SRC-MWN H.B. 3286 77(R)   BILL ANALYSIS


Senate Research Center   H.B. 3286
77R5926 DAK-DBy: Lewis, Ron (Brown, J. E. "Buster")
Natural Resources
4/28/2001
Engrossed


DIGEST AND PURPOSE 

Current law permits state and local governments, school districts, and
institutions of higher education to enter into performance contracts for
energy conservation projects, but does not specifically extend this to
water conservation projects. In a performance contract, a company enters
into an agreement with an entity such as a school district and provides
capital to pay for improvements that will result in reduced energy or water
use. The company is reimbursed out of the revenue stream based on
conservation savings. The benefit is that conservation improvements can be
done without having to issue debt instruments. H.B. 3286 authorizes state
and local entities, school districts, and institutions of higher education
to enter into a performance contract for water conservation measures to
reduce water consumption.  

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a
state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends the heading to Section 44.901, Education Code, to read as
follows: 

 Sec. 44.901. ENERGY OR WATER CONSERVATION MEASURES.

SECTION 2. Amends Sections 44.901(a)-(g), Education Code, as follows:

(a) Authorizes the board of trustees of a school district to enter into a
contract for energy or water conservation measures to reduce energy or
water consumption or operating costs of school facilities in accordance
with this section. 

(b) Provides that a contract to which this section applies includes a
contract for the installation of certain equipment. 

(c)  Requires all energy or water conservation measures to comply with
current local, state, and federal construction, plumbing, and environmental
codes and regulations. Requires a contract for energy or water conservation
measures, notwithstanding anything to the contrary in Subsection (b), to
not include improvements or equipment that allow or cause water from any
condensing, cooling, or industrial process or any system of nonpotable
usage over which the public water supply system officials do not have
sanitary control, to be returned to the potable water supply. 

(d)  Requires the person with whom the board contracts to be experienced in
the design, implementation, and installation of the energy or water
conservation measures addressed by the contract. 

  (e) Makes conforming changes.
 
  (f) Makes a conforming change.

(g)  Provides that if the term of a contract for energy or water
conservation measures exceeds one year, the school district's contractual
obligations in any one year during the term of the contract beginning after
the final date of installation is prohibited from exceeding the total
energy, water, wastewater, and operating cost savings, including but not
limited to electrical, gas, water, wastewater, or other utility cost
savings and operating cost savings resulting from automatic monitoring and
control as determined by the school district in this subsection, divided by
the number of years in the contract term. 

SECTION 3. Amends the heading to Section 51.927, Education Code, to me as
follows: 

 Sec. 51.927. ENERGY OR WATER CONSERVATION MEASURES.

SECTION 4. Amends Sections 51.927(a)-(h) and (l), Education Code, as
follows: 

 (a) Makes conforming changes.

(b) Provides that a contract to which this section applies includes a
contract for the installation of certain equipment. 

  (c) Makes conforming changes.

  (d) Requires the entity with whom the board contracts to be experienced
in the design, implementation, and installation of the energy or water
conservation measures addressed by the contract. 

  (e) Makes conforming changes.

  (f) Makes conforming changes.

  (g) Makes conforming changes.

  (h) Makes conforming changes.

(l) Requires the legislature to base an institution's appropriation for
energy, water, or wastewater costs during a fiscal year on certain sums. 

SECTION 5. Amends the heading to Chapter 302, Local Government Code, to
read as follows: 

 Chapter 302. ENERGY OR WATER CONSERVATION MEASURES 
FOR LOCAL GOVERNMENTS

SECTION 6. Amends Sections 302.001-302.004, Local Government Code, as
follows: 

 Sec. 302.001. DEFINITION. Defines "local government."

Sec. 302.002. New heading: ENERGY OR WATER CONSERVATION MEASURES. Makes
conforming changes. 

 Sec. 302.003. PAYMENT AND PERFORMANCE BOND. Makes conforming changes.

Sec. 302.004. METHOD OF FINANCING; TERMS OF CONTRACT. Makes conforming
changes. 
 
SECTION 7. Amends Section 2166.402, Government Code, as follows:

Sec. 2166.402. New heading: ENERGY OR WATER CONSERVATION STANDARDS FOR
ENTITIES OTHERWISE EXCLUDED FROM CHAPTER. 

(a) Requires the design standards to meet certain criteria. Makes a
conforming change. 

(b) Requires the state energy conservation office, rather than management
center of the governor's office, to assist a governing body of a state
agency, commission, or institution subject to Subsection (a) in preparing
energy conservation standards by providing technical assistance and advice. 

(c) Requires the Texas Water Development Board to assist the governing body
of a state agency, commission, or institution described by Subsection (a)
in preparing water conservation standards by providing technical assistance
and advice. 

SECTION 8. Amends the heading to Section 2166.406, Government Code, to read
as follows: 

 Sec. 2166.406. New heading: ENERGY OR WATER CONSERVATION MEASURES.

SECTION 9. Amends Sections 2166.406(a)-(h), (l), and (m), Government Code,
as follows: 

 (a)-(c). Makes conforming changes.

(d) Requires the entity with whom the board contracts to be experienced in
the design, implementation, and the installation of the energy or water
conservation measures addressed by the contract. 

  (e)-(i). Makes conforming changes.

(l) Authorizes the state to allow proposal revisions after submissions and
before the award of a contract for energy or water conservation measures. 

  (m) Makes conforming changes.

SECTION 10. Amends Chapter 447, Government Code, as follows:

CHAPTER 447. New heading: STATE ENERGY CONSERVATION OFFICE

Sec. 447.001. New heading: ESTABLISHMENT OF OFFICE. Makes conforming
changes. 

Sec. 447.002. INFORMATION; RULES; PROGRAMS. Authorizes the office, rather
than center, to make rules relating to the adoption and implementation of
energy and water conservation programs applicable to state buildings and
facilities. Authorizes the office's, rather than center's, rules for
programs and energy and water conservation, adopted under Chapter 2001, to
include provisions relating to the retrofitting of existing state
structures with energysaving and water-saving devices and to the
energy-related renovation of such structures. Requires the state energy
conservation office to coordinate all water conservation-related activities
with the Texas Water Development Board.  Requires the Texas Water
Development Board to evaluate and help develop all proposed water
conservation and reuse requirements and provide training and expertise to
the staff of the state energy conservation office regarding water
conservation issues. Makes conforming changes. 

Sec. 447.003. LIAISON TO FEDERAL GOVERNMENT. Makes conforming changes.
Deletes text regarding the National Energy Extension Service Act. 
 
 Sec. 447.004. DESIGN STANDARDS. (a)-(b) Make conforming changes.

  (c) Requires the procedural standards to concern certain issues.

  (d)-(e) Make conforming changes.

Sec. 447.005. New heading: ENERGY AND WATER EFFICIENCY PROJECTS. Makes
conforming changes. 

 Sec. 447.006. OBTAINING DATA. Makes conforming changes.

 Sec. 447.007. MODEL CODES. Makes conforming changes.

Sec. 447.008. ADDITIONAL ENERGY OR WATER SERVICES. (a) Authorizes the state
energy conservation office, rather than management center, to provide
additional energy and water services, including certain assistance or
training. 

 (b)-(h) Make conforming changes.

Sec. 447.009. New heading: ENERGY AND WATER AUDITS. Makes conforming
changes. 

Sec. 447.010. New heading: ENERGY-SAVING AND WATER-SAVING DEVICES OR
MEASURES. Makes conforming changes. 

Sec. 447.011. New heading: ENERGY AND WATER MANAGEMENT PLANNING. Makes
conforming changes. 

SECTION 11. Effective date: September 1, 2001.