Amend CSSB 2 by adding te following article, numbered
appropriately, and renumbering subsequent articles and sections
accordingly:
ARTICLE ___. WATER UTILITY SYSTEMS
SECTION ____. Section 13.137, Water Code, is amended to read
as follows:
Sec. 13.137. OFFICE AND OTHER BUSINESS LOCATIONS OF UTILITY;
RECORDS; REMOVAL FROM STATE. (a) Every utility shall:
(1) make available and notify its customers of a
business location where its customers may make payments to prevent
disconnection of or to restore service:
(A) in each county in which the utility provides
service; or
(B) not more than 20 miles from the residence of
any residential customer if there is no location to receive
payments in the county; and
(2) have an office in a county of this state or in the
immediate area in which its property or some part of its property
is located in which it shall keep all books, accounts, records, and
memoranda required by the commission to be kept in this state.
(b) The commission by rule may provide for waiving the
requirements of Subsection (a)(1) for a utility for which meeting
those requirements would cause a rate increase or otherwise harm or
inconvenience customers. The rules must provide for an additional
14 days to be given for a customer to pay before a utility that is
granted a waiver may disconnect service for late payment.
(c) Books, accounts, records, or memoranda required by the
regulatory authority to be kept in the state may not be removed
from the state, except on conditions prescribed by the commission.
SECTION ____. Section 13.144, Water Code, is amended to read
as follows:
Sec. 13.144. NOTICE OF WHOLESALE WATER SUPPLY CONTRACT. A
district or authority created under Section 52, Article III, or
Section 59, Article XVI, Texas Constitution, a retail public
utility, a wholesale water service, or other person providing a
retail public utility with a wholesale water supply shall provide
the commission with a certified copy of any wholesale water supply
contract with a retail public utility within 30 days after the date
of the execution of the contract. The submission must include the
amount of water being supplied, term of the contract, consideration
being given for the water, purpose of use, location of use, source
of supply, point of delivery, limitations on the reuse of water, a
disclosure of any affiliated interest between the parties to the
contract, and any other condition or agreement relating to the
contract.
SECTION ____. Subchapter E, Chapter 13, Water Code, is
amended by adding Section 13.145 to read as follows:
Sec. 13.145. MULTIPLE SYSTEMS CONSOLIDATED UNDER TARIFF. A
utility may consolidate more than one system under a single tariff
only if:
(1) the systems under the tariff are substantially
similar in terms of facilities, quality of service, and cost of
service; and
(2) the tariff provides for rates that promote water
conservation for single-family residences and landscape irrigation.
SECTION ____. Section 13.182, Water Code, is amended to read
as follows:
Sec. 13.182. JUST AND REASONABLE RATES. (a) The regulatory
authority shall ensure that every rate made, demanded, or received
by any utility or by any two or more utilities jointly shall be
just and reasonable.
(b) Rates shall not be unreasonably preferential,
prejudicial, or discriminatory but shall be sufficient, equitable,
and consistent in application to each class of consumers.
(c) For ratemaking purposes, the commission may treat two or
more municipalities served by a utility as a single class wherever
the commission considers that treatment to be appropriate.
(d) The commission by rule shall establish a preference that
rates under a consolidated tariff be consolidated by region.
The regions under consolidated tariffs must be determined on a
case-by-case basis.
SECTION ____. Section 13.183, Water Code, is amended by
amending Subsection (c) and adding Subsections (d) and (e) to read
as follows:
(c) To ensure that retail customers receive a higher
quality, more affordable, or more reliable water or sewer service,
to encourage regionalization, or to maintain financially stable and
technically sound utilities, the regulatory authority, by rule or
ordinance, as appropriate, may adopt specific alternative
ratemaking <may develop> methodologies for water or sewer rates
based on factors other than rate of return and those specified in
Section 13.185. Overall revenues determined according <pursuant> to
an alternative ratemaking <alternate> methodology adopted
<developed> under this section must provide revenues to the utility
that satisfy the requirements of Subsection (a). The regulatory
authority may not approve rates under an alternative ratemaking
methodology unless the regulatory authority adopts the methodology
before the date the rate application was administratively complete.
(d) A regulatory authority other than the commission may not
approve an acquisition adjustment for a system purchased before the
effective date of an ordinance authorizing acquisition adjustments.
(e) In determining to use an alternative ratemaking
methodology <alternate ratemaking methodologies>, the regulatory
authority shall assure that rates, operations, and services are
just and reasonable to the consumers and to the utilities.
SECTION ____. Section 13.187, Water Code, is amended to read
as follows:
Sec. 13.187. STATEMENT OF INTENT TO CHANGE RATES; HEARING;
DETERMINATION OF RATE LEVEL. (a) A utility may not make changes in
its rates except by delivering a statement of intent to each
ratepayer and with the regulatory authority having original
jurisdiction at least 60 <30> days before the effective date of the
proposed change. The effective date of the new rates must be the
first day of a billing period, and the new rates may not apply to
service received before the effective date of the new rates. The
statement of intent must include:
(1) the information required by the regulatory
authority's rules;
(2) a billing comparison regarding the existing water
rate and the new water rate computed for the use of:
(A) 10,000 gallons of water; and
(B) 30,000 gallons of water; and
(3) a billing comparison regarding the existing sewer
rate and the new sewer rate computed for the use of 10,000 gallons,
unless the utility proposes a flat rate for sewer services.
(b) A copy of the statement of intent shall be mailed or
delivered to the appropriate offices of each affected municipality,
and to any other affected persons as required by the regulatory
authority's rules.
(c) When the statement of intent is delivered, the utility
shall file with the regulatory authority an application to change
rates. The application must include information the regulatory
authority requires by rule. If the utility fails to provide within
a reasonable time after the application is filed the necessary
documentation or other evidence that supports the costs and
expenses that are shown in the application, the regulatory
authority may disallow the nonsupported expenses.
(d) If the application or the statement of intent is not
substantially complete or does not comply with the regulatory
authority's rules, it may be rejected and the effective date of the
rate change may be suspended until a properly completed application
is accepted by the regulatory authority and a proper statement of
intent is provided. The commission may also suspend the effective
date of any rate change if the utility does not have a certificate
of public convenience and necessity or a completed application for
a certificate or to transfer a certificate pending before the
commission or if the utility is delinquent in paying the assessment
and any applicable penalties or interest required by Section
5.235(n) of this code.
(e) <(b)> If, before the 91st day <within 60 days> after the
effective date of the rate change, the regulatory authority
receives a complaint from any affected municipality, or from the
lesser of 1,000 or 10 percent of the ratepayers of the utility over
whose rates the regulatory authority has original jurisdiction, the
regulatory authority shall set the matter for hearing.
(f) The regulatory authority may set the matter for hearing
on its own motion at any time within 120 days after the effective
date of the rate change. If more than half of the ratepayers of
the utility receive service in a county with a population of more
than 2.5 million, the hearing must be held at a location in that
county.
(g) The hearing may be informal.
(h) If, after hearing, the regulatory authority finds the
rates currently being charged or those proposed to be charged are
unreasonable or in violation of law, the regulatory authority shall
determine the rates to be charged by the utility and shall fix the
rates by order served on the utility.
(i) <(c)> The regulatory authority, pending final action in
a rate proceeding, may order the utility to deposit all or part of
the rate increase received or to be received into an escrow account
with a financial institution approved by the regulatory authority.
Unless otherwise agreed to by the parties to the rate proceeding,
the utility shall refund or credit against future bills all sums
collected during the pendency of the rate proceeding in excess of
the rate finally ordered plus interest as determined by the
regulatory authority.
(j) For good cause shown, the regulatory authority may
authorize the release of funds to the utility from the escrow
account during the pendency of the proceeding.
(k) If the regulatory authority receives at least the number
of complaints from ratepayers required for the regulatory authority
to set a hearing under Subsection (e), the regulatory authority
may, pending the hearing and a decision, suspend the date the rate
change would otherwise be effective. The proposed rate may not be
suspended for longer than:
(1) 90 days by a local regulatory authority; or
(2) 150 days by the commission.
(l) At any time during the pendency of the rate proceeding
the regulatory authority may fix interim rates to remain in effect
until a final determination is made on the proposed rate.
(m) If the regulatory authority sets a final rate that is
higher than the interim rate, the utility shall be allowed to
collect the difference between the interim rate and final rate
unless otherwise agreed to by the parties to the rate proceeding.
(n) For good cause shown, the regulatory authority may at
any time during the proceeding require the utility to refund money
collected under a proposed rate before the rate was suspended or an
interim rate was established to the extent the proposed rate
exceeds the existing rate or the interim rate.
(o) If a <the> regulatory authority other than the
commission establishes interim rates or an escrow account, the
regulatory authority must make a final determination on the rates
not later than the first anniversary of <within 335 days after> the
effective date of the interim rates or escrowed rates or the rates
are automatically approved as requested by the utility.
(p) <(d)> Except to implement a rate adjustment provision
approved by the regulatory authority by rule or ordinance, as
applicable, or to adjust the rates of a newly acquired utility
system, a utility or two or more utilities under common control and
ownership may not file a statement of intent to increase its rates
more than once in a 12-month period, unless the regulatory
authority determines that a financial hardship exists. If the
regulatory authority requires the utility to deliver a corrected
statement of intent, the utility is not considered to be in
violation of the 12-month filing requirement.
SECTION ____. Subchapter I, Chapter 13, Water Code, is
amended by adding Section 13.343 to read as follows:
Sec. 13.343. WHOLESALE WATER CONTRACTS BETWEEN CERTAIN
AFFILIATES. (a) The owner of a utility that supplies retail water
service may not contract to purchase from an affiliated supplier
wholesale water service for any of that owner's systems unless:
(1) the wholesale service is provided for not more
than 90 days to remedy an emergency condition, as defined by
commission rule; or
(2) the executive director determines that the utility
cannot obtain wholesale water service from another source at a
lower cost than from the affiliate.
(b) The utility may not purchase groundwater from any
provider if:
(1) the source of the groundwater is located in a
priority groundwater management area; and
(2) a wholesale supply of surface water is available.
SECTION ____. (a) The changes in law made by this Act to
Chapter 13, Water Code, apply to a proceeding in which the Texas
Natural Resource Conservation Commission has not issued a final
order before the effective date of this Act.
(b) Section 13.343, Water Code, as added by this Act, does
not apply to a contract executed before the effective date of this
Act. A contract executed before the effective date of this Act is
governed by the law in effect on the date it was executed, and that
law is continued in effect for that purpose.