LEGISLATIVE BUDGET BOARD
                                   Austin, Texas
         
                                   FISCAL NOTE
                               75th Regular Session
         
                                  April 16, 1997
         
         
      TO: Honorable David Counts, Chair            IN RE:  House Bill No. 3554
          Committee on Natural Resources                              By: Pickett
          House
          Austin, Texas
         
         
         
         
         FROM:  John Keel, Director    
         
In response to your request for a Fiscal Note on HB3554 ( Relating 
to the inclusion of the territory of the Town of Clint in the 
Lower Valley Water District.) this office has detemined the 
following:
         
         Biennial Net Impact to General Revenue Funds by HB3554-As Introduced
         

No fiscal implication to the State is anticipated.
         

         
 
          
This bill would allow the Lower Valley Water District (LVWD) 
to annex the Town of Clint for water utility purposes.  The 
annexation would require the town to hold an election on the 
question of the assumption of LVWD s outstanding bonds, notes, 
taxes, or other obligations and voted but unissued bonds.  The 
bill calls for the LVWD to purchase the Clint water transmission 
line owned by Clint Independent School District (ISD) and whatever 
interest the Clint ISD owns in the water service and distribution 
facilities within the town.  The bill calls for existing water 
supply contracts and other contractual arrangements between 
Clint ISD and the City of El Paso's Water Utilities Public Service 
Board (PSB) to be terminated as of the date of annexation, to 
be replaced with an appropriate wholesale water supply contractual 
agreement between the LVWD and El Paso PSB to provide water 
to the annexed area.  The bill calls for the LVWD to complete 
the construction of the necessary facilities and have an adequate 
water capacity and pressure to provide the annexed territory 
with service in accordance with the regulatory requirements 
of the Texas Natural Resource Conservation Commission (TNRCC). 
 

An election on the question of annexation by the LVWD would 
be paid for by the Town of Clint.  The Town of Clint estimates 
such an election would cost $1,200 to $1,500.

It is estimated 
that LVWD would not experience any negative fiscal implications 
associated with assuming the Town of Clint's outstanding water 
system debt, since the Town currently has no such debt.  However, 
LVWD would be required to pay the Clint ISD for the water transmission 
line at a cost estimated at $50,000 to $100,000.  LVWD would 
consequently realize increased revenues from user fees, which 
could offset a portion of that cost. 

The Water Development 
Board estimates that the LVWD would be required to seek approximately 
$1 million in funds to implement service that meets TNRCC regulations 
within the Town of Clint.  If LVWD is required to issue bonds 
to raise these funds, all customers of the LVWD would contribute 
to the repayment of those bonds through user fees.  
          
   Source:            Agencies:   582   Natural Resources Conservation Commission
                                         580   Water Development Board
                                         304   Comptroller of Public Accounts
                                         
                      LBB Staff:   JK ,BB ,TL