By Hightower H.B. No. 2448
75R7030 T
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the creation, administration, powers, duties,
1-3 operations, and financing of the Lake Livingston Special Utility
1-4 District; providing for severability and declaring an emergency.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 ARTICLE 1. GENERAL PROVISIONS
1-7 Sec. 1.01. CREATION OF THE DISTRICT. Lake Livingston
1-8 Special Utility District may be created pursuant to the provisions
1-9 of this Act and under and subject to the authority, conditions, and
1-10 restrictions of, and is considered a conservation and reclamation
1-11 district under, Article XVI, Section 59, of the Texas Constitution.
1-12 The District will be a government agency and a body politic and
1-13 corporate.
1-14 Sec. 1.02. Definitions. In this chapter:
1-15 (1) "District" means Lake Livingston Special Utility
1-16 District.
1-17 (2) "Board" means the board of directors of the
1-18 District.
1-19 (3) "Director" means a member of the board of
1-20 directors of the District.
1-21 (4) "Commission" means the Texas Natural Resource
1-22 Conservation Commission.
1-23 (5) "Executive director" means the executive director
1-24 of the Texas Natural Resource Conservation Commission.
2-1 (6) "City" means any incorporated city or town.
2-2 (7) "Extraterritorial jurisdiction" means the
2-3 extraterritorial jurisdiction of a city as determined under Chapter
2-4 42, Local Government Code.
2-5 (8) "Public agency" means any city, the United States
2-6 and its agencies, the State of Texas and its agencies, and any
2-7 district or authority created under Article XVI, Section 59, or
2-8 Article III, Sections 52(b)(1) and (2), of the Texas Constitution.
2-9 (9) "Corporation" means Lake Livingston Water Supply
2-10 and Sewer Service Corporation, a corporation organized and existing
2-11 under Tex. Rev. Civ. Stat. Anno. Art. 1434a.
2-12 Sec. 1.03. Purposes of the District. The District may be
2-13 created for the following purposes:
2-14 (1) to purchase, own, hold, lease, and otherwise
2-15 acquire sources of water supply; to build, operate, and maintain
2-16 facilities for the transportation of water; and to sell water to
2-17 towns, cities, and other political subdivisions of this state, to
2-18 private business entities, and to individuals;
2-19 (2) the protection, preservation, and restoration of
2-20 the purity and sanitary condition of water within the District.
2-21 Sec. 1.04. Composition of District. The District shall
2-22 include the area in all or part of any one or more counties
2-23 including all or part of any cities and other public agencies
2-24 within the Certificate of Convenience and Necessity No. 10147 (East
2-25 Texas Hydrotechnology, Inc.), 11364 (Paradise Cove), No. 12668
2-26 (Green Acres), No. 12633 (Lake Shore Hide-a-Way) and the Riverview
2-27 Subdivision (located in Walker County), all of the above being
3-1 situated in San Jacinto, Tyler, Polk, Trinity, Hardin, Liberty or
3-2 Walker Counties.
3-3 Sec. 1.05. OPEN MEETINGS. All meetings of the Corporation
3-4 and the District shall be held and conducted in accordance with
3-5 Chapter 551, Government Code.
3-6 ARTICLE 2. ADMINISTRATIVE PROVISIONS
3-7 Sec. 2.01. RESOLUTION PROPOSING CREATION OF DISTRICT. (a)
3-8 The board of directors of the Corporation shall adopt a resolution
3-9 recommending to the members of the Corporation that it be converted
3-10 to the District; that upon the confirmation of the District as
3-11 provided below, all of the assets of the corporation be conveyed to
3-12 the District and the Corporation be dissolved.
3-13 (b) By September 15, 1997, the board of directors of the
3-14 Corporation shall submit the resolution to the membership for their
3-15 vote on the question of the conversion of the Corporation to the
3-16 District. The vote shall be conducted in accordance with the
3-17 by-laws of the Corporation.
3-18 Sec. 2.02. CONSENT OF CITY. A District may operate within
3-19 the corporate limits of a city or within the extraterritorial
3-20 jurisdiction of a city, provided that a city may require that the
3-21 District construct all facilities to serve the land in accordance
3-22 with plans and specifications that are approved by the city. The
3-23 city may also require that the city be entitled to inspect
3-24 facilities being constructed by a District within the corporate
3-25 limits or extraterritorial jurisdiction of the city.
3-26 Sec. 2.03. If the members of the Corporation approve the
3-27 resolution on the question of converting to the District by a
4-1 simple majority, the board of directors of the Corporation shall
4-2 than call for and conduct a confirmation and director election as
4-3 provided in Chapter 49, Subchapter D of the Water Code. The board
4-4 of directors of the Corporation shall serve as the temporary
4-5 directors for the confirmation and director election.
4-6 Sec. 2.04. For election of directors, the District shall be
4-7 divided into three numbered single member precinct, one precinct
4-8 for Polk County, one precinct for Trinity County, and one precinct
4-9 for San Jacinto County. One director shall be elected from each
4-10 precinct and four directors will be elected at large.
4-11 Sec. 2.05. The District's powers, rights, duties and
4-12 functions are exercised by a board of directors.
4-13 Sec. 2.06. The Board shall consist of seven members all of
4-14 whom must reside in the District. To serve as Director, a person
4-15 must be at least eighteen years old, a resident citizen of this
4-16 State and a qualified voter of the District.
4-17 ARTICLE 3. POWERS AND DUTIES
4-18 Sec. 3.01. POWERS. (a) The District has the functions,
4-19 powers, authority, and rights that will permit accomplishment of
4-20 the purposes for which it is created.
4-21 (b) The District may purchase, construct, acquire, own,
4-22 operate, maintain, repair, improve, or extend inside and outside
4-23 its boundaries any works, improvements, facilities, plants,
4-24 equipment, and appliances necessary to accomplish the purposes for
4-25 which it was created, including works, improvements, facilities,
4-26 plants, equipment, and appliances incident, helpful, or necessary
4-27 to:
5-1 (1) supply water for municipal uses, domestic uses,
5-2 power and commercial purposes, and other beneficial uses or
5-3 controls;
5-4 (2) collect, transport, process, dispose of, store,
5-5 and control domestic, industrial, or interest on wastes whether in
5-6 fluid, solid, or composite state;
5-7 (3) irrigate the land in a District;
5-8 (4) alter land elevation in a District where it is
5-9 needed; and
5-10 (c) Such other powers, except as expressly limited below in
5-11 Section 3.02, given to a District under Chapter 49, Subchapter H,
5-12 of the Water Code.
5-13 Sec. 3.02. SOLID WASTE. A District may not collect
5-14 municipal solid waste as defined as Health & Safety Code Section
5-15 361.003 or purchase, construct, acquire, own, operate, maintain,
5-16 repair, improve, and extend a municipal solid waste collection and
5-17 disposal system.
5-18 Sec. 3.03. ADOPTING RULES. The District may adopt and
5-19 enforce reasonable rules to:
5-20 (1) secure and maintain safe, sanitary, and adequate
5-21 plumbing installations, connections, and appurtenances as
5-22 subsidiary parts of its sanitary sewer system;
5-23 (2) preserve the purity and the sanitary condition of
5-24 all water controlled by the District;
5-25 (3) prevent waste or the unauthorized use of water
5-26 controlled by the District;
5-27 (4) regulate privileges on any land or easement owned
6-1 or controlled by the District; and
6-2 (5) provide and regulate a safe and adequate
6-3 freshwater distribution system.
6-4 Sec. 3.04. EFFECT OF RULES. After the required publication,
6-5 rules adopted by the District under Section 3.03 of this Act shall
6-6 be recognized by the courts as if they were penal ordinances of a
6-7 city.
6-8 Sec. 3.05. PUBLICATION OF RULES. (a) The board shall
6-9 publish a substantive statement of each rule and the penalty for
6-10 its violation once a week for two consecutive weeks in one or more
6-11 newspapers with general circulation in the area in which the
6-12 District is located.
6-13 (b) The substantive statement shall be condensed as far as
6-14 possible to intelligently explain the purpose to be accomplished or
6-15 the act forbidden by each rule.
6-16 (c) The notice must advise that breach of a rule will
6-17 subject the violator to a penalty and that the full text of each
6-18 rule is on file in the principal office of the District at which it
6-19 may be read by any interested person.
6-20 (d) Any number of rules may be included in one notice.
6-21 Sec. 3.06. EFFECTIVE DATE OF RULES. The penalty for
6-22 violation of a rule is not effective and enforceable until five
6-23 days after the last publication of the notice. Five days after the
6-24 last publication, the published rule takes effect and ignorance of
6-25 the rule is not a defense to a prosecution for the enforcement of
6-26 the penalty.
6-27 Sec. 3.07. PROHIBITION ON ASSESSMENT OR COLLECTION OF TAXES.
7-1 Section 49.107 of the Water Code does not apply to the District.
7-2 ARTICLE 4. BONDS AND NOTES
7-3 Sec. 4.01. ISSUANCE OF BONDS AND NOTES. The District may
7-4 issue its bonds or notes for the purpose of purchasing,
7-5 constructing, acquiring, owning, operating, repairing, improving,
7-6 or extending any District works, improvements, facilities, plants,
7-7 equipment, and appliances needed to accomplish the purposes listed
7-8 in Section 1.03 of this Act, including works, improvements,
7-9 facilities, plants, equipment, and appliances needed to provide a
7-10 waterworks system, sanitary sewer system, storm sewer system, solid
7-11 waste disposal system, or to provide for solid waste collection or
7-12 fire-fighting services and facilities.
7-13 Sec. 4.02. Form of Bonds and Notes. (a) The District may
7-14 issue its bonds or notes in various series or issues.
7-15 (b) Bonds or notes shall mature serially or otherwise not
7-16 more than 40 years from their date and shall bear interest at any
7-17 rate permitted by the constitution and laws of this state. The
7-18 board shall determine the maturity and the interest rate of the
7-19 bonds and notes.
7-20 (c) The District's bonds, notes, and interest coupons, if
7-21 any, are investment securities under Chapter 8, Business & Commerce
7-22 Code, and may be issued registrable as to principal or as to both
7-23 principal and interest. The board may make the bonds redeemable
7-24 before maturity, at the option of the District, or may include in
7-25 the bonds a mandatory redemption provision.
7-26 (d) The District's bonds or notes may be issued in the form,
7-27 denominations, and manner and under the terms, conditions, and
8-1 details, and must be signed and executed, as provided by the board
8-2 in the resolution or order authorizing the issuance of the bonds or
8-3 notes.
8-4 Sec. 4.03. Manner of Repayment of Bonds or Notes. The board
8-5 may provide for the payment of principal of and interest and
8-6 redemption price, if any, on the bonds or notes by pledging all or
8-7 any part of the designated revenues to result from the ownership or
8-8 operation of the District's works, improvements, facilities,
8-9 plants, equipment, and appliances or under specific contracts for
8-10 the period of time the board determines.
8-11 Sec. 4.04. Additional Security for Bonds or Notes. (a) The
8-12 bonds or notes, within the discretion of the board, may be
8-13 additionally secured by a deed of trust or mortgage lien on all or
8-14 part of the physical properties of the District, and franchises,
8-15 easements, water rights, and appropriation permits, leases, and
8-16 contracts and all rights appurtenant to those properties, vesting
8-17 in the trustee power to sell the property for payment of the
8-18 indebtedness, power to operate the property, and all other
8-19 authority necessary for the further security of the bonds or notes.
8-20 (b) The trust indenture, regardless of the existence of the
8-21 deed of trust or mortgage lien on any property, may:
8-22 (1) include provisions prescribed by the board for the
8-23 security of the bonds or notes and the preservation of the trust
8-24 estate;
8-25 (2) make provision for amendment or modification;
8-26 (3) condition the right to spend District money or
8-27 sell District property on approval of a registered professional
9-1 engineer selected as provided in the trust indenture; and
9-2 (4) make provision for investment of funds of the
9-3 District.
9-4 (c) Any purchaser under a sale under the deed of trust or
9-5 mortgage lien, if one is given, is absolute owner of the property,
9-6 facilities, and rights purchased and is entitled to maintain and
9-7 operate them.
9-8 Sec. 4.05. Method for Issuance of Bonds and Notes. Bonds or
9-9 notes may be issued by resolution or order of the board.
9-10 Sec. 4.06. Provisions of Bonds or Notes. (a) In an order
9-11 or resolution authorizing the issuance of bonds or notes, including
9-12 refunding bonds, the board may provide for the flow of funds, the
9-13 establishment and maintenance of the interest and sinking fund, the
9-14 reserve fund, and other funds, and may enter into additional
9-15 covenants relating to the bonds or notes and the pledged revenues
9-16 and to the operation and maintenance of those works, improvements,
9-17 facilities, plants, equipment, and appliances the revenues of which
9-18 are pledged, including provision for the operation or for the
9-19 leasing of all or any part of the improvements and the use or
9-20 pledge of money derived from the operation contracts and leases, as
9-21 the board considers appropriate.
9-22 (b) An order or resolution of the board authorizing the
9-23 issuance of bonds or notes also may prohibit the further issuance
9-24 of bonds, notes, or other obligations payable from the pledged
9-25 revenue or may reserve the right to issue additional bonds to be
9-26 secured by a pledge of and payable from the revenue on a parity
9-27 with or subordinate to the lien and pledge in support of the bonds
10-1 being issued, subject to the conditions that may be set forth in
10-2 the order or resolution.
10-3 (c) An order or resolution of the board issuing bonds or
10-4 notes may include other provisions and covenants determined by the
10-5 board that are not prohibited by the constitution or by this
10-6 chapter.
10-7 (d) The board may adopt and have executed any other
10-8 proceedings or instruments necessary and convenient in the issuance
10-9 of bonds or notes.
10-10 Sec. 4.07. Use of Bond or Note Proceeds. The District may
10-11 use bond or note proceeds to pay interest, administrative, and
10-12 operating expenses expected to accrue during the period of
10-13 construction. The period of construction under this section may
10-14 not exceed three years as provided by the bond order or resolution.
10-15 The District also may use bond or note proceeds to pay expenses
10-16 incurred and to be incurred in the issuance, sale, and delivery of
10-17 the bonds or notes.
10-18 Sec. 4.08. Sale or Exchange of Bonds. (a) The board shall
10-19 sell the bonds on the best terms and for the best possible price,
10-20 but the bonds may not be sold for less than 95 percent of their
10-21 face value.
10-22 (b) The District may exchange bonds for property acquired by
10-23 purchase or in payment of the contract price of work done or
10-24 services performed for the use and benefit of the District.
10-25 Sec. 4.09. Refunding Bonds. (a) The District may issue
10-26 bonds to refund all or any part of its outstanding bonds, notes, or
10-27 other obligations, including matured but unpaid interest coupons.
11-1 (b) Refunding bonds shall mature serially or otherwise not
11-2 more than 40 years from their date and shall bear interest at any
11-3 rate or rates permitted by the constitution and laws of this state.
11-4 (c) Refunding bonds may be payable from the same source as
11-5 the bonds, notes, or other obligations being refunded or from other
11-6 additional sources.
11-7 (d) The refunding bonds shall be approved by the attorney
11-8 general and shall be registered by the comptroller on the surrender
11-9 and cancellation of the bonds being refunded.
11-10 (e) An order or resolution authorizing the issuance of
11-11 refunding bonds may provide that the refunding bonds will be sold
11-12 and the proceeds deposited in the place or places at which the
11-13 bonds being refunded are payable, and the refunding bonds may be
11-14 issued before the cancellation of the bonds being refunded provided
11-15 an amount sufficient to pay the principal of and interest on the
11-16 bonds being refunded to their maturity dates, or to their option
11-17 dates if the bonds have been duly called for payment prior to
11-18 maturity according to their terms, is deposited in the place or
11-19 places at which the bonds being refunded are payable. The
11-20 comptroller shall register the refunding bonds without the
11-21 surrender and cancellation of bonds being refunded.
11-22 (f) A refunding may be accomplished in one or in several
11-23 installment deliveries. Refunding bonds and their interest coupons
11-24 are investment securities under Chapter 8, Business & Commerce
11-25 Code.
11-26 (g) In lieu of the method set forth in this section, a
11-27 district may refund bonds, notes, or other obligations as provided
12-1 by the general laws of this state.
12-2 Sec. 4.10. Obligations; Legal Investment; Security for
12-3 Funds. (a) Bonds, notes, and other obligations issued by a
12-4 District are legal and authorized investments for all banks,
12-5 savings banks, trust companies, savings and loan associations,
12-6 insurance companies, fiduciaries, and trustees, guardians, and for
12-7 interest and sinking funds and other public funds of the state and
12-8 its agencies, including the permanent school fund, and counties,
12-9 cities, school Districts, and other political subdivisions of the
12-10 state.
12-11 (b) The District's bonds, notes, and other obligations are
12-12 eligible to secure deposits of public funds of the state and its
12-13 agencies and counties, cities, school Districts, and other
12-14 political subdivisions of the state. The bonds, notes, and other
12-15 obligations are lawful and sufficient security to the extent of
12-16 their market value if accompanied by all unmatured interest coupons
12-17 attached to them.
12-18 Sec. 4.11. Mandamus by Bondholders. In addition to other
12-19 rights and remedies provided by the law of this state, if the
12-20 District defaults in the payment of principal of, interest on, or
12-21 redemption price on its bonds when due, or if the District fails to
12-22 make payments into any fund created in the order or resolution
12-23 authorizing the issuance of the bonds, or defaults in the
12-24 observation or performance of any other covenants, conditions, or
12-25 obligations stated in the resolution or order authorizing the
12-26 issuance of its bonds, the owners of any of the bonds are entitled
12-27 to a writ of mandamus issued by a court of competent jurisdiction
13-1 compelling the District and its officials to observe and perform
13-2 the covenants, the obligations, or conditions prescribed in the
13-3 order or resolution authorizing the issuance of the District's
13-4 bonds.
13-5 Sec. 4.12. Cancellation of Unsold Bonds. (a) The board, by
13-6 order or resolution, may provide for the cancellation of all or any
13-7 part of any bonds that have been submitted to and approved by the
13-8 attorney general and registered by the comptroller, but not yet
13-9 sold, and may provide for the issuance of new bonds in lieu of the
13-10 old bonds in the manner provided by this chapter for the issuance
13-11 of the original bonds including their approval by the attorney
13-12 general and their registration by the comptroller.
13-13 (b) The order or resolution of the board shall describe the
13-14 bonds to be canceled, and also shall describe the new bonds to be
13-15 issued in lieu of the old bonds.
13-16 (c) A certified copy of the order or resolution of the board
13-17 providing for the cancellation of the old bonds, together with the
13-18 old bonds, shall be delivered to the comptroller, who shall cancel
13-19 and destroy the old bonds and make a record of the cancellation.
13-20 Sec. 4.13. Cancellation of Unsold Bonds. (a) The board, by
13-21 order or resolution, may provide for the cancellation of all or any
13-22 part of any bonds that have been submitted to and approved by the
13-23 attorney general and registered by the comptroller, but not yet
13-24 sold, and may provide for the issuance of new bonds in lieu of the
13-25 old bonds in the manner provided by this chapter for the issuance
13-26 of the original bonds including their approval by the attorney
13-27 general and their registration by the comptroller.
14-1 (b) The order or resolution of the board shall describe the
14-2 bonds to be canceled, and also shall describe the new bonds to be
14-3 issued in lieu of the old bonds.
14-4 (c) A certified copy of the order or resolution of the board
14-5 providing for the cancellation of the old bonds, together with the
14-6 old bonds, shall be delivered to the comptroller, who shall cancel
14-7 and destroy the old bonds and make a record of the cancellation.
14-8 ARTICLE 5. CONSOLIDATION OF DISTRICTS
14-9 The District may consolidate with any District governed by
14-10 Chapter 65 of the Water Code in accordance with the procedures
14-11 provided in Water Code Section 65.723, et seq, as may be amended.
14-12 ARTICLE 6. MISCELLANEOUS
14-13 Sec. 6.01. SEVERABILITY. If any portion of this Act or the
14-14 application of any portion of this Act to any person or set of
14-15 circumstances is held by a court to be unconstitutional, void,
14-16 invalid, or unenforceable, the validity of the remaining portions
14-17 of this Act or the application of the challenged portion of the Act
14-18 to other persons or sets of circumstances shall not be affected by
14-19 the court's holding. It is the intent of the legislature in
14-20 adopting this Act that no portion of the Act become inoperative or
14-21 fail by reason of the unconstitutionality or invalidity of any
14-22 other portion of the Act.
14-23 Sec. 6.02. EMERGENCY. The importance of this legislation
14-24 and the crowded condition of the calendars in both houses create an
14-25 emergency and an imperative public necessity that the
14-26 constitutional rule requiring bills to be read on three several
14-27 days in each house be suspended, and this rule is hereby suspended,
15-1 and that this Act take effect and be in force from and after its
15-2 passage, and it is so enacted.