By Lindsay S.B. No. 700 76R333 JJT-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to the creation, administration, powers, duties, 1-3 operation, and financing of the North Harris County Regional Water 1-4 Authority; granting the power of eminent domain and the authority 1-5 to issue bonds and to impose taxes; providing a civil penalty. 1-6 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-7 ARTICLE 1. GENERAL PROVISIONS 1-8 SECTION 1.01. CREATION. (a) A conservation and reclamation 1-9 district, to be known as the North Harris County Regional Water 1-10 Authority, is created in Harris County. The district is a 1-11 governmental agency and a body politic and corporate. 1-12 (b) The district is created under and is essential to 1-13 accomplish the purposes provided by Section 59, Article XVI, Texas 1-14 Constitution. 1-15 SECTION 1.02. DEFINITIONS. In this Act: 1-16 (1) "Board" means the board of directors of the 1-17 district. 1-18 (2) "Commission" means the Texas Natural Resource 1-19 Conservation Commission. 1-20 (3) "Director" means a member of the board. 1-21 (4) "District" means the North Harris County Regional 1-22 Water Authority. 1-23 (5) "Local government" means a municipality, county, 1-24 river authority, or water district or authority acting under 2-1 Section 52, Article III, or Section 59, Article XVI, Texas 2-2 Constitution. 2-3 (6) "Person" has the meaning assigned by Section 2-4 311.005, Government Code. 2-5 (7) "Subsidence district" means the Harris-Galveston 2-6 Coastal Subsidence District. 2-7 (8) "System" means a network of pipelines, conduits, 2-8 canals, pumping stations, force mains, treatment plants, and any 2-9 other construction, device, or related appurtenance used to treat 2-10 or transport water. 2-11 (9) "Water" includes: 2-12 (A) groundwater, percolating or otherwise; and 2-13 (B) any surface water, natural or artificial, 2-14 navigable or nonnavigable. 2-15 SECTION 1.03. DESCRIPTION OF BOUNDARIES. (a) Except as 2-16 provided by Subsections (b) and (c) of this section, the district 2-17 includes all the territory contained within the following area, 2-18 whether the territory contains noncontiguous parcels of land or 2-19 whether the territory is located within the boundaries of any other 2-20 governmental entity or political subdivision of the state: 2-21 BEGINNING at the intersection of the Harris and Waller County 2-22 line with the north right-of-way line of US Highway 290; 2-23 THENCE northwest along the Harris and Waller County line to 2-24 the intersection with Spring Creek; 2-25 THENCE continuing southeasterly along said Harris and Waller 2-26 County line, with the meanders of Spring Creek to the intersection 2-27 of the Waller and Montgomery County line; 3-1 THENCE southeasterly along the Harris and Montgomery County 3-2 line continuing with the meanders of said Spring Creek; to the 3-3 intersection with the City of Houston, corporate limits; 3-4 THENCE along said City of Houston corporate limits the 3-5 following: south approximately one half mile; east approximately 3-6 one half mile to the City of Humble corporate limits; north along 3-7 said City of Humble corporate limits approximately one half mile to 3-8 aforementioned Spring Creek; east along Spring Creek to its 3-9 confluence with the San Jacinto River to the intersection of US 3-10 Highway 59; easterly and southerly along the take line for Lake 3-11 Houston to the intersection with the southeasterly right-of-way of 3-12 the Union Pacific Railroad southwesterly along said Union Pacific 3-13 Railroad for approximately two miles; south to the north end of 3-14 Duessen Parkway; southeast along the east side of Duessen Parkway 3-15 and along the north side of the access road to the intersection 3-16 with North Lake Houston Parkway. 3-17 THENCE departing said City of Houston corporate limits, west 3-18 along the north side of said North Lake Houston Parkway to the 3-19 beginning of Mount Houston Road, and continuing west on Mount 3-20 Houston Road to the 6900 block to the intersection of Suburban; 3-21 THENCE south along Suburban to the City of Houston corporate 3-22 limits; 3-23 THENCE along said City of Houston corporate limits, the 3-24 following: west to Hirsch Road; south along the west side of 3-25 Hirsch Road to Langley; west along the south side of Langley to the 3-26 southbound feeder road of US Highway 59; northeast along the west 3-27 side of the feeder road of US Highway 59 to Little York; west along 4-1 the south side of Little York to Bentley; north along the east side 4-2 of Bentley to Sagebrush; west along the north side of Sagebrush to 4-3 Halls Bayou; south along Halls Bayou to Little York; west along the 4-4 south side of Little York to Aldine Westfield Road; north along the 4-5 east sides of Aldine Westfield Road to its intersection with the 4-6 easterly extension of the City of Houston corporate limits; west to 4-7 the Hardy Toll Road; north along the Hardy Toll Road approximately 4-8 0.25 mile, east approximately 0.35 mile, north approximately 0.15 4-9 mile, west approximately 0.35 mile; northwest along the Hardy Toll 4-10 Road approximately 1 mile; southwesterly along an irregular path 4-11 generally west to Carby; west along Carby to Airline Dr.; south 4-12 along Airline Dr. to Canino; west along Canino to Sweetwater; north 4-13 along Sweetwater to West Road; west to Interstate 45/US 75; south 4-14 along Interstate 45/US 75 to south of Bluebell Rd.; southerly along 4-15 an irregular path generally south and west to West Mount Houston 4-16 Rd.; west along Mount Houston Road to a line east of Ella 4-17 Boulevard; south along a line generally parallel to Ella Blvd. to 4-18 south of W. Gulf Bank; west along the south side of W. Gulf Bank to 4-19 Tomball Parkway; northwest along Tomball Parkway approximately 1.5 4-20 miles; west along an irregular path to N. Houston-Rosslyn Rd.; 4-21 north along N. Houston-Rosslyn Rd. to Vogel Creek; west along Vogel 4-22 Creek to the FWD CRIP RR; south along the FWD CRIP RR to Logview; 4-23 west along Logview to Hollister; south along Hollister to White Oak 4-24 Bayou; east along White Oak Bayou to Twisting Vine; south along 4-25 Twisting Vine to West Little York, west along West Little York to 4-26 Fairbanks N. Houston; south along Fairbanks N. Houston to Cole 4-27 Creek; west along Cole Creek to Hempstead Highway; northwest along 5-1 Hempstead Highway to West Sam Houston Parkway North. 5-2 THENCE departing said City of Houston corporate limits and 5-3 continuing northwest along Hempstead Highway to US 290 at Spencer 5-4 Road; 5-5 THENCE northwest along US 290 to the intersection of the 5-6 Harris and Waller County line, the POINT OF BEGINNING. 5-7 (b) The district does not include any area inside the 5-8 municipal limits of the city of Houston on the effective date of 5-9 this Act. 5-10 (c) On annexation of any part of the territory of the 5-11 district by a municipality or incorporation by a municipality of 5-12 any part of the territory of the district, the municipality shall 5-13 assume a pro rata share of all debt of the district payable in 5-14 whole or in part by ad valorem taxes. The percentage of the 5-15 assumption shall be determined by multiplying the total debt of the 5-16 district payable in whole or in part from taxes by a fraction, the 5-17 numerator of which is the assessed value of the property to be 5-18 annexed or incorporated based on the most recent certified county 5-19 property tax rolls at the time of annexation or incorporation and 5-20 the denominator of which is the total assessed value of the 5-21 property of the district based on the most recent certified county 5-22 property tax rolls at the time of annexation or incorporation. 5-23 After annexation by a municipality of a portion of the territory of 5-24 the district or incorporation over any part of the territory of the 5-25 district, the territory is no longer considered a part of the 5-26 district for any purpose and the district may not impose taxes on 5-27 that territory. 6-1 SECTION 1.04. EXCLUSION OF CERTAIN TERRITORY. (a) The 6-2 governing body of a political subdivision within the territory 6-3 described by Section 1.03 of this Act may request the subsidence 6-4 district to certify that water systems serving the political 6-5 subdivision are in compliance with the subsidence district's rules. 6-6 The subsidence district shall issue a letter granting or denying 6-7 certification not later than the 30th day after the date the 6-8 subsidence district receives the request for certification. 6-9 (b) The governing body of a political subdivision whose 6-10 water systems the subsidence district has certified under 6-11 Subsection (a) of this section by order may exclude from the 6-12 district the area inside the subdivision's territorial limits. 6-13 (c) An order issued under Subsection (b) of this section 6-14 must include an accurate description of the boundaries of the 6-15 excluded territory. 6-16 (d) The governing body of the political subdivision shall 6-17 file a copy of the order in the office of the county clerk of 6-18 Harris County and present a copy of the order to the board. On 6-19 receipt of the copy of the order, the board shall file with the 6-20 office of the county clerk of Harris County a description of the 6-21 district's boundaries after the territory is excluded. The county 6-22 clerk shall record the order and the description of the district's 6-23 boundaries in the county records. Immediately after the order and 6-24 description are recorded, the excluded territory is no longer a 6-25 part of the district. 6-26 (e) The exclusion of territory under this section does not 6-27 diminish or impair the rights of the holders of any outstanding and 7-1 unpaid bond or note of the district. The district shall continue 7-2 to impose taxes each year on the excluded territory at the same 7-3 rate imposed on other territory in the district and charge fees in 7-4 the excluded territory to the extent the tax or fee revenue is 7-5 pledged to pay an outstanding bond or note of the district. The 7-6 district shall apply taxes and fees collected under this subsection 7-7 only to the payment of the excluded territory's pro rata share of 7-8 the district's indebtedness at the time the territory was excluded. 7-9 At any time, the owner of all or part of the excluded territory may 7-10 pay in full the owner's share of the excluded territory's pro rata 7-11 share of the district's indebtedness and receive a corresponding 7-12 credit from the district. 7-13 SECTION 1.05. APPLICABILITY OF OTHER LAW. This Act prevails 7-14 over any inconsistent provision of general law. 7-15 SECTION 1.06. FINDING OF BENEFIT. All the land and other 7-16 property included within the boundaries of the district will be 7-17 benefited by the works and projects that are to be accomplished by 7-18 the district under powers conveyed by this Act. The district is 7-19 created to serve a public use and benefit. 7-20 ARTICLE 2. DIRECTORS 7-21 SECTION 2.01. BOARD OF DIRECTORS. (a) The district is 7-22 governed by a board of nine directors. 7-23 (b) A vacancy in the office of director shall be filled by 7-24 appointment of the board until the next election for directors. If 7-25 the position is not scheduled to be filled at the election, the 7-26 person elected to fill the position shall serve only for the 7-27 remainder of the unexpired term. 8-1 (c) To be eligible to serve as director, a person must be a 8-2 qualified voter in the voting district from which the person is 8-3 elected or appointed if representing a voting district or in the 8-4 district if representing the district at large. 8-5 SECTION 2.02. METHOD OF ELECTION OF DIRECTORS. (a) One 8-6 director shall be elected from each of nine single-member voting 8-7 districts by the qualified voters of the voting district. 8-8 (b) A person shall indicate on the person's application for 8-9 a place on the ballot the voting district that the person seeks to 8-10 represent. 8-11 (c) In the manner described by Section 49.103(d), Water 8-12 Code, the board shall redraw the single-member voting districts as 8-13 soon as practicable after: 8-14 (1) each federal decennial census; and 8-15 (2) any change in the district's boundaries. 8-16 (d) At the first election after each time the voting 8-17 districts are redrawn: 8-18 (1) nine new directors shall be elected to represent 8-19 the single-member voting districts; and 8-20 (2) the directors elected shall draw lots to determine 8-21 their terms so that: 8-22 (A) four directors serve two-year terms; and 8-23 (B) five directors serve four-year terms. 8-24 (e) Subchapter C, Chapter 146, Election Code, applies to the 8-25 consideration of votes for a write-in candidate for initial 8-26 permanent director or permanent director as if the district were a 8-27 municipality. 9-1 SECTION 2.03. SERVICE OF DIRECTORS. (a) Temporary 9-2 directors serve until the initial permanent directors are elected 9-3 under Section 2.05 of this Act. 9-4 (b) The initial permanent directors serve until permanent 9-5 directors are elected under Section 2.06 of this Act. 9-6 (c) Permanent directors serve staggered four-year terms. 9-7 (d) A director serves until the director's successor has 9-8 qualified. 9-9 SECTION 2.04. TEMPORARY DIRECTORS. (a) The temporary board 9-10 of directors is composed of three individuals appointed by the 9-11 commission. 9-12 (b) If a temporary director fails to qualify for office, the 9-13 temporary directors who have qualified shall appoint a person to 9-14 fill the vacancy. If at any time there are fewer than two 9-15 qualified temporary directors, or if the temporary directors cannot 9-16 agree on the appointment, the commission shall appoint the 9-17 necessary number of persons to fill all vacancies on the board. 9-18 (c) A temporary director is not eligible to be elected under 9-19 Section 2.05 of this Act. 9-20 SECTION 2.05. INITIAL PERMANENT DIRECTORS. (a) The 9-21 temporary board of directors shall: 9-22 (1) establish nine single-member voting districts in 9-23 the manner described by Section 49.103(d), Water Code; and 9-24 (2) on the third Saturday in January, 2000, hold an 9-25 election to elect nine initial permanent directors. 9-26 (b) A person who desires to be a candidate for the office of 9-27 initial permanent director may file an application with the 10-1 temporary board to have the candidate's name printed on the ballot. 10-2 (c) For the initial permanent directors' election, the 10-3 temporary board of directors shall have placed on the ballot: 10-4 (1) the name of each candidate filing for the office 10-5 of director; and 10-6 (2) blank spaces to write in the names of other 10-7 persons. 10-8 (d) As soon as practicable after the initial permanent 10-9 directors have qualified, the directors shall draw lots to 10-10 determine their terms so that: 10-11 (1) four directors serve terms that expire when 10-12 permanent directors are elected at the first election held under 10-13 Section 2.06 of this Act; and 10-14 (2) five directors serve terms that expire when 10-15 permanent directors are elected at the second election held under 10-16 Section 2.06 of this Act. 10-17 (e) Section 41.001(a), Election Code, does not apply to the 10-18 initial permanent directors' election held under this section. 10-19 SECTION 2.06. ELECTION DATES. On the third Saturday in 10-20 January in each subsequent even-numbered year, the appropriate 10-21 number of directors shall be elected to the board. 10-22 SECTION 2.07. COST OF ELECTION OF INITIAL PERMANENT 10-23 DIRECTORS. The temporary board of the district and the board of 10-24 directors of the subsidence district shall execute an agreement by 10-25 which: 10-26 (1) the subsidence district shall pay the costs of the 10-27 election under Section 2.05 of this Act; and 11-1 (2) the district shall repay the subsidence district 11-2 for those costs. 11-3 ARTICLE 3. ADMINISTRATIVE PROVISIONS 11-4 SECTION 3.01. MEETINGS AND ACTIONS OF BOARD. The board 11-5 shall meet at least four times each year and may meet at any other 11-6 time considered appropriate. 11-7 SECTION 3.02. EMPLOYEE BONDS. (a) Each employee or 11-8 contractor of the district who is charged with the collection, 11-9 custody, or payment of any money of the district shall execute a 11-10 fidelity bond in an amount determined by the board and in a form 11-11 and with a surety approved by the board. 11-12 (b) The district shall pay the premiums on any bonds 11-13 required under this section. 11-14 ARTICLE 4. POWERS AND DUTIES 11-15 SECTION 4.01. GENERAL POWERS AND DUTIES. (a) The district 11-16 may exercise all of the rights, powers, privileges, authority, 11-17 functions, and duties necessary and convenient to accomplish the 11-18 purposes of this Act, including those provided by Chapters 36 and 11-19 49, Water Code, except the following provisions of Chapter 36, 11-20 Water Code: 11-21 (1) Section 36.101; 11-22 (2) Section 36.116; and 11-23 (3) Section 36.205(c)(2). 11-24 (b) The district may not take any action under Section 11-25 36.113(e), Water Code, related to the control or prevention of 11-26 subsidence. 11-27 (c) The district may: 12-1 (1) provide for the conservation, preservation, 12-2 protection, recharge, and prevention of waste of groundwater, 12-3 groundwater reservoirs, or subdivisions of groundwater reservoirs 12-4 in a manner consistent with the purposes of Section 59, Article 12-5 XVI, Texas Constitution; 12-6 (2) provide for a water treatment or water supply 12-7 system to end subsidence in a manner consistent with Chapter 151, 12-8 Water Code; 12-9 (3) administer and enforce the provisions of this Act; 12-10 (4) coordinate water services provided inside of, 12-11 outside of, or into the district; 12-12 (5) contract for production, treatment, or supply of 12-13 water inside or outside of the district; and 12-14 (6) enter into interlocal contracts under Chapter 791, 12-15 Government Code. 12-16 (d) The district shall consult with the subsidence district 12-17 on any matter involving subsidence inside of the district's 12-18 boundaries. 12-19 (e) The rights, powers, privileges, authority, functions, 12-20 and duties of the district are subject to the continuing right of 12-21 supervision of the state to be as exercised by and through the 12-22 commission. 12-23 SECTION 4.02. DISTRICT RULES. (a) The district shall adopt 12-24 and enforce rules reasonably required to implement this Act, 12-25 including rules governing procedure and practice before the board. 12-26 (b) The district shall print its rules and furnish copies of 12-27 the rules to any person on written request. 13-1 SECTION 4.03. FEES AND CHARGES. (a) The district may 13-2 establish fees and charges necessary to enable the district to 13-3 fulfill the district's obligations under this Act. 13-4 (b) The district may establish fees to recover capital 13-5 expenditures as provided by Chapter 395, Local Government Code. 13-6 SECTION 4.04. INSPECTIONS AND INVESTIGATIONS. The district 13-7 may enter public or private property in the district to inspect or 13-8 investigate conditions relating to the district's authorized 13-9 purposes under the same provisions and restrictions applicable to 13-10 the commission under general law. 13-11 SECTION 4.05. HEARING AND ORDER. (a) The board may: 13-12 (1) hold hearings, receive evidence from a party in 13-13 interest who appears before the board, compel the attendance of 13-14 witnesses, and make findings of fact and determinations with 13-15 respect to administering this Act or any order or rule of the 13-16 district; and 13-17 (2) delegate to one or more of its members or 13-18 employees the authority to take testimony and administer oaths in a 13-19 hearing held or authorized to be held by the district. 13-20 (b) An order of the board must be: 13-21 (1) in the district's name; and 13-22 (2) attested by proper members of the board under the 13-23 district's rules. 13-24 SECTION 4.06. CIVIL PENALTY; INJUNCTION. (a) A person who 13-25 violates a rule, permit, or order of the district is subject to a 13-26 civil penalty of not less than $50 and not more than $5,000 for 13-27 each violation or each day of a continuing violation. 14-1 (b) The district may sue to recover the penalty in a 14-2 district court in the county where the violation occurred. The 14-3 penalty shall be paid to the district. 14-4 (c) The district may sue for injunctive relief in a district 14-5 court in the county where a violation of a district rule, permit, 14-6 or order occurs or is threatened to occur. The court may grant to 14-7 the district, without bond or other undertaking, a prohibitory or 14-8 mandatory injunction that the facts warrant, including a temporary 14-9 restraining order, temporary injunction, or permanent injunction. 14-10 (d) The district may sue for a civil penalty and injunctive 14-11 relief in the same proceeding. 14-12 SECTION 4.07. JUDICIAL REVIEW. (a) A rule, order, or other 14-13 official action of the district under this chapter may be appealed 14-14 to a district court in Harris County by any adversely affected 14-15 person. An appeal must be filed not later than the 45th day after 14-16 the date the rule is adopted, order is issued, or other action 14-17 takes effect. 14-18 (b) On written request of a person who resides or owns real 14-19 property in the district, the board shall make written findings of 14-20 fact and conclusions of law regarding a rule, order, or other 14-21 action of the district and provide a certified copy of the findings 14-22 and conclusions to the person not later than the 35th day after the 14-23 date the district receives the request. 14-24 (c) The review on appeal is under the substantial evidence 14-25 rule as described by Section 2001.174, Government Code. 14-26 SECTION 4.08. WATER SUPPLY PLANS. The district by rule 14-27 shall, as needed but not less frequently than every five years, 15-1 develop, prepare, revise, and adopt comprehensive water supply 15-2 plans for various areas of the district. The plans: 15-3 (1) must be consistent with standards adopted by the 15-4 commission; 15-5 (2) must be consistent with regional planning; and 15-6 (3) shall include 10-year, 20-year, and 50-year 15-7 projections of water needs within the district. 15-8 SECTION 4.09. ACQUISITION, CONSTRUCTION, AND OPERATION OF 15-9 SYSTEMS. The district may: 15-10 (1) acquire and provide by purchase, gift, or lease a 15-11 water treatment or supply system inside or outside of the district 15-12 boundaries; 15-13 (2) design, finance, or construct a water treatment or 15-14 supply system and provide wholesale water services inside or 15-15 outside of the district boundaries; 15-16 (3) operate, lease, or sell a water treatment or 15-17 supply system the district constructs or acquires; and 15-18 (4) contract with any person to operate or maintain a 15-19 water treatment or supply system the person owns. 15-20 SECTION 4.10. SYSTEM CONTRACTS. (a) The district may 15-21 contract to receive, treat, and supply water to or from any person 15-22 inside or outside the district. 15-23 (b) In a contract under this section, the district shall set 15-24 fees according to: 15-25 (1) the quality and quantity of the water; 15-26 (2) the difficulty in treating the water; 15-27 (3) operation and maintenance expenses and debt 16-1 retirement service costs; and 16-2 (4) any other reasonable consideration. 16-3 SECTION 4.11. SALE OR REUSE OF WATER OR BY-PRODUCT. The 16-4 district may store, sell, or reuse: 16-5 (1) water; or 16-6 (2) any by-product from the district's operation. 16-7 SECTION 4.12. EMINENT DOMAIN. The district may exercise the 16-8 power of eminent domain under Chapter 21, Property Code, to acquire 16-9 property of any kind to further authorized district purposes. The 16-10 district is not required to deposit a bond under Section 21.021(a), 16-11 Property Code. 16-12 SECTION 4.13. CONTRACTS. (a) The district may enter into a 16-13 contract with any person or legal entity regarding the performance 16-14 of any purpose or function of the district, including a contract to 16-15 jointly construct, finance, own, or operate works, improvements, 16-16 facilities, plants, equipment, or appliances necessary to 16-17 accomplish a purpose or function of the district. A contract may be 16-18 of unlimited duration. 16-19 (b) The district may purchase an interest in a project used 16-20 for a purpose or function of the district. 16-21 (c) The district may contract for: 16-22 (1) the purchase or sale of water; 16-23 (2) the performance of activities within the authority 16-24 of the district to promote the continuing and orderly development 16-25 of land and property in the district through the purchase, 16-26 construction, or installation of works, improvements, facilities, 16-27 plants, equipment, or appliances so that, to the greatest extent 17-1 possible considering sound engineering practices and economic 17-2 feasibility, all of the land and property in the district may 17-3 receive services of the works, improvements, facilities, plants, 17-4 equipment, or appliances of the district; or 17-5 (3) the conservation, ownership, maintenance, or 17-6 operation of any works, improvements, facilities, plants, 17-7 equipment, or appliances of the district or another person or legal 17-8 entity. 17-9 (d) The district may purchase surplus property from this 17-10 state, the United States, or another public entity through a 17-11 negotiated contract without bids. 17-12 (e) An officer, agent, or employee of the district who is 17-13 financially interested in a contract of the type described in 17-14 Subsection (d) of this section shall disclose the interest to the 17-15 board before the board votes on the acceptance of the contract. 17-16 (f) Notwithstanding any provision of a municipality's 17-17 charter, a contract between the district and the municipality is 17-18 not required to be submitted to the municipality's electorate. 17-19 SECTION 4.14. GIFTS AND GRANTS. The district may accept and 17-20 use a gift or grant from the subsidence district from money 17-21 collected by the subsidence district under Chapter 36, Water Code, 17-22 to fund a water treatment or supply system in the district. 17-23 ARTICLE 5. NOTES, BONDS, AND TAXATION 17-24 SECTION 5.01. REVENUE NOTES. (a) The board, without an 17-25 election, may borrow money on negotiable notes of the district to 17-26 be paid solely from the revenue derived from any source other than 17-27 ad valorem taxes, including: 18-1 (1) tolls, charges, and fees the district imposes; 18-2 (2) the sale of water, water or sewer services, or any 18-3 other service or product of the district; 18-4 (3) grants or gifts; 18-5 (4) the ownership and operation of all or a designated 18-6 part of the district's works, plants, improvements, facilities, or 18-7 equipment; and 18-8 (5) contracts between the district and any person, 18-9 including a local government. 18-10 (b) The notes may be first or subordinate lien notes at the 18-11 board's discretion. An obligation may not be a charge on the 18-12 property of the district or on taxes imposed by the district. An 18-13 obligation may only be a charge on revenue pledged for the payment 18-14 of the obligation. A tax imposed by the district may not be used 18-15 to pay any part of the obligation. 18-16 SECTION 5.02. BONDS. (a) To carry out a power or authority 18-17 conferred by this Act, the district may issue bonds secured by a 18-18 pledge of ad valorem taxes or of all or part of the revenue derived 18-19 from any source other than ad valorem taxes, including any source 18-20 described by Section 5.01(a) of this Act. 18-21 (b) In issuing or securing a bond or note of the district, 18-22 the district may exercise any power of an issuer under Chapter 656, 18-23 Acts of the 68th Legislature, Regular Session, 1983 (Article 717q, 18-24 Vernon's Texas Civil Statutes). 18-25 (c) The district may conduct a public, private, or 18-26 negotiated sale of the bonds. 18-27 (d) Bonds secured in whole or in part by taxes may not be 19-1 issued until authorized at an election called and held in 19-2 compliance with Section 36.180, Water Code. 19-3 (e) The district's bonds must: 19-4 (1) be authorized by board resolution; 19-5 (2) be issued in the district's name; 19-6 (3) be signed by the president or vice president of 19-7 the board, which may be accomplished by facsimile signature; 19-8 (4) be attested by the secretary of the board, which 19-9 may be accomplished by facsimile signature; and 19-10 (5) bear the district's seal or a facsimile seal. 19-11 (f) A district bond may be secured by an indenture of trust 19-12 with a corporate trustee. 19-13 (g) The district may issue bonds in more than one series as 19-14 required for carrying out the purposes of this Act. The district 19-15 may, in issuing bonds secured by the district's ad valorem taxes or 19-16 by revenue, reserve the right to issue additional bonds secured by 19-17 the district's ad valorem taxes or by revenue that are on a parity 19-18 with or are senior or subordinate to the bonds issued earlier. 19-19 (h) The resolution authorizing the bonds or the trust 19-20 indenture securing the bonds may specify additional provisions that 19-21 constitute a contract between the district and its bondholders. 19-22 The board may provide: 19-23 (1) for additional bond provisions; and 19-24 (2) for a corporate trustee or receiver to take 19-25 possession of the district's facilities if the district defaults. 19-26 (i) Sections 36.171 and 49.181, Water Code, do not apply to 19-27 bonds or notes issued by the district. 20-1 SECTION 5.03. REFUNDING BONDS. The provisions of this Act 20-2 that apply to the district's issuance of other bonds, their 20-3 security, and the remedies of the holders apply to refunding bonds. 20-4 SECTION 5.04. APPROVAL AND REGISTRATION OF BONDS. After the 20-5 district authorizes bonds, the district shall submit the bonds and 20-6 the record relating to their issuance to the attorney general for 20-7 approval. If the bonds are secured by a pledge of the proceeds of 20-8 a contract between the district and a municipality or other 20-9 governmental agency, authority, or district, the district shall 20-10 submit to the attorney general a copy of the contract and the 20-11 proceedings of the municipality or other governmental agency, 20-12 authority, or district authorizing the contract. If the attorney 20-13 general finds that the bonds have been authorized and each contract 20-14 has been made in accordance with the constitution and laws of this 20-15 state, the attorney general shall approve the bonds and contracts. 20-16 On approval, the bonds shall be registered by the comptroller. 20-17 SECTION 5.05. FUNDING BY OTHER CONSERVATION AND RECLAMATION 20-18 DISTRICTS. (a) The district shall develop a procedure for 20-19 cooperatively funding a district project with money from other 20-20 conservation and reclamation districts inside of the district's 20-21 boundaries if the district project fulfills a governmental purpose 20-22 of both districts. 20-23 (b) Not later than the 90th day before the date the district 20-24 issues bonds, other than refunding bonds, to finance a project, 20-25 the district shall provide written notice of the district's 20-26 intention to issue the bonds to each conservation and reclamation 20-27 district inside of the district's boundaries that may be benefited 21-1 or affected by the project. The notice must include the value of 21-2 the bonds planned to be issued, a description of the project the 21-3 bonds would finance, and a schedule of the portion of the project 21-4 costs financed by the bonds that may be allocated to each 21-5 conservation and reclamation district benefited or affected. The 21-6 schedule must be prepared by means of a formula certified by the 21-7 district engineer. 21-8 (c) A conservation or reclamation district may enter into a 21-9 contract with the district for the conservation and reclamation 21-10 district to finance a portion of the proposed project with the 21-11 conservation and reclamation district's resources instead of using 21-12 proceeds from district bonds for that purpose. The contract must 21-13 be executed before the district issues the bonds. If a contract is 21-14 executed under this section, the project may not be financed in any 21-15 part with bonds payable with revenue derived from ad valorem taxes. 21-16 As provided in the contract, the district must: 21-17 (1) reduce the value of the bond issuance to the 21-18 degree that the conservation and reclamation district provides 21-19 project funding; and 21-20 (2) credit the conservation and reclamation district 21-21 for its contribution to the project financing and adjust the 21-22 allocation of revenue pledged to the payment of the bonds so that 21-23 revenue from the conservation and reclamation district is not used 21-24 to service the bond debt or interest to a degree commensurate with 21-25 the contribution. 21-26 ARTICLE 6. COMPETITIVE PROPOSALS AND CONTRACTS 21-27 SECTION 6.01. PROPOSALS FOR CONTRACTS AND SERVICES 22-1 GENERALLY. The board is not required to solicit proposals for 22-2 contracts or services but may solicit proposals to further the 22-3 interests of the district. If the board elects to solicit 22-4 proposals, the board shall make the solicitation in accordance with 22-5 Subchapter B, Chapter 271, Local Government Code, except as 22-6 provided by this article. 22-7 SECTION 6.02. REQUESTS FOR PROPOSAL; NOTICE. The district 22-8 must solicit quotations through a request for proposal. Public 22-9 notice of the request for proposal: 22-10 (1) must include at least a general description of the 22-11 service or item to be purchased or constructed; and 22-12 (2) may request the submission of unpriced proposals. 22-13 SECTION 6.03. OPENING PROPOSALS AND PRICED BIDS. The board 22-14 or a person the board appoints shall open the proposals and solicit 22-15 priced bids from the persons whose proposals qualify under the 22-16 criteria stated in the solicitation for proposals. The 22-17 solicitation for priced bids must be mailed not later than the 22-18 seventh day after the date the proposals are opened. 22-19 SECTION 6.04. CONSIDERATION OF PRICED BIDS; AWARD. (a) The 22-20 board shall consider the priced bids in open session not later than 22-21 the 30th day after the date the proposals are opened under Section 22-22 6.03 of this Act. 22-23 (b) The board shall award the contract to the responsible 22-24 offeror whose bid is the lowest evaluated offer that results from 22-25 negotiation. 22-26 SECTION 6.05. PUBLIC INSPECTION OF BIDS AND PROPOSALS. The 22-27 board shall make all proposals and bids available for public 23-1 inspection after the board awards the contract. 23-2 SECTION 6.06. NEGOTIATION WITH BIDDERS. (a) In the manner 23-3 provided by the request for proposals and rules of the district, 23-4 the board may conduct discussions with a responsible offeror who 23-5 has submitted a priced bid that the board considers reasonably 23-6 likely to be selected for an award of the contract. 23-7 (b) The board shall give offerors fair and equal treatment 23-8 regarding opportunities for discussion and revisions of proposals. 23-9 (c) To obtain best and final offers, the board may allow 23-10 revisions of proposals or bids submitted under this article before 23-11 the contract is awarded. 23-12 SECTION 6.07. CONTRACT MODIFICATION. (a) At any time after 23-13 a contract is awarded under this article and before the contract is 23-14 executed, the board or a person the board appoints to make 23-15 purchases or act on the board's behalf may negotiate a modified 23-16 contract if the modification: 23-17 (1) is in the best interest of the district; and 23-18 (2) does not: 23-19 (A) substantially change the scope of the 23-20 contract; or 23-21 (B) cause a contract amount to exceed the amount 23-22 of the next lowest bid the board received. 23-23 (b) A modified contract may not take effect without the 23-24 approval of the board. 23-25 SECTION 6.08. CHANGE OF CONTRACT AMOUNT. (a) Except as 23-26 provided by Subsection (b) of this section, the board may grant an 23-27 employee of the district general authority to approve a change 24-1 order that involves an increase or decrease in contract costs of 24-2 $50,000 or less. 24-3 (b) The board or employee may not approve a change order 24-4 that would increase the contract price to an amount greater than 24-5 125 percent of the original contract price unless the change order 24-6 is necessary to comply with a federal or state statute, rule, 24-7 regulation, or administrative order, or with a judicial decision or 24-8 order, that was enacted, adopted, rendered, or issued after the 24-9 date the contract was executed. 24-10 (c) The board or employee may not approve a change order 24-11 that would decrease the contract price to an amount less than 82 24-12 percent of the original contract price without the consent of the 24-13 contractor. 24-14 SECTION 6.09. BID BOND. (a) The board may include in the 24-15 request for proposals or bid specifications a requirement that the 24-16 bidder provide a good and sufficient bid bond in the amount of five 24-17 percent of the total contract price if: 24-18 (1) the contract price exceeds $100,000; or 24-19 (2) the contract is for the construction of a public 24-20 work. 24-21 (b) A bid bond required under this section must be executed 24-22 with a surety company authorized to do business in this state. 24-23 SECTION 6.10. PERFORMANCE BOND. (a) The board may require 24-24 an offeror of a proposal or a bidder to provide a performance bond 24-25 to the district for the full amount of the contract if the contract 24-26 price exceeds $50,000. The bond must be provided before the 24-27 contract work begins and not later than the 30th day after the 25-1 date: 25-2 (1) the contract is executed; or 25-3 (2) a purchase order is issued. 25-4 (b) This section does not apply to a contract for which 25-5 Subchapter B, Chapter 2253, Government Code, requires a performance 25-6 bond. 25-7 ARTICLE 7. MISCELLANEOUS PROVISIONS 25-8 SECTION 7.01. FINDINGS RELATED TO PROCEDURAL REQUIREMENTS. 25-9 (a) The proper and legal notice of the intention to introduce this 25-10 Act, setting out the general substance of this Act, has been 25-11 published as provided by law, and the notice and a copy of this Act 25-12 have been furnished to all persons, agencies, officials, or 25-13 entities to which they are required to be furnished by the 25-14 constitution and other laws of this state, including the governor, 25-15 who has submitted the notice and the Act to the commission. 25-16 (b) The commission has filed its recommendations relating to 25-17 this Act with the governor, lieutenant governor, and speaker of the 25-18 house of representatives within the required time. 25-19 (c) All requirements of the constitution and laws of this 25-20 state and of the rules and procedures of the legislature with 25-21 respect to the notice, introduction, and passage of this Act are 25-22 fulfilled and accomplished. 25-23 SECTION 7.02. EMERGENCY. The importance of this legislation 25-24 and the crowded condition of the calendars in both houses create an 25-25 emergency and an imperative public necessity that the 25-26 constitutional rule requiring bills to be read on three several 25-27 days in each house be suspended, and this rule is hereby suspended, 26-1 and that this Act take effect and be in force from and after its 26-2 passage, and it is so enacted.