST.  A director of a
  11-11  district is subject to the provisions of Chapter 171, Local
  11-12  Government Code, relating to the regulation of conflicts of
  11-13  interest of officers of local governments.
  11-14        Sec. 49.059.  DISQUALIFICATION OF TAX ASSESSOR AND COLLECTOR.
  11-15  (a)  No person may serve as tax assessor and collector of a
  11-16  district providing potable water or sewer utility services to
  11-17  household users if that person:
  11-18              (1)  is related within the third degree of affinity or
  11-19  consanguinity to any developer of property in the district, a
  11-20  member of the board, or the manager, engineer, or attorney for the
  11-21  district;
  11-22              (2)  is or was within two years immediately preceding
  11-23  the assumption of assessment and collection duties with the
  11-24  district an employee of any developer of property in the district
  11-25  or any director, manager, engineer, or attorney for the district;
  11-26              (3)  owns an interest in or is employed by any
  11-27  corporation organized for the purpose of tax assessment and
   12-1  collection services, a substantial portion of the stock of which is
   12-2  owned by a developer of property within the district or any
   12-3  director, manager, engineer, or attorney for the district; or
   12-4              (4)  is directly or through a corporation developing
   12-5  land in the district or is a director, engineer, or attorney for
   12-6  the district.
   12-7        (b)  Within 60 days after the board determines a relationship
   12-8  or employment exists which constitutes a disqualification under
   12-9  Subsection (a), it shall replace the person serving as tax assessor
  12-10  and collector with a person who would not be disqualified.
  12-11        (c)  Any person who wilfully violates the provisions of
  12-12  Subsection (a) is guilty of a misdemeanor and on conviction shall
  12-13  be fined not less than $100 nor more than $1,000.
  12-14        (d)  As used in this section, "developer of property in the
  12-15  district" has the same meaning as in Section 49.052(d).
  12-16        Sec. 49.060.  FEES OF OFFICE; REIMBURSEMENT.  (a)  A director
  12-17  is entitled to receive fees of office of not more than $100  a day
  12-18  for each day the director actually spends performing the duties of
  12-19  a director.  The fees of office may not exceed $6,000 per annum
  12-20  except for directors of a special water authority which is engaged
  12-21  in the distribution and sale of electric energy to the public.
  12-22        (b)  Each director is also entitled to receive reimbursement
  12-23  of actual expenses reasonably and necessarily incurred while
  12-24  engaging in activities on behalf of the district.
  12-25        (c)  In order to receive fees of office and to receive
  12-26  reimbursement for expenses, each director shall file with the
  12-27  district a verified statement showing the number of days actually
   13-1  spent in the service of the district and a general description of
   13-2  the duties performed for each day of service.
   13-3        (d)  Section 49.002 notwithstanding, in all areas of conflict
   13-4  the provisions of this section shall take precedence over all prior
   13-5  statutory enactments.  If the enactment of this section results in
   13-6  an increase in the fees of office for any district, that district's
   13-7  fees of office shall not increase unless the board adopts a
   13-8  resolution authorizing payment of the higher fees.
   13-9        Sec. 49.061.  SEAL.  The directors shall adopt a seal for the
  13-10  district.
  13-11        Sec. 49.062.  OFFICES AND MEETING PLACES.  (a)  The board
  13-12  shall designate from time to time and maintain one or more regular
  13-13  offices for conducting the business of the district and maintaining
  13-14  the records of the district.  Such offices may be located either
  13-15  inside or outside the district's boundaries as determined in the
  13-16  discretion of the board.
  13-17        (b)  The board shall designate one or more places inside or
  13-18  outside the district for conducting the meetings of the board.  The
  13-19  meeting place may be a private residence or office, provided that
  13-20  the board, in its order establishing the meeting place, declares
  13-21  the same to be a public place and invites the public to attend any
  13-22  meeting of the board.  If the board establishes a meeting place or
  13-23  places outside the district, it shall give notice of the location
  13-24  or locations by filing a true copy of the resolution establishing
  13-25  the location or locations of the meeting place or places with the
  13-26  commission and also by publishing notice of the location or
  13-27  locations in a newspaper of general circulation in the district.
   14-1  If the location of any of the meeting places outside the district
   14-2  is changed, notice of the change shall be given in the same manner.
   14-3        (c)  After at least 25 qualified electors are residing in a
   14-4  district, on written request of at least five of those electors,
   14-5  the board shall designate a meeting place and hold meetings within
   14-6  the district if it determines that the meeting place used by the
   14-7  district deprives the residents of a reasonable opportunity to
   14-8  attend district meetings.  On the failure to designate the location
   14-9  of the meeting place within the district, five electors may
  14-10  petition the commission to designate a location.  If it determines
  14-11  that the meeting place used by the district deprives the residents
  14-12  of a reasonable opportunity to attend district meetings, the
  14-13  commission may designate a meeting place inside or outside the
  14-14  district which is reasonably available to the public and require
  14-15  that the meetings be held at such place.  After the next election,
  14-16  the board may designate different meeting places, including one
  14-17  located outside the boundaries of the district.
  14-18        (d)  Two or more districts may designate and share offices
  14-19  and meeting places.  This section does not apply to special water
  14-20  authorities.
  14-21        Sec. 49.063.  NOTICE OF MEETINGS.  Notice of meetings of the
  14-22  board shall be given as set forth in the open meetings law, Chapter
  14-23  551, Government Code, except that if a district does not have a
  14-24  meeting place within the district, the district shall post notice
  14-25  of its meeting at a public place within the district specified by
  14-26  the board in a written resolution, rather than at its
  14-27  administrative office.  The board shall specify such public place
   15-1  to be a bulletin board or other place within the district which is
   15-2  reasonably available to the public.  Neither failure to provide
   15-3  notice of a regular meeting nor an insubstantial defect in notice
   15-4  of any meeting shall affect the validity of any action taken at the
   15-5  meeting.
   15-6        Sec. 49.064.  MEETINGS.  The board shall hold such regular
   15-7  and special meetings as may be necessary for the proper conduct of
   15-8  the district's business.  All meetings shall be conducted in
   15-9  accordance with the open meetings law, Chapter 551, Government
  15-10  Code.   A meeting of a committee of the board, or a committee
  15-11  composed of representatives of more than one board, where less than
  15-12  a quorum of any one board is present is not subject to the
  15-13  provisions of the open meetings law, Chapter 551, Government Code.
  15-14        Sec. 49.065.  RECORDS.  (a)  The board shall keep a complete
  15-15  account of all its meetings and proceedings and shall preserve its
  15-16  minutes, contracts, records, notices, accounts, receipts, and other
  15-17  records in a safe place.
  15-18        (b)  The records of each district are the property of the
  15-19  district and are subject to the open records law, Chapter 552,
  15-20  Government Code.
  15-21        (c)  The preservation, microfilming, destruction, or other
  15-22  disposition of the records of each district is subject to the
  15-23  requirements of Chapter 201, Local Government Code, and rules
  15-24  adopted thereunder.
  15-25        Sec. 49.066.  SUITS.  (a)  A district may sue and be sued in
  15-26  the courts of this state in the name of the district by and through
  15-27  its board.  All courts shall take judicial notice of the creation
   16-1  of the district and of its boundaries.
   16-2        (b)  Any court in the state rendering judgment for debt
   16-3  against a district may order the board to levy, assess, and collect
   16-4  taxes or assessments to pay the judgment.
   16-5        (c)  The president or the general manager of any district
   16-6  shall be the agent of the district on whom process, notice, or
   16-7  demand required or permitted by law to be served upon the district
   16-8  may be served.
   16-9        (d)  Except as provided in Subsection (e), no suit may be
  16-10  instituted in any court of this state contesting:
  16-11              (1)  the validity of the creation and boundaries of a
  16-12  district created under this code;
  16-13              (2)  any bonds or other obligations created under this
  16-14  code; or
  16-15              (3)  the validity or the authorization of a contract
  16-16  with the United States by the district.
  16-17        (e)  The matters listed in Subsection (d) may be judicially
  16-18  inquired into at any time and determined in any suit brought by the
  16-19  State of Texas through the attorney general.  The action shall be
  16-20  brought on good cause shown, except where otherwise provided by
  16-21  other provisions of this code or by the Texas Constitution.  It is
  16-22  specifically provided, however, that no such proceeding shall
  16-23  affect the validity of or security for any bonds or other
  16-24  obligations theretofore issued by a district if such bonds or other
  16-25  obligations have been approved by the attorney general as provided
  16-26  by Section 49.184.
  16-27        (f)  A district or water supply corporation shall not be
   17-1  required to give bond for appeal, injunction, or costs in any suit
   17-2  to which it is a party and shall not be required to deposit more
   17-3  than the amount of any award in any eminent domain proceeding.
   17-4        Sec. 49.067.  CONTRACTS.  A district shall contract, and be
   17-5  contracted with, in the name of the district.
   17-6        Sec. 49.068.  CONTRACTS WITH GOVERNMENTAL AGENCIES.  The
   17-7  provisions of this chapter pertaining to bids and the Local
   17-8  Government Code notwithstanding, a district may purchase property
   17-9  from any governmental entity by negotiated contract without the
  17-10  necessity of securing appraisals or advertising for bids.
  17-11        Sec. 49.069.  EMPLOYEE BENEFITS.  (a)  The board may provide
  17-12  for and administer retirement, disability, and death compensation
  17-13  funds for the employees of the district.
  17-14        (b)  The board may establish a public retirement system in
  17-15  accordance with the provisions of Chapter 810, Government Code.
  17-16  The board may also provide for a deferred compensation plan
  17-17  described by Section 457 of the Internal Revenue Code of 1986 (26
  17-18  U.S.C. Section 457).
  17-19        (c)  The board may include hospitalization and medical
  17-20  benefits to its employees as part of the compensation paid to the
  17-21  officers and employees and may adopt any plan, rule, or regulation
  17-22  in connection with it and amend or change the plan, rule, or
  17-23  regulation as it may determine.
  17-24        Sec. 49.070.  WORKERS' COMPENSATION.  The board may become a
  17-25  subscriber under Title 5, Labor Code (Texas Workers' Compensation
  17-26  Act), with any insurance company authorized to write the policies
  17-27  in the State of Texas.
   18-1        Sec. 49.071.  DISTRICT NAME CHANGE.  (a)  On petition by a
   18-2  district showing reasonable grounds for a name change, the
   18-3  commission by order may change the name of the district to the name
   18-4  requested by the district.  The new name must be generally
   18-5  descriptive of the location of the district followed by the type of
   18-6  district as provided by the title of the chapter of the Water Code
   18-7  governing the district.  If a district is located wholly within one
   18-8  county that contains more than one district of that type, the
   18-9  district may be differentiated, if necessary, by adding to the new
  18-10  name the proper consecutive number.  The new name may not be the
  18-11  same as the name of any other district in the county.
  18-12        (b)  A name change takes effect on the date of issuance of
  18-13  the commission order making the name change.
  18-14        (c)  Not later than the 30th day after the date of issuance
  18-15  of the commission order making the name change, the district shall
  18-16  publish notice of the name change in a newspaper or newspapers of
  18-17  general circulation in the county or counties in which the district
  18-18  is located.  Within that same period, the district shall also give
  18-19  notice of the name change by mail to utility customers or
  18-20  permittees, if any, and, to the extent practicable, to the holders
  18-21  of bonds, obligations, and other indebtedness of the district.
  18-22  Failure of the district to comply with this subsection does not
  18-23  affect the validity of the name change.
  18-24        (d)  A change in the name of a district does not affect
  18-25  bonds, obligations, or other indebtedness of the district existing
  18-26  before the name change occurred.
  18-27            (Sections 49.072-49.100 reserved for expansion
   19-1                  SUBCHAPTER D.  ELECTION PROVISIONS
   19-2        Sec. 49.101.  GENERAL.  All elections shall be generally
   19-3  conducted in accordance with the Election Code except as otherwise
   19-4  provided for by this code.  Write-in candidacies for any district
   19-5  office shall be governed by Subchapter C, Chapter 146, Election
   19-6  Code.
   19-7        Sec. 49.102.  CONFIRMATION AND DIRECTOR ELECTION.
   19-8  (a)  Before issuing any bonds or other obligations, an election
   19-9  shall be held within the boundaries of the proposed district to
  19-10  determine if the proposed district shall be established and, if the
  19-11  directors of the district are required by law to be elected, to
  19-12  elect permanent directors.
  19-13        (b)  Notice of a confirmation or director election shall
  19-14  state the day and place or places for holding the election, the
  19-15  propositions to be voted on, and the number of directors to be
  19-16  voted on.
  19-17        (c)  The ballots for a confirmation election shall be printed
  19-18  to provide for voting "For District" and "Against District."
  19-19  Ballots for a directors election shall provide the names of the
  19-20  persons appointed by the governing body who qualified and are
  19-21  serving as temporary directors at the time the election is called.
  19-22  The ballots shall also have blank places after the names of the
  19-23  temporary directors in which a voter may write the names of other
  19-24  persons for directors.
  19-25        (d)  Immediately after the confirmation and director
  19-26  election, the presiding judge shall take returns of the results to
  19-27  the temporary board.  The temporary board shall canvass the returns
   20-1  and declare the results at the earliest practicable time.
   20-2        (e)  If a majority of the votes cast in the election favor
   20-3  the creation of the district, then the temporary board shall
   20-4  declare that the district is created and enter the result in its
   20-5  minutes.  If a majority of the votes cast in the election are
   20-6  against the creation of the district, the temporary board shall
   20-7  declare that the district was defeated and enter the result in its
   20-8  minutes.  A copy of the order shall be filed with the commission.
   20-9        (f)  The order canvassing the results of the confirmation
  20-10  election shall contain a description of the district's boundaries
  20-11  and shall be filed with the executive director and in the deed
  20-12  records of the county or counties in which the district is located.
  20-13        (g)  The temporary board shall also declare the persons
  20-14  receiving the highest number of votes for directors to have been
  20-15  elected as permanent directors.
  20-16        (h)  Unless otherwise agreed, the directors shall decide the
  20-17  initial terms of office by lot, with a simple majority of directors
  20-18  serving until the second succeeding directors election and the
  20-19  remaining directors serving until the next directors election.
  20-20        (i)  The provisions of this section shall not be applicable
  20-21  to any district exercising the powers of Chapter 375, Local
  20-22  Government Code, or any district created by a special Act of the
  20-23  legislature that does not require a confirmation election.
  20-24        Sec. 49.103.  TERMS OF OFFICE OF DIRECTORS.  (a)  Except as
  20-25  provided by Section 49.102, the members of the board of a district
  20-26  shall serve for four-year terms.
  20-27        (b)  An election shall be held on the uniform election date,
   21-1  established by the Election Code, in either January or May of each
   21-2  even-numbered year to elect the appropriate number of directors.
   21-3        (c)  The permanent directors may assign a position number to
   21-4  each director's office, in which case directors shall thereafter be
   21-5  elected by position and not at large.
   21-6        (d)  A district may provide for the election of all
   21-7  directors, or a majority of directors, from single-member
   21-8  districts, which shall be geographically described within the
   21-9  boundaries of the district in a manner that is equitable for the
  21-10  electors within such districts and within the district generally.
  21-11        (e)  Section 49.002 notwithstanding, in all areas of conflict
  21-12  the provisions of Subsection (b) shall take precedence over all
  21-13  prior statutory enactments.
  21-14        (f)  This section does not apply to any special law district
  21-15  or authority that is not required by the law creating the district
  21-16  or authority to elect its directors by the public.
  21-17        Sec. 49.104.  ALTERNATIVE ELECTION PROCEDURES.  (a)
  21-18  Notwithstanding the provisions and requirements of the Election
  21-19  Code and general laws, any two or more districts situated in the
  21-20  same county and in which substantially all of the land is being or
  21-21  has been developed as part of a single community development plan
  21-22  and which are served by common water supply and waste disposal
  21-23  systems may by mutual agreement designate a common election office
  21-24  and common early and regular polling places within one or more of
  21-25  the districts, but outside the boundaries of one or more of the
  21-26  districts, for the conduct of director election proceedings and
  21-27  early and regular balloting in director elections.  This
   22-1  alternative election procedure may only be used if the common
   22-2  election office and polling places so designated:
   22-3              (1)  are within buildings open to the public;
   22-4              (2)  are within the boundaries of at least one of the
   22-5  districts;
   22-6              (3)  meet the requirements of the Election Code and
   22-7  general laws as polling places; and
   22-8              (4)  are located not more than five miles from any
   22-9  portion of the boundaries of any of the participating districts.
  22-10        (b)  Such districts may also agree upon and designate a
  22-11  common election officer and common early and regular voting
  22-12  officials for some or all of the director elections to be
  22-13  simultaneously conducted at a common location, any of whom may be
  22-14  nonelective employees of one or more of the districts, so long as
  22-15  the early and regular voting officials are qualified voters within
  22-16  at least one of the districts.
  22-17        Sec. 49.105.  VACANCIES.  (a)  Except as otherwise provided
  22-18  in this code, all vacancies on the board and in other offices shall
  22-19  be filled for the unexpired term by appointment of the board.
  22-20        (b)  If the number of directors is reduced to fewer than a
  22-21  majority, the vacancies shall be filled by appointment by the
  22-22  commission or the county commissioners court if the district was
  22-23  created by the county commissioners court.  An appointed director
  22-24  shall serve for the unexpired term of the director he or she is
  22-25  replacing.
  22-26        (c)  In the event of a failure to elect one or more members
  22-27  of the board of a district resulting from the absence of, or
   23-1  failure to vote by, the qualified voters in the district, the
   23-2  current members of the board holding the positions not filled at
   23-3  such election shall be deemed to have been reelected and shall
   23-4  serve an additional term of office.
   23-5        Sec. 49.106.  BOND ELECTIONS.  (a)  Before an election is
   23-6  held to authorize the issuance of bonds, other than refunding
   23-7  bonds, there shall be filed in the office of the district and open
   23-8  to inspection by the public an engineer's report covering the land,
   23-9  improvements, facilities, plants, equipment, and appliances to be
  23-10  purchased or constructed and their estimated cost, together with
  23-11  maps, plats, profiles, and data fully showing and explaining the
  23-12  report.
  23-13        (b)  Notice of a bond election shall contain the proposition
  23-14  or propositions to be voted upon, which includes the  estimate of
  23-15  the probable cost of design, construction, purchase, and
  23-16  acquisition of improvements and additions thereto, and incidental
  23-17  expenses connected with such improvements and the issuance of
  23-18  bonds.
  23-19        (c)  A bond election may be held on the same day as any other
  23-20  district election.  The bond election may be called by a separate
  23-21  election order or as a part of any other election order.  The board
  23-22  may submit multiple purposes in a single proposition at an
  23-23  election.
  23-24        Sec. 49.107.  OPERATION AND MAINTENANCE TAX.  (a)  A district
  23-25  may levy and collect a tax for operation and maintenance purposes,
  23-26  including funds for planning, constructing, acquiring, maintaining,
  23-27  repairing, and operating all necessary land, plants, works,
   24-1  facilities, improvements, appliances, and equipment of the district
   24-2  and for paying costs of proper services, engineering and legal
   24-3  fees, and organization and administrative expenses.
   24-4        (b)  An operation and maintenance tax may not be levied by a
   24-5  district until it is approved by a majority of the electors voting
   24-6  at an election held for that purpose.  After such a tax has been
   24-7  authorized by the district's voters, the board shall be authorized
   24-8  to levy the tax and have it assessed and collected as other
   24-9  district taxes.
  24-10        (c)  An operation and maintenance tax election may be held at
  24-11  the same time and in conjunction with any other district election.
  24-12  The election may be called by a separate election order or as part
  24-13  of any other election order.
  24-14        (d)  The proposition in an operation and maintenance tax
  24-15  election may be for a specific maximum rate or for an unlimited
  24-16  rate.
  24-17        (e)  If a district has any surplus operation and maintenance
  24-18  tax funds that are not needed for the purposes for which they were
  24-19  collected, the funds may be used for any lawful purpose.
  24-20        (f)  Before a district reimburses a developer of property in
  24-21  the district, as that term is defined in Section 49.052(d), or its
  24-22  assigns, from operation and maintenance tax funds, for planning,
  24-23  constructing, or acquiring facilities, the district shall obtain
  24-24  approval by the executive director.
  24-25        Sec. 49.108.  CONTRACT ELECTIONS.  (a)  A contract may
  24-26  provide that the district will make payment under the contract from
  24-27  proceeds from the sale of notes or bonds, from taxes, or from any
   25-1  other income of the district or any combination of these.
   25-2        (b)  A district may make payments under a contract from taxes
   25-3  other than operation and maintenance taxes after the provisions of
   25-4  the contract have been approved by a majority of the electors
   25-5  voting at an election held for that purpose.
   25-6        (c)  A contract election may be held at the same time and in
   25-7  conjunction with any other district election.  The election may be
   25-8  called by a separate election order or as part of any other
   25-9  election order.
  25-10        (d)  A contract approved by the voters will constitute an
  25-11  obligation against the taxing power of the district to the extent
  25-12  provided in the contract.
  25-13            (Sections 49.109-49.150 reserved for expansion
  25-14                   SUBCHAPTER E.  FISCAL PROVISIONS
  25-15        Sec. 49.151.  EXPENDITURES.  (a)  Except as hereinafter
  25-16  provided, a district's money may be disbursed only by check, draft,
  25-17  order, or other instrument that shall be signed by at least a
  25-18  majority of the directors.
  25-19        (b)  The board may by resolution allow the general manager,
  25-20  treasurer, bookkeeper, or other employee of the district to sign
  25-21  disbursements.
  25-22        (c)  The board may by resolution allow disbursements to be
  25-23  transferred by federal reserve wire system to accounts in the name
  25-24  of the district.
  25-25        Sec. 49.152.  PURPOSES FOR BORROWING MONEY.  The district may
  25-26  borrow money for any corporate purpose or combination of corporate
  25-27  purposes only in compliance with the methods and procedures
   26-1  specifically provided by this chapter or by general law.
   26-2        Sec. 49.153.  REVENUE NOTES.  (a)  The board, without the
   26-3  necessity of an election, may borrow money on negotiable notes of
   26-4  the district to be paid solely from the revenues derived from the
   26-5  ownership of all or any designated part of the district's works,
   26-6  plants, improvements, facilities, or equipment after deduction of
   26-7  the reasonable cost of maintaining and operating the facilities.
   26-8        (b)  The notes may be first or subordinate lien notes within
   26-9  the discretion of the board, but no obligation may ever be a charge
  26-10  on the property of the district or on taxes levied or collected by
  26-11  the district but shall be solely a charge on the revenues pledged
  26-12  for the payment of the obligation.  No part of the obligation may
  26-13  ever be paid from taxes levied or collected by the district.
  26-14        (c)  A district may not execute a note for a term longer than
  26-15  three years unless the commission issues an order approving the
  26-16  note.
  26-17        (d)  This section does not apply to special water
  26-18  authorities.
  26-19        Sec. 49.154.  BOND ANTICIPATION NOTES; TAX ANTICIPATION
  26-20  NOTES.  (a)  The board may declare an emergency in the matter of
  26-21  funds not being available to pay principal of and interest on any
  26-22  bonds of the district payable in whole or in part from taxes or to
  26-23  meet any other needs of the district and may issue negotiable tax
  26-24  anticipation notes or negotiable bond anticipation notes to borrow
  26-25  the money needed by the district without advertising or giving
  26-26  notice of the sale.  Bond anticipation notes and tax anticipation
  26-27  notes shall mature within one year of their date.
   27-1        (b)  Tax anticipation notes may be issued for any purpose for
   27-2  which the district is authorized to levy taxes, and tax
   27-3  anticipation notes shall be secured with the proceeds of taxes to
   27-4  be levied by the district in the succeeding 12-month period.  The
   27-5  board may covenant with the purchasers of the notes that the board
   27-6  will levy a sufficient tax to pay the principal of and interest on
   27-7  the notes and pay the costs of collecting the taxes.
   27-8        (c)  Bond anticipation notes may be issued for any purpose
   27-9  for which bonds of the district may have previously been voted or
  27-10  may be issued for the purpose of refunding previously issued bond
  27-11  anticipation notes.  A district may covenant with the purchasers of
  27-12  the bond anticipation notes that the district will use the proceeds
  27-13  of sale of any bonds in the process of issuance for the purpose of
  27-14  refunding the bond anticipation notes, in which case the board will
  27-15  be required to use the proceeds received from sale of the bonds in
  27-16  the process of issuance to pay principal, interest, or redemption
  27-17  price on the bond anticipation notes.
  27-18        (d)  Districts required to seek commission approval of bonds
  27-19  must have an application for such approval on file with the
  27-20  commission prior to the issuance of bond anticipation notes.
  27-21        Sec. 49.155.  REPAYMENT OF EXPENSES.  (a)  The district may
  27-22  pay all costs and expenses necessarily incurred in the organization
  27-23  and operation of a district during creation and construction
  27-24  periods including, but not limited to, the following:
  27-25              (1)  organizational, administrative, and operating
  27-26  expenses;
  27-27              (2)  the cost of investigation and making plans;
   28-1              (3)  the cost of the engineer's report;
   28-2              (4)  legal fees; and
   28-3              (5)  any other incidental expenses.
   28-4        (b)  For purposes of this section, construction periods shall
   28-5  mean any periods during which the district is constructing its
   28-6  facilities or there is construction by third parties of above
   28-7  ground improvements within the district, but in no event longer
   28-8  than five years.
   28-9        (c)  The district may reimburse any person for money advanced
  28-10  for the purposes in Subsection (a) and may be charged interest on
  28-11  such funds.
  28-12        (d)  These payments may be made from money obtained from the
  28-13  issuance of notes or the sale of bonds issued by the district or
  28-14  out of maintenance taxes or other revenues of the district.
  28-15        Sec. 49.156.  DEPOSITORY.  (a)  The board, by order or
  28-16  resolution, shall designate one or more banks or savings
  28-17  associations within the state to serve as the depository for the
  28-18  funds of the district.  The board shall not be required to
  28-19  advertise or solicit bids in selecting its depositories.
  28-20        (b)  To the extent that funds in the depository banks or
  28-21  savings associations are not insured by the Federal Deposit
  28-22  Insurance Corporation, they shall be secured in the manner provided
  28-23  by law for the security of funds by Chapter 2257, Government Code
  28-24  (Public Funds Collateral Act).
  28-25        (c)  The board may authorize a designated representative to
  28-26  supervise the substitution of securities pledged to secure the
  28-27  district's funds.
   29-1        Sec. 49.157.  INVESTMENTS.  (a)  All district deposits and
   29-2  investments shall be governed by Subchapter A, Chapter 2256,
   29-3  Government Code (Public Funds Investment Act).
   29-4        (b)  The board may provide that an authorized representative
   29-5  of the district may invest and reinvest the funds of the district
   29-6  and provide for money to be withdrawn from the appropriate accounts
   29-7  of the district for the investments on such terms as the board
   29-8  considers advisable.
   29-9        Sec. 49.158.  FISCAL YEAR.  Within 30 days after a district
  29-10  becomes financially active, the board shall adopt a fiscal year by
  29-11  a formal board resolution.  The district shall notify the executive
  29-12  director of the adopted fiscal year within 30 days after adoption.
  29-13  The district may change its fiscal year at any time; provided,
  29-14  however, it may not be changed more than once in any 24-month
  29-15  period.  After any change in the district's fiscal year, the
  29-16  district shall notify the executive director of the changed fiscal
  29-17  year within 30 days after adoption.
  29-18            (Sections 49.159-49.180 reserved for expansion
  29-19                   SUBCHAPTER F.  ISSUANCE OF BONDS
  29-20        Sec. 49.181.  AUTHORITY OF COMMISSION OVER ISSUANCE OF
  29-21  DISTRICT BONDS.  (a)  A district may not issue bonds unless the
  29-22  commission determines that the project to be financed by the bonds
  29-23  is feasible and issues an order approving the issuance of the
  29-24  bonds.  This section does not apply to refunding bonds or bonds
  29-25  issued to and approved by the Farmers Home Administration, the
  29-26  United States Department of Agriculture, or the Texas Water
  29-27  Development Board.
   30-1        (b)  A district may submit to the commission a written
   30-2  application for investigation of feasibility.  An engineer's report
   30-3  describing the project, including the data, profiles, maps, plans,
   30-4  and specifications prepared in connection with the report, must be
   30-5  submitted with the application.
   30-6        (c)  The executive director shall examine the application and
   30-7  the report and shall inspect the project area.  The district shall,
   30-8  on request, supply the executive director with additional data and
   30-9  information necessary for an investigation of the application, the
  30-10  engineer's report, and the project.
  30-11        (d)  The executive director shall prepare a written report on
  30-12  the project and include suggestions, if any, for changes or
  30-13  improvements in the project.  The executive director shall retain a
  30-14  copy of the report and send a copy of the report to both the
  30-15  commission and the district.
  30-16        (e)  The commission shall consider the application, the
  30-17  engineer's report, the executive director's report, and any other
  30-18  evidence allowed by commission rule to be considered in determining
  30-19  the feasibility of the project.
  30-20        (f)  The commission shall determine whether the project to be
  30-21  financed by the bonds is feasible and issue an order either
  30-22  approving or disapproving, as appropriate, the issuance of the
  30-23  bonds.  The commission shall retain a copy of the order and send a
  30-24  copy of the order to the district.
  30-25        (g)  Notwithstanding any provision of this code to the
  30-26  contrary, the commission may approve the issuance of bonds of a
  30-27  district without the submission of plans and specifications of the
   31-1  improvements to be financed with the bonds.  The commission may
   31-2  condition the approval on any terms or conditions considered
   31-3  appropriate by the commission.
   31-4        (h)  This section does not apply to a district if:
   31-5              (1)  the district's boundaries include one entire
   31-6  county;
   31-7              (2)  the district was created by a special Act of the
   31-8  legislature and:
   31-9                    (A)  the district is located entirely within one
  31-10  county;
  31-11                    (B)  entirely within one or more home-rule
  31-12  municipalities;
  31-13                    (C)  the total taxable value of the real property
  31-14  and improvements to the real property zoned by one or more
  31-15  home-rule municipalities for residential purposes and located
  31-16  within the district does not exceed 25 percent of the total taxable
  31-17  value of all taxable property in the district, as shown by the most
  31-18  recent certified appraisal tax roll prepared by the appraisal
  31-19  district for the county; and
  31-20                    (D)  the district was not required by law to
  31-21  obtain commission approval of its bonds before the effective date
  31-22  of this section;
  31-23              (3)  the district is a special water authority; or
  31-24              (4)  the district is governed by a board of directors
  31-25  appointed in whole or in part by the governor, a state agency, or
  31-26  the governing body or chief elected official of a municipality or
  31-27  county and does not provide water and sewer services to residential
   32-1  retail customers as its principal function.
   32-2        Sec. 49.182.  COMMISSION SUPERVISION OF PROJECTS AND
   32-3  IMPROVEMENTS.  (a)  During construction of projects and
   32-4  improvements approved by the commission under this subchapter, no
   32-5  substantial alterations may be made in the plans and specifications
   32-6  without the approval of the commission in accordance with
   32-7  commission rules.
   32-8        (b)  The executive director may inspect the improvements at
   32-9  any time during construction to determine if the project is being
  32-10  constructed in accordance with the plans and specifications
  32-11  approved by the commission.
  32-12        (c)  If the executive director finds that the project is not
  32-13  being constructed in accordance with the approved plans and
  32-14  specifications, the executive director shall give written notice
  32-15  immediately by certified mail to the district's manager and to each
  32-16  board member.
  32-17        (d)  If within 10 days after the notice is mailed the board
  32-18  does not take steps to ensure that the project is being constructed
  32-19  in accordance with the approved plans and specifications, the
  32-20  executive director shall give written notice of this fact to the
  32-21  attorney general.
  32-22        (e)  After receiving this notice, the attorney general may
  32-23  bring an action for injunctive relief or quo warranto proceedings
  32-24  against the directors.  Venue for either suit is exclusively in a
  32-25  district court in Travis County.
  32-26        Sec. 49.183.  BOND SALES.  (a)  Except for refunding bonds,
  32-27  or bonds sold to a state or federal agency, bonds issued by a
   33-1  district shall be sold after advertising for and receiving
   33-2  competitive sealed bids and shall be awarded to the bidder whose
   33-3  bid produces the lowest net effective interest rate to the
   33-4  district.
   33-5        (b)  Except for refunding bonds, or bonds sold to a state or
   33-6  federal agency, after any bonds are finally approved and before
   33-7  they are sold by a district, the board shall publish an appropriate
   33-8  notice of the sale:
   33-9              (1)  at least one time not less than 10 days before the
  33-10  date of sale in a newspaper of general circulation in the county or
  33-11  counties in which the district is located; and
  33-12              (2)  at least one time in one or more recognized
  33-13  financial publications of general circulation in the state as
  33-14  approved by the state attorney general.
  33-15        (c)  If the district is issuing bonds and refunding bonds as
  33-16  one issue and if the initial principal amount of refunding bonds is
  33-17  50 percent or more of the total initial principal amount of bonds
  33-18  being issued, for the purposes of this section, the issue shall be
  33-19  considered to be refunding bonds and competitive bids shall not be
  33-20  required.
  33-21        (d)  A district's bonds are negotiable instruments within the
  33-22  meaning and purposes of the Business & Commerce Code.  A district's
  33-23  bonds may be issued and bear interest in accordance with Chapter
  33-24  503, Acts of the 54th Legislature, Regular Session, 1955 (Article
  33-25  717k, Vernon's Texas Civil Statutes); Chapter 3, Acts of the 61st
  33-26  Legislature, Regular Session, 1969 (Article 717k-2, Vernon's Texas
  33-27  Civil Statutes); the Bond Procedures Act of 1981 (Article 717k-6,
   34-1  Vernon's Texas Civil Statutes); and Chapter 656, Acts of the 68th
   34-2  Legislature, Regular Session, 1983 (Article 717q, Vernon's Texas
   34-3  Civil Statutes).  Except for this subsection, this section does not
   34-4  apply to special water authorities or districts defined in Section
   34-5  49.181(h)(4).
   34-6        (e)  Subsections (a) and (b) do not apply to district bonds
   34-7  issued pursuant to Chapter 656, Acts of the 68th Legislature,
   34-8  Regular Session, 1983 (Article 717q, Vernon's Texas Civil
   34-9  Statutes).
  34-10        Sec. 49.184.  APPROVAL OF BONDS BY ATTORNEY GENERAL;
  34-11  REGISTRATION OF BONDS.  (a)  Before bonds issued by a district are
  34-12  delivered to the purchasers, a certified copy of all proceedings
  34-13  relating to organization of the district for first bond issues and
  34-14  issuance of the bonds and other relevant information shall be sent
  34-15  to the attorney general.
  34-16        (b)  The attorney general shall carefully examine the bonds,
  34-17  with regard to the record and the constitution and laws of this
  34-18  state governing the issuance of bonds, and the attorney general
  34-19  shall officially approve and certify the bonds if he or she finds
  34-20  that they conform to the record and the constitution and laws of
  34-21  this state and are valid and binding obligations of the district.
  34-22        (c)  After the attorney general approves and certifies the
  34-23  bonds, the comptroller shall register them in a book kept for that
  34-24  purpose and shall record the certificate of the attorney general.
  34-25        (d)  After the approval and registration of the bonds by the
  34-26  comptroller, they shall be incontestable in any court or other
  34-27  forum, for any reason, and shall be valid and binding obligations
   35-1  in accordance with their terms for all purposes.
   35-2        (e)  A contract or lease may be submitted to the attorney
   35-3  general along with the bond records, and, if submitted, the
   35-4  approval by the attorney general of the bonds shall constitute an
   35-5  approval of the contract or lease and the contract or lease shall
   35-6  be incontestable.
   35-7        Sec. 49.185.  EXEMPTIONS.  This subchapter shall not apply to
   35-8  districts engaged in the distribution and  sale of electric energy
   35-9  to the public.
  35-10            (Sections 49.186-49.190 reserved for expansion
  35-11                      SUBCHAPTER G.  AUDIT OF DISTRICTS
  35-12        Sec. 49.191.  DUTY TO AUDIT.  (a)  The board shall have the
  35-13  district's fiscal accounts and records audited annually at the
  35-14  expense of the district.
  35-15        (b)  In all areas of conflict, the provisions of this
  35-16  subchapter shall take precedence over all prior statutory
  35-17  enactments.
  35-18        (c)  The person who performs the audit shall be a certified
  35-19  public accountant or public accountant holding a permit from the
  35-20  Texas State Board of Public Accountancy.
  35-21        (d)  The audit required by this section shall be completed
  35-22  within 120 days after the close of the district's fiscal year.
  35-23        Sec. 49.192.  FORM OF AUDIT.  The executive director shall
  35-24  adopt accounting and auditing manuals and, except as otherwise
  35-25  provided by the manuals, the district audit shall be performed
  35-26  according to the generally accepted auditing standards adopted by
  35-27  the American Institute of Certified Public Accountants.  Financial
   36-1  statements shall be prepared in accordance with generally accepted
   36-2  accounting principles as adopted by the American Institute of
   36-3  Certified Public Accountants.
   36-4        Sec. 49.193.  FINANCIAL REPORTS.  The district's depository,
   36-5  the district's treasurer, and the district's bookkeeper, if any,
   36-6  who receives or has control over any district funds shall keep a
   36-7  full and itemized account of district funds in its, his, or her
   36-8  possession.  Such itemized accounts and records shall be available
   36-9  for audit.
  36-10        Sec. 49.194.  FILING OF AUDITS, AFFIDAVITS, AND FINANCIAL
  36-11  REPORTS.  (a)  After the board has approved the audit, it shall
  36-12  submit a copy of the report to the executive director for filing
  36-13  within 135 days after the close of the district's fiscal year.
  36-14        (b)  If the board refuses to approve the annual audit report,
  36-15  the board shall submit a copy of the report to the executive
  36-16  director for filing within 135 days after the close of the
  36-17  district's fiscal year, accompanied by a statement from the board
  36-18  explaining the reasons for its failure to approve the report.
  36-19        (c)  Copies of the audit, the annual financial dormancy
  36-20  affidavit, or annual financial report described in Sections 49.197
  36-21  and 49.198 of this subchapter shall be filed annually in the office
  36-22  of the district.
  36-23        (d)  Each district shall file with the executive director an
  36-24  annual filing affidavit in a format prescribed by the executive
  36-25  director, executed by a duly authorized representative of the
  36-26  board, stating that all copies of the annual audit report, annual
  36-27  financial dormancy affidavit, or annual financial report have been
   37-1  filed under this section.
   37-2        (e)  The annual filing affidavit shall be submitted with the
   37-3  applicable annual document when it is submitted to the executive
   37-4  director for filing as prescribed by this subchapter.
   37-5        (f)  The executive director shall file with the attorney
   37-6  general the names of any districts that do not comply with the
   37-7  provisions of this subchapter.
   37-8        Sec. 49.195.  REVIEW BY EXECUTIVE DIRECTOR.  (a)  The
   37-9  executive director may review the audit report of each district.
  37-10        (b)  The commission may request that the state auditor assist
  37-11  in the establishment of standards and procedures for review of
  37-12  district audits by the executive director.
  37-13        (c)  If the executive director has any objections or
  37-14  determines any violations of generally accepted auditing standards
  37-15  or accounting principles, statutes, or board rules, or if the
  37-16  executive director has any recommendations, he or she shall notify
  37-17  the board and the district's auditor.
  37-18        (d)  Before the audit report may be accepted by the executive
  37-19  director as being in compliance with the provisions of this
  37-20  subchapter, the board and the auditor shall remedy objections and
  37-21  correct violations of which they have been notified by the
  37-22  executive director.
  37-23        (e)  If the audit report indicates that any penal law has
  37-24  been violated, the executive director shall notify the appropriate
  37-25  county or district attorney and the attorney general.
  37-26        Sec. 49.196.  ACCESS TO AND MAINTENANCE OF DISTRICT RECORDS.
  37-27  (a)  The executive director shall have access to all vouchers,
   38-1  receipts, district fiscal and financial records, and other district
   38-2  records the executive director considers necessary.
   38-3        (b)  All district fiscal records shall be prepared on a
   38-4  timely basis and maintained in an orderly manner in accordance with
   38-5  generally accepted accounting principles.  The fiscal records shall
   38-6  be available for public inspection during regular business hours.
   38-7  A district's fiscal records may be removed from the district's
   38-8  office for the purposes of recording its fiscal affairs and
   38-9  preparing an audit, during which time the fiscal records are under
  38-10  the control of the district's auditor.
  38-11        Sec. 49.197.  FINANCIALLY DORMANT DISTRICTS.  (a)  A
  38-12  financially dormant district is a district that had:
  38-13              (1)  $500 or less of receipts from operations, tax
  38-14  assessments, loans, contributions, or any other sources during the
  38-15  calendar year;
  38-16              (2)  $500 or less of disbursements of funds during the
  38-17  calendar year;
  38-18              (3)  no bonds or other long-term (more than one year)
  38-19  liabilities outstanding during the calendar year; and
  38-20              (4)  no cash or investments that exceeded $5,000 at any
  38-21  time during the calendar year.
  38-22        (b)  A financially dormant district may elect to submit to
  38-23  the executive director a financial dormancy affidavit instead of
  38-24  complying with the audit requirements of Section 49.191.
  38-25        (c)  The annual financial dormancy affidavit shall be
  38-26  prepared in a format prescribed by the executive director and shall
  38-27  be submitted for filing by a duly authorized representative of the
   39-1  district.
   39-2        (d)  The affidavit must be filed annually on or before
   39-3  January 31 with the executive director until such time as the
   39-4  district becomes financially active and the board adopts a fiscal
   39-5  year; thereafter, the district shall file annual audit reports as
   39-6  prescribed by this subchapter.
   39-7        (e)  A district that becomes financially dormant after having
   39-8  been financially active shall be required to file annual financial
   39-9  dormancy affidavits on or before January 31, until the district is
  39-10  either dissolved or again becomes financially active.
  39-11        (f)  Districts governed by this section are subject to
  39-12  periodic audits by the executive director.
  39-13        Sec. 49.198.  AUDIT REPORT EXEMPTION.  (a)  A district that
  39-14  is not collecting taxes may elect to file annual financial reports
  39-15  with the executive director in lieu of the district's compliance
  39-16  with Section 49.191 provided:
  39-17              (1)  the district had no bonds or other long-term (more
  39-18  than one year) liabilities outstanding during the fiscal period;
  39-19              (2)  the district did not have gross receipts from
  39-20  operations, loans, or contributions in excess of $100,000 during
  39-21  the fiscal period; and
  39-22              (3)  the district's cash and temporary investments were
  39-23  not in excess of $100,000 at any time during the fiscal period.
  39-24        (b)  The annual financial report must be accompanied by an
  39-25  affidavit attesting to the accuracy and authenticity of the
  39-26  financial report signed by a duly authorized representative of the
  39-27  district.
   40-1        (c)  The annual financial report and affidavit in a format
   40-2  prescribed by the executive director must be on file with the
   40-3  executive director within 45 days after the close of the district's
   40-4  fiscal year.
   40-5        (d)  Districts governed by this section are subject to
   40-6  periodic audits by the executive director.
   40-7        Sec. 49.199.  POLICIES AND AUDITS OF DISTRICTS.  (a)  Subject
   40-8  to the law governing the district, the board shall adopt the
   40-9  following in writing:
  40-10              (1)  a code of ethics for district directors, officers,
  40-11  employees, and persons who are engaged in handling investments for
  40-12  the district;
  40-13              (2)  a policy relating to travel expenditures;
  40-14              (3)  a policy relating to district investments that
  40-15  ensures that:
  40-16                    (A)  purchases and sales of investments are
  40-17  initiated by authorized individuals, conform to investment
  40-18  objectives and regulations, and are properly documented and
  40-19  approved; and
  40-20                    (B)  periodic review is made of district
  40-21  investments to evaluate investment performance and security;
  40-22              (4)  policies and procedures for selection, monitoring,
  40-23  or review and evaluation of professional services;
  40-24              (5)  a uniform method of accounting and reporting for
  40-25  industrial development bonds and pollution control bonds that
  40-26  complies with requirements of the commission; and
  40-27              (6)  policies that ensure a better use of management
   41-1  information including:
   41-2                    (A)  budgets for use in planning and controlling
   41-3  cost;
   41-4                    (B)  an audit committee of the board; and
   41-5                    (C)  uniform reporting requirements that use
   41-6  "Audits of State and Local Governmental Units" as a guide on audit
   41-7  working papers and that use "Governmental Accounting and Financial
   41-8  Reporting Standards."
   41-9        (b)  The state auditor may audit the financial transactions
  41-10  of any district if the state auditor determines that the audit is
  41-11  necessary.
  41-12        Sec. 49.200.  REVIEW AND COMMENT ON BUDGET OF CERTAIN
  41-13  DISTRICTS.  A district that provides wholesale potable water and
  41-14  wastewater services shall adopt a program that provides such
  41-15  wholesale customers an opportunity to review and comment on the
  41-16  district's annual budget that applies to their services before that
  41-17  budget is adopted by the board.
  41-18            (Sections 49.201-49.210 reserved for expansion
  41-19                   SUBCHAPTER H.  POWERS AND DUTIES
  41-20        Sec. 49.211.  POWERS.  (a)  A district shall have the
  41-21  functions, powers, authority, rights, and duties that will permit
  41-22  accomplishment of the purposes for which it was created or the
  41-23  purposes authorized by the constitution, this code, or any other
  41-24  law.
  41-25        (b)  A district is authorized to purchase, construct,
  41-26  acquire, own, operate, maintain, repair, improve, or extend inside
  41-27  and outside its boundaries any and all land, works, improvements,
   42-1  facilities, plants, equipment, and appliances necessary to
   42-2  accomplish the purposes of its creation or the purposes authorized
   42-3  by this code or any other law.
   42-4        Sec. 49.212.  FEES AND CHARGES.  (a)  A district may adopt
   42-5  and enforce all necessary charges, fees, or rentals, in addition to
   42-6  taxes, for providing or making available any district facility or
   42-7  service.
   42-8        (b)  A district may require a deposit for any services or
   42-9  facilities furnished and the district may or may not provide that
  42-10  the deposit will bear interest.
  42-11        (c)  Subject to observance of the procedure appropriate to
  42-12  the circumstances, a district may discontinue any or all facilities
  42-13  or services to prevent an abuse or to enforce payment of an unpaid
  42-14  charge, fee, or rental due the district, including taxes that have
  42-15  been delinquent for not less than six months.
  42-16        (d)  Notwithstanding any provision of law to the contrary, a
  42-17  district that charges a fee that is an impact fee as described in
  42-18  Section 395.001(4), Local Government Code, must comply with Chapter
  42-19  395, Local Government Code.  A charge or fee by a district for
  42-20  construction, installation, or inspection of a tap or connection to
  42-21  district water, sanitary sewer, or drainage facilities, including
  42-22  all necessary service lines and meters, that (i) does not exceed
  42-23  three times the actual and reasonable costs to the district for
  42-24  such work or (ii) if made to a nontaxable entity, does not exceed
  42-25  the actual costs to the district for such work and for all
  42-26  facilities that are necessary to provide district services to such
  42-27  entity and that are financed or are to be financed in whole or in
   43-1  part by tax-supported bonds of the district, shall not be deemed or
   43-2  considered to be an impact fee under Chapter 395, Local Government
   43-3  Code.
   43-4        Sec. 49.213.  AUTHORITY TO ISSUE CONTRACTS.  (a)  A district
   43-5  may contract with a person or any public or private entity for the
   43-6  joint construction, financing, ownership, and operation of any
   43-7  works, improvements, facilities, plants, equipment, and appliances
   43-8  necessary to accomplish any purpose or function permitted by a
   43-9  district, or a district may purchase an interest in any project
  43-10  used for any purpose or function permitted by a district.
  43-11        (b)  A district may enter into contracts with any person or
  43-12  any public or private entity in the performance of any purpose or
  43-13  function permitted by a district.
  43-14        (c)  A district may enter into contracts, which may be of
  43-15  unlimited duration, with persons or any public or private entities
  43-16  on the terms and conditions the board may consider desirable, fair,
  43-17  and advantageous for:
  43-18              (1)  the purchase or sale of water;
  43-19              (2)  the collection, transportation, treatment, and
  43-20  disposal of its domestic, industrial, and communal wastes or the
  43-21  collection, transportation, treatment, and disposal of domestic,
  43-22  industrial, and communal wastes of other persons;
  43-23              (3)  the gathering, diverting, and control of local
  43-24  storm water, or other local harmful excesses of water;
  43-25              (4)  the continuing and orderly development of the land
  43-26  and property within the district through the purchase,
  43-27  construction, or installation of works, improvements, facilities,
   44-1  plants, equipment, and appliances that the district may otherwise
   44-2  be empowered and authorized to do or perform so that, to the
   44-3  greatest extent reasonably possible, considering sound engineering
   44-4  and economic practices, all of the land and property may be placed
   44-5  in a position to ultimately receive the services of the works,
   44-6  improvements, plants, facilities, equipment, and appliances;
   44-7              (5)  the maintenance and operation of any works,
   44-8  improvements, facilities, plants, equipment, and appliances of the
   44-9  district or of another person or public or private entity;
  44-10              (6)  the collection, treatment, and disposal of
  44-11  municipal solid wastes;
  44-12              (7)  the exercise of any other rights, powers, and
  44-13  duties granted to a district.
  44-14        Sec. 49.214.  CONFLICTS OF INTEREST IN CONTRACTS.  The
  44-15  provisions of Chapter 171, Local Government Code, shall apply to
  44-16  the award of district contracts.
  44-17        Sec. 49.215.  SERVICE TO AREAS OUTSIDE THE DISTRICT.  (a)  A
  44-18  district may purchase, construct, acquire, own, operate, repair,
  44-19  improve, or extend all works, improvements, facilities, plants,
  44-20  equipment, and appliances necessary to provide any services or
  44-21  facilities authorized to be provided by the district to areas
  44-22  contiguous to or in the vicinity of the district provided the
  44-23  district does not duplicate a service or facility of another public
  44-24  entity.  A district providing potable water and sewer utility
  44-25  services to household users shall not provide services or
  44-26  facilities to serve areas outside the district that are also within
  44-27  the corporate limits of a city without securing a resolution or
   45-1  ordinance of the city granting consent for the district to serve
   45-2  the area within the city.
   45-3        (b)  To secure money for this purpose, a district is
   45-4  authorized to issue and sell negotiable bonds and notes payable
   45-5  from the levy and collection of ad valorem taxes on all taxable
   45-6  property within the district or from all or any designated part of
   45-7  the revenues received from the operation of the district's works,
   45-8  improvements, facilities, plants, equipment, and appliances or from
   45-9  a combination of taxes and revenues.
  45-10        (c)  Any bonds and notes may be issued upon the terms and
  45-11  conditions set forth in this code.
  45-12        (d)  A district shall not be required to hold a certificate
  45-13  of convenience and necessity as a precondition for providing retail
  45-14  water or sewer service to any customer or service area,
  45-15  notwithstanding the fact that such customer or service area may be
  45-16  located either within or outside the boundaries of the district or
  45-17  has previously received water or sewer service from an entity
  45-18  required by law to hold a certificate of convenience and necessity
  45-19  as a precondition for such service.  This subsection does not
  45-20  authorize a district to provide services within an area for which a
  45-21  retail public utility holds a certificate of convenience and
  45-22  necessity or within the boundaries of another district without that
  45-23  district's consent, unless the district has a valid certificate of
  45-24  convenience and necessity to provide services to that area.
  45-25        (e)  A district is authorized to establish, maintain, revise,
  45-26  charge, and collect the rates, fees, rentals, tolls, or other
  45-27  charges for the use, services, and facilities that provide service
   46-1  to areas outside the district that are considered necessary and may
   46-2  be higher than those charged for comparable service to users within
   46-3  the district.
   46-4        (f)  The rates, fees, rentals, tolls, or other charges shall
   46-5  be at least sufficient to meet the expense of operating and
   46-6  maintaining the services and facilities for a water and sanitary
   46-7  sewer system serving areas outside the district and to pay the
   46-8  principal of and interest and redemption price on bonds issued to
   46-9  purchase, construct, acquire, own, operate, repair, improve, or
  46-10  extend the services or facilities.
  46-11        Sec. 49.216.  ENFORCEMENT BY PEACE OFFICERS.  (a)  A district
  46-12  may contract for or employ its own peace officers with power to
  46-13  make arrests when necessary to prevent or abate the commission of:
  46-14              (1)  any offense against the rules of the district when
  46-15  the offense or threatened offense occurs on any land, water, or
  46-16  easement owned or controlled by the district;
  46-17              (2)  any offense involving injury or detriment to any
  46-18  property owned or controlled by the district; and
  46-19              (3)  any offense against the laws of the state.
  46-20        (b)  A district may appoint reserve peace officers who may be
  46-21  called to serve as peace officers by the district during the actual
  46-22  discharge of their official duties.
  46-23        (c)  A reserve peace officer serves at the discretion of the
  46-24  district and may be called into service if the district considers
  46-25  it necessary to have additional officers to preserve the peace in
  46-26  or enforce the law of the district.
  46-27        (d)  A reserve peace officer on active duty and actively
   47-1  engaged in assigned duties has the same rights, privileges, and
   47-2  duties as any other peace officer of the district.
   47-3        (e)  Any peace officer, before beginning to perform any
   47-4  duties and at the time of appointment, must take an oath and
   47-5  execute a bond conditioned on faithful performance of such
   47-6  officer's duties in the amount of $1,000 payable to the district.
   47-7  The oath and the bond shall be filed in the district office.
   47-8        Sec. 49.217.  OPERATION OF CERTAIN MOTOR VEHICLES ON OR NEAR
   47-9  PUBLIC FACILITIES.  (a)  In this section, "motor vehicle" means a
  47-10  self-propelled device in, upon, or by which a person or property is
  47-11  or may be transported or drawn on a road or highway.
  47-12        (b)  Except as provided in Subsections (c) and (d), a person
  47-13  may not operate a motor vehicle on a levee, in a drainage ditch, or
  47-14  on land adjacent to a levee, canal, ditch, exposed conduit,
  47-15  pipeline, pumping plant, storm water facility, or other facility
  47-16  for the transmission, storage, treatment, or distribution of water,
  47-17  sewage, or storm water owned or controlled by a district.
  47-18        (c)  A district may authorize the use of motor vehicles on
  47-19  land that it owns or controls by posting signs on the property.
  47-20        (d)  This section does not prohibit a person from:
  47-21              (1)  driving on a public road or highway; or
  47-22              (2)  operating a motor vehicle used for repair or
  47-23  maintenance of public water, sewer, or storm water facilities.
  47-24        (e)  A person who operates a motor vehicle in violation of
  47-25  Subsection (b) commits an offense.  An offense under this section
  47-26  is a Class C misdemeanor, except that if a person has been
  47-27  convicted of an offense under this section, a subsequent offense is
   48-1  a Class B misdemeanor.
   48-2        Sec. 49.218.  Acquisition of Property.  (a)  A district or a
   48-3  water supply corporation may acquire land, materials, waste
   48-4  grounds, easements, rights-of-way, equipment, contract or permit
   48-5  rights or interests, and other property, real or personal,
   48-6  considered necessary for the purpose of accomplishing any one or
   48-7  more of the district's or water supply corporation's purposes
   48-8  provided in this code or in any other law.
   48-9        (b)  A district or water supply corporation shall have the
  48-10  right to acquire property by gift, grant, or purchase and the right
  48-11  to acquire property shall include property considered necessary for
  48-12  the construction, improvement, extension, enlargement, operation,
  48-13  or maintenance of the plants, works, improvements, facilities,
  48-14  equipment, or appliances of a district or a water supply
  48-15  corporation.
  48-16        (c)  A district or water supply corporation may acquire
  48-17  either the fee simple title to or an easement on all land, both
  48-18  public and private, either inside or outside its boundaries and may
  48-19  acquire the title to or an easement on property other than land
  48-20  held in fee.
  48-21        (d)  A district or water supply corporation may also lease
  48-22  property from others for its use on such terms and conditions as
  48-23  the board of the district or the board of directors of the water
  48-24  supply corporation may determine to be advantageous.
  48-25        Sec. 49.219.  ACQUISITION OF EXISTING FACILITIES.  Any
  48-26  district may acquire by agreement all or any part of existing
  48-27  water, sanitary sewer, or drainage systems of any water supply
   49-1  corporation, including works, improvements, facilities, plants,
   49-2  equipment, appliances, contract rights, and other assets and rights
   49-3  that are completed, partially completed, or under construction, and
   49-4  in connection therewith a district may assume all or any part of
   49-5  the contracts, indebtedness, or obligations of the corporation
   49-6  related to said systems, including any contracts, indebtedness, or
   49-7  obligations related to or payable from the revenues of said
   49-8  systems, and may perform all or any part of the obligations of said
   49-9  corporation in the same manner and to the same extent that any
  49-10  other purchaser or assignee could be bound on any such contracts,
  49-11  indebtedness, or obligations.  Before assuming any indebtedness or
  49-12  obligations of such corporation related to any such system, a
  49-13  district other than a special water authority shall obtain the
  49-14  approval of the commission of such assumption.
  49-15        Sec. 49.220.  RIGHT TO USE EXISTING RIGHTS-OF-WAY.  All
  49-16  districts or water supply corporations are given rights-of-way,
  49-17  within, along, under, and across all public, state, county, city,
  49-18  town, or village roads, highways, and rights-of-way and other
  49-19  public rights-of-way without the requirement for surety bond or
  49-20  secuity; provided, however, that the entity having jurisdiction
  49-21  over such roads, highways, and rights-of-way may require
  49-22  indemnification.  A district or water supply corporation shall not
  49-23  proceed with any action to change, alter, or damage a portion of
  49-24  the state highway system without having first obtained the written
  49-25  consent of the Texas Department of Transportation, and the
  49-26  placement of any facility of a district or water supply corporation
  49-27  within state highway right-of-way shall be subject to department
   50-1  regulation.
   50-2        Sec. 49.221.  Right to Enter Land.  (a)  The directors,
   50-3  engineers, attorneys, agents, operators, and employees of a
   50-4  district or water supply corporation may go on any land to inspect,
   50-5  make surveys, or perform tests to determine the condition, value,
   50-6  and usability of the property, with reference to the proposed
   50-7  location of works, improvements, plants, facilities, equipment, or
   50-8  appliances.  The cost of restoration shall be borne by the district
   50-9  or the water supply corporation.
  50-10        (b)  District employees and agents are entitled to enter any
  50-11  public or private property within the boundaries of the district or
  50-12  adjacent to any reservoir or other property owned by the district
  50-13  at any reasonable time for the purpose of inspecting and
  50-14  investigating conditions relating to the quality of water in the
  50-15  state or the compliance with any rule, regulation, permit, or other
  50-16  order of the district.  District employees or agents acting under
  50-17  this authority who enter private property shall observe the
  50-18  establishment's rules and regulations concerning safety, internal
  50-19  security, and fire protection and shall notify any occupant or
  50-20  management of their presence and shall exhibit proper credentials.
  50-21        Sec. 49.222.  Eminent Domain.  (a)  A district or water
  50-22  supply corporation may acquire by condemnation any land, easements,
  50-23  or other property inside or outside the district boundaries, or the
  50-24  boundaries of the certificated service area for a water supply
  50-25  corporation, necessary for water, sanitary sewer, storm drainage,
  50-26  or flood drainage or control purposes or for any other of its
  50-27  projects or purposes, and may elect to condemn either the fee
   51-1  simple title or a lesser property interest.
   51-2        (b)  The right of eminent domain shall be exercised in the
   51-3  manner provided in Chapter 21, Property Code, except that a
   51-4  district or a water supply corporation shall not be required to
   51-5  give bond for appeal or bond for costs in any condemnation suit or
   51-6  other suit to which it is a party and shall not be required to
   51-7  deposit more than the amount of any award in any suit.
   51-8        (c)  The power of eminent domain may not be used for the
   51-9  condemnation of land for the purpose of acquiring rights to
  51-10  underground water or of water or water rights.
  51-11        Sec. 49.223.  Costs of Relocation of Property.  (a)  In the
  51-12  event that the district or the water supply corporation, in the
  51-13  exercise of the power of eminent domain or power of relocation, or
  51-14  any other power, makes necessary the relocation, raising, lowering,
  51-15  rerouting, or change in grade of or alteration in construction of
  51-16  any road, bridge, highway, railroad, electric transmission line,
  51-17  telegraph, or telephone properties, facilities, or pipelines, all
  51-18  necessary relocations, raising, lowering, rerouting, or change in
  51-19  grade or alteration of construction shall be done at the sole
  51-20  expense of the district or the water supply corporation unless
  51-21  otherwise agreed to in writing.  Such relocation shall be
  51-22  accomplished in a timely manner so that the project of the district
  51-23  or the water supply corporation is not delayed.
  51-24        (b)  "Sole expense" means the actual cost of the relocation,
  51-25  raising, lowering, rerouting, or change in grade or alteration of
  51-26  construction and providing comparable replacement without enhancing
  51-27  the facilities after deducting from it the net salvage value
   52-1  derived from the old facility.
   52-2        Sec. 49.224.  POWER TO CONDEMN CEMETERIES.  (a)  The use of
   52-3  land for the construction of district dams and creation of lakes
   52-4  and reservoirs for the purpose of conservation and development of
   52-5  the natural resources of this state is hereby declared to be
   52-6  superior to all other uses; and for these purposes only a district
   52-7  has the power of eminent domain to acquire land, improvements, and
   52-8  other property owned and held for cemeteries or burial places
   52-9  necessary for the construction of a dam or that lies inside the
  52-10  area to be covered by the lake or reservoir or within 300 feet of
  52-11  the high water line of the lake or reservoir.
  52-12        (b)  Except as otherwise provided by this subchapter, the
  52-13  procedure in condemnation proceedings is governed by Chapter 21,
  52-14  Property Code.
  52-15        (c)  Notice shall be served on the title owner of the land on
  52-16  which the cemetery is situated as provided in Chapter 21, Property
  52-17  Code.  General notice to persons having relatives interred in the
  52-18  cemetery shall be given by publication for two consecutive weeks in
  52-19  a newspaper circulated in the county in which the cemetery is
  52-20  situated.
  52-21        (d)  The measure of damages in these eminent domain
  52-22  proceedings shall be assessed as in other condemnation cases.  An
  52-23  additional amount of damages shall be assessed to cover the cost of
  52-24  removing and reinterring the bodies interred in the cemetery or
  52-25  burial place and the cost of removing and resetting the monuments
  52-26  or markers erected at the graves.
  52-27        (e)  The additional assessment shall be deposited in the
   53-1  registry of the county court and disbursed only for the purpose of
   53-2  removing and reinterring the bodies in other cemeteries in Texas
   53-3  agreed on between the district and the relatives of the deceased
   53-4  persons.
   53-5        (f)  If in any case the district and the relatives of a
   53-6  deceased person cannot agree within 30 days on a cemetery for
   53-7  reinterment, or no relatives appear within that time, then the
   53-8  county judge shall designate the cemetery for reinterment.
   53-9        (g)  Instead of depositing the additional assessment in the
  53-10  registry of the court, the district may execute a bond sufficient
  53-11  to cover costs of removing and reinterring the bodies.  The bond
  53-12  shall be payable to and approved by the county judge and
  53-13  conditioned that the bodies will be removed and reinterred as
  53-14  provided by this section.
  53-15        Sec. 49.225.  Leases.  A district may lease any of its
  53-16  property, real or personal, to any person.  The lease may contain
  53-17  the terms and provisions that the board determines to be
  53-18  advantageous to the district.
  53-19        Sec. 49.226.  Sale or Exchange of Surplus Land or Personal
  53-20  Property.  (a)  Any land, interest in land, or personal property
  53-21  owned by the district which is found by the board to be surplus and
  53-22  is not needed by the district may be sold under order of the board
  53-23  either by public or private sale, or the land, interest in land, or
  53-24  personal property may be exchanged for other land, interest in
  53-25  land, or personal property needed by the district.  Except as
  53-26  provided in Subsection (b), land, interest in land, or personal
  53-27  property must be exchanged for like fair market value, which value
   54-1  may be determined by the district.
   54-2        (b)  Any property dedicated to or acquired by the district
   54-3  without expending district funds may be abandoned or released to
   54-4  the original grantor, the grantor's heirs, assigns, executors, or
   54-5  successors upon terms and conditions deemed necessary or
   54-6  advantageous to the district and without receiving compensation for
   54-7  such abandonment or release.  District property may also be
   54-8  abandoned, released, exchanged, or transferred to another district,
   54-9  municipality, county, countywide agency, or authority upon terms
  54-10  and conditions deemed necessary or advantageous to the district.
  54-11  Narrow strips of property resulting from boundary or surveying
  54-12  conflicts or similar causes, or from insubstantial encroachments by
  54-13  abutting property owners, may be abandoned, released, exchanged, or
  54-14  transferred to such abutting owners upon terms and conditions
  54-15  deemed necessary or advantageous to the district.  Chapter 272,
  54-16  Local Government Code, shall not apply to this subsection.
  54-17        (c)  Before either a public or a private sale of real
  54-18  property not required by the district, the district shall give
  54-19  notice of the intent to sell by publishing notice once a week for
  54-20  two consecutive weeks in one or more newspapers with general
  54-21  circulation in the district.
  54-22        (d)  If the district has outstanding bonds secured by a
  54-23  pledge of tax revenues, the proceeds of the sale of property not
  54-24  required by the district shall be applied to retire outstanding
  54-25  bonds of the district when required by the district's applicable
  54-26  bond resolutions.
  54-27        (e)  If the district does not have any outstanding bonds, the
   55-1  proceeds derived from the sale of the personal property or land not
   55-2  required by the district may be used for any lawful purpose.
   55-3        Sec. 49.227.  Authority to Act Jointly.  A district or water
   55-4  supply corporation may act jointly with any other person or entity,
   55-5  private or public, whether within the State of Texas or the United
   55-6  States, in the performance of any of the powers and duties
   55-7  permitted by this code or any other laws.
   55-8        Sec. 49.228.  Damage to Property.  A person who wilfully
   55-9  destroys, defaces, damages, or interferes with district or water
  55-10  supply corporation property is guilty of a Class B misdemeanor.
  55-11        Sec. 49.229.  Grants and Gifts.  A district may accept
  55-12  grants, gratuities, advances, and loans in any form from any source
  55-13  approved by the board, including any governmental entity, any
  55-14  private or public corporation, and any other person and may make
  55-15  and enter into contracts, agreements, and covenants the board
  55-16  considers appropriate in connection with acceptance of grants,
  55-17  gratuities, advances, and loans.
  55-18        Sec. 49.230.  Area-Wide Wastewater Treatment.  The powers and
  55-19  duties conferred on the district are granted subject to the policy
  55-20  of the state to encourage the development and use of integrated
  55-21  area-wide wastewater collection, treatment, and disposal systems to
  55-22  serve the wastewater disposal needs of the citizens of the state
  55-23  whenever economically feasible and competitive to do so, it being
  55-24  an objective of the policy to avoid the economic burden to the
  55-25  people and the impact on the quality of the water in the state that
  55-26  result from the construction and operation of numerous small
  55-27  wastewater collection, treatment, and disposal facilities to serve
   56-1  an area when an integrated area-wide wastewater collection,
   56-2  treatment, and disposal system for the area can be reasonably
   56-3  provided.
   56-4        Sec. 49.231.  STANDBY FEES.  (a)  In this section:
   56-5              (1)  "Standby fee" means a charge, other than a tax,
   56-6  imposed on undeveloped property for the availability of potable
   56-7  water, sanitary sewer, or drainage facilities and services.
   56-8              (2)  "Undeveloped property" means a tract, lot, or
   56-9  reserve in the district to which no potable water, sanitary sewer,
  56-10  or drainage connections have been made for which:
  56-11                    (A)  water, sanitary sewer, or drainage
  56-12  facilities and services are available;
  56-13                    (B)  water supply, wastewater treatment plant
  56-14  capacity, or drainage capacity sufficient to serve the property is
  56-15  available; or
  56-16                    (C)  major water supply lines, wastewater
  56-17  collection lines, or drainage facilities with capacity sufficient
  56-18  to serve the property are available.
  56-19        (b)  A district that proposes to provide or actually provides
  56-20  retail potable water or sewer utility services, or drainage
  56-21  services as the principal function of the district, may, with the
  56-22  approval of the commission, adopt and impose on the owners of
  56-23  undeveloped property in the district a standby fee in addition to
  56-24  taxes levied by the district.  A district may not impose a standby
  56-25  fee for debt service purposes on undeveloped property unless the
  56-26  facilities and services available to the property have been
  56-27  financed by the district; however, a district may impose a standby
   57-1  fee for operating and maintaining facilities that it has not
   57-2  financed.  The district may impose standby fees in different
   57-3  amounts to fairly reflect the level and type of services and
   57-4  facilities available to serve different property.  The intent of
   57-5  the standby fee is to distribute a fair portion of the cost burden
   57-6  for operating and maintaining the facilities and for financing
   57-7  capital costs of the facilities to owners of property who have not
   57-8  constructed improvements but have potable water, sewer, or drainage
   57-9  capacity available.  Any revenues collected from the standby fees
  57-10  shall be used to pay operation and maintenance expenses, to pay
  57-11  debt service on the bonds, or both.
  57-12        (c)  If a district described in Subsection (b) desires to
  57-13  adopt and impose a standby fee, the district shall submit to the
  57-14  commission an application for authority to adopt and impose the
  57-15  standby fee.  The application must describe the tracts of
  57-16  undeveloped property in the district and state the amount of the
  57-17  proposed fee.
  57-18        (d)  The executive director shall examine an application
  57-19  submitted under Subsection (c) and shall investigate the financial
  57-20  condition of the district, including the district's assets,
  57-21  liabilities, sources of revenue, level of utility service rates,
  57-22  and level of debt service and maintenance tax rates.  On the
  57-23  request of the executive director, the district shall submit any
  57-24  information the executive director considers relevant to the
  57-25  examination and investigation.  The executive director shall
  57-26  prepare a written report on the application and the district's
  57-27  financial condition, retain a copy of the report, and send a copy
   58-1  of the report to the commission and the district.
   58-2        (e)  The commission shall hold a hearing on an application
   58-3  submitted under Subsection (c).  Notice of the hearing shall be
   58-4  published in a newspaper of general circulation in the county or
   58-5  counties in which the district is located once a week for two
   58-6  consecutive weeks.  The first publication must occur not later than
   58-7  the 30th day before the date of the hearing.  The district shall
   58-8  send, not later than the 30th day before the date of the hearing,
   58-9  notice of the hearing by certified mail, return receipt requested,
  58-10  to each owner of undeveloped property in the district.  On the date
  58-11  the application is filed, the district's tax assessor and collector
  58-12  shall certify to the district the names of the persons owning
  58-13  undeveloped land in the district as reflected by the most recent
  58-14  certified tax roll of the district.  Notice of the hearing must be
  58-15  sent by certified mail, return receipt requested, to each mortgagee
  58-16  of record that has submitted a written request to be informed of
  58-17  any hearings.  To be effective, the written request must be
  58-18  received by the district not later than the 60th day before the
  58-19  date of the hearing.  The written request for notice must include
  58-20  the name and address of the mortgagee, the name of the property
  58-21  owner in the district, and a brief property description.
  58-22        (f)  The commission shall consider the application, the
  58-23  report of the executive director, and any other evidence allowed by
  58-24  commission rule.  The commission may approve the application only
  58-25  if the commission finds that the fee is necessary to maintain the
  58-26  financial integrity and stability of the district and fairly
  58-27  allocates the costs of district facilities and services among
   59-1  property owners of the district.
   59-2        (g)  After a hearing on an application under Subsection (e),
   59-3  the commission shall issue an order approving or disapproving the
   59-4  application.  The commission shall retain a copy of the order and
   59-5  send a copy of the order to the district.
   59-6        (h)  The commission may approve the adoption and imposition
   59-7  of the standby fee for a period of not more than three years.  The
   59-8  imposition of a standby fee may be renewed for additional periods
   59-9  of not more than three years each in the same manner provided in
  59-10  this section for initial approval of the standby fee.
  59-11        (i)  If approved by the commission, the board by resolution
  59-12  or order may impose an annual standby fee on undeveloped land in
  59-13  the district.
  59-14        (j)  The board may:
  59-15              (1)  charge interest, at the rate of one percent a
  59-16  month, on a standby fee not paid in a timely manner in accordance
  59-17  with the resolution or order imposing the standby fee; and
  59-18              (2)  refuse to provide potable water, sanitary sewer,
  59-19  or drainage service to the property for which the fee was assessed
  59-20  until all delinquent standby fees on the property and interest on
  59-21  those fees are fully paid.
  59-22        (k)  A standby fee imposed under this section is a personal
  59-23  obligation of the person owning the undeveloped property on January
  59-24  1 of the year for which the fee is assessed.  A person is not
  59-25  relieved of the obligation on transfer of title to the property.
  59-26  On January 1 of each year, a lien attaches to undeveloped property
  59-27  to secure payment of any standby fee imposed under this section and
   60-1  the interest, if any, on the fee.  The lien has the same priority
   60-2  as a lien for taxes of the district.
   60-3        (l)  If a standby fee imposed under this section is not paid
   60-4  in a timely manner, a district may file suit to foreclose the lien
   60-5  securing payment of the fee and interest or to enforce the personal
   60-6  obligation for the fee and interest, or both.  The district may
   60-7  recover, in addition to the fee and interest, reasonable costs,
   60-8  including attorney's fees, incurred by the district in enforcing
   60-9  the lien or obligation not to exceed 20 percent of the delinquent
  60-10  fee and interest.  A suit authorized by this subsection must be
  60-11  filed not later than the fourth anniversary of the date the fee
  60-12  became due.  A fee delinquent for more than four years and interest
  60-13  on the fee are considered paid unless a suit is filed before the
  60-14  expiration of the four-year period.
  60-15        (m)  Chapter 395, Local Government Code, does not apply to a
  60-16  standby fee imposed under this section.
  60-17        (n)  For purposes of title insurance policies issued under
  60-18  the authority of Chapter 9, Insurance Code, standby fees are
  60-19  considered taxes.
  60-20        Sec. 49.232.  LABORATORY SERVICES.  A district may contract
  60-21  with any person, within or without the boundaries of the district,
  60-22  to provide or receive laboratory services related to environmental,
  60-23  health, or drinking water testing.
  60-24            (Sections 49.233-49.270 reserved for expansion
  60-25                 SUBCHAPTER I.  CONSTRUCTION CONTRACTS
  60-26        Sec. 49.271.  CONTRACTS FOR CONSTRUCTION WORK.  (a)  Any
  60-27  contract made by the board for construction work shall conform to
   61-1  the provisions of this chapter.
   61-2        (b)  The contract shall contain, incorporate by reference, or
   61-3  have attached to it the specifications, plans, and details for work
   61-4  included in the contract.  All work shall be done in accordance
   61-5  with these plans and specifications and any authorized change
   61-6  orders under the supervision of the board or its designee.
   61-7        (c)  The district may adopt minimum criteria for the
   61-8  qualifications of bidders on its construction contracts and for
   61-9  sureties issuing payment and performance bonds.  For contracts over
  61-10  $25,000, the district shall require a person who bids to submit a
  61-11  certified or cashier's check on a responsible bank in the state
  61-12  equal to at least two percent of the total amount of the bid, or a
  61-13  bid bond of at least two percent of the total amount of the bid
  61-14  issued by a surety legally authorized to do business in this state,
  61-15  as a good faith deposit to ensure execution of the contract.  If
  61-16  the successful bidder fails or refuses to enter into a proper
  61-17  contract with the district, or fails or refuses to furnish the bond
  61-18  required by law, the bidder forfeits the deposit.
  61-19        (d)  The district may also require attendance by a principal
  61-20  of each prospective bidder at mandatory pre-bid conferences and may
  61-21  make any reasonable additional requirements regarding the taking of
  61-22  bids the district may deem appropriate in order to obtain
  61-23  competitive bids from responsible contractors and to minimize
  61-24  contract disputes.
  61-25        Sec. 49.272.  REPORTS FURNISHED TO PROSPECTIVE BIDDERS.  The
  61-26  board shall furnish to any person who desires to bid on
  61-27  construction work, and who makes a request in writing, a copy of
   62-1  the engineer's report or plans and specifications showing the
   62-2  details of the work to be done.  The board may charge for each copy
   62-3  of the engineer's report or plans and specifications an amount
   62-4  sufficient to cover the cost of making the copy.
   62-5        Sec. 49.273.  CONSTRUCTION CONTRACT AWARD.  (a)  The board
   62-6  shall contract for construction in accordance with this section.
   62-7  The bidding documents, plans, specifications, and other data needed
   62-8  to bid on the project must be available at the time of the first
   62-9  advertisement and the advertisement shall state the location at
  62-10  which these documents may be reviewed.
  62-11        (b)  A construction contract may cover all the work to be
  62-12  provided by the district or the various elements of the work may be
  62-13  segregated for the purpose of receiving bids and awarding
  62-14  contracts.  A contract may provide that the work will be
  62-15  constructed in stages over a period of years.
  62-16        (c)  A construction contract may provide for the payment of a
  62-17  total sum that is the completed cost of the work or may be based on
  62-18  bids to cover cost of units of the various elements entering into
  62-19  the work as estimated and approximately specified by the district's
  62-20  engineers, or a contract may be let and awarded in any other form
  62-21  or composite of forms and to any responsible person or persons
  62-22  that, in the board's judgment, will be most advantageous to the
  62-23  district and result in the best and most economical completion of
  62-24  the district's proposed plants, improvements, facilities, works,
  62-25  equipment, and appliances.
  62-26        (d)  For construction contracts for $25,000 or more, the
  62-27  board shall advertise the letting of the contract, including the
   63-1  general conditions, time, and place of opening of sealed bids.  The
   63-2  notice shall be published in one or more newspapers circulated in
   63-3  each county in which part of the district is located.  If one
   63-4  newspaper meets both of these requirements, publication in such
   63-5  newspaper is sufficient.  If there are more than four counties in
   63-6  the district, notice may be published in any newspaper with general
   63-7  circulation in the district.  The notice shall be published once a
   63-8  week for three consecutive weeks before the date that the bids are
   63-9  opened, and the first publication shall be not later than the 21st
  63-10  day before the date of the opening of the sealed bids.
  63-11        (e)  For construction contracts for $15,000 or more but less
  63-12  than $25,000, the board shall solicit written competitive bids on
  63-13  uniform written specifications from at least three bidders.
  63-14        (f)  For construction contracts of less than $15,000, the
  63-15  board is not required to advertise or seek competitive bids.
  63-16        (g)  The board may not subdivide work to avoid the
  63-17  advertising requirements specified in this section.
  63-18        (h)  The board may not accept bids that include substituted
  63-19  items unless the substituted items were included in the original
  63-20  bid proposal and all bidders had the opportunity to bid on the
  63-21  substituted items or unless notice is given to all bidders at a
  63-22  mandatory pre-bid conference.
  63-23        (i)  Change orders to contracts may be issued only as a
  63-24  result of unanticipated conditions encountered during construction
  63-25  or changes in regulatory criteria or to facilitate project
  63-26  coordination with other political entities.
  63-27        (j)  The provisions of this subchapter do not apply to
   64-1  contracts for personal or professional services or for a utility
   64-2  service operator or to contracts made by a district engaged in the
   64-3  distribution and sale of electric energy to the public.
   64-4        (k)  The provisions of this subchapter do not apply to high
   64-5  technology procurements.  The provisions of Sections 252.021(a) and
   64-6  252.042, Local Government Code, shall apply to high technology
   64-7  procurements.
   64-8        Sec. 49.274.  EMERGENCY APPROVAL OF DISTRICT PROJECTS.  If a
   64-9  district experiences an emergency condition that may create a
  64-10  serious health hazard or unreasonable economic loss to the district
  64-11  that requires immediate corrective action, the district may
  64-12  negotiate limited duration contracts to make the necessary repairs.
  64-13  The district shall submit to the executive director details
  64-14  describing the specific serious health hazard or unreasonable
  64-15  economic loss as soon as practicable following the issuance of the
  64-16  contracts.  Whenever possible, the district should obtain prior
  64-17  approval of the executive director before authorizing the contract,
  64-18  but failure to obtain prior approval shall not void the contract.
  64-19  This section does not apply to special water authorities.
  64-20        Sec. 49.275.  CONTRACTOR'S BOND.  Any person, firm,
  64-21  partnership, or corporation to whom a contract is let must give
  64-22  good and sufficient performance and payment bonds in accordance
  64-23  with Chapter 2253, Government Code, and any minimum criteria for
  64-24  sureties issuing such bonds adopted by a district in accordance
  64-25  with Section 49.271.
  64-26        Sec. 49.276.  PAYMENT FOR CONSTRUCTION WORK.  (a)  The
  64-27  district shall pay the contract price of construction contracts
   65-1  only as provided in this section.
   65-2        (b)  The district will make progress payments under
   65-3  construction contracts monthly as the work proceeds, or at more
   65-4  frequent intervals as determined by the board or its designee, on
   65-5  estimates approved by the board or its designee.
   65-6        (c)  If requested by the district or district engineer, the
   65-7  contractor shall furnish a breakdown of the total contract price
   65-8  showing the amount included for each principal category of the
   65-9  work, in such detail as requested, to provide a basis for
  65-10  determining progress payments.  In the preparation of estimates,
  65-11  the district engineer may authorize material delivered on the site
  65-12  and preparatory work done to be considered if the consideration is
  65-13  specifically authorized by the contract and if the contractor
  65-14  furnishes satisfactory evidence that he has acquired title to the
  65-15  material and that it will be utilized on the work covered by the
  65-16  contract.
  65-17        (d)  In making progress payments, 10 percent of the estimated
  65-18  amount shall be retained until final completion and acceptance of
  65-19  the contract work.  However, if the board at any time after 50
  65-20  percent of the work has been completed finds that satisfactory
  65-21  progress is being made, it may authorize any of the remaining
  65-22  progress payments to be made in full.  Also, if the work is
  65-23  substantially complete, the board, if it finds the amount retained
  65-24  to be in excess of the amount adequate for the protection of the
  65-25  district, at its discretion may release to the contractor all or a
  65-26  portion of the excess amount.  The district is not obligated to pay
  65-27  interest on amounts retained except as provided herein.  The
   66-1  district shall not be obligated to pay any interest on the 10
   66-2  percent retainage held on the first 50 percent of work completed.
   66-3  If the district holds any retainage on the remaining 50 percent of
   66-4  the work completed, the district shall pay interest on such
   66-5  retainage from the date the retainage is withheld to the date of
   66-6  payment to the contractor.  The interest rate to be paid on such
   66-7  retainage shall be the rate of interest paid by the district's
   66-8  depository bank on interest bearing accounts of similar amounts
   66-9  during the period of time interest accrues as provided herein.
  66-10        (e)  On completion and acceptance of each separate project,
  66-11  public work, or other division of the contract, on which the price
  66-12  is stated separately in the contract, payment may be made without
  66-13  retention of a percentage.
  66-14        Sec. 49.277.  INSPECTION OF AND REPORTS ON CONSTRUCTION WORK.
  66-15  (a)  The board shall have control of construction work being done
  66-16  for the district under contract to determine whether or not the
  66-17  contract is being fulfilled and shall have the construction work
  66-18  inspected by the district engineer or other designated person.
  66-19        (b)  During the progress of the construction work, the
  66-20  district engineer or other designated person shall submit to the
  66-21  board detailed written reports showing whether or not the
  66-22  contractor is complying with the contract, and when the work is
  66-23  completed the district engineer shall submit to the board a final
  66-24  detailed report including as-built plans of the facilities showing
  66-25  whether or not the contractor has fully complied with the contract.
  66-26            (Sections 49.278-49.300 reserved for expansion
  66-27            SUBCHAPTER J.  ANNEXATION OR EXCLUSION OF LAND
   67-1        Sec. 49.301.  ADDING LAND BY PETITION OF LANDOWNER.  (a)  In
   67-2  addition to any other provision provided by law, the owner or
   67-3  owners of land whether or not contiguous to the district or
   67-4  otherwise may file with the board a petition requesting that there
   67-5  be included in the district the land described in the petition by
   67-6  metes and bounds or by lot and block number if there is a recorded
   67-7  plat of the area to be included in the district.  The petition may
   67-8  request the district to condition the annexation on certain
   67-9  conditions, including the voter authorization of bonds to serve the
  67-10  area to be annexed.
  67-11        (b)  If the district has bonds, notes, or other obligations
  67-12  outstanding or bonds payable in whole or in part from taxes that
  67-13  have been voted but are unissued, the board may require the
  67-14  petitioner or petitioners to assume their share of the outstanding
  67-15  bonds, notes, or other obligations and the voted but unissued tax
  67-16  bonds of the district and authorize the board to levy a tax on
  67-17  their property in each year while any of the bonds, notes, or other
  67-18  obligations payable in whole or in part from taxation are
  67-19  outstanding to pay their share of the indebtedness.
  67-20        (c)  The petition of the landowner to add land to the
  67-21  district shall be signed and executed in the manner provided by law
  67-22  for the conveyance of real estate.
  67-23        (d)  The board shall hear and consider the petition and may
  67-24  add to the district the land described in the petition if it is
  67-25  feasible, practicable, and to the advantage of the district and if
  67-26  the district's system and other improvements of the district are
  67-27  sufficient or will be sufficient to supply the added land without
   68-1  injuring land already in the district.
   68-2        (e)  If the district has bonds payable in whole or in part
   68-3  from taxation that are voted but unissued at the time of an
   68-4  annexation and the petitioners assume the bonds and authorize the
   68-5  district to levy a tax on their property to pay the bonds, then the
   68-6  board may issue the voted but unissued bonds even though the
   68-7  boundaries of the district have been altered since the
   68-8  authorization of the bonds.
   68-9        (f)  Granted petitions shall be filed for record and shall be
  68-10  recorded in the office of the county clerk of the county or
  68-11  counties in which the added land is located.
  68-12        Sec. 49.302.  ADDING LAND BY PETITION OF LESS THAN ALL THE
  68-13  LANDOWNERS.  (a)  In addition to the method of adding land to a
  68-14  district described in Section 49.301 of this subchapter, defined
  68-15  areas of land, whether or not they are contiguous to the district,
  68-16  may be annexed to the district in the manner set forth in this
  68-17  section.
  68-18        (b)  A petition requesting the annexation of a defined area
  68-19  signed by a majority in value of the owners of land in the defined
  68-20  area, as shown by the tax rolls of the county or counties in which
  68-21  such area is located, or signed by 50 landowners if the number of
  68-22  landowners is more than 50, shall describe the land by metes and
  68-23  bounds or by lot and block number if there is a recorded plat of
  68-24  the area and shall be filed with the secretary of the board.
  68-25        (c)  It shall be the duty of the board to pass an order
  68-26  fixing a time and place at which the petition for annexation shall
  68-27  be heard that shall not be less than 30 days from the day of the
   69-1  order calling the hearing.
   69-2        (d)  The secretary of the board shall issue a notice setting
   69-3  forth the time and place of the hearing and describing the area
   69-4  proposed to be annexed.  Notice of the hearing shall be given by
   69-5  posting copies of the notice in three public places in the district
   69-6  and in one public place in the area proposed to be annexed for at
   69-7  least 14 days before the day of the hearing and by publishing a
   69-8  copy of the notice in a newspaper of general circulation in the
   69-9  county or counties in which the area proposed to be annexed is
  69-10  located one time at least 14 days before the day of the hearing.
  69-11        (e)  If upon the hearing of the petition it is found by the
  69-12  board that the proposed annexation of the area to the district is
  69-13  feasible, practicable, and to the advantage of the district and if
  69-14  the district's system and other improvements of the district are
  69-15  sufficient or will be sufficient to supply the added land without
  69-16  injuring land already in the district, then the board, by order
  69-17  entered in its minutes, may receive the proposed area as an
  69-18  addition to and to become a part of the district.  The order adding
  69-19  the proposed territory to the district need not include all of the
  69-20  land described in the petition if at the hearing a modification or
  69-21  change is found necessary or desirable by the board.
  69-22        (f)  A copy of the order annexing land to the district,
  69-23  signed by a majority of the members of the board and attested by
  69-24  the secretary of the board, shall be filed and recorded in the deed
  69-25  records of the county or counties in which the district is located
  69-26  if the land is finally annexed to the district.
  69-27        (g)  After the order is recorded the area shall be a
   70-1  component part of the district.
   70-2        (h)  The annexed area shall bear its pro rata share of all
   70-3  bonds, notes, or other obligations or taxes that may be owed,
   70-4  contracted, or authorized by the district to which it has been
   70-5  added.
   70-6        (i)  Before the added area shall be subject to all or any
   70-7  part of the bonds, notes, obligations, or taxes created before the
   70-8  annexation of the area to the district, the board shall order an
   70-9  election to be held in the district, as enlarged by reason of the
  70-10  annexation of the area, on the question of the assumption of the
  70-11  bonds, notes, obligations, and taxes by the annexed area.
  70-12        (j)  At the same election, the board may also submit a
  70-13  proposition on the question of whether the annexed area should
  70-14  assume its part of the bonds of the district payable in whole or in
  70-15  part from taxes that have been voted previously but not yet issued
  70-16  or sold and the levy of an ad valorem tax on all taxable property
  70-17  within the area annexed along with a tax on the rest of the
  70-18  district for the payment of the bonds.
  70-19        (k)  If the election results favorably, the district shall be
  70-20  authorized to issue its voted but unissued tax bonds even though
  70-21  the boundaries of the district have been changed since the original
  70-22  election approving the bonds.
  70-23        (l)  At the election called for the purpose of determining
  70-24  whether the annexed area shall assume the bonds, notes, or other
  70-25  obligations or taxes of the district, the board in a separate
  70-26  proposition may also submit the question of whether the board
  70-27  should be authorized to issue bonds payable in whole or in part
   71-1  from taxes to provide service to the area annexed.
   71-2        (m)  In the event that the district has bonds, notes, or
   71-3  obligations or taxes that may be owed, contracted, or authorized at
   71-4  the time an area is annexed or if the district has voted but
   71-5  unissued bonds payable in whole or in part from taxes at the time
   71-6  of an annexation, the board may provide in its order annexing an
   71-7  area to the district that the annexation will not be complete or
   71-8  final unless the indebtedness, tax or bond, note, or other
   71-9  obligation assumption election results favorably to the assumption
  71-10  of the district's outstanding bonds, notes, or other obligations
  71-11  and voted but unissued bonds.
  71-12        (n)  If the board elects to submit the question of whether
  71-13  the board should be authorized to issue bonds to provide service to
  71-14  the area annexed, the board may also provide in its order annexing
  71-15  an area to the district that the annexation will not be complete
  71-16  unless the election results favorably to the issuance of bonds to
  71-17  serve the annexed area.
  71-18        (o)  Whenever an election is ordered to be held in the
  71-19  district for the purpose of the assumption of bonds, notes, or
  71-20  other obligations or taxes or the assumption of voted but unissued
  71-21  bonds by reason of the annexation of any area, then the election
  71-22  shall be held and notice given as provided for bond elections held
  71-23  by the district.
  71-24        (p)  The district has the same right and duty to furnish
  71-25  service to the annexed land that it previously had to furnish
  71-26  service to other land in the district and the board shall endeavor
  71-27  to serve all land in the district without discrimination.
   72-1        Sec. 49.303.  EXCLUDING LAND FROM DISTRICT.  (a)  Before a
   72-2  district orders an election for the authorization of bonds payable
   72-3  in whole or in part from taxes, the board may, on its own motion,
   72-4  call a hearing on the question of the exclusion of land from the
   72-5  district under the provisions of this section and Sections
   72-6  49.304-49.307, if the exclusions are practicable, just, or
   72-7  desirable.
   72-8        (b)  The board must call a hearing on the exclusion of land
   72-9  or other property from the district on the written petition of any
  72-10  landowner or property owner in the district filed with the
  72-11  secretary of the board before the first election on the question of
  72-12  whether bonds should be issued payable in whole or in part from
  72-13  taxes is ordered.
  72-14        (c)  The board may hold a hearing on the exclusion of land or
  72-15  other property from the district if the district has not issued
  72-16  bonds payable in whole or in part from taxes, and if a landowner or
  72-17  property owner submits a signed petition to the secretary of the
  72-18  board evidencing the consent of the owners of a majority of the
  72-19  acreage proposed to be excluded and a majority of the taxable
  72-20  property in the district, as reflected by the most recent certified
  72-21  tax roll of the district.
  72-22        (d)  A district that has previously held an election at which
  72-23  approval was given for the issuance of bonds payable in whole or in
  72-24  part from taxes may not rely on that election for the issuance of
  72-25  the bonds if after the bond election, but before the bonds are
  72-26  issued, land is excluded from the district as provided by this
  72-27  subchapter.  The board must call and hold another bond election and
   73-1  receive voter approval as provided by this subchapter before
   73-2  issuing those bonds.
   73-3        Sec. 49.304.  HEARING TO ANNOUNCE PROPOSED EXCLUSIONS AND TO
   73-4  RECEIVE PETITIONS.  (a)  If the board determines that an exclusion
   73-5  hearing should be held or if a written petition requesting an
   73-6  exclusion hearing is filed with the secretary of the board as
   73-7  provided in Section 49.303, the board shall give notice of the time
   73-8  and place of a hearing to announce its own conclusions relating to
   73-9  land or other property to be excluded and to receive petitions for
  73-10  exclusion of land or other property.
  73-11        (b)  The board shall publish notice of the hearing once a
  73-12  week for two consecutive weeks in one or more newspapers with
  73-13  general circulation in the district.  The first publication shall
  73-14  appear at least 14 days before the day of the hearing.
  73-15        (c)  The notice shall advise all interested property owners
  73-16  of their right to present petitions for exclusions of land or other
  73-17  property and to offer evidence in support of the petitions and
  73-18  their right to contest any proposed exclusion based on either a
  73-19  petition or the board's own conclusions and to offer evidence in
  73-20  support of the contest.
  73-21        Sec. 49.305.  PETITION.  (a)  A petition for exclusion of
  73-22  land must accurately describe by metes and bounds or lot and block
  73-23  number the land to be excluded.  A petition for exclusion of other
  73-24  property must describe the property to be excluded.
  73-25        (b)  A petition for exclusion shall be filed with the
  73-26  district at least seven days before the hearing and shall state
  73-27  clearly the particular grounds on which the exclusion is sought.
   74-1  Only the stated grounds shall be considered.
   74-2        Sec. 49.306.  GROUNDS FOR EXCLUSION.  Exclusions from the
   74-3  district may be made on the grounds that:
   74-4              (1)  to retain certain land or other property within
   74-5  the district's taxing power would be arbitrary and unnecessary to
   74-6  conserve the public welfare, would impair or destroy the value of
   74-7  the property desired to be excluded, and would constitute the
   74-8  arbitrary imposition of a confiscatory burden;
   74-9              (2)  to retain any given land or other property in the
  74-10  district and to extend to it, either presently or in the future,
  74-11  the benefits, service, or protection of the district's facilities
  74-12  would create an undue and uneconomical burden on the remainder of
  74-13  the district; or
  74-14              (3)  the land desired to be excluded cannot be bettered
  74-15  as to conditions of living and health, provided with water or sewer
  74-16  service, protected from flood, drained, freed from interruption of
  74-17  traffic caused by excess of water on the roads, highways, or other
  74-18  means of transportation serving the land, or otherwise benefited by
  74-19  the district's proposed improvements.
  74-20        Sec. 49.307.  HEARING AND ORDER EXCLUDING LAND.  (a)  The
  74-21  board may adjourn the hearing from one day to another and until all
  74-22  persons desiring to be heard are heard.  The board immediately
  74-23  shall specifically describe all property it proposes to exclude on
  74-24  its own motion and shall hear first any protests and evidence
  74-25  against exclusions proposed on the board's own motion.
  74-26        (b)  After considering all engineering data and other
  74-27  evidence presented to it, the board shall determine whether the
   75-1  facts disclose the affirmative of the propositions stated in
   75-2  Subdivision (1) or (2) or, if appropriate, in Subdivision (3) of
   75-3  Section 49.306.  If the affirmative exists, the board shall enter
   75-4  an order excluding all land or other property falling within the
   75-5  conditions defined by the respective subdivisions and shall
   75-6  redefine in the order the boundaries of the district to embrace all
   75-7  land not excluded.  A copy of the order excluding land and
   75-8  redefining the boundaries of the district shall be filed in the
   75-9  deed records of the county or counties in which the district is
  75-10  situated.
  75-11        Sec. 49.308.  SUIT TO REVIEW EXCLUSION.  (a)  Any person
  75-12  owning an interest in land affected by the order may file a
  75-13  petition within 20 days after the effective date of the order to
  75-14  review, set aside, modify, or suspend the order.
  75-15        (b)  The venue in any action shall be in any district court
  75-16  that has jurisdiction in the county in which the district is
  75-17  located.  If the district includes land in more than one county,
  75-18  the venue shall be in the district court having jurisdiction in the
  75-19  county in which the major portion of the acreage of the land sought
  75-20  to be excluded from the district is located.
  75-21        (c)  A person may appeal from the judgment or order of a
  75-22  district court in a suit brought under the provisions of this
  75-23  section to the court of civil appeals and supreme court as in other
  75-24  civil cases in which the district court has original jurisdiction.
  75-25  The appeal is subject to the statutes and rules of practice and
  75-26  procedure in civil cases.
  75-27        Sec. 49.309.  EXCLUSION OF NONIRRIGATED PROPERTY.  For the
   76-1  purposes of this section and Sections 49.310-49.314, the following
   76-2  definitions shall apply:
   76-3              (1)  "Nonirrigated property" means land that:
   76-4                    (A)  is not irrigable;
   76-5                    (B)  the owners of a majority of the acreage of
   76-6  which no longer intend to irrigate; or
   76-7                    (C)  has been subdivided into:
   76-8                          (i)  town lots, or town lots and blocks, or
   76-9  small parcels of the same general nature as town lots; or
  76-10                          (ii)  town blocks and lots designed,
  76-11  intended, or suitable for residential, commercial, or other
  76-12  nonagricultural purposes, as distinguished from farm acreage
  76-13  whether subdivided into a subdivision or not; and
  76-14                          (iii)  including streets, alleys, parkways,
  76-15  parks, and railroad property and rights-of-way located in the
  76-16  subdivided land.
  76-17        The property described in Subdivision (1) shall be considered
  76-18  nonirrigated property regardless of whether the land is within or
  76-19  near a municipality and regardless of whether a plat or map of the
  76-20  subdivision has been duly filed for record and recorded in the
  76-21  office of the county clerk of the county in which the land or any
  76-22  part of the land is situated.
  76-23        The term does not include land that within the year preceding
  76-24  the date of the hearing under Section 49.310 was used for farming
  76-25  or agricultural purposes.
  76-26              (2)  "District" means a water control and improvement,
  76-27  water improvement, or irrigation district the principal purpose of
   77-1  which is furnishing water for the irrigation of agricultural lands
   77-2  or that is principally engaged in furnishing water for the
   77-3  irrigation of agricultural lands.
   77-4        Sec. 49.310.  AUTHORITY TO EXCLUDE LAND.  (a)  A petition for
   77-5  exclusion may be filed by the owner or owners, or their authorized
   77-6  agent, of a majority in acreage of nonirrigated property included
   77-7  within the boundaries of a district.
   77-8        (b)  Upon receipt of a petition for exclusion, or upon its
   77-9  own motion, a district shall issue an order excluding the property
  77-10  if, after notice and hearing, the board finds that:
  77-11              (1)  the described property is nonirrigated property;
  77-12              (2)  the applicable requirements of Section 49.311 have
  77-13  been satisfied;
  77-14              (3)  the owner or owners do not object to the exclusion
  77-15  of their nonirrigated property; and
  77-16              (4)  it is in the best interest of the district and of
  77-17  the described property to exclude that property from the district.
  77-18        (c)  The district shall follow the notice and hearing
  77-19  provisions and other procedural requirements for excluding
  77-20  territory applicable to that district as set out in Sections
  77-21  49.303-49.307.
  77-22        Sec. 49.311.  CONSENT FROM HOLDERS OF INDEBTEDNESS.  If the
  77-23  district has outstanding bonded indebtedness, or indebtedness under
  77-24  a loan from a governmental agency, a written consent from an
  77-25  authorized representative of the holder or holders of the
  77-26  indebtedness consenting to the exclusion shall be obtained and
  77-27  filed with the district before the hearing.
   78-1        Sec. 49.312.  RESULTS OF EXCLUSION.  (a)  Upon issuance of an
   78-2  order excluding property, that property is no longer a part of the
   78-3  district and is not entitled to water service from the district.
   78-4        (b)  Any taxes, assessments, or other charges owed to the
   78-5  district at the time of exclusion remain the obligation of the
   78-6  owner of the  excluded property and continue to be secured by
   78-7  statutory liens on the property, if any.
   78-8        (c)  Once excluded, the landowner has no further liability to
   78-9  the district for future taxes, assessments, or other charges of the
  78-10  district.
  78-11        (d)  A copy of the order excluding the property from the
  78-12  district certified and acknowledged by the secretary of the board
  78-13  shall be recorded by the district in the real property records of
  78-14  the county in which the excluded property is located as evidence of
  78-15  the exclusion.
  78-16        Sec. 49.313.  DISTRICT FACILITIES ON EXCLUDED PROPERTY.  If
  78-17  any canals, ditches, pipelines, pumps, or other facilities of the
  78-18  district are located on lands excluded by the resolution of the
  78-19  board, the exclusion does not affect or interfere with any rights
  78-20  that the district has to maintain and continue operation of the
  78-21  facilities as located for the purpose of servicing lands remaining
  78-22  in the district.
  78-23        Sec. 49.314.  WATER ALLOCATIONS.  (a)  After the district
  78-24  adopts an order excluding nonirrigated property, a city or other
  78-25  water supply corporation that serves the excluded land with a
  78-26  potable water supply may petition the district to apply to the
  78-27  commission to convert the proportionate irrigation water allocation
   79-1  of the land excluded as nonirrigated property, as determined by the
   79-2  district, from irrigation use to municipal use allocation.
   79-3        (b)  The district shall make such application to the
   79-4  commission within 30 days of the filing of a petition by the city
   79-5  or water supply corporation that serves the land with a potable
   79-6  water supply, provided the city or other water supply corporation
   79-7  pays the district the amount the district estimates will be its
   79-8  reasonable expenses and attorney's fees incurred in the commission
   79-9  conversion proceedings and enters into an agreement with the
  79-10  district setting forth the basis on which the water allocation
  79-11  shall be delivered, or made available, to the city or water supply
  79-12  corporation covering such terms as the entities may agree to, and
  79-13  in the event the parties cannot agree, such dispute shall not be
  79-14  subject to the jurisdiction of the commission, or its successors,
  79-15  under this code but subject to resolution through alternative
  79-16  dispute resolution.  In such commission proceeding, the city or
  79-17  water supply corporation shall provide evidence to the commission
  79-18  of the current or projected need within a five year period for the
  79-19  municipal-use water allocation after such conversion as a condition
  79-20  of such conversion of use of the district's water rights from
  79-21  irrigation use to municipal use.
  79-22            (Sections 49.315-49.320 reserved for expansion
  79-23                      SUBCHAPTER K.  DISSOLUTION
  79-24        Sec. 49.321.  DISSOLUTION AUTHORITY.  After notice and
  79-25  hearing, the commission may dissolve any district that is inactive
  79-26  for a period of five consecutive years and has no outstanding
  79-27  bonded indebtedness.
   80-1        Sec. 49.322.  NOTICE OF HEARING.  (a)  The commission shall
   80-2  give notice of the dissolution hearing that briefly describes the
   80-3  reasons for the proceeding.
   80-4        (b)  The notice shall be published once each week for two
   80-5  consecutive weeks before the day of hearing in a newspaper having
   80-6  general circulation in the county or counties in which the district
   80-7  is located.  The first publication shall be 30 days before the day
   80-8  of the hearing.
   80-9        (c)  The commission shall give notice of the hearing by first
  80-10  class mail addressed to the directors of the district according to
  80-11  the last record on file with the executive director.
  80-12        Sec. 49.323.  INVESTIGATION.  The executive director shall
  80-13  investigate the facts and circumstances of the district to be
  80-14  dissolved and the result of the investigation shall be included in
  80-15  a written report.
  80-16        Sec. 49.324.  ORDER OF DISSOLUTION.  The commission may enter
  80-17  an order dissolving the district at the conclusion of the hearing
  80-18  if it finds that the district has performed none of the functions
  80-19  for which it was created for a period of five consecutive years
  80-20  before the day of the proceeding and that the district has no
  80-21  outstanding bonded indebtedness.
  80-22        Sec. 49.325.  CERTIFIED COPY OF ORDER.  The commission shall
  80-23  file a certified copy of the order of dissolution of the district
  80-24  in the deed records of the county or counties in which the district
  80-25  is located.  If the particular district was created by a special
  80-26  Act of the legislature, the commission shall file a certified copy
  80-27  of the order of dissolution with the secretary of state.
   81-1        Sec. 49.326.  APPEALS.  (a)  Appeals from a commission order
   81-2  dissolving a district shall be filed and heard in the district
   81-3  court of any of the counties in which the land is located.
   81-4        (b)  The trial on appeal shall be de novo and the substantial
   81-5  evidence rule shall not apply.
   81-6        Sec. 49.327.  ASSETS ESCHEAT TO STATE.  Upon the dissolution
   81-7  of a district by the commission, all assets of the district shall
   81-8  escheat to the State of Texas.  The assets shall be administered by
   81-9  the state treasurer and shall be disposed of in the manner provided
  81-10  by Chapter 72, Property Code.
  81-11            (Sections 49.328-49.350 reserved for expansion
  81-12                    SUBCHAPTER L.  FIRE DEPARTMENTS
  81-13        Sec. 49.351.  FIRE DEPARTMENTS.  (a)  A district providing
  81-14  potable water or sewer service to household users may establish,
  81-15  operate, and maintain a fire department to perform all
  81-16  fire-fighting activities within the district as provided in this
  81-17  subchapter and may issue, with voter approval, bonds for financing
  81-18  the establishment of the fire department including the construction
  81-19  and purchase of necessary buildings, facilities, and equipment and
  81-20  the provision of an adequate water supply.
  81-21        (b)  After approval of the district electors of a plan to
  81-22  operate or jointly operate a fire department, the district or
  81-23  districts shall provide an adequate system and water supply for
  81-24  fire-fighting purposes, may construct and purchase necessary
  81-25  buildings, facilities, and equipment, and may employ all necessary
  81-26  personnel including supervisory personnel to operate the fire
  81-27  department.
   82-1        (c)  Bonds issued for establishment of the fire department
   82-2  shall be authorized and issued, and a district shall be authorized
   82-3  to levy a tax to pay the principal of and interest on such bonds,
   82-4  as provided by law for authorization and issuance of other bonds of
   82-5  the district.
   82-6        (d)  Two or more districts may contract to operate a joint
   82-7  fire department for their districts and shall include in the
   82-8  contract a system for joint administration and operation of the
   82-9  fire department, the extent of services to be provided, a method
  82-10  for funding the department from funds of each district, and any
  82-11  other terms and conditions the parties consider necessary.
  82-12        (e)  A district may contract with any other person to perform
  82-13  fire-fighting services within the district.
  82-14        (f)  Before a district establishes a fire department,
  82-15  contracts to operate a joint fire department, or contracts with
  82-16  another person to perform fire-fighting services within the
  82-17  district, the district must comply with the provisions of
  82-18  Subsections (g), (h), and (i).
  82-19        (g)  A district or districts proposing to act jointly shall
  82-20  develop a detailed plan for the establishment, operation, and
  82-21  maintenance of the proposed department, including a detailed
  82-22  presentation of all financial requirements.  If a district is
  82-23  entering into a contract under Subsection (e), the district shall
  82-24  develop a plan that describes in detail the facilities and
  82-25  equipment to be devoted to service to the district and all
  82-26  proposals for providing the service and that includes a
  82-27  presentation of the financial requirements under the contract.
   83-1  Before adoption of a plan and any contract by the district, the
   83-2  board shall hold a hearing at which any person residing in the
   83-3  district may present testimony for and against the proposed plan
   83-4  and any proposed contract.  Notice of the hearing and the place at
   83-5  which the plan and any contract may be examined shall be posted in
   83-6  two public places within the district at least 10 days before the
   83-7  date of the hearing.
   83-8        (h)  After adoption of the plan and any contract by the
   83-9  board, the plan and financial presentation, together with any
  83-10  contract and a written report in a form prescribed by the executive
  83-11  director describing existing fire departments and fire-fighting
  83-12  services available within 25 miles of the boundaries of the
  83-13  district, shall be submitted to the executive director for
  83-14  consideration by the commission under rules adopted by the
  83-15  commission.  Before approval or disapproval, the commission shall
  83-16  hold a hearing.  Notice of the hearing before the commission shall
  83-17  be posted by the board in at least two public places in the
  83-18  district at least five days before the hearing.  Before the
  83-19  commission approves the application, it must find that it is
  83-20  economically feasible for the district to implement the plan and
  83-21  meet the provisions of any contract and shall take into
  83-22  consideration in giving its approval the general financial
  83-23  condition of the district and the economic feasibility of the
  83-24  district carrying out the plan or meeting the obligations of the
  83-25  contract.
  83-26        (i)  After approval by the commission, the district shall
  83-27  submit to the electors of the district at the election to approve
   84-1  bonds for financing the plan, or if no bonds are to be approved, at
   84-2  an election called for approval of the plan, the proposition of
   84-3  whether or not the plan should be implemented or entered into by
   84-4  the district.  The ballots at the election shall be printed, as
   84-5  applicable, to provide for voting for or against the proposition:
   84-6  "The implementation of the plan for (operation/joint operation) of
   84-7  a fire department"; or "The plan and contract to provide
   84-8  fire-fighting services for the district."
   84-9        (j)  No funds of the district may be used to establish a fire
  84-10  department, to enter into joint operation of a fire department, or
  84-11  to contract for fire-fighting services without the approval of a
  84-12  plan by the electors as provided in this section.  However, the
  84-13  district may use available funds for preparation of a plan and any
  84-14  contract.  The operation of a fire department or provision of
  84-15  fire-fighting services is an essential public necessity, and a
  84-16  district may discontinue any and all services, including water and
  84-17  sewer service, to any person who fails to timely pay fire
  84-18  department service fees or any other assessment adopted by the
  84-19  district to support the fire department or the provision of
  84-20  fire-fighting services.
  84-21            (Sections 49.352-49.450 reserved for expansion
  84-22            SUBCHAPTER M.  NOTICES, REPORTS, AND BANKRUPTCY
  84-23        Sec. 49.451.  POSTING SIGNS IN THE DISTRICT.  (a)  A district
  84-24  subject to the notice requirements of Section 49.452 shall, within
  84-25  30 days after the effective date of this section or the creation of
  84-26  the district, post signs indicating the existence of the district
  84-27  at two principal entrances to the district.
   85-1        (b)  The size and exact location of the information contained
   85-2  on the signs shall be determined by the executive director.
   85-3        Sec. 49.452.  NOTICE TO PURCHASERS.  (a)(1)  Any person who
   85-4  proposes to sell or convey real property located in a district
   85-5  created under this title or by a special Act of the legislature
   85-6  that is providing or proposing to provide, as the district's
   85-7  principal function, water, sanitary sewer, drainage, and flood
   85-8  control or protection facilities or services, or any of these
   85-9  facilities or services that have been financed or are proposed to
  85-10  be financed with bonds of the district payable in whole or part
  85-11  from taxes of the district, or by imposition of a standby fee, if
  85-12  any, to household or commercial users, other than agricultural,
  85-13  irrigation, or industrial users, and which district includes less
  85-14  than all the territory in at least one county and which, if located
  85-15  within the corporate area of a city, includes less than 75 percent
  85-16  of the incorporated area of the city or which is located outside
  85-17  the corporate area of a city in whole or in substantial part, must
  85-18  first give to the purchaser the written notice provided in this
  85-19  section.
  85-20              (2)  The provisions of this section shall not be
  85-21  applicable to:
  85-22                    (A)  transfers of title under any type of lien
  85-23  foreclosure;
  85-24                    (B)  transfers of title by deed in cancellation
  85-25  of indebtedness secured by a lien upon the property conveyed; or
  85-26                    (C)  transfers of title by reason of a will or
  85-27  probate proceedings.
   86-1        (b)  The prescribed notice for all districts shall be
   86-2  executed by the seller and shall read as follows:
   86-3        "The real property, described below, that you are about to
   86-4  purchase is located in the ___________________ District.  The
   86-5  district has taxing authority separate from any other taxing
   86-6  authority and may, subject to voter approval, issue an unlimited
   86-7  amount of bonds and levy an unlimited rate of tax in payment of
   86-8  such bonds.  As of this date, the rate of taxes levied by the
   86-9  district on real property located in the district is $__________ on
  86-10  each $100 of assessed valuation.  If the district has not yet
  86-11  levied taxes, the most recent projected rate of debt service tax,
  86-12  as of this date, is $__________ on each $100 of assessed valuation.
  86-13  The total amount of bonds approved by the voters and which have
  86-14  been or may, at this date, be issued is $__________, and the
  86-15  aggregate initial principal amounts of all bonds issued for one or
  86-16  more of the specified facilities of the district and payable in
  86-17  whole or in part from property taxes is $__________.
  86-18        "The district has the authority to adopt and impose a standby
  86-19  fee on property in the district that has water, sanitary sewer, or
  86-20  drainage facilities and services available but not connected and
  86-21  which does not have a house, building, or other improvement located
  86-22  thereon and does not substantially utilize the utility capacity
  86-23  available to the property.  The district may exercise the authority
  86-24  without holding an election on the matter.  As of this date, the
  86-25  most recent amount of the standby fee is $__________.  An unpaid
  86-26  standby fee is a personal obligation of the person that owned the
  86-27  property at the time of imposition and is secured by a lien on the
   87-1  property.  Any person may request a certificate from the district
   87-2  stating the amount, if any, of unpaid standby fees on a tract of
   87-3  property in the district.
   87-4        "The purpose of this district is to provide water, sewer,
   87-5  drainage, or flood control facilities and services within the
   87-6  district through the issuance of bonds payable in whole or in part
   87-7  from property taxes.  The cost of these utility facilities is not
   87-8  included in the purchase price of your property, and these utility
   87-9  facilities are owned or to be owned by the district.  The legal
  87-10  description of the property you are acquiring is as follows:
  87-11  ___________________________________________________________________
  87-12                                        ______________________ (Date)
  87-13                                        _____________________________
  87-14                                             Signature of Seller
  87-15        PURCHASER IS ADVISED THAT THE INFORMATION SHOWN ON THIS FORM
  87-16  IS SUBJECT TO CHANGE BY THE DISTRICT AT ANY TIME.  THE DISTRICT
  87-17  ROUTINELY ESTABLISHES TAX RATES DURING THE MONTHS OF SEPTEMBER
  87-18  THROUGH DECEMBER OF EACH YEAR, EFFECTIVE FOR THE YEAR IN WHICH THE
  87-19  TAX RATES ARE APPROVED BY THE DISTRICT.  PURCHASER IS ADVISED TO
  87-20  CONTACT THE DISTRICT TO DETERMINE THE STATUS OF ANY CURRENT OR
  87-21  PROPOSED CHANGES TO THE INFORMATION SHOWN ON THIS FORM.
  87-22        "The undersigned purchaser hereby acknowledges receipt of the
  87-23  foregoing notice at or prior to execution of a binding contract for
  87-24  the purchase of the real property described in such notice or at
  87-25  closing of purchase of the real property.
  87-26                                        ______________________ (Date)
  87-27                                        _____________________________
   88-1                                         Signature of Purchaser
   88-2        "(Note:  Correct district name, tax rate, bond amounts, and
   88-3  legal description are to be placed in the appropriate space.)
   88-4  Except for notices included as an addendum or paragraph of a
   88-5  purchase contract, the notice shall be executed by the seller and
   88-6  purchaser, as indicated.  If the district does not propose to
   88-7  provide one or more of the specified facilities and services, the
   88-8  appropriate purpose may be eliminated.  If the district has not yet
   88-9  levied taxes, a statement of the district's most recent projected
  88-10  rate of debt service tax is to be placed in the appropriate space.
  88-11  If the district does not have approval from the commission to adopt
  88-12  and impose a standby fee, the second paragraph of the notice may be
  88-13  deleted.  For the purposes of the notice form required to be given
  88-14  to the prospective purchaser prior to execution of a binding
  88-15  contract of sale and purchase, a seller and any agent,
  88-16  representative, or person acting on the seller's behalf may modify
  88-17  the notice by substitution of the words 'January 1, ______' for the
  88-18  words 'this date' and place the correct calendar year in the
  88-19  appropriate space."
  88-20        (c)  The notice required by this section shall be given to
  88-21  the prospective purchaser prior to execution of a binding contract
  88-22  of sale and purchase either separately or as an addendum or
  88-23  paragraph of a purchase contract.  In the event a contract of
  88-24  purchase and sale is entered into without the seller providing the
  88-25  notice required by this subsection, the purchaser shall be entitled
  88-26  to terminate the contract.  If, however, the seller furnishes the
  88-27  required notice at or prior to closing the purchase and sale
   89-1  contract and the purchaser elects to close even though such notice
   89-2  was not timely furnished prior to execution of the contract, it
   89-3  shall be conclusively presumed that the purchaser has waived all
   89-4  rights to terminate the contract and recover damages or other
   89-5  remedies or rights under the provisions of this section.
   89-6  Notwithstanding any provision of this subchapter to the contrary,
   89-7  all sellers, title companies, and examining attorneys, and any
   89-8  agent, representative, or person acting on their behalf, shall not
   89-9  be liable for damages under the provisions of either Subsection (l)
  89-10  or (m) or liable for any other damages to any person for failure to
  89-11  provide the notice required by this section to a purchaser prior to
  89-12  execution of a binding contract of a purchase and sale when the
  89-13  district has not filed the information form and map or plat as
  89-14  required under Section 49.455.
  89-15        (d)  The purchaser shall sign the notice or purchase contract
  89-16  including such notice to evidence the receipt of notice.
  89-17        (e)  At the closing of purchase and sale, a separate copy of
  89-18  such notice with current information shall be executed by the
  89-19  seller and purchaser, acknowledged, and thereafter recorded in the
  89-20  deed records of the county in which the property is located.  For
  89-21  the purposes of this section, all sellers, title companies, and
  89-22  examining attorneys, and any agent, representative, or person
  89-23  acting on their behalf, shall be entitled to rely on the accuracy
  89-24  of the information form and map or plat as last filed by each
  89-25  district under Section 49.455 or the information contained in or
  89-26  shown on the notice form issued by the district under Section
  89-27  49.453 in completing the notice form to be executed by the seller
   90-1  and purchaser at the closing of purchase and sale.  Any information
   90-2  taken from the information form or map or plat as last filed by
   90-3  each district and the information contained in or shown on the
   90-4  notice form issued by the district under Section 49.453 shall be,
   90-5  for purposes of this section, conclusively presumed as a matter of
   90-6  law to be correct.  All subsequent sellers, purchasers, title
   90-7  insurance companies, examining attorneys, and lienholders shall be
   90-8  entitled to rely upon the information form and map or plat filed by
   90-9  the district or the notice form issued by the district under
  90-10  Section 49.453.
  90-11        (f)  For the purposes of this section, an executory contract
  90-12  of purchase and sale having a performance period of more than six
  90-13  months shall be considered a sale under Subsection (a).
  90-14        (g)  For the purposes of the notice form to be given to the
  90-15  prospective purchaser prior to execution of a binding contract of
  90-16  sale and purchase, a seller and any agent, representative, or
  90-17  person acting in the seller's behalf may modify the notice by
  90-18  substitution of the words "January 1, ____" for the words "this
  90-19  date" and place the correct calendar year in the appropriate space.
  90-20  All sellers, and all persons completing the prescribed notice in
  90-21  the sellers' behalf, shall be entitled to rely on the information
  90-22  contained in or shown on the information form and map or plat filed
  90-23  of record by the district under Section 49.455 in completing the
  90-24  prescribed form to be given to the prospective purchaser prior to
  90-25  execution of a binding contract of sale and purchase.  Except as
  90-26  otherwise provided in Subsection (e), any information taken from
  90-27  the information form or map or plat filed of record by the district
   91-1  in effect as of January 1 of each year shall be, for purposes of
   91-2  the notice to be given to the prospective purchaser prior to
   91-3  execution of a binding contract of sale and purchase, conclusively
   91-4  presumed as a matter of law to be correct for the period January 1
   91-5  through December 31 of such calendar year.  A seller and any
   91-6  persons completing the prescribed notice in the seller's behalf may
   91-7  provide more recent information, if available, than the information
   91-8  contained in or shown on the information form and map or plat filed
   91-9  of record by the district under Section 49.455 in effect as of
  91-10  January 1 of each year in completing the prescribed form to be
  91-11  given to the purchaser prior to execution of a binding contract of
  91-12  sale and purchase.  Nothing contained in the preceding sentence
  91-13  shall be construed to create an affirmative duty on the part of a
  91-14  seller or any persons completing the prescribed notice in the
  91-15  seller's behalf to provide more recent information than the
  91-16  information taken from the information form and map or plat filed
  91-17  of record by the district as of January 1 of each year in
  91-18  completing the prescribed notice to be given to the purchaser prior
  91-19  to execution of a binding contract of sale and purchase.  All
  91-20  subsequent sellers, purchasers, title insurance companies,
  91-21  examining attorneys, and lienholders shall be entitled to rely upon
  91-22  the information form and map or plat filed by the district.
  91-23        (h)  If such notice is given at closing as provided in
  91-24  Subsection (e), a purchaser, or the purchaser's heirs, successors,
  91-25  or assigns, shall not be entitled to maintain any action for
  91-26  damages or maintain any action against a seller, title insurance
  91-27  company, or lienholder, or any agent, representative, or person
   92-1  acting in their behalf, by reason of use by the seller of the
   92-2  information filed for record by the district or reliance by the
   92-3  seller on the filed plat and filed legal description of the
   92-4  district in determining whether the property to be sold and
   92-5  purchased is within the district.  No action may be maintained
   92-6  against any title company for failure to disclose the inclusion of
   92-7  the described real property within a district when the district has
   92-8  not filed for record the information form, map, or plat with the
   92-9  clerk of the county or counties in which the district is located.
  92-10        (i)  Any purchaser who purchases any real property in a
  92-11  district and who thereafter sells or conveys the same shall on
  92-12  closing of such subsequent sale be conclusively considered as
  92-13  having waived any prior right to damages under this section.
  92-14        (j)  It is the express intent of this section that all
  92-15  sellers, title insurance companies, examining attorneys, vendors of
  92-16  property and tax information, real estate brokers, and lienholders,
  92-17  and any agent, representative, or person acting on their behalf,
  92-18  shall be entitled to rely on the accuracy of the information form
  92-19  and map or plat as last filed by each district or the information
  92-20  contained in or shown on the notice form issued by the district
  92-21  under Section 49.453, or for the purposes of the notice to be given
  92-22  the purchaser prior to execution of a binding contract of sale and
  92-23  purchase the information contained in or shown on the information
  92-24  form and map or plat filed of record by the district in effect as
  92-25  of January 1 of each year for the period January 1 through December
  92-26  31 of such calendar year.
  92-27        (k)  Except as otherwise provided in Subsection (c), if any
   93-1  sale or conveyance of real property within a district is not made
   93-2  in compliance with the provisions of this section, the purchaser
   93-3  may institute a suit for damages under the provisions of either
   93-4  Subsection (l) or (m).
   93-5        (l)  A purchaser of real property covered by the provisions
   93-6  of this section, if the sale or conveyance of the property is not
   93-7  made in compliance with this section, may institute a suit for
   93-8  damages in the amount of all costs relative to the purchase of the
   93-9  property plus interest and reasonable attorney's fees.  The suit
  93-10  for damages may be instituted jointly or severally against the
  93-11  person, firm, corporation, partnership, organization, business
  93-12  trust, estate, trust, association, or other legal entity that sold
  93-13  or conveyed the property to the purchaser.  Following the recovery
  93-14  of damages under this subsection, the amount of the damages shall
  93-15  first be paid to satisfy all unpaid obligations on each outstanding
  93-16  lien or liens on the property and the remainder of the damage
  93-17  amount shall be paid to the purchaser.  On payment of all damages
  93-18  respectively to the lienholders and purchaser, the purchaser shall
  93-19  reconvey the property to the seller.
  93-20        (m)  A purchaser of real property covered by the provisions
  93-21  of this section, if the sale or conveyance of the property is not
  93-22  made in compliance with this section, may institute a suit for
  93-23  damages in an amount not to exceed $5,000, plus reasonable
  93-24  attorney's fees.
  93-25        (n)  A purchaser is not entitled to recover damages under
  93-26  both Subsections (l) and (m), and entry of a final decision
  93-27  awarding damages to the purchaser under either Subsection (l) or
   94-1  (m) shall preclude the purchaser from recovering damages under the
   94-2  other subsection.  Notwithstanding any part or provision of the
   94-3  general or special laws or the common law of the state to the
   94-4  contrary, the relief provided under Subsections (l) and (m) shall
   94-5  be the exclusive remedies for a purchaser aggrieved by the seller's
   94-6  failure to comply with the provisions of this section.  Any action
   94-7  for damages shall not, however, apply to, affect, alter, or impair
   94-8  the validity of any existing vendor's lien, mechanic's lien, or
   94-9  deed of trust lien on the property.
  94-10        (o)  A suit for damages under the provisions of this section
  94-11  must be brought within 90 days after the purchaser receives the
  94-12  first district tax notice or within four years after the property
  94-13  is sold or conveyed to the purchaser, whichever time occurs first,
  94-14  or the purchaser loses the right to seek damages under this
  94-15  section.
  94-16        (p)  Notwithstanding any provisions of this subchapter to the
  94-17  contrary, a purchaser may not recover damages of any kind under
  94-18  this section if that person:
  94-19              (1)  purchases an equity in real property and in
  94-20  conjunction with the purchase assumes any liens, whether purchase
  94-21  money or otherwise; and
  94-22              (2)  does not require proof of title by abstract, title
  94-23  policy, or any other proof of title.
  94-24        Sec. 49.453.  NOTICE FORM FROM DISTRICT.  (a)  A district
  94-25  covered by Section 49.452 shall also maintain in the district
  94-26  office the particular form of Notice to Purchasers required by
  94-27  Section 49.452 to be furnished by a seller to a purchaser of real
   95-1  property in that district and shall, upon written request of any
   95-2  person, issue the notice form completed by a district with all
   95-3  information required to be furnished by the district.  A notice
   95-4  form issued by a district under the provisions of this section
   95-5  shall include a written statement that the notice form is being
   95-6  issued by the district, the date of its issuance, and the
   95-7  district's telephone number.  A district shall not be required to
   95-8  orally provide the information.
   95-9        (b)  A district may charge a reasonable fee as determined by
  95-10  the district not to exceed $10 for the issuance of a notice form
  95-11  pursuant to Subsection (a).  The notice form shall be delivered by
  95-12  regular mail or made available at the district's office.  If a
  95-13  district is requested to deliver the notice form to a person by an
  95-14  alternative method, the district may impose a charge not to exceed
  95-15  the actual cost of such delivery.
  95-16        (c)  A district may delegate the responsibility for issuance
  95-17  of the particular form of Notice to Purchasers to an employee or
  95-18  agent of the district.  A district shall file with the commission
  95-19  the name, address, and telephone number of the employee or agent of
  95-20  the district responsible for issuance of the notice forms and shall
  95-21  notify the commission in writing within seven days after there is a
  95-22  change to the information required to be filed with the commission
  95-23  under the provisions of this subsection.
  95-24        (d)  Any notice issued by the district shall contain the
  95-25  information effective as of the date of its issuance.
  95-26        Sec. 49.454.  NOTICE OF UNPAID STANDBY FEES.  (a)  A district
  95-27  covered by Section 49.452 shall, on the written request of any
   96-1  person, issue a certificate stating the amount of any unpaid
   96-2  standby fees, including interest on the fees, that have been
   96-3  assessed against a tract of property in the district.  The district
   96-4  may charge a fee not to exceed $10 for each certificate.  A
   96-5  certificate issued through fraud or collusion is void.
   96-6        (b)  If the district issues a certificate containing an
   96-7  erroneous statement under Subsection (a) and the owner of the
   96-8  property transfers the property to a good faith purchaser for
   96-9  value, the lien on the property provided by Section 49.231(k) is
  96-10  extinguished to the extent of the error.
  96-11        (c)  This section does not affect the liability for any
  96-12  unpaid standby fees of the former owner of the undeveloped property
  96-13  under Section 49.231(k).
  96-14        Sec. 49.455.  FILING INFORMATION.  (a)  The board covered by
  96-15  the provisions of Section 49.452 of this subchapter shall file with
  96-16  the county clerk in each of the counties in which all or part of
  96-17  the district is located a duly affirmed and acknowledged
  96-18  information form that includes the information required in
  96-19  Subsection (b), and a complete and accurate map or plat showing the
  96-20  boundaries of the district.
  96-21        (b)  The information form filed by a district under this
  96-22  section shall include:
  96-23              (1)  the name of the district;
  96-24              (2)  the complete and accurate legal description of the
  96-25  boundaries of the district;
  96-26              (3)  the most recent rate of district taxes on property
  96-27  located in the district;
   97-1              (4)  the total amount of bonds that have been approved
   97-2  by the voters and which may be issued by the district (excluding
   97-3  refunding bonds and any bonds or portion of bonds payable solely
   97-4  from revenues received or expected to be received pursuant to a
   97-5  contract with a governmental entity);
   97-6              (5)  the aggregate initial principal amount of all
   97-7  bonds of the district payable in whole or part from taxes
   97-8  (excluding refunding bonds and any bonds or portion of bonds
   97-9  payable solely from revenues received or expected to be received
  97-10  pursuant to a contract with a governmental entity) that have been
  97-11  previously issued and remain outstanding;
  97-12              (6)  whether a standby fee is imposed by the district
  97-13  and, if so, the amount of the standby fee;
  97-14              (7)  the date on which the election to confirm the
  97-15  creation of the district was held if such was required;
  97-16              (8)  a statement of the functions performed or to be
  97-17  performed by the district; and
  97-18              (9)  the particular form of Notice to Purchasers
  97-19  required by Section 49.452 of this subchapter to be furnished by a
  97-20  seller to a purchaser of real property in that district completed
  97-21  by the district with all information required to be furnished by
  97-22  the district.
  97-23        If a district has not yet levied taxes, a statement to such
  97-24  effect together with the district's most recent projected rate of
  97-25  debt service tax shall be substituted for Subdivisions (3) and (4).
  97-26        (c)  The information form and map or plat required by this
  97-27  section shall be signed by a majority of the members of the board
   98-1  and by each such officer affirmed and acknowledged before it is
   98-2  filed with the county clerk, and each amendment made to an
   98-3  information form or map shall also be signed by the members of the
   98-4  board and by each such officer affirmed and acknowledged before it
   98-5  is filed with the county clerk.
   98-6        (d)  The information form required by this section shall be
   98-7  filed with the county clerk within 48 hours after the effective
   98-8  date of this section or within 48 hours after the district is
   98-9  officially created, whichever time comes first.  For purposes of
  98-10  this section, the words "officially created" mean the date and hour
  98-11  in which the results of the election to confirm the creation of the
  98-12  district are declared.
  98-13        (e)  Within seven days after there is a change in any of the
  98-14  information contained in the district information form, map, or
  98-15  plat, the district shall file an amendment to the information form,
  98-16  map, or plat setting forth the changes made.
  98-17        (f)  Any person who affirms the corrections and accuracy of
  98-18  and acknowledges an information form, map, or plat, or any
  98-19  amendment to an information form, map, or plat that includes
  98-20  information that is inaccurate or incorrect shall be guilty of a
  98-21  misdemeanor and shall be fined not less than $100 nor more than
  98-22  $1,000 for each violation.
  98-23        (g)  If a district fails to file the information required by
  98-24  this section in the time required, the executive director may
  98-25  request the state attorney general or the district or county
  98-26  attorney of the county in which the district is located to seek a
  98-27  writ of mandamus to force the board to prepare and file the
   99-1  necessary information.
   99-2        (h)  Any member of a governing board who wilfully fails or
   99-3  refuses to join in filing an information form, map, or plat or an
   99-4  amendment to an information form, map, or plat under this section
   99-5  shall be guilty of a misdemeanor and shall be fined not less than
   99-6  $100 nor more than $1,000 for each violation.  A member of a
   99-7  governing board is presumed to have wilfully failed or refused to
   99-8  join in the filing of an information form, map, or plat or an
   99-9  amendment to an information form, map, or plat if that member was
  99-10  present at the meeting at which the information included in the
  99-11  information form, map, or plat or amendment to the information
  99-12  form, map, or plat was adopted.
  99-13        (i)  If a district covered by this section is dissolved,
  99-14  annexed to another local government, or consolidated with another
  99-15  district, the members of the board shall file a statement of this
  99-16  fact together with the effective date of the dissolution,
  99-17  annexation, or consolidation with the information form.  After a
  99-18  district is dissolved and the statement is filed under this
  99-19  subsection, a person who sells or conveys property within the
  99-20  dissolved district is no longer required to give notice under
  99-21  Section 49.452 of this subchapter.
  99-22        (j)  A copy of all information forms, maps, or plats and
  99-23  amendments to these filed under this section shall also be filed
  99-24  with the executive director.
  99-25        Sec. 49.456.  BANKRUPTCY OF DISTRICTS; AUTHORITY OF
  99-26  COMMISSION.  (a)  Notwithstanding Section 140.001, Local Government
  99-27  Code, or any other law of this state, a district created under
  100-1  Sections 52(b)(1) and (2), Article III, or Section 59, Article XVI,
  100-2  Texas Constitution, that is subject to the continuing supervision
  100-3  of the commission may not proceed under Chapter 9 of the Federal
  100-4  Bankruptcy Code (11 U.S.C. Sections 901-946) or any other law
  100-5  enacted by the Congress of the United States under federal
  100-6  bankruptcy authority until the commission authorizes the district
  100-7  to proceed under those laws by written order.
  100-8        (b)  A district requesting the commission's authorization to
  100-9  proceed under Chapter 9 of the Federal Bankruptcy Code (11 U.S.C.
 100-10  Sections 901-946) or any other federal bankruptcy law shall file an
 100-11  application with the commission requesting authorization.
 100-12        (c)  The commission shall investigate the financial condition
 100-13  of a district submitting an application under Subsection (b),
 100-14  including its assets, liabilities, and sources of revenues and may
 100-15  require a district to submit any information that the commission
 100-16  considers material to a determination of whether authorization to
 100-17  proceed in bankruptcy should be granted.
 100-18        (d)  The commission may not authorize a district to proceed
 100-19  in bankruptcy unless the commission determines that the district
 100-20  cannot, through the full exercise of its rights and powers under
 100-21  the laws of this state, reasonably expect to meet its debts and
 100-22  other obligations as they mature.
 100-23        (e)  The commission shall adopt and assess reasonable and
 100-24  necessary fees adequate to recover the costs of the commission in
 100-25  administering this section.
 100-26        SECTION 3.  Title 4, Water Code, is amended by adding Chapter
 100-27  59 to read as follows:
  101-1                    CHAPTER 59.  REGIONAL DISTRICTS
  101-2                   SUBCHAPTER A.  DISTRICT CREATION
  101-3        Sec. 59.001.  PURPOSE AND APPLICATION.  (a)  The purpose of
  101-4  this chapter is to authorize creation and operation of regional
  101-5  districts for water, sanitary sewer, drainage, and municipal solid
  101-6  waste disposal under Section 59, Article XVI, Texas Constitution.
  101-7        (b)  This chapter applies only in counties with a population
  101-8  of at least 2.2 million, according to the most recent federal
  101-9  census, or bordering a county with a population of at least 2.2
 101-10  million, according to the most recent federal census.
 101-11        Sec. 59.002.  DEFINITIONS.  (a)  In this chapter:
 101-12              (1)  "District" means a district created or operating
 101-13  under this chapter.
 101-14              (2)  "Municipal district" means a district created
 101-15  under general law or a special Act operating under Chapter 51, 53,
 101-16  or 54.
 101-17              (3)  "Bond" means bonds, coupons, notes, or any other
 101-18  evidence of indebtedness.
 101-19        (b)  Other terms not defined by this chapter have the same
 101-20  meaning assigned to those terms by Section 49.001.
 101-21        Sec. 59.003.  CREATION OF DISTRICT.  (a)  A district may be
 101-22  created by:
 101-23              (1)  The boards of at least 20 percent of the total
 101-24  number of municipal districts to be included in the proposed
 101-25  district may jointly petition the commission for creation of a
 101-26  district.  The petition must describe the territory to be included
 101-27  in the district and must include resolutions endorsing creation of
  102-1  the district adopted by each municipal district to be included in
  102-2  the district.
  102-3              (2)  The owner or owners of 2,000 or more contiguous
  102-4  acres may petition the commission for creation of a district.
  102-5              (3)  The commissioners courts of one or more counties
  102-6  may petition the commission for creation of a district in any
  102-7  territory within the county.
  102-8              (4)  The governing body of any city may petition the
  102-9  commission for creation of a district in any territory within the
 102-10  city or its extraterritorial jurisdiction.
 102-11        (b)  Petitions for the creation of a district must:
 102-12              (1)  describe the boundaries of the proposed district
 102-13  by metes and bounds that adequately and completely circumscribe the
 102-14  property so that there is complete closure of the property or by
 102-15  lot and block numbers if there is a recorded map or plat or
 102-16  subdivision survey of the area;
 102-17              (2)  state the general nature of the work proposed to
 102-18  be done, the necessity of the work, and the cost of any projects of
 102-19  the district as estimated by those filing the petition;
 102-20              (3)  state the name of each petitioner; and
 102-21              (4)  include a name of the district generally
 102-22  descriptive of the locale of the district followed by the words
 102-23  "Regional District."
 102-24        (c)  A proposed district may not have the same name as any
 102-25  other district in the state.
 102-26        (d)  Section 54.013 applies to the composition of districts
 102-27  created under this chapter.
  103-1        Sec. 59.004.  PURPOSES OF DISTRICT.  A district shall be
  103-2  created:
  103-3              (1)  to purchase, own, hold, lease, and otherwise
  103-4  acquire sources of water supply;
  103-5              (2)  to build, operate, and maintain facilities for the
  103-6  transportation of water;
  103-7              (3)  to sell water to cities, to political subdivisions
  103-8  of this state, to water supply corporations, to private business
  103-9  entities, and to individuals;
 103-10              (4)  to purchase, own, hold, lease, and otherwise
 103-11  acquire equipment and mechanisms necessary for sanitary sewer and
 103-12  wastewater treatment;
 103-13              (5)  to build, operate, and maintain facilities for
 103-14  sanitary sewer and wastewater treatment;
 103-15              (6)  to transport and treat sanitary sewer and
 103-16  wastewater effluent of cities and political subdivisions of this
 103-17  state and for private business entities or individuals;
 103-18              (7)  to purchase, own, hold, lease, and otherwise
 103-19  acquire equipment and mechanisms for the drainage of storm water
 103-20  and floodwater; and
 103-21              (8)  for the purposes outlined in Section 54.012.
 103-22        Sec. 59.005.  MATCHING FUNDS GUARANTEES.  If the Texas Water
 103-23  Development Board requires that matching funds be provided as a
 103-24  condition for receiving a loan or grant from the Texas Water
 103-25  Development Board from research and planning funds, the matching
 103-26  funds may not be provided through a guarantee of matching funds by
 103-27  any individual who has a financial interest in the regional
  104-1  district or who will receive any direct financial benefit from a
  104-2  regional district project.
  104-3        Sec. 59.006.  CONSENT OF CITY.  (a)  Land in the corporate
  104-4  limits of a city or in the extraterritorial jurisdiction of a city
  104-5  may not be included in a district unless the city grants its
  104-6  written consent by resolution or ordinance to the inclusion of the
  104-7  land in the district.
  104-8        (b)  If the governing body of a city fails or refuses to
  104-9  grant permission for the inclusion of land in its extraterritorial
 104-10  jurisdiction in a district within 120 days after receipt of a
 104-11  written request, the person or entity desiring to create the
 104-12  district may petition the governing body of the city to make
 104-13  available the water, sewer, or drainage service contemplated to be
 104-14  provided by the district.
 104-15        (c)  Failure of the governing body of the city and the
 104-16  requesting district to execute a mutually agreeable contract
 104-17  providing for the service requested within six months after receipt
 104-18  of a request for consent constitutes authorization for the
 104-19  inclusion of land in the district under this section.
 104-20  Authorization for the inclusion of the land in the district under
 104-21  this section means only authorization to initiate proceedings to
 104-22  include the land in the district as otherwise provided by this
 104-23  chapter.
 104-24        (d)  Sections 54.016(e), (f), (g), and (h) apply under this
 104-25  chapter.
 104-26        Sec. 59.007.  GRANTING OR REFUSING PETITION; EXCLUSION OF
 104-27  TERRITORY.  (a)  If after the hearing of the petition the
  105-1  commission finds that the petition conforms to the requirements of
  105-2  this chapter and that the creation of the district would be of
  105-3  benefit to the territory to be included in the district, the
  105-4  commission shall issue an order granting the petition for creation.
  105-5  If the commission finds that part of the territory included in the
  105-6  proposed district will not benefit from the creation of the
  105-7  district, the commission shall exclude that territory from the
  105-8  proposed district and redefine the proposed district's boundaries
  105-9  accordingly.
 105-10        (b)  If the commission finds that the petition does not
 105-11  conform to the requirements of this chapter or that the proposed
 105-12  projects are not of benefit to the territory in the proposed
 105-13  district, the commission shall issue an order either denying the
 105-14  petition or requiring petitioners to amend their petition.
 105-15        (c)  A copy of the order of the commission granting or
 105-16  denying a petition shall be mailed to each city having
 105-17  extraterritorial jurisdiction in the county or counties in which
 105-18  the district is to be located that has requested notice of hearings
 105-19  as provided by Section 54.019.
 105-20            (Sections 59.008-59.020 reserved for expansion
 105-21               SUBCHAPTER B.  ADMINISTRATIVE PROVISIONS
 105-22        Sec. 59.021.  DIRECTORS.  (a)  The commission shall appoint
 105-23  temporary directors who shall serve until permanent directors are
 105-24  elected.
 105-25        (b)  A petition requesting creation filed in accordance with
 105-26  Section 59.006 may provide that directors be elected by precinct as
 105-27  provided by Subsection (h).
  106-1        (c)  The board of directors is composed of five members
  106-2  unless the petition requesting creation of the district requests
  106-3  and the commission approves a board that consists of seven members.
  106-4        (d)  Permanent directors shall be elected in accordance with
  106-5  Chapter 49.
  106-6        (e)  If the petition for creation has requested the election
  106-7  of seven directors as provided by Subsection (c), unless otherwise
  106-8  agreed, the three directors elected who received the fewest number
  106-9  of votes, whether their election is by precinct or at large, shall
 106-10  serve until the next directors election following the confirmation
 106-11  election and the four who received the highest number of votes
 106-12  shall serve until the second directors election after the
 106-13  confirmation election.
 106-14        (f)  After the creation of the district, the persons or
 106-15  entities that petitioned for creation or 50 qualified voters of the
 106-16  district may file a petition with the commission requesting to
 106-17  expand the district's board to seven members.  If the commission
 106-18  grants the petition, the commission shall appoint two temporary
 106-19  directors.  One temporary director shall serve until the next
 106-20  directors election and one shall serve until the next succeeding
 106-21  directors election.  At each election one director shall be elected
 106-22  to serve for a four-year term.
 106-23        (g)  If the board of directors of the district is expanded to
 106-24  seven members, four directors shall constitute a quorum and a
 106-25  concurrence of four directors is necessary in all matters
 106-26  pertaining to the business of the district.
 106-27        (h)  A petition for the creation of a district may request
  107-1  that the board be elected to represent a geographic area.  If the
  107-2  petition requesting creation of the district is granted, the
  107-3  commission shall establish precincts from which the directors are
  107-4  to be elected.  In establishing the precincts the commission shall
  107-5  attempt to have directors represent geographic areas with equal
  107-6  numbers of people and shall comply with the federal Voting Rights
  107-7  Act of 1965 (42 U.S.C. Sections 1971, 1973 et seq.).  Thereafter,
  107-8  the board of directors of the district shall revise the precincts
  107-9  from time to time to cause them to comply with the provisions of
 107-10  this subsection.
 107-11        Sec. 59.022.  ABILITY TO SET RATES.  The district may charge
 107-12  rates to persons and entities located outside the district's
 107-13  boundaries on terms, rates, and charges the board of directors may
 107-14  determine to be advisable.  In setting rates for out-of-district
 107-15  customers, the board shall set rates sufficient to enable it to
 107-16  meet operation and maintenance expenses and to pay the principal of
 107-17  and interest on debt issued in connection with providing service
 107-18  and to provide a reasonable reserve for replacements to the
 107-19  district.  In setting rates, the district may take into
 107-20  consideration past operation and debt service expenses.
 107-21        Sec. 59.023.  ISSUANCE OF BONDS.  The district may issue
 107-22  bonds for the purpose of purchasing, constructing, acquiring,
 107-23  owning, operating, repairing, improving, or extending any district
 107-24  works, improvements, facilities, plants, equipment, and appliances
 107-25  needed to accomplish the purposes of the district, including works,
 107-26  improvements, facilities, plants, equipment, and appliances needed
 107-27  to provide a waterworks system, sanitary sewer system, storm sewer
  108-1  system, solid waste disposal system, and parks and recreational
  108-2  facilities.  Prior to issuing bonds or other obligations, a
  108-3  confirmation election must be held in accordance with Chapter 49,
  108-4  and a majority of voters must approve the establishment of the
  108-5  district.
  108-6        Sec. 59.024.  EXCLUSION OF CERTAIN MUNICIPAL DISTRICTS.  (a)
  108-7  A municipal district may be excluded from the district as provided
  108-8  by this section.
  108-9        (b)  To be excluded, the board of directors of the municipal
 108-10  district may adopt a resolution requesting exclusion by a majority
 108-11  vote of its board of directors and shall file the petition with the
 108-12  directors of the proposed district before the first confirmation
 108-13  election.
 108-14        (c)  At the time of the district's confirmation election, a
 108-15  separate voting precinct shall be used for the qualified voters in
 108-16  each municipal district that has filed a petition requesting
 108-17  exclusion.  The votes in each precinct shall be tallied separately
 108-18  to determine whether that municipal district will be excluded from
 108-19  the district boundaries.
 108-20        (d)  If a majority of the votes cast in a municipal district
 108-21  requesting exclusion vote against confirmation of the district, the
 108-22  votes cast in the confirmation election shall not be counted for
 108-23  the confirmation election, bond election, or maintenance tax
 108-24  election, and that municipal district must be excluded from the
 108-25  boundaries of the district by the board of directors of the
 108-26  district at the time the results of the election are canvassed.
 108-27        (e)  After a confirmation election at which the district is
  109-1  authorized to be created, the board of directors of the district
  109-2  shall adopt an order redefining the boundaries of the district to
  109-3  exclude those municipal districts petitioning for exclusion that
  109-4  have voted not to confirm creation of the district.
  109-5        (f)  Before the creation hearing, any municipal district
  109-6  located within the proposed district may petition the commission
  109-7  for a separate voting precinct to be used within the boundaries of
  109-8  the petitioning district at the time of the district's confirmation
  109-9  election.  If the commission grants the petition requesting a
 109-10  separate voting precinct, Subsections (c) through (e) apply.
 109-11        Sec. 59.025.  CONFIRMATION ELECTION.  (a)  Before a district
 109-12  may be created pursuant to a petition granted by the commission, a
 109-13  confirmation election must be held within the boundaries of the
 109-14  proposed district.
 109-15        (b)  The directors appointed by the commission shall call and
 109-16  hold the confirmation election in the manner provided for
 109-17  conducting elections under Chapter 49.  The provisions of those
 109-18  sections relating to a directors election do not apply to an
 109-19  election held under this section.
 109-20        (c)  If the creation of the district is defeated, subsequent
 109-21  confirmation elections may not be held to confirm the creation of
 109-22  the district.
 109-23        (d)  A bond election, maintenance tax election, and any other
 109-24  election may be held at the same time and in conjunction with a
 109-25  confirmation election.
 109-26            (Sections 59.026-59.050 reserved for expansion
 109-27       SUBCHAPTER C.  ADDING OR EXCLUDING TERRITORY; DISSOLUTION
  110-1        Sec. 59.051.  ADDING LAND BY PETITION OF LESS THAN ALL
  110-2  LANDOWNERS.  In addition to the method of adding land to a district
  110-3  described in Section 59.052, defined areas of land, regardless of
  110-4  whether they are contiguous to the district, may be annexed to the
  110-5  district in the manner provided in Chapter 49.
  110-6        Sec. 59.052.  FILING OF PETITION.  A petition requesting the
  110-7  annexation of a defined area that is signed by a majority in value
  110-8  of the owners of land in the defined area, as shown by the tax
  110-9  rolls of the county or counties in which that area is located, that
 110-10  is signed by 50 landowners if the number of landowners is more than
 110-11  50, that is signed by the single landowner of 2,000 or more acres
 110-12  of land in the area, or that is signed by a majority of the
 110-13  governing body of a municipal district, a county, or a city
 110-14  requesting annexation shall be filed with the secretary of the
 110-15  board.
 110-16        Sec. 59.053.  DISSOLUTION OF DISTRICT BEFORE ISSUANCE OF
 110-17  BONDS.  (a)  If the board considers it advisable before the
 110-18  issuance of any bonds, the board may dissolve the district and
 110-19  liquidate the affairs of the district as provided by Sections
 110-20  54.734 through 54.738.
 110-21        (b)  If a majority of the board finds at any time before the
 110-22  authorization of bonds that the proposed district and its proposed
 110-23  activities are for any reason impracticable or apparently cannot be
 110-24  successfully and beneficially accomplished, the board may issue
 110-25  notice of a hearing on a proposal to dissolve the district.
 110-26        Sec. 59.054.  JUDICIAL REVIEW OF BOARD'S ORDER.  The board's
 110-27  order to dissolve the district may be judicially reviewed as
  111-1  provided in Chapter 49.
  111-2            (Sections 59.055-59.070 reserved for expansion
  111-3                     SUBCHAPTER D.  MISCELLANEOUS
  111-4        Sec. 59.071.  ANNEXATION OR INCORPORATION BY CITY.  (a)  If a
  111-5  city annexes all or any part of the territory within a district, or
  111-6  incorporates all or any part of any territory within a district,
  111-7  the city shall succeed to the powers, duties, assets, and
  111-8  obligations of the district as provided by this chapter.
  111-9        (b)  On annexation of any part of the territory of a district
 111-10  by a city or incorporation by a city of any part of the territory
 111-11  of a district, the city shall assume a pro rata share of all debt
 111-12  of the district payable in whole or in part by ad valorem taxes
 111-13  incurred for water, sewer, or drainage purposes or any combination
 111-14  of the three purposes.  The percentage of the assumption shall be
 111-15  determined by multiplying the total debt of the district payable in
 111-16  whole or in part from taxes incurred for the stated purposes by a
 111-17  fraction, the numerator of which is the assessed value of the
 111-18  property to be annexed or incorporated based on the most recent
 111-19  certified county property tax rolls at the time of annexation or
 111-20  incorporation and the denominator of which is the total assessed
 111-21  value of the property of the district based on the most recent
 111-22  certified county property tax rolls at the time of annexation or
 111-23  incorporation.
 111-24        (c)  After annexation by a city of a portion of the territory
 111-25  of a district or incorporation over any part of the territory of a
 111-26  district, the district may not levy taxes on that territory, and
 111-27  the territory is no longer considered a part of the district for
  112-1  any purpose.
  112-2        (d)  If any district's debt payable in whole or in part from
  112-3  ad valorem taxes is assumed by a city, the governing body of the
  112-4  city shall levy and cause to be collected taxes on all taxable
  112-5  property within the city or provide other funds sufficient to pay
  112-6  the city's pro rata share of the principal of and interest on that
  112-7  debt as it becomes due and payable.
  112-8        (e)  If a city annexes or incorporates the entire territory
  112-9  of the district, the district shall be dissolved in accordance with
 112-10  Sections 43.074, 43.075, and 43.081, Local Government Code, if the
 112-11  district is located in one city or Sections 43.076-43.079, Local
 112-12  Government Code, if the district is located in more than one city.
 112-13        (f)  Section 43.071, Local Government Code, does not apply to
 112-14  the annexation of a district created pursuant to this chapter.
 112-15        Sec. 59.072.  OTHER LAWS.  (a)  This chapter prevails over
 112-16  any other law in conflict with or inconsistent with this chapter.
 112-17        (b)  Except as specifically provided by this chapter, Chapter
 112-18  49 and Sections 54.018, 54.019(a), (b), (c), and (d), 54.020,
 112-19  54.021, 54.023, 54.024, 54.201, 54.205, 54.207-54.208,
 112-20  54.502-54.505, 54.507(b) and (c), 54.510-54.512, 54.514, 54.515,
 112-21  54.518, 54.520, 54.521, 54.601-54.604, and 54.735-54.737 apply
 112-22  under this chapter.
 112-23        (c)  Section 54.019(e) does not apply to a district governed
 112-24  by this chapter.
 112-25        SECTION 4.  Section 51.0711(a), Water Code, is amended to
 112-26  read as follows:
 112-27        (a)  The governing body of a municipality that enters a
  113-1  contract or agreement with a district located in more than one
  113-2  county to jointly construct, acquire, operate, or maintain a
  113-3  regional wastewater system is entitled to appoint a special
  113-4  director to the board of the district.  Section 51.072 <of this
  113-5  code> does not apply to a special director.
  113-6        SECTION 5.  Section 51.072, Water Code, is amended to read as
  113-7  follows:
  113-8        Sec. 51.072.  QUALIFICATIONS FOR DIRECTOR.  To be qualified
  113-9  for election as a director, a person must be a resident of the
 113-10  state, own land subject to taxation in the district, and be at
 113-11  least 18 <21> years of age.  Section 49.052 does not apply to a
 113-12  district governed by this chapter whose principal purpose is
 113-13  providing water for irrigation.
 113-14        SECTION 6.  Section 51.076(a), Water Code, is amended to read
 113-15  as follows:
 113-16        (a)  In a district created after June 18, 1967, with
 113-17  boundaries coterminous with the boundaries of a county, the
 113-18  commissioners court may provide in the order granting the petition
 113-19  for creation that the directors are to be selected either as
 113-20  provided in Section 49.102 <51.073 of this code> or by the
 113-21  "commissioners precinct method," which provides for the election of
 113-22  two directors from each commissioners precinct in the county and
 113-23  the election of one director from the county at large.
 113-24        SECTION 7.  Section 51.750(d), Water Code, is amended to read
 113-25  as follows:
 113-26        (d)  The temporary directors of each of the resulting
 113-27  districts must qualify as directors of the district pursuant to
  114-1  Section <Sections> 51.072 <and 51.073 of this code> within the
  114-2  period of 90 days after the election approving the division of the
  114-3  original district and shall assume their offices at the expiration
  114-4  of the 90-day period.
  114-5        SECTION 8.  Section 52.005, Water Code, is amended by adding
  114-6  Subsection (c) to read as follows:
  114-7        (c)  Sections 49.052, 49.216, and 49.301-49.308 do not apply
  114-8  to districts governed by this chapter.
  114-9        SECTION 9.  Section 52.115, Water Code, is amended to read as
 114-10  follows:
 114-11        Sec. 52.115.  MEETINGS.  <(a)>  The board shall hold regular
 114-12  quarterly meetings.  It may hold meetings at other times as
 114-13  required for the business of the district.
 114-14        <(b)  Any person may attend a meeting of the board and may
 114-15  present in an orderly manner matters for the board's consideration.>
 114-16        <(c)  Meetings shall be conducted and notice of meetings
 114-17  shall be posted in accordance with the open meetings law, Chapter
 114-18  271, Acts of the 60th Legislature, Regular Session, 1967 (Article
 114-19  6252-17, Vernon's Texas Civil Statutes).>
 114-20        SECTION 10.  Sections 52.294(c), (d), and (e), Water Code,
 114-21  are amended to read as follows:
 114-22        (c)  <Notice of an election must be given as provided by
 114-23  Section 52.059(c) of this code for creation elections.>
 114-24        <(d)>  At an election to authorize bonds or notes payable
 114-25  wholly from ad valorem taxes, the ballots must be printed to
 114-26  provide for voting for or against the proposition:  "The issuance
 114-27  of (bonds or notes) and the levy of taxes for payment of the (bonds
  115-1  or notes)."  At any election to authorize bonds or notes payable
  115-2  from both ad valorem taxes and revenues, the ballots must be
  115-3  printed to provide for voting for or against:  "The issuance of
  115-4  (bonds or notes) and the pledge of net revenues and the levy of ad
  115-5  valorem taxes adequate to provide for the payment of the (bonds or
  115-6  notes)."
  115-7        (d) <(e)>  The board shall canvass the returns and declare
  115-8  the results of the election.  If a majority of the votes cast at
  115-9  the election favor the issuance of the bonds or notes, the bonds or
 115-10  notes may be issued by the board, but if a majority of the votes
 115-11  cast at the election do not favor issuance of the bonds or notes,
 115-12  the bonds or notes may not be issued.
 115-13        SECTION 11.  Section 53.040, Water Code, is amended to read
 115-14  as follows:
 115-15        Sec. 53.040.  Elected Supervisors Take Office.  If the
 115-16  election results in a division of the district, the five candidates
 115-17  receiving the most votes in each new district shall be declared
 115-18  elected.  They shall immediately qualify in accordance with Section
 115-19  49.055 <by taking the constitutional oath of office and shall file
 115-20  the oath with the county clerk>.
 115-21        SECTION 12.  Section 53.042, Water Code, is amended to read
 115-22  as follows:
 115-23        Sec. 53.042.  Newly Elected Supervisors--Term of Office.  The
 115-24  newly elected supervisors hold office until the new district's next
 115-25  supervisors election <first general election and then until their
 115-26  successors are elected and have qualified>.
 115-27        SECTION 13.  Section 53.062, Water Code, is amended to read
  116-1  as follows:
  116-2        Sec. 53.062.  Board of Supervisors.  A district created under
  116-3  this chapter is governed by a board of five elected supervisors.
  116-4  <Specific provisions for the election of supervisors are found in
  116-5  Section 53.021, Section 53.086, and Section 53.0861 of this code.>
  116-6        SECTION 14.  Section 53.088, Water Code, is amended to read
  116-7  as follows:
  116-8        Sec. 53.088.  Status of the District.  <(a)>  A district is:
  116-9              (1)  a governmental agency;
 116-10              (2)  a body politic and corporate; and
 116-11              (3)  a defined district within the meaning of Article
 116-12  XVI, Section 59, of the Texas Constitution.
 116-13        <(b)  A district may, through its board, sue and be sued in
 116-14  any court of this state in the name of the district.  All courts of
 116-15  this state shall take judicial notice of the creation of a
 116-16  district.  A district shall contract and be contracted with in the
 116-17  name of the district.>
 116-18        SECTION 15.  Section 53.172, Water Code, is amended to read
 116-19  as follows:
 116-20        Sec. 53.172.  Ordering Bond Election.  After the creation of
 116-21  a district and the qualification of the supervisors, the board may
 116-22  order an election in the district to authorize a bond issue.  <The
 116-23  board shall set the day for the election, which must be held during
 116-24  the period beginning on the 20th day and ending with the 30th day
 116-25  after the day of the order.>  At this election, the board shall
 116-26  submit only a proposition authorizing the issuance of bonds and the
 116-27  levy of a tax to pay the bonds.  The ballots shall be printed to
  117-1  allow for voting for or against the proposition:  "The issuance of
  117-2  bonds and the levy of taxes to pay the bonds."
  117-3        SECTION 16.  Section 54.025, Water Code, is amended to read
  117-4  as follows:
  117-5        Sec. 54.025.  Qualification of Temporary Directors.  After a
  117-6  district has been organized, each temporary director shall execute
  117-7  a <his> bond in accordance with the provisions of Section 49.055
  117-8  <54.116 of this code> and shall take the <his> oath of office, and
  117-9  the board shall meet and organize.
 117-10        SECTION 17.  Section 54.036, Water Code, is amended to read
 117-11  as follows:
 117-12        Sec. 54.036.  Directors to Continue Serving.  The existing
 117-13  board of a district converted to a municipal utility district under
 117-14  the provisions of this chapter shall continue to serve as the board
 117-15  of the converted district <until the first Saturday in April
 117-16  following conversion of the district, at which time five directors
 117-17  shall be elected to serve for such period of time and in the same
 117-18  manner as provided in Section 54.029 of this code for directors
 117-19  first elected for a district>.
 117-20        SECTION 18.  Section 54.203, Water Code, is amended to read
 117-21  as follows:
 117-22        Sec. 54.203.  MUNICIPAL Solid Waste.  A district is
 117-23  authorized to purchase, construct, acquire, own, operate, maintain,
 117-24  repair, improve, extend, or establish a municipal solid waste
 117-25  collection and disposal system, including recycling, inside and
 117-26  outside the district and make proper charges for it.  A district
 117-27  may require use of such services as a condition for receiving other
  118-1  district services.  A district may enter into an exclusive contract
  118-2  with a private entity to provide such services to all land and
  118-3  persons within its boundaries.
  118-4        SECTION 19.  Section 54.729(a), Water Code, is amended to
  118-5  read as follows:
  118-6        (a)  After the board of each district has agreed on the terms
  118-7  and conditions of consolidation, which may include the assumption
  118-8  by each district of the <other district's> bonds, notes, or other
  118-9  obligations and voted but unissued bonds of the other consolidating
 118-10  districts payable in whole or in part from taxation, the levy of
 118-11  taxes to pay for the bonds, and adoption of a name for the
 118-12  consolidated district, the board shall order an election in each
 118-13  district to determine whether the districts should be consolidated.
 118-14        SECTION 20.  Section 54.730(a), Water Code, is amended to
 118-15  read as follows:
 118-16        (a)  After two or more districts are consolidated, they
 118-17  become one district and are governed as one district, except for
 118-18  the payment of debts created before consolidation if the conditions
 118-19  of consolidation do not provide for the assumption by each district
 118-20  of the <other's> bonds, notes, or other obligations and voted but
 118-21  unissued bonds of the other consolidating districts.
 118-22        SECTION 21.  Section 54.732, Water Code, is amended to read
 118-23  as follows:
 118-24        Sec. 54.732.  ASSESSMENT AND COLLECTION OF TAXES.  After
 118-25  consolidation, the district shall assess and collect taxes on
 118-26  property in the original districts to pay debts created by the
 118-27  original districts unless each district has assumed the <other
  119-1  district's> bonds, notes, or other indebtedness payable in whole or
  119-2  in part from taxation of the other consolidating districts.
  119-3        SECTION 22.  Section 54.733, Water Code, is amended to read
  119-4  as follows:
  119-5        Sec. 54.733.  VOTED BUT UNISSUED BONDS.  In the event any
  119-6  consolidating <either> district has voted but unissued bonds
  119-7  payable in whole or in part from taxation and the consolidated
  119-8  district assumed the voted but unissued bonds and the consolidated
  119-9  district was authorized to levy taxes to pay for the bonds, then
 119-10  the consolidated district shall be authorized to issue the voted
 119-11  but unissued bonds in the name of the consolidated district and
 119-12  levy a uniform tax on all taxable property in the consolidated
 119-13  district to pay for the bonds.
 119-14        SECTION 23.  Chapter 54, Water Code, is amended by adding
 119-15  Sections 54.739-54.747 to read as follows:
 119-16        Sec. 54.739.  Substituting Land of Equal Acreage and Value.
 119-17  After the district is organized and acquires facilities with which
 119-18  to function for the purposes for which it was organized, and votes,
 119-19  issues and sells bonds for such purposes, land within the district
 119-20  boundaries subject to taxation that does not need or utilize the
 119-21  services of the district may be excluded and other land not within
 119-22  the boundaries of the district may be included within the
 119-23  boundaries of the district as provided by the provisions of this
 119-24  section and Sections 54.741-54.748 subject to commission approval.
 119-25        Sec. 54.740.  Requisites for Application for Exclusion.  An
 119-26  owner of land in the district not receiving services from the
 119-27  district may apply for its exclusion from the district boundaries
  120-1  if all taxes levied and assessed by the district on the land to be
  120-2  excluded have been fully paid.  The application shall set forth
  120-3  facts concerning the land proposed for exclusion, including
  120-4  evidence of the reasonable market value of the land, and state that
  120-5  the other requisites for the exclusion of the land and substitution
  120-6  of other land have been fulfilled or will be fulfilled at the
  120-7  hearing upon the application.  The application shall be verified
  120-8  and acknowledged in a recordable form as conveyances of real
  120-9  property.
 120-10        Sec. 54.741.  Inclusion of Substitute Land Required.  An
 120-11  application for exclusion can only be considered by the board if an
 120-12  application is filed by an owner of other land lying outside the
 120-13  boundaries of the district seeking inclusion of land that can be
 120-14  served in a practical manner by the district of at least equal
 120-15  value to the land proposed for exclusion.  Such land must be
 120-16  included within the district boundaries and taxing jurisdiction of
 120-17  the district simultaneously with the exclusion of the land proposed
 120-18  for exclusion.  Such included land must be of sufficient acreage to
 120-19  avoid an impairment of the security for payment of voted and issued
 120-20  bonds and any other contract obligations payable or secured, in
 120-21  whole or in part, from ad valorem taxes or revenues of the
 120-22  district.
 120-23        Sec. 54.742.  Application for Inclusion.  The application
 120-24  submitted by an owner of land proposed for inclusion shall set
 120-25  forth that the owner of the new land assumes the payment of all
 120-26  taxes, assessments and fees levied on the land and assessed by the
 120-27  district after the date the land is included in the district.  The
  121-1  application shall also set forth an agreement by the owner of the
  121-2  land proposed for inclusion that the land will be subject to future
  121-3  taxes for bond tax and other assessments and fees levied and
  121-4  assessed by the district and be subject to the same liens and
  121-5  provisions and statutes governing all other lands in the district
  121-6  as though the land had been incorporated originally in the
  121-7  district.  The application for inclusion shall be verified and
  121-8  acknowledged in a recordable form as conveyances of real property.
  121-9        Sec. 54.743.  Notice of Hearing and Hearing Procedures.  The
 121-10  board shall give notice of the hearing on the applications for
 121-11  exclusion and inclusion in conformity with the notice and hearing
 121-12  requirements otherwise applicable to exclusions or additions of
 121-13  land.  The board at such hearing shall hear all interested parties
 121-14  and all evidence in connection with the applications.
 121-15        Sec. 54.744.  Impairment of Security.  For purposes of the
 121-16  board's consideration of the applications, the lands proposed for
 121-17  inclusion shall be deemed to be sufficient to avoid an impairment
 121-18  of the security for payment of obligations of the district if:
 121-19              (1)  according to the county tax rolls, the taxable
 121-20  value of such included lands equals or exceeds the taxable value of
 121-21  the excluded lands;
 121-22              (2)  the estimated costs of providing district
 121-23  facilities and services to such included lands is equal to or less
 121-24  than the estimated costs of providing district facilities and
 121-25  services to the excluded lands; and
 121-26              (3)  the district's outstanding bonds or contract
 121-27  obligations are payable in whole or in part by a pledge of net
  122-1  revenues from the ownership or operation of the district's
  122-2  facilities, and the projected net revenues to be derived from the
  122-3  lands to be included during the succeeding 12-month period, as
  122-4  determined by the district's engineer, equals or exceeds the
  122-5  projected net revenues that would otherwise have been derived from
  122-6  the lands to be excluded during the same period.
  122-7        Sec. 54.745.  Board's Resolution to Substitute.  If the board
  122-8  finds that all the conditions provided for the exclusion of land
  122-9  and inclusion of other land in the district exist and that it is in
 122-10  the best interest of the district to grant such applications, it
 122-11  may adopt and enter in its minutes a resolution and order excluding
 122-12  all or part of the land proposed for exclusion and including all or
 122-13  part of the land proposed for inclusion.  Prior to the effective
 122-14  date of the exclusion and inclusion of lands, the district shall
 122-15  have received payment of all fees, charges, assessments, taxes,
 122-16  together with any associated penalties and interest due or overdue
 122-17  in respect to the lands excluded, and if no ad valorem taxes or
 122-18  fees have yet been established by the district for the current
 122-19  year, an amount determined by the district to equal the estimated
 122-20  ad valorem taxes and standby fees to be established by the district
 122-21  for the current year, prorated to the date of exclusion with
 122-22  respect to such excluded lands, shall also be paid.
 122-23        Sec. 54.746.  Liability of Excluded and Included Land.  The
 122-24  land excluded from the district is free from any lien or liability
 122-25  created on the excluded land by reason of its having been included
 122-26  in the district.  Land included in the district is subject to all
 122-27  laws, liens, and provisions governing the district and the land in
  123-1  the district.
  123-2        Sec. 54.747.  Service to Included Land.  The district has the
  123-3  same right and obligation to furnish services to the included land
  123-4  that it previously had to furnish to the excluded land.
  123-5        SECTION 24.  Section 55.101, Water Code, is amended to read
  123-6  as follows:
  123-7        Sec. 55.101.  Board of Directors.  The governing body of a
  123-8  district is a <the> board of five directors.
  123-9        SECTION 25.  Section 55.102, Water Code, is amended to read
 123-10  as follows:
 123-11        Sec. 55.102.  Qualifications of Directors.  To be qualified
 123-12  for election as a director, a person must be a resident of the
 123-13  state, own land subject to taxation in the district, and be at
 123-14  least 18 <more than 21> years of age at the time of the election.
 123-15  Section 49.052 does not apply to a district governed by this
 123-16  chapter whose principal purpose is providing water for irrigation.
 123-17        SECTION 26.  Section 55.721, Water Code, is amended to read
 123-18  as follows:
 123-19        Sec. 55.721.  Exclusion of Nonagricultural and Nonirrigable
 123-20  Land From District.  Land located in the district which is
 123-21  classified as nonagricultural and nonirrigable may be excluded from
 123-22  the district in the manner provided in Subchapter J, Chapter 49
 123-23  <Sections 51.702-51.713 of this code>.
 123-24        SECTION 27.  Section 56.064, Water Code, is amended to read
 123-25  as follows:
 123-26        Sec. 56.064.  Election of Directors.  (a)  On petition of a
 123-27  majority of the real property taxpayers of a district requesting an
  124-1  election of district directors, the commissioners court shall
  124-2  immediately order an election to be held at the earliest legal
  124-3  time.  The election shall be held as other elections under Chapter
  124-4  49 <this chapter>.
  124-5        (b)  <The commissioners court shall declare the three persons
  124-6  receiving the highest number of votes elected, and if two or more
  124-7  persons tie for the third highest vote, the commissioners court
  124-8  shall elect the third director from those tying for the place.>
  124-9        <(c)  On qualifying for office, directors elected under this
 124-10  section are the legal and rightful directors of the district within
 124-11  the full meaning and purpose of this law.>
 124-12        <(d)  The first elected directors of the district hold office
 124-13  until the next regular directors' election, and subsequent
 124-14  directors of the district are elected every four years except as
 124-15  provided by Subsection (e) of this section.>
 124-16        <(e)>  The first elected directors of the districts in
 124-17  Calhoun, Matagorda, and Victoria Counties hold office until May 15
 124-18  of the next succeeding odd-numbered year.  Subsequent directors of
 124-19  the district are elected every two years on the first Saturday in
 124-20  May in each odd-numbered year, for a term of two years beginning on
 124-21  May 15 following the election.
 124-22        SECTION 28.  Section 57.053, Water Code, is amended to read
 124-23  as follows:
 124-24        Sec. 57.053.  Term of Office, Removal, and Succession.  (a)
 124-25  <Each director shall hold office for a period of two years and
 124-26  until his successor is appointed and has qualified.>
 124-27        <(b)>  A vacancy on the board shall be filled by majority
  125-1  vote of the commissioners court <of jurisdiction>, and the court
  125-2  shall appoint directors so that the board will always have full
  125-3  membership.
  125-4        (b) <(c)>  The commissioners court <of jurisdiction>, by
  125-5  majority vote, may remove an appointed <a> member of the board.
  125-6        SECTION 29.  Section 57.060, Water Code, is amended to read
  125-7  as follows:
  125-8        Sec. 57.060.  Petition.  Before an election is held under
  125-9  Section 57.057 <of this code>, a petition, signed by at least 100
 125-10  <25> electors in the district <each county commissioners precinct>
 125-11  who are qualified to vote <at an election for directors if a
 125-12  countywide election, or by 50 electors if less than countywide>,
 125-13  shall be presented to the district <county judge> requesting that
 125-14  an election be held in the district to determine whether or not
 125-15  directors for the district should be elected and, if so, to elect
 125-16  directors to serve until the next regular director election <for
 125-17  state and county officers>.  The petition shall include the name of
 125-18  one or more nominees for each director's position.
 125-19        SECTION 30.  Section 57.061, Water Code, is amended to read
 125-20  as follows:
 125-21        Sec. 57.061.  Procedure for Election.  <(a)>  After the
 125-22  petition is presented under Section 57.060 <of this code>, the
 125-23  board <county judge> shall order an election <to determine the
 125-24  propositions presented in the petition.  The election shall be held
 125-25  not less than 30 days from the date of the order calling the
 125-26  election, or the propositions may be determined at a general
 125-27  election>.
  126-1        <(b)  The election order shall designate the polling places
  126-2  which shall be the same as the polling places used in the last
  126-3  general election in the county, if a countywide election is held.>
  126-4        <(c)  The county clerk shall issue notice of the election and
  126-5  shall have the notice published in a newspaper of general
  126-6  circulation in the county once a week for two consecutive weeks.
  126-7  The first publication must be not less than 14 days before the day
  126-8  of the election.>
  126-9        <(d)  The sheriff shall post a copy of the notice at least 20
 126-10  days before the day of the election at each polling place
 126-11  designated in the election order.>
 126-12        <(e)  The district shall pay all expenses incident to calling
 126-13  and holding the election.>
 126-14        SECTION 31.  Section 57.207, Water Code, is amended to read
 126-15  as follows:
 126-16        Sec. 57.207.  Declaring Result of Election.  <(a)
 126-17  Immediately after an election under this chapter, the officials
 126-18  holding the election shall return the result to the commissioners
 126-19  court of jurisdiction.>
 126-20        <(b)  The election officials shall return the ballot boxes to
 126-21  the clerk of the commissioners court of jurisdiction, who shall
 126-22  safely keep the boxes and deliver them with the returns of the
 126-23  election to the commissioners court of jurisdiction at its next
 126-24  regular or special session.>
 126-25        <(c)  The commissioners court of jurisdiction at its first
 126-26  session after the election shall canvass the vote and the returns.
 126-27  If the proposition submitted has been approved by a majority of the
  127-1  electors of the district voting at the election, the commissioners
  127-2  court of jurisdiction shall declare the result in favor of the
  127-3  proposition, but if the proposition is not approved by the electors
  127-4  of the district, the commissioners court of jurisdiction shall
  127-5  declare the result to be against the proposition.>
  127-6        <(d)>  The board <commissioners court of jurisdiction> shall
  127-7  enter an order declaring the election result in its minutes.
  127-8        SECTION 32.  Section 58.072, Water Code, is amended to read
  127-9  as follows:
 127-10        Sec. 58.072.  QUALIFICATIONS.  To be qualified for election
 127-11  as a director, a person must be a resident of the state, be the
 127-12  owner of record of fee simple title to land in the district, <and>
 127-13  be at least 18 years of age, and owe no delinquent taxes or
 127-14  assessments to the district.  Section 49.052 does not apply to a
 127-15  district governed by this chapter.
 127-16        SECTION 33.  Subchapter A, Chapter 60, Water Code, is amended
 127-17  by adding Section 60.002 to read as follows:
 127-18        Sec. 60.002.  AUDIT.  Subchapter G, Chapter 49, related to
 127-19  Audit of Districts, shall apply to districts governed by this
 127-20  chapter.
 127-21        SECTION 34.  Subchapter M, Chapter 60, Water Code, is amended
 127-22  by adding Section 60.350 to read as follows:
 127-23        Sec. 60.350.  BONDS.  Section 49.181, related to the
 127-24  Authority of Commission Over Issuance of District Bonds, and
 127-25  Section 49.183, related to Bond Sales, shall apply to bonds
 127-26  supported by taxes and issued by districts governed by this
 127-27  chapter.
  128-1        SECTION 35.  Section 65.103, Water Code, is amended to read
  128-2  as follows:
  128-3        Sec. 65.103.  Election of Directors; Terms of Office.  (a)
  128-4  The persons receiving the highest number of votes at each election
  128-5  shall serve as directors of the district.
  128-6        (b)  The terms of the directors may run concurrently, or may
  128-7  be staggered, but in any event, the term of office of a director
  128-8  may not exceed three years.
  128-9        (c)  The method for determining the initial terms for each of
 128-10  the directors constituting the initial board shall be determined by
 128-11  the temporary directors, and the terms must be clearly stated on
 128-12  the ballot for the confirmation and directors' election.  At
 128-13  subsequent elections in each following year in which there is an
 128-14  election, the election must be held on the same uniform election
 128-15  date as the confirmation and directors' election, and the terms of
 128-16  the directors being elected must be stated on the ballot.
 128-17        <(d)  The election of directors must be held in a district on
 128-18  one of the dates provided by Section 9b, Texas Election Code
 128-19  (Article 2.01b, Vernon's Texas Election Code).>
 128-20        <(e)  The permanent directors may assign a position number to
 128-21  each director's office, and each director subsequently shall be
 128-22  elected by position and not at large.>
 128-23        SECTION 36.  Chapter 65, Water Code, is amended by adding
 128-24  Section 65.235 to read as follows:
 128-25        Sec. 65.235.  Prohibition on Assessment or Collection of
 128-26  Taxes.  Section 49.107 does not apply to a district created under
 128-27  this chapter.
  129-1        SECTION  37.  Section 66.101, Water Code, is amended to read
  129-2  as follows:
  129-3        Sec. 66.101.  Board of Directors.  A district shall be
  129-4  governed by a board of directors composed of five members, who are
  129-5  elected as provided in Chapter 49 <by this chapter>.
  129-6        SECTION 38.  Section 66.310(b), Water Code, is amended to
  129-7  read as follows:
  129-8        (b)  Bonds issued by a district and projects and improvements
  129-9  of the district that are provided through the issuance of bonds are
 129-10  governed by Chapter 49 <Sections 54.516 and 54.517 of this code>.
 129-11        SECTION 39.  Chapter 50, Water Code, is repealed, except that
 129-12  Subchapter H is continued in effect for the sole purpose of the
 129-13  administration and operation of contracts created or issued under
 129-14  those laws.
 129-15        SECTION 40.  The following sections of Chapter 51, Water
 129-16  Code, are repealed:  Sections 51.033, 51.034, 51.073-51.074,
 129-17  51.077-51.084, 51.0851, 51.087-51.089, 51.091-51.101,
 129-18  51.122-51.124, 51.126, 51.131, 51.132, 51.136-51.138,
 129-19  51.140-51.146, 51.149, 51.183, 51.191-51.193, 51.221-51.224,
 129-20  51.231-51.279, 51.354-51.363, 51.371-51.374, 51.412, 51.416-51.418,
 129-21  51.421, 51.422, 51.4321, 51.4371, 51.691-51.701, 51.714-51.731, and
 129-22  51.737-51.747.
 129-23        SECTION 41.  The following sections of Chapter 52, Water
 129-24  Code, are repealed:  Sections 52.104, 52.107-52.114, 52.116-52.118,
 129-25  52.119-52.121, 52.157, 52.251-52.253, 52.259-52.262, and 52.297.
 129-26        SECTION 42.  The following sections of Chapter 53, Water
 129-27  Code, are repealed:  Sections 53.020, 53.022, 53.023,
  130-1  53.025-53.028, 53.035-53.039, 53.064, 53.065, 53.067-53.070,
  130-2  53.0721, 53.076, 53.077, 53.084-53.087, 53.089, 53.090, 53.105,
  130-3  53.106, 53.108-53.111, 53.114, 53.117-53.120, 53.123-53.125,
  130-4  53.141-53.144, 53.147, 53.148, 53.173-53.175, 53.1791, 53.197,
  130-5  53.198, and 53.231-53.273.
  130-6        SECTION 43.  The following sections of Chapter 54, Water
  130-7  Code, are repealed:  Sections 54.026-54.029, 54.103-54.126, 54.202,
  130-8  54.204, 54.209-54.233, 54.301-54.312, 54.506, 54.507(a), 54.509,
  130-9  54.5121, 54.513, 54.516, 54.517, 54.519, 54.701-54.727.
 130-10        SECTION 44.  The following sections of Chapter 55, Water
 130-11  Code, are repealed:  Sections 55.030, 55.033-55.036, 55.052,
 130-12  55.104-55.106, 55.109, 55.111-55.116, 55.118-55.128, 55.162,
 130-13  55.164, 55.168-55.184, 55.189-55.191, 55.199, 55.203, 55.252,
 130-14  55.291-55.304, 55.331, 55.423-55.430, 55.451, 55.453,
 130-15  55.492-55.496, 55.503, 55.506, 55.711-55.720, and 55.722-55.749.
 130-16        SECTION 45.  The following sections of Chapter 56, Water
 130-17  Code, are repealed:  Sections 56.027-56.031, 56.062, 56.063,
 130-18  56.065-56.068, 56.076-56.081, 56.083, 56.113, 56.114, 56.119,
 130-19  56.129-56.134, 56.136, 56.138, 56.139, 56.183, 56.184, 56.2045, and
 130-20  56.714-56.725.
 130-21        SECTION 46.  The following sections of Chapter 57, Water
 130-22  Code, are repealed:  Sections 57.052, 57.054-57.056, 57.062-57.070,
 130-23  57.095-57.099, 57.106, 57.107, 57.109, 57.110, 57.112-57.115,
 130-24  57.119, 57.120, 57.171-57.174, 57.178, 57.202-57.206, 57.2075,
 130-25  57.209-57.211, and 57.276-57.278.
 130-26        SECTION 47.  The following sections of Chapter 58, Water
 130-27  Code, are repealed:  Sections 58.033, 58.034, 58.073,
  131-1  58.074-58.083, 58.085-58.088, 58.090-58.100, 58.123, 58.124,
  131-2  58.131, 58.132, 58.135, 58.139-58.149, 58.151, 58.152, 58.169,
  131-3  58.179, 58.187-58.189, 58.221-58.224, 58.261, 58.317,
  131-4  58.354-58.362, 58.442, 58.451, 58.452, 58.601, 58.691-58.701, and
  131-5  58.714-58.725.
  131-6        SECTION 48.  The following sections of Chapter 65, Water
  131-7  Code, are repealed:  Sections 65.024-65.029, 65.104-65.122, 65.202,
  131-8  65.204, 65.209-65.234, 65.301, 65.401-65.409, 65.509, 65.512,
  131-9  65.514, and 65.701-65.722.
 131-10        SECTION 49.  The following sections of Chapter 66, Water
 131-11  Code, are repealed:  Sections 66.022-66.029, 66.103-66.117, 66.119,
 131-12  66.120, 66.203-66.205, 66.208-66.215, 66.301, 66.302,
 131-13  66.305-66.309, 66.312, and 66.323.
 131-14        SECTION 50.  (a)  This Act takes effect as provided by this
 131-15  section.
 131-16        (b)  Section 49.103(b), Water Code, shall govern all
 131-17  elections held after December 31, 1995.  Directors elected at any
 131-18  election held between January 1, 1992, and April 30, 1992, shall
 131-19  serve until the January 1996 election.  Directors elected at any
 131-20  election held between May 1, 1992, and December 31, 1992, shall
 131-21  serve until the May 1996 election.  Directors elected at any
 131-22  election held between January 1, 1993, and April 30, 1993, shall
 131-23  serve until the January 1996 election.  Directors elected at any
 131-24  election held between May 1, 1993, and July 31, 1993, shall serve
 131-25  until the May 1996 election.  Directors elected at any election
 131-26  held between August 1, 1993, and December 31, 1993, shall serve
 131-27  until the May 1998 election.  Directors elected at any election
  132-1  held between January 1, 1994, and April 30, 1994, shall serve until
  132-2  the January 1998 election.  Directors elected at any election held
  132-3  between May 1, 1994, and December 31, 1994, shall serve until the
  132-4  May 1998 election.  Directors elected at any election held between
  132-5  January 1, 1995, and April 30, 1995, shall serve until the January
  132-6  1998 election.  Directors elected at any election held between May
  132-7  1, 1995, and July 31, 1995, shall serve until the May 1998
  132-8  election.  Directors elected at any election held between August 1,
  132-9  1995, and December 31, 1995, shall serve until the May 1998
 132-10  election.  Directors whose terms expire prior to the election date
 132-11  set by this section shall continue to serve until their successors
 132-12  have been elected and qualified.
 132-13        (c)  All other provisions of this Act take effect September
 132-14  1, 1995.
 132-15        SECTION 51.  The importance of this legislation and the
 132-16  crowded condition of the calendars in both houses create an
 132-17  emergency and an imperative public necessity that the
 132-18  constitutional rule requiring bills to be read on three several
 132-19  days in each house be suspended, and this rule is hereby suspended,
 132-20  and that this Act take effect and be in force according to its
 132-21  terms, and it is so enacted.