1-1 By: Sibley, Harris S.B. No. 1944 1-2 (In the Senate - Filed May 1, 1997; May 2, 1997, read first 1-3 time and referred to Committee on Natural Resources; May 9, 1997, 1-4 reported favorably by the following vote: Yeas 9, Nays 0; 1-5 May 9, 1997, sent to printer.) 1-6 A BILL TO BE ENTITLED 1-7 AN ACT 1-8 relating to the creation, administration, powers, duties, 1-9 operation, and financing of the Parker County Utility District No. 1-10 1; granting the power of eminent domain and authorizing the 1-11 issuance of bonds. 1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-13 ARTICLE 1. CREATION OF THE DISTRICT 1-14 SECTION 1.01. CREATION. (a) A regional wastewater 1-15 district, to be known as the Parker County Utility District No. 1, 1-16 is created. The district is a governmental agency and a body 1-17 politic and corporate. 1-18 (b) The district is created under and is essential to 1-19 accomplish the purposes of Section 59, Article XVI, Texas 1-20 Constitution. 1-21 SECTION 1.02. DEFINITIONS. In this Act: 1-22 (1) "Board" means the board of directors of the 1-23 district. 1-24 (2) "Bond" means all interest-bearing obligations, 1-25 including bonds, notes, debentures, certificates, warrants, 1-26 securities, interim certificates or receipts, and other evidences 1-27 of debt issued by the district, whether general or special, 1-28 negotiable or nonnegotiable in form, in bearer or registered form, 1-29 temporary or permanent in form, or with or without interest 1-30 coupons. 1-31 (3) "Customer" means a wholesale user of wastewater or 1-32 other services provided by the district. 1-33 (4) "Director" means a member of the board. 1-34 (5) "District" means the Parker County Utility 1-35 District No. 1. 1-36 (6) "Local government" means a municipality, county, 1-37 or entity created under Section 52, Article III, or Section 59, 1-38 Article XVI, Texas Constitution. 1-39 (7) "Member entity" means a public entity or private 1-40 utility entity that: 1-41 (A) provides retail utility service or regulates 1-42 water, wastewater, sewage, or solid waste within the district; and 1-43 (B) enters into a contract with the district for 1-44 service. 1-45 (8) "Participant entity" means a public entity or 1-46 private utility entity that: 1-47 (A) provides utility service within the 1-48 boundaries of the entity; and 1-49 (B) enters into a contract with the district for 1-50 the construction of and payment for wastewater or other utility 1-51 service projects to be financed or provided by the district. 1-52 (9) "Person" means an individual, firm, association, 1-53 corporation, business trust, partnership, government or 1-54 governmental agency, joint venture, or other legal entity. 1-55 (10) "Service area" means the territory within the 1-56 district and within the corporate limits or defined boundaries of 1-57 all member entities, participant entities, and customers of the 1-58 district, including the areas served by the member entities, 1-59 participant entities, and customers. 1-60 SECTION 1.03. PURPOSES. The district is created to 1-61 accomplish the following purposes: 1-62 (1) to purchase, own, hold, lease, or otherwise 1-63 acquire wastewater collection facilities; 1-64 (2) to build, operate, and maintain facilities to 2-1 treat and transport wastewater; 2-2 (3) to protect, preserve, and restore the purity and 2-3 sanitary condition of water within the district; and 2-4 (4) to provide other utilities within the district if 2-5 the utilities are not otherwise provided. 2-6 SECTION 1.04. BOUNDARIES. The district includes the 2-7 territory contained within the following area: 2-8 BEGINNING at a point in the centerline of Highway 51; said point 2-9 being approximately 31,500 feet north along the centerline of 2-10 Highway 51 from the centerline intersection of Highway 199, said 2-11 point also being in the northern boundary line for the Walnut Creek 2-12 Special Utility District (WCSUD); 2-13 1. THENCE North 90 East, 8200 Feet along the WCSUD boundary; 2-14 2. THENCE South 00 East, 9800 Feet along the WCSUD boundary; 2-15 3. THENCE North 90 East, 6100 Feet along the WCSUD boundary; 2-16 4. THENCE South 00 East, 6700 Feet along the WCSUD boundary; 2-17 5. THENCE North 90 East, 1300 Feet along the WCSUD boundary; 2-18 6. THENCE South 00 East, 992.04 Feet along the WCSUD boundary to a 2-19 point of divergence; 2-20 7. THENCE South 8922'10" East, 20491.62 Feet; 2-21 8. THENCE South 0052'05" East, 26624.35 Feet; 2-22 9. THENCE South 8929'51" West, 215.45 Feet; 2-23 10. THENCE South 0030'09" East, 1930.51 Feet; 2-24 11. THENCE South 8929'51" West, 4703.61 Feet; 2-25 12. THENCE South 0030'09" East, 3134.46 Feet; 2-26 13. THENCE South 8929'51" West, 1041.52 Feet; 2-27 14. THENCE North 7455'09" West, 4870.79 Feet; 2-28 15. THENCE North 6402'36" West, 122.68 Feet; 2-29 16. THENCE South 0030'09" East, 2550.47 Feet; 2-30 17. THENCE South 8929'51" West, 1262.75 Feet to a point in the 2-31 boundary of WCSUD; 2-32 18. THENCE South 00 East, 4103.65 Feet along the WCSUD boundary; 2-33 19. THENCE North 90 West, 45600 Feet along the WCSUD boundary; 2-34 20. THENCE North 00 East, 12400 Feet along the WCSUD boundary; 2-35 21. THENCE North 90 West, 14,200 Feet along the WCSUD boundary; 2-36 22. THENCE North 00 East, 36500 Feet along the WCSUD boundary; 2-37 23. THENCE North 90 East, 25500 Feet along the WCSUD boundary; 2-38 24. THENCE North 00 East, 5900 Feet along the WCSUD boundary; 2-39 25. THENCE North 90 East, 9775.84 Feet to the POINT OF BEGINNING 2-40 and containing 70,490 gross acres more or less. Save and except 2-41 CCN areas numbered 10266, 10285, 12397 (except for dually 2-42 certificated portion), 11719 and 12427. 2-43 SECTION 1.05. FINDINGS RELATING TO BOUNDARIES. The 2-44 legislature finds that the boundaries and field notes of the 2-45 district form a closure. A mistake in the field notes or in 2-46 copying the field notes in the legislative process does not affect 2-47 the organization, existence, or validity of the district or the 2-48 legality or operation of the district or its governing body. 2-49 SECTION 1.06. FINDING OF BENEFIT. All of the land and other 2-50 property included within the boundaries of the district will be 2-51 benefited by the improvements, works, and projects that are to be 2-52 accomplished by the district under the powers conferred by this Act 2-53 and under Section 59, Article XVI, Texas Constitution. 2-54 SECTION 1.07. FINDING OF STATE BENEFIT. The legislature 2-55 finds that creation of the district will benefit the state by: 2-56 (1) contributing to economic development and 2-57 diversification; 2-58 (2) decreasing the rate of unemployment and 2-59 underemployment; 2-60 (3) stimulating agricultural innovation; 2-61 (4) fostering enterprise growth based on agriculture; 2-62 and 2-63 (5) contributing to the development or expansion of 2-64 transportation and commerce. 2-65 SECTION 1.08. POWERS. (a) Except as provided by this 2-66 section, the district has all of the rights, powers, privileges, 2-67 authority, functions, and duties provided by the general law of 2-68 this state, including Chapters 49, 54, and 65, Water Code, and 2-69 conferred by Section 59, Article XVI, Texas Constitution. This Act 3-1 prevails over any provision of general law that is in conflict or 3-2 inconsistent with this Act. 3-3 (b) The district may not levy or collect ad valorem taxes. 3-4 (c) The rights, powers, privileges, authority, functions, 3-5 and duties of the district are subject to the continuing right of 3-6 supervision of the state to be exercised by and through the Texas 3-7 Natural Resource Conservation Commission. Except as provided by 3-8 this Act or other state law, the district may exercise the rights, 3-9 powers, privileges, authority, functions, and duties conferred by 3-10 this Act without having to obtain approval from the Texas Natural 3-11 Resource Conservation Commission. 3-12 SECTION 1.09. CONFIRMATION ELECTION NOT REQUIRED. Creation 3-13 of the district does not require a confirmation election. 3-14 ARTICLE 2. ADMINISTRATIVE PROVISIONS 3-15 SECTION 2.01. APPOINTMENT OF DIRECTORS. (a) The district 3-16 is governed by a board of directors as provided by this section. 3-17 (b) The governing bodies of the City of Springtown and the 3-18 Walnut Creek Special Utility District shall each appoint three 3-19 initial directors. 3-20 (c) Initial directors serve until permanent directors 3-21 appointed under Subsection (e) of this section take office. 3-22 (d) The Parker County judge, or a person designated by the 3-23 Parker County judge, serves as an ex officio director. A person 3-24 who serves as an ex officio director under this subsection may vote 3-25 on any matter considered by the board. 3-26 (e) Permanent directors shall be appointed as provided by 3-27 Subsection (f) of this section by the governing bodies of the 3-28 member entities of the district not earlier than April 1 or later 3-29 than April 30 of 1998. 3-30 (f) Each member entity shall appoint: 3-31 (1) one director if the number of member entities of 3-32 the district is at least six; 3-33 (2) two directors if the number of member entities of 3-34 the district is at least three, but less than six; 3-35 (3) three directors if there are two member entities 3-36 of the district; or 3-37 (4) six directors if there is one member entity of the 3-38 district. 3-39 (g) Not earlier than April 1 or later than April 30 of each 3-40 year after 1998, the appropriate number of permanent directors, if 3-41 any, shall be appointed to the board as provided by Subsection (f) 3-42 of this section. 3-43 (h) Permanent directors serve staggered four-year terms, 3-44 unless required by the board to serve a term of less than four 3-45 years under Subsection (j) of this section. 3-46 (i) Permanent directors appointed under Subsections (e) and 3-47 (g) of this section serve beginning May 1 of the year in which the 3-48 director is appointed and until the director's successor has 3-49 qualified. 3-50 (j) For purposes of staggering the terms of office of 3-51 directors as required by Subsection (h) of this section, the board 3-52 shall develop a procedure to determine which directors appointed 3-53 under Subsections (e) and (g) of this section serve four-year terms 3-54 and which directors serve terms of less than four years. 3-55 (k) A vacancy on the board shall be filled by appointment 3-56 made by the governing body of the appropriate member entity. An 3-57 appointment under this subsection may be made any time after the 3-58 vacancy occurs. A member entity that makes an appointment under 3-59 this subsection shall provide notice of the appointment to the 3-60 board not later than six hours before the first board meeting 3-61 following the appointment. An appointment made under this 3-62 subsection is effective on the date notice is received by the 3-63 board. If notice of an appointment is not provided as required by 3-64 this subsection, the appointment is not effective until after the 3-65 first board meeting following the appointment. 3-66 (l) The appointment of a director is not valid unless the 3-67 appointment is made as provided by this section. 3-68 (m) A participant entity or customer may not appoint a 3-69 director under this section. 4-1 SECTION 2.02. REMOVAL OF DIRECTORS. A director may be 4-2 removed for any reason: 4-3 (1) by the governing body of the member entity that 4-4 appointed the director; or 4-5 (2) if three-quarters of the directors vote to remove 4-6 the director. 4-7 SECTION 2.03. DIRECTOR QUALIFICATIONS. A person is 4-8 qualified to serve as a director if the person: 4-9 (1) is at least 18 years of age; 4-10 (2) is a qualified voter who resides within the 4-11 boundaries of the district; 4-12 (3) qualifies to serve as a director by taking the 4-13 oath of office; 4-14 (4) except as otherwise provided by this section, is 4-15 eligible to serve as a director under Subchapter C, Chapter 49, 4-16 Water Code; and 4-17 (5) verifies compliance with the requirements of this 4-18 section. 4-19 SECTION 2.04. DIRECTOR VOTING. A director, including the 4-20 chairman elected under Section 2.09 of this article, may vote on 4-21 any matter considered by the board, including a matter authorizing 4-22 a financial commitment to a capital project. This section applies 4-23 to a director notwithstanding that the director was appointed by a 4-24 member entity of the district that is not participating in the 4-25 project being considered by the board. 4-26 SECTION 2.05. DIRECTOR COMPENSATION. (a) Except as 4-27 provided by Subsection (b) of this section, a director may not 4-28 receive compensation for serving on the board. 4-29 (b) A director may receive reimbursement for travel or other 4-30 expenses reasonably incurred by the director while acting on behalf 4-31 of the district. The board may adopt reasonable policies governing 4-32 the reimbursement of director expenses under this subsection, 4-33 including a requirement that the director provide written 4-34 verification of expenses. 4-35 SECTION 2.06. EX OFFICIO DIRECTORS. The board may appoint 4-36 or elect ex officio directors of the district and provide for the 4-37 powers and duties of such directors in the bylaws, rules, or 4-38 regulations of the district. 4-39 SECTION 2.07. EXCLUSIVE AUTHORITY OF BOARD. The board has 4-40 the exclusive authority to manage the district. 4-41 SECTION 2.08. POWERS AND DUTIES OF THE BOARD. (a) The 4-42 board shall: 4-43 (1) adopt a seal for the district; 4-44 (2) adopt bylaws to govern matters of the district; 4-45 and 4-46 (3) hold regular and, if necessary, special and 4-47 emergency board meetings. 4-48 (b) The board may amend bylaws adopted under Subdivision (2) 4-49 of Subsection (a) of this section. 4-50 (c) The board shall hold board meetings at a time and place 4-51 specified in the district bylaws. 4-52 SECTION 2.09. ELECTION OF OFFICERS. (a) At the first board 4-53 meeting following the appointment of initial directors under 4-54 Subsection (b) of Section 2.01 of this article, the board shall 4-55 elect from the initial directors primary officers for the district, 4-56 including a chairman, vice chairman, secretary, and treasurer, and 4-57 any other officer that the board determines is necessary. 4-58 (b) At the first board meeting following the appointment of 4-59 permanent directors under Subsection (e) of Section 2.01 of this 4-60 article, the board shall elect from the permanent directors new 4-61 officers for the district. 4-62 (c) Each subsequent year at the first board meeting 4-63 following the appointment of the appropriate number of directors 4-64 under Subsection (g) of Section 2.01 of this article, the board 4-65 shall elect from the directors new officers for the district. 4-66 (d) Officers serve until the election of new officers under 4-67 this section. 4-68 SECTION 2.10. POWERS AND DUTIES OF OFFICERS. (a) The 4-69 chairman of the board elected under Section 2.09 of this article is 5-1 the chief executive officer of the district and the presiding 5-2 officer of the board. 5-3 (b) The vice chairman of the board elected under Section 5-4 2.09 of this article may perform the duties and exercise the powers 5-5 of the chairman if the chairman is absent or fails, refuses, or is 5-6 unable to act. 5-7 (c) The secretary of the board elected under Section 2.09 of 5-8 this article or an assistant secretary: 5-9 (1) shall keep a record of the minutes of the board 5-10 meetings; 5-11 (2) shall maintain the official records of the 5-12 district; and 5-13 (3) may certify the accuracy and authenticity of any 5-14 actions, proceedings, minutes, or records of the board or the 5-15 district. 5-16 (d) The board may provide for additional powers and duties 5-17 of officers elected under Section 2.09 of this article in the 5-18 district bylaws. 5-19 SECTION 2.11. DISTRICT EMPLOYEES. The board may appoint and 5-20 employ any person, firm, corporation, partnership, or other entity 5-21 that the board determines is necessary to conduct the affairs of 5-22 the district, including a general manager, engineer, attorney, 5-23 financial advisor, accountant, or other consultant. 5-24 SECTION 2.12. CONFLICT OF INTEREST. Directors and officers 5-25 of the district are subject to Chapter 572, Government Code. 5-26 SECTION 2.13. OPEN RECORDS. Chapter 551, Government Code, 5-27 applies to the minutes, orders, contracts and related instruments, 5-28 books, records, audits, and other documents of the district. 5-29 SECTION 2.14. DISTRICT BUSINESS. (a) A quorum of the 5-30 directors of the district is required to be present at a board 5-31 meeting for the board to conduct district business. The board 5-32 shall specify in the district bylaws the number of directors that 5-33 constitute a quorum, except that a quorum may not be less than a 5-34 majority of the directors serving on the board. 5-35 (b) The board shall specify in the district bylaws the 5-36 number of votes necessary to approve a matter considered by the 5-37 board, except that the number of votes specified may not be less 5-38 than a majority of the directors present at the meeting in which 5-39 the matter is being considered. 5-40 SECTION 2.15. CUSTOMER ADVISORY COUNCIL. (a) The board may 5-41 establish a customer advisory council as provided by this section. 5-42 (b) A customer advisory council established under this 5-43 section shall consist of one representative of each customer of the 5-44 district. 5-45 (c) A representative serving on a customer advisory council 5-46 established under this section: 5-47 (1) has the powers and duties provided in the bylaws, 5-48 rules, and regulations of the district; and 5-49 (2) may not vote on any matter considered by the 5-50 board. 5-51 (d) A customer advisory council established under this 5-52 section may be abolished by the board. 5-53 SECTION 2.16. ADMINISTRATION AND PLANNING COSTS FEE. The 5-54 district may charge each member entity an annual pro rata fee to 5-55 pay for administration and planning costs incurred by the district 5-56 that are unrelated to capital projects financed by the district. A 5-57 fee charged a member entity under this section may not exceed $2 5-58 per capita population of the member entity, unless the board and at 5-59 least 75 percent of the member entities of the district that 5-60 together have at least 75 percent of the population of the district 5-61 agree to a different fee. 5-62 SECTION 2.17. EXPANSION OF DISTRICT BOUNDARIES. On request 5-63 by a member entity, the boundaries of the district may be expanded 5-64 to include additional or the remaining territory of the member 5-65 entity if: 5-66 (1) the boundaries of the member entity are contiguous 5-67 to the boundaries of the district; and 5-68 (2) the requested expansion is approved by a 5-69 three-quarters majority vote of the directors of the district. 6-1 SECTION 2.18. RULES AND REGULATIONS. The board may adopt 6-2 and enforce reasonable rules and regulations to exercise the powers 6-3 and perform the duties of the district as provided by this Act. 6-4 ARTICLE 3. RIGHTS, POWERS, AND DUTIES 6-5 SECTION 3.01. RIGHTS IN SERVICE AREA. (a) The district may 6-6 provide wastewater collection, treatment, or service within the 6-7 district. 6-8 (b) The district may own, operate, and provide other 6-9 necessary utilities and services within the district, including raw 6-10 water, potable water, water distribution and treatment, solid waste 6-11 collection and disposal, fire, police, and ambulance services, if 6-12 the right to own, operate, or provide the utility or service has 6-13 not been conveyed to another entity, unless the entity to which the 6-14 right has been conveyed agrees to sell, cede, or otherwise convey 6-15 to the district the right to own, operate, or provide the utility 6-16 or service. 6-17 (c) Subsection (b) of this section does not require the 6-18 district to own, operate, or provide other necessary utilities or 6-19 services within the district, unless the district is required to 6-20 own, operate, or provide the utility or service under a permit, 6-21 certificate, or license issued by the state. 6-22 SECTION 3.02. RIGHTS OF OTHER ENTITIES PROTECTED. 6-23 (a) Except as provided by Subsection (b) of this section, a 6-24 customer or prospective customer of the district is not required 6-25 under this Act to secure wastewater or other utility service from 6-26 the district, unless the customer or prospective customer enters 6-27 into a contract with the district for that purpose. 6-28 (b) A customer or prospective customer is required under 6-29 this Act to secure wastewater or other utility service from the 6-30 district if: 6-31 (1) the customer or prospective customer is not 6-32 receiving the service from another source; and 6-33 (2) the district provides the service or determines 6-34 that the district will make the service available to the customer 6-35 or prospective customer. 6-36 (c) If a customer enters into a contract with the district 6-37 to secure wastewater or other utility service from the district, a 6-38 user of the service under the contract must connect to the 6-39 district's service system if: 6-40 (1) the user is located within the boundaries of the 6-41 customer; and 6-42 (2) the district's system is available for connection 6-43 at or near the property line of the user. 6-44 (d) A contract under this section may provide that the 6-45 district may: 6-46 (1) require the customer to terminate service provided 6-47 to a user who fails or refuses to pay for that service after 6-48 providing notice as required by law; 6-49 (2) terminate service provided to a customer or user 6-50 who fails or refuses to pay for that service after providing notice 6-51 as required by law; and 6-52 (3) terminate other utility services provided to a 6-53 customer or user if the customer or user fails or refuses to pay 6-54 for any service provided by the district after providing notice as 6-55 required by law. 6-56 (e) This Act does not alter any existing permit, contract, 6-57 or other obligation, or impair the right of any entity to own, 6-58 operate, maintain, or otherwise use, provide, or control water, 6-59 wastewater, solid waste, or liquid waste under the governing law of 6-60 the entity. 6-61 SECTION 3.03. PURCHASE, CONSTRUCT, OR ACQUIRE WORKS AND 6-62 FACILITIES. The district may plan, lay out, purchase, construct, 6-63 acquire, own, operate, maintain, repair, or improve, or contract 6-64 for, within or outside the boundaries of the district, any works, 6-65 improvements, facilities, plants, equipment, and appliances, 6-66 including any administrative properties and facilities, any 6-67 permits, franchises, licenses, or contract or property rights, and 6-68 any levees, drains, waterways, lakes, reservoirs, channels, 6-69 conduits, sewers, dams, storm water detention facilities, treatment 7-1 plants, or other similar facilities and improvements, whether for 7-2 municipal, industrial, agricultural, flood control, or related 7-3 purposes, that are necessary, helpful, or incidental to the 7-4 exercise of any right, power, privilege, authority, or function 7-5 provided by this Act. 7-6 SECTION 3.04. FINANCING CAPITAL IMPROVEMENTS. The district 7-7 is a political subdivision for purposes of Chapter 395, Local 7-8 Government Code. 7-9 SECTION 3.05. ADDITIONAL POWERS. The district may: 7-10 (1) provide for: 7-11 (A) the collection, construction, improvement, 7-12 maintenance, and operation of wholesale wastewater and water 7-13 systems and treatment works necessary to provide wholesale service 7-14 to customers of the district; and 7-15 (B) the acquisition, construction, improvement, 7-16 and maintenance of water supply, reservoir, or interest in water 7-17 supply or reservoir, necessary to exercise and fulfill the powers 7-18 and duties of the district; 7-19 (2) supply water for municipal, domestic, and 7-20 industrial or other beneficial uses or controls; 7-21 (3) collect, treat, process, dispose of, and control 7-22 all domestic or industrial wastes, whether in fluid, solid, or 7-23 composite state; 7-24 (4) gather, conduct, divert, control, and treat local 7-25 storm water or local harmful excesses of water within the 7-26 boundaries of the district; and 7-27 (5) irrigate and alter land elevations within the 7-28 boundaries of the district as needed. 7-29 SECTION 3.06. EMINENT DOMAIN. (a) The district may acquire 7-30 by purchase or eminent domain land, an easement, a right-of-way, or 7-31 other property or improvement within or outside the boundaries of 7-32 the district if necessary or appropriate in exercising the powers 7-33 and performing the functions of the district. 7-34 (b) The power of eminent domain may be exercised by the 7-35 district under Subsection (a) of this section as provided by state 7-36 law, including Chapter 21, Property Code, except that the district 7-37 is not required to comply with the requirements of Subsection (a), 7-38 Section 21.021, Property Code, during the pendency of the subject 7-39 litigation. 7-40 (c) The district is not required in a condemnation 7-41 proceeding brought by the district: 7-42 (1) to pay in advance or give bond or other security 7-43 for costs; 7-44 (2) to give bond for the issuance of a temporary 7-45 restraining order or a temporary injunction; or 7-46 (3) to give bond for costs or supersedeas on an appeal 7-47 or writ of error. 7-48 (d) The district may not exercise the power of eminent 7-49 domain to acquire: 7-50 (1) property located in the existing corporate limits 7-51 of a municipality that is located in whole or in part within the 7-52 district unless the governing body of the municipality in which the 7-53 property is located consents by resolution to the acquisition of 7-54 the property; 7-55 (2) property located outside the boundaries of the 7-56 district to be used as a water supply reservoir unless the county 7-57 in which the reservoir is to be located consents; 7-58 (3) property owned by a county, a municipality, an 7-59 entity created by special act of the legislature under Section 52, 7-60 Article III, or Section 59, Article XVI, Texas Constitution, a 7-61 political subdivision of the state, or an agency or instrumentality 7-62 of a county or municipality; or 7-63 (4) a waterworks system or a wastewater system owned 7-64 by a municipality, an entity created by special act of the 7-65 legislature under Section 52, Article III, or Section 59, Article 7-66 XVI, Texas Constitution, a political subdivision of the state, a 7-67 private party, or a nonprofit corporation. 7-68 (e) If the district exercises the power of eminent domain 7-69 and requires relocating, raising, lowering, rerouting, changing the 8-1 grade, or altering the construction of any railroad, highway, or 8-2 pipeline or electric transmission and electric distribution, 8-3 telegraph, or telephone lines, conduits, poles, or facilities, the 8-4 district shall pay the cost of relocating, raising, lowering, 8-5 rerouting, changing the grade, or altering the construction that 8-6 equals the comparable replacement cost without enhancement of 8-7 facilities minus the net salvage value derived from the old 8-8 facility. 8-9 SECTION 3.07. SERVICE OUTSIDE DISTRICT. The district may 8-10 provide services outside the service area of the district as 8-11 provided by state law. 8-12 SECTION 3.08. DISPOSAL SYSTEMS. (a) The district may 8-13 establish, acquire, operate, and maintain a regional solid waste 8-14 disposal system and a nonhazardous liquid waste disposal system. 8-15 (b) If the district establishes a disposal system under 8-16 Subsection (a) of this section, the district shall provide 8-17 services from the system to: 8-18 (1) users as determined by the board if the services 8-19 are provided within the service area of the district; and 8-20 (2) customers if the services are provided outside the 8-21 service area of the district. 8-22 SECTION 3.09. RULES RELATING TO WATER QUALITY. (a) The 8-23 district may adopt and enforce rules relating to protection of the 8-24 quality of water flowing to or from the areas in or surrounding the 8-25 lakes, reservoirs, and other sources of water supply owned, 8-26 operated, or controlled by the district. 8-27 (b) The rules adopted by the district under Subsection 8-28 (a) of this section must: 8-29 (1) relate to: 8-30 (A) the prevention of waste or unauthorized use 8-31 of water controlled by the district; or 8-32 (B) the regulation of privileges on land, a 8-33 reservoir, or an easement owned or controlled by the district; and 8-34 (2) be consistent with rules and regulations of the 8-35 state. 8-36 SECTION 3.10. RATES, FEES, CHARGES, AND RENTALS. (a) The 8-37 district may adopt, enforce, and collect all assessed charges, 8-38 fees, rates, and rentals that are necessary to provide services and 8-39 facilities to customers and users of the district. Rates, fees, 8-40 and charges assessed under this section may vary according to 8-41 customer class, project, or service area to reflect different costs 8-42 of providing service. 8-43 (b) The district may require a customer to obtain a deposit 8-44 from a user for services or facilities provided by the district. A 8-45 deposit under this subsection may bear interest. 8-46 (c) If the district issues revenue bonds or other 8-47 obligations payable wholly from revenue, the board shall establish 8-48 and revise rates of compensation for water sold and wastewater or 8-49 other services rendered by the district that are sufficient: 8-50 (1) to pay operating and maintenance expenses of 8-51 district facilities; 8-52 (2) to pay the issued bonds as the bonds mature and 8-53 the interest that accrues on the bonds; 8-54 (3) to maintain the district's fund reserve; and 8-55 (4) to maintain other funds of the district provided 8-56 by the resolution that authorized the issuance of the bonds. 8-57 (d) A local government, water supply corporation, or other 8-58 entity that enters into a contract with the district may: 8-59 (1) establish, charge, and collect fees, rates, 8-60 charges, rentals, or other amounts for services or facilities 8-61 provided under the contract; and 8-62 (2) pledge amounts that are sufficient to make the 8-63 required payments under the contract. 8-64 (e) The district may discontinue providing a service or 8-65 facility to prevent an abuse or to enforce the payment of an unpaid 8-66 charge, fee, or rental due and payable to the district. 8-67 SECTION 3.11. REGULATORY POWER OF MUNICIPALITIES. The 8-68 district and the land within the district are subject to any 8-69 ordinances, codes, resolutions, rules, or regulations of a 9-1 municipality, including platting and zoning requirements, that has 9-2 jurisdiction over territory within the district. 9-3 SECTION 3.12. GENERAL CONTRACTING AUTHORITY. (a) The 9-4 district may, if necessary to exercise the powers and accomplish 9-5 the purposes of the district, enter into a contract with the United 9-6 States, any agency of the United States, a municipality, a county, 9-7 a water supply corporation, an entity created under Section 52, 9-8 Article III, or Section 59, Article XVI, Texas Constitution, or 9-9 other public or private entity. 9-10 (b) The district may enter into a contract for the 9-11 acquisition, purchase, rental, lease, or operation of wastewater or 9-12 water facilities owned or operated by the party contracting with 9-13 the district. 9-14 (c) The district may acquire water appropriation or other 9-15 necessary permits from the state or permit owners. 9-16 (d) A contract that requires payment of money by the 9-17 district may be satisfied from any general or specific source of 9-18 district funds as determined by the board. 9-19 SECTION 3.13. AUTHORITY TO CONTRACT WITH DISTRICT. (a) A 9-20 municipality, a county, a public agency, a political subdivision of 9-21 the state, an entity created under Section 52, Article III, or 9-22 Section 59, Article XVI, Texas Constitution, or a water supply 9-23 corporation may enter into a contract with the district if the 9-24 entity is conducting business in whole or part within the district. 9-25 (b) The governing body of an entity that enters into a 9-26 contract under this section with the district may pledge to the 9-27 payment of the contract any source of revenue that is available to 9-28 the governing body, including revenue derived from levying and 9-29 collecting ad valorem taxes. 9-30 (c) If an entity under this section pledges to the payment 9-31 of a contract funds derived from the entity's water system, 9-32 wastewater system, or combined water and wastewater system, the 9-33 payments constitute an operating expense of that system. 9-34 SECTION 3.14. DEPOSITORY. (a) The board, by order or 9-35 resolution, shall designate one or more banks inside or outside the 9-36 boundaries of the district to serve as depository for the funds of 9-37 the district. 9-38 (b) Except as provided by this Act, district funds shall be 9-39 deposited in a depository bank designated under Subsection (a) of 9-40 this section. 9-41 (c) The board may invest district funds: 9-42 (1) in the same manner as provided for the investment 9-43 of county funds; and 9-44 (2) as provided by the Public Funds Investment Act, 9-45 Chapter 2256, Government Code. 9-46 (d) District funds shall be secured in the same manner as 9-47 provided for the deposit of public funds under the Public Funds 9-48 Collateral Act, Chapter 2257, Government Code. 9-49 SECTION 3.15. JOINT AUTHORITY. For purposes of 9-50 accomplishing the objectives and exercising the powers of the 9-51 district, the district may: 9-52 (1) enter into an agreement with a local government 9-53 under the Interlocal Cooperation Act, Chapter 791, Government Code; 9-54 and 9-55 (2) enter into a joint agreement or contract with a 9-56 water supply corporation, a municipality, an entity created under 9-57 Section 52, Article III, or Section 59, Article XVI, Texas 9-58 Constitution, a county, a political subdivision of the state, the 9-59 state, or other private or public entity. 9-60 ARTICLE 4. GENERAL FISCAL PROVISIONS 9-61 SECTION 4.01. AUDITS. All funds and accounts of the 9-62 district shall be audited by an independent auditor. A copy of an 9-63 audit required under this section shall be maintained in the 9-64 official records of the district. 9-65 SECTION 4.02. CREATION EXPENSES. (a) The district may pay 9-66 the costs and expenses incurred in obtaining the Walnut Basin 9-67 Regional Wastewater Study and, if conducted, other feasibility 9-68 studies and other costs and expenses incurred in creating and 9-69 organizing the district, including the reimbursement of costs and 10-1 expenses incurred by the City of Springtown and the Walnut Creek 10-2 Special Utility District. 10-3 (b) The district may succeed to and assume rights, 10-4 privileges, duties, and responsibilities, including contractual 10-5 obligations, of the City of Springtown and the Walnut Creek Special 10-6 Utility District relating to the creation of the district. 10-7 SECTION 4.03. TAX EXEMPTION. Accomplishment of the purposes 10-8 of the district benefit the people, property, and industry of the 10-9 state. The district is performing an essential public function 10-10 under the Texas Constitution by accomplishing the purposes of the 10-11 district and is not required to pay any tax or assessment on any 10-12 property or project owned, operated, leased, or controlled by the 10-13 district or any part of that property, and the bonds or other 10-14 obligations issued by the district under this Act and the transfer 10-15 and income from those bonds or other obligations, including the 10-16 profits made on the sale of the bonds, are free from taxation in 10-17 the state. 10-18 ARTICLE 5. BONDS 10-19 SECTION 5.01. ISSUANCE OF BONDS. (a) The district may 10-20 issue bonds to provide district funds to carry out the purposes and 10-21 exercise the powers of the district. 10-22 (b) The district may issue revenue bonds, notes, revenue 10-23 anticipation notes, short-term obligations, refunding bonds, or 10-24 other obligations without holding an election and on terms that the 10-25 board determines to be appropriate. 10-26 SECTION 5.02. PAYMENT AND SECURITY. (a) Obligations issued 10-27 under Section 5.01 of this article: 10-28 (1) may be made payable from all or part of the 10-29 revenues of the district derived from any lawful source, including 10-30 revenues derived from a contract with a customer or other user of 10-31 facilities owned or operated by the district or from the ownership 10-32 and operation of any waterworks system, wastewater system, sewer 10-33 system, solid waste disposal system, or nonhazardous liquid waste 10-34 system, or a combination of those systems; and 10-35 (2) may be paid from and secured by liens on the 10-36 pledges of all or part of the revenue, income, or receipts derived 10-37 from the district's ownership, operation, lease, or sale of the 10-38 property, buildings, structures, or facilities, including the 10-39 proceeds or revenues from contracts with any person, firm, 10-40 corporation, municipality, public agency, or other political 10-41 subdivision or entity. 10-42 (b) Bonds and other obligations of the district may be 10-43 additionally secured by mortgages or deeds of trust on real 10-44 property owned or to be acquired by the district and by chattel 10-45 mortgages or liens on any personal property appurtenant to that 10-46 real property. The board may authorize the execution of trust 10-47 indentures, mortgages, deeds of trust, or other forms of 10-48 encumbrances. The district may also pledge to the payment of the 10-49 obligations all or part of a grant, donation, revenue, or income 10-50 received or to be received from the United States or any public or 10-51 private source. 10-52 (c) The district may pledge all or part of the district's 10-53 revenue, income, or receipts from fees, rentals, rates, charges, or 10-54 contract proceeds or payments to the payment of the district's 10-55 bonds or other obligations, including the payment of principal, 10-56 interest, and any other amounts required or permitted relating to 10-57 the bonds or other obligations. The pledged fees, rentals, rates, 10-58 charges, proceeds, or payments shall be established and collected 10-59 in amounts sufficient, together with any other pledged resources, 10-60 to provide for the payment of expenses relating to the bonds or 10-61 other obligations and for operation and maintenance and other 10-62 expenses relating to those facilities. 10-63 (d) For purposes of Subsections (a) and (c) of this section, 10-64 payments and revenues that are pledged for the benefit of the 10-65 district under Subsections (a) and (b) of Section 3.13 of this Act 10-66 are revenues of the district. 10-67 SECTION 5.03. TERMS AND CONDITIONS. Bonds and other 10-68 obligations of the district: 10-69 (1) may mature serially or otherwise, except that the 11-1 term of the bonds or other obligations may not exceed 40 years from 11-2 the date of issuance; 11-3 (2) may provide for the subsequent issuance of 11-4 additional parity obligations or subordinate lien obligations under 11-5 terms provided in the resolution that authorized the issuance of 11-6 the bond or other obligation; 11-7 (3) shall be executed and may be made redeemable 11-8 before maturity, issued in the form, denominations, and manner, and 11-9 under the terms, conditions, and detail, and sold in the manner, at 11-10 the price, and under the terms provided by the resolution that 11-11 authorized the issuance of the bond or other obligation; and 11-12 (4) shall bear an interest rate as provided by the 11-13 resolution that authorized the issuance of the bond or other 11-14 obligation. 11-15 SECTION 5.04. NEGOTIABLE INSTRUMENTS. Obligations under 11-16 this article are negotiable instruments for purposes of Chapter 8, 11-17 Business & Commerce Code. 11-18 SECTION 5.05. PROCEEDS. (a) If permitted in the resolution 11-19 that authorized the issuance of the bond or other obligation, the 11-20 proceeds from the sale of the bond or other obligation may be used: 11-21 (1) to pay the interest on the bond or other 11-22 obligation during the period of acquisition or construction of 11-23 facilities to be provided through the issuance of the bond or other 11-24 obligation; 11-25 (2) to pay the operating and maintenance expenses of 11-26 district facilities; 11-27 (3) to create a reserve fund for the payment of the 11-28 principal of and interest on the bond or other obligation; and 11-29 (4) in any other manner that is necessary, 11-30 appropriate, or convenient to accomplish the purposes of the 11-31 district. 11-32 (b) The proceeds from the sale of bonds or other obligations 11-33 may be placed on time deposit or invested as provided by the 11-34 resolution that authorized the issuance of the bond or other 11-35 obligation. 11-36 SECTION 5.06. MISCELLANEOUS. (a) The district is an issuer 11-37 as defined by Section 3.001, Chapter 53, Acts of the 70th 11-38 Legislature, 2nd Called Session, 1987 (Article 717k-8, Vernon's 11-39 Texas Civil Statutes). Bonds issued by the district under this Act 11-40 and the appropriate proceedings authorizing the issuance of the 11-41 bonds shall be submitted to the attorney general for examination if 11-42 required under Article 3, Chapter 53, Acts of the 70th Legislature, 11-43 2nd Called Session, 1987 (Article 717k-8, Vernon's Texas Civil 11-44 Statutes). If a bond issued by the district contains a recital 11-45 that the bond is secured by a pledge of revenue derived from a 11-46 contract, a copy of the contract and the proceedings relating to 11-47 the contract may also be submitted to the attorney general. If the 11-48 attorney general finds that the bonds submitted for examination 11-49 under this subsection are authorized and that the contract was 11-50 entered into in accordance with the law, the attorney general shall 11-51 approve the bonds and, if submitted, the contract and the 11-52 comptroller shall register the bonds. If bonds and the contract 11-53 are approved by the attorney general and registered by the 11-54 comptroller, the bonds and the contract are incontestable in any 11-55 court or other forum for any reason and are valid and binding 11-56 obligations as provided by the terms of the obligation. 11-57 (b) The district may issue bonds and other obligations as 11-58 provided by Chapter 656, Acts of the 68th Legislature, Regular 11-59 Session, 1983 (Article 717q, Vernon's Texas Civil Statutes), and as 11-60 provided by the Bond Procedures Act of 1981 (Article 717k-6, 11-61 Vernon's Texas Civil Statutes). 11-62 ARTICLE 6. ADDING TERRITORY TO THE DISTRICT 11-63 SECTION 6.01. ADDITION OF MEMBER ENTITIES. (a) On receipt 11-64 of a petition submitted by the governing body of a local 11-65 government, other political subdivision, or private entity, 11-66 including a water supply corporation, the board may add a member 11-67 entity to the district as provided by this section. 11-68 (b) A petition must be submitted in the manner and form 11-69 required in the district bylaws. 12-1 (c) On receipt of a petition, the board shall give notice 12-2 and hold a hearing on the petition to determine if adding the 12-3 member entity to the district: 12-4 (1) will benefit the territory or service area within 12-5 the member entity; and 12-6 (2) is in the best interests of the district. 12-7 (d) If the board determines that the proposed member entity 12-8 should be added to the district, the board shall, subject to 12-9 Subsection (e) of this section, issue an order: 12-10 (1) adding the member entity and the territory or 12-11 service area of the member entity to the district; and 12-12 (2) making the member entity and the territory or 12-13 service area of the member entity subject to the privileges, 12-14 duties, assets, and financial obligations of the district in the 12-15 same manner as other member entities of the district. 12-16 (e) The board shall include in an order issued under 12-17 Subsection (d) of this section a requirement that the member entity 12-18 added to the district must reimburse the existing member entities 12-19 of the district, or directly reimburse the district, for the costs 12-20 incurred in creating and operating the district. Reimbursement 12-21 under this subsection must be an equitable pro rata share of the 12-22 costs paid by the existing member entities or the district. 12-23 SECTION 6.02. APPOINTMENT OF DIRECTORS BY NEW MEMBER ENTITY. 12-24 If the board issues an order under Subsection (d) of Section 6.01 12-25 of this article adding a member entity to the district, the 12-26 governing body of the member entity shall appoint the appropriate 12-27 number of directors to the board as provided by Subsection (g) of 12-28 Section 2.01 of this Act. 12-29 ARTICLE 7. MISCELLANEOUS PROVISIONS 12-30 SECTION 7.01. INITIAL DIRECTORS. (a) The governing bodies 12-31 of the City of Springtown and the Walnut Creek Special Utility 12-32 District shall, not later than the 30th day after the effective 12-33 date of this Act, appoint the appropriate number of initial 12-34 directors as required by Subsection (b) of Section 2.01 of this 12-35 Act. 12-36 (b) The Parker County judge, or the person designated by the 12-37 Parker County judge, shall begin serving as an ex officio director 12-38 as provided by Subsection (d) of Section 2.01 of this Act on the 12-39 effective date of this Act. 12-40 SECTION 7.02. FINDINGS RELATING TO PROCEDURAL REQUIREMENTS. 12-41 (a) The proper and legal notice of the intention to introduce this 12-42 Act, setting forth the general substance of this Act, has been 12-43 published as provided by law, and the notice and copy of this Act 12-44 have been furnished to all persons, agencies, officials, or 12-45 entities to which they are required to be furnished by the 12-46 constitution and other laws of this state, including the governor, 12-47 who has submitted the notice and Act to the Texas Natural Resource 12-48 Conservation Commission. 12-49 (b) The Texas Natural Resource Conservation Commission has 12-50 filed its recommendations relating to this Act with the governor, 12-51 lieutenant governor, and speaker of the house of representatives 12-52 within the required time. 12-53 (c) All requirements of the constitution and laws of this 12-54 state and the rules and procedures of the legislature with respect 12-55 to the notice, introduction, and passage of this Act are fulfilled 12-56 and accomplished. 12-57 SECTION 7.03. EMERGENCY. The importance of this legislation 12-58 and the crowded condition of the calendars in both houses create an 12-59 emergency and an imperative public necessity that the 12-60 constitutional rule requiring bills to be read on three several 12-61 days in each house be suspended, and this rule is hereby suspended, 12-62 and that this Act take effect and be in force from and after its 12-63 passage, and it is so enacted. 12-64 * * * * *