AN ACT 1-1 relating to the authority to dissolve the Sebastian Municipal 1-2 Utility District or transfer certain of its assets and obligations. 1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-4 SECTION 1. DEFINITIONS. In this Act: 1-5 (1) "Board" means the board of directors of the 1-6 Sebastian Municipal Utility District. 1-7 (2) "District" means the Sebastian Municipal Utility 1-8 District. 1-9 (3) "Corporation" means a qualified water supply 1-10 corporation as described by Section 7 of this Act. 1-11 SECTION 2. AGREEMENT AND ORDER RELATING TO DISSOLUTION OF 1-12 DISTRICT. (a) A corporation may enter into an agreement with the 1-13 district to: 1-14 (1) assume the district's debts, liabilities, and 1-15 obligations; 1-16 (2) assume ownership of the district's assets and 1-17 facilities; 1-18 (3) accept assignment of the district's certificate of 1-19 public convenience and necessity obtained under Section 13.246, 1-20 Water Code, and any right obtained under the certificate after the 1-21 Texas Natural Resource Conservation Commission determines that the 1-22 corporation is capable of rendering adequate and continuous service 1-23 as required by Section 13.251, Water Code; and 2-1 (4) perform the district's functions and provide all 2-2 services previously provided by the district. 2-3 (b) If a corporation enters into an agreement described by 2-4 Subsection (a) of this section with the district, the board shall 2-5 issue an order that dissolves the district. 2-6 (c) The dissolution of the district becomes effective on the 2-7 30th day after the date the board issues the order dissolving the 2-8 district. 2-9 (d) On the effective date of the dissolution: 2-10 (1) all property and other assets of the district are 2-11 transferred to the corporation; 2-12 (2) all debts, liabilities, and other obligations of 2-13 the district are assumed by the corporation; and 2-14 (3) the district's certificate of public convenience 2-15 and necessity and any right obtained under the certificate is 2-16 assigned to the corporation in the manner prescribed by Section 2-17 13.251, Water Code. 2-18 SECTION 3. AGREEMENT AND ORDER RELATING TO WATER AND 2-19 WASTEWATER SERVICE. (a) A corporation may enter into an agreement 2-20 with the district to: 2-21 (1) assume the district's debts, liabilities, and 2-22 obligations relating to water and wastewater service; 2-23 (2) assume ownership of the district's assets and 2-24 facilities relating to water and wastewater service; 2-25 (3) apply to the Texas Natural Resource Conservation 3-1 Commission to obtain a certificate of public convenience and 3-2 necessity, or an amendment of a certificate, under Section 13.244, 3-3 Water Code, to render water and wastewater service to the area 3-4 served by the district; and 3-5 (4) perform the district's functions relating to water 3-6 and wastewater service and provide all services relating to those 3-7 services previously provided by the district. 3-8 (b) If a corporation enters into an agreement described by 3-9 Subsection (a) of this section with the district and the Texas 3-10 Natural Resource Conservation Commission grants to the corporation 3-11 a certificate of public convenience and necessity as described by 3-12 Subdivision (3) of Subsection (a) of this section, the board shall 3-13 issue an order transferring the district's debts, liabilities, 3-14 obligations, assets, and facilities relating to water and 3-15 wastewater service to the corporation. 3-16 (c) On the 30th day after the date the board issues the 3-17 order transferring the district's debts, liabilities, obligations, 3-18 assets, and facilities: 3-19 (1) all property and other assets of the district 3-20 relating to water and wastewater service are transferred to the 3-21 corporation; and 3-22 (2) all debts, liabilities, and other obligations of 3-23 the district relating to water and wastewater service are assumed 3-24 by the corporation. 3-25 SECTION 4. PETITION TO DISSOLVE DISTRICT. (a) A petition 4-1 may be filed with the board requesting an election in the district 4-2 to decide if the board must enter into an agreement as described by 4-3 Subsection (a) of Section 2 of this Act. 4-4 (b) A petition filed under this section shall be printed in 4-5 English and Spanish and read as follows: 4-6 "We, the undersigned, being registered voters in the 4-7 Sebastian Municipal Utility District, request the board of 4-8 directors of the Sebastian Municipal Utility District to hold an 4-9 election to decide if the board must enter into an agreement with a 4-10 qualified water supply corporation in which the district's debts, 4-11 liabilities, obligations, assets, and facilities are transferred to 4-12 the qualified water supply corporation and the district is 4-13 dissolved." 4-14 SECTION 5. ELECTION. (a) The board shall call an election 4-15 as requested by a petition filed under Section 4 of this Act only 4-16 if: 4-17 (1) an election has not been held previously under 4-18 this section; and 4-19 (2) the board determines that the petition is signed 4-20 by at least 10 percent of the registered voters in the district. 4-21 (b) The board shall make the determination under Subsection 4-22 (a)(2) of this section not later than the seventh day after the 4-23 date on which the board receives the petition. 4-24 (c) The board shall hold an election required by Subsection 4-25 (a) of this section on the first authorized uniform election date 5-1 after the date the board determines an election is required that 5-2 allows sufficient time for the board to comply with all applicable 5-3 provisions of the Election Code. 5-4 (d) The board shall publish notice of the election in a 5-5 newspaper of general circulation in the district once each week for 5-6 three weeks before the date the election is scheduled to be held. 5-7 The notice must include: 5-8 (1) the time and place of the election; and 5-9 (2) a description of the issue to be decided by the 5-10 election. 5-11 (e) The ballot for an election ordered in response to a 5-12 petition filed under Section 4 of this Act shall be printed in 5-13 English and Spanish and read as follows: 5-14 "By voting YES on this ballot, you are voting in favor of 5-15 requiring the Sebastian Municipal Utility District to enter into an 5-16 agreement with a qualified water supply corporation in which the 5-17 district's debts, liabilities, obligations, assets, and facilities 5-18 are transferred to the corporation and the district is dissolved. 5-19 By voting NO on this ballot, you are voting against requiring the 5-20 Sebastian Municipal Utility District to enter into such an 5-21 agreement." 5-22 (f) If a majority of the electors vote in favor of the 5-23 ballot proposition stated in Subsection (e) of this section, the 5-24 board shall enter into an agreement as described by Subsection (a) 5-25 of Section 2 of this Act if: 6-1 (1) a corporation agrees to the terms specified by 6-2 Subsection (a) of Section 2 of this Act; and 6-3 (2) the Texas Natural Resource Conservation Commission 6-4 determines that the corporation is capable of rendering adequate 6-5 and continuous service as required by Section 13.251, Water Code. 6-6 (g) If a majority of the electors vote against the ballot 6-7 proposition stated in Subsection (e) of this section, the board may 6-8 not enter into an agreement as described by Subsection (a) of 6-9 Section 2 of this Act before the district conducts the first board 6-10 election held after the date on which the electors voted against 6-11 the ballot proposition. 6-12 SECTION 6. FILING REQUIREMENT. The board shall file a copy 6-13 of the agreement described by Subsection (a) of Section 2 or 6-14 Subsection (a) of Section 3 of this Act, as appropriate, and a copy 6-15 of the board's order dissolving the district issued under 6-16 Subsection (b) of Section 2 of this Act, or a copy of the board's 6-17 order transferring the district's obligations and assets issued 6-18 under Subsection (b) of Section 3 of this Act, as appropriate, not 6-19 later than the 15th day after the date the board issues the 6-20 dissolution or transfer order: 6-21 (1) with the Texas Natural Resource Conservation 6-22 Commission; and 6-23 (2) in the deed records of Willacy and Cameron 6-24 counties. 6-25 SECTION 7. QUALIFIED WATER SUPPLY CORPORATION. A 7-1 corporation is qualified to assume the district's debts, 7-2 liabilities, and obligations and assume ownership of the district's 7-3 assets and facilities if the corporation: 7-4 (1) is member-owned and member-controlled and formed 7-5 under Chapter 76, Acts of the 43rd Legislature, 1st Called Session, 7-6 1933 (Article 1434a, Vernon's Texas Civil Statutes); and 7-7 (2) possesses a valid certificate of public 7-8 convenience and necessity obtained under Section 13.246, Water 7-9 Code. 7-10 SECTION 8. EMERGENCY. The importance of this legislation 7-11 and the crowded condition of the calendars in both houses create an 7-12 emergency and an imperative public necessity that the 7-13 constitutional rule requiring bills to be read on three several 7-14 days in each house be suspended, and this rule is hereby suspended, 7-15 and that this Act take effect and be in force from and after its 7-16 passage, and it is so enacted. _______________________________ _______________________________ President of the Senate Speaker of the House I hereby certify that S.B. No. 1656 passed the Senate on April 11, 1997, by the following vote: Yeas 29, Nays 0; and that the Senate concurred in House amendment on May 16, 1997, by the following vote: Yeas 30, Nays 0. _______________________________ Secretary of the Senate I hereby certify that S.B. No. 1656 passed the House, with amendment, on May 13, 1997, by the following vote: Yeas 143, Nays 0, two present not voting. _______________________________ Chief Clerk of the House Approved: _______________________________ Date _______________________________ Governor