By Lewis of Orange, Geren H.B. No. 622
77R11625 E
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to financing rural water projects.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Chapter 15, Water Code, is amended by adding
1-5 Subchapter O to read as follows:
1-6 SUBCHAPTER O. RURAL WATER ASSISTANCE FUND
1-7 Sec. 15.901. DEFINITIONS. In this subchapter:
1-8 (1) Notwithstanding Section 15.001, "federal agency"
1-9 means the United States Department of Agriculture or an agency or
1-10 entity acting through or on behalf of the United States Department
1-11 of Agriculture.
1-12 (2) Notwithstanding Section 15.001, "fund" means the
1-13 rural water assistance fund established under this subchapter.
1-14 (3) "State agency" means an agency or other entity of
1-15 the state, including the Department of Agriculture, the Texas
1-16 Department of Housing and Community Affairs, or an agency or
1-17 authority acting through or on behalf of the Department of
1-18 Agriculture or the Texas Department of Housing and Community
1-19 Affairs.
1-20 Sec. 15.902. ELIGIBILITY FOR ASSISTANCE. The following
1-21 political subdivisions are eligible for assistance under this
1-22 subchapter:
1-23 (1) a nonprofit water supply or sewer service
1-24 corporation, district, or municipality that:
2-1 (A) has a water or sewer service area that has a
2-2 population of not more than 10,000; or
2-3 (B) qualifies for financing from a federal
2-4 agency; and
2-5 (2) a county that does not contain an urban area with
2-6 a population of more than 50,000.
2-7 Sec. 15.903. CREATION OF FUND. (a) The rural water
2-8 assistance fund is created in the state treasury.
2-9 (b) The fund consists of:
2-10 (1) money directly transferred to the fund;
2-11 (2) the repayment of principal and interest on loans
2-12 made from the fund not otherwise needed as a source of revenue
2-13 under Section 17.9611(b);
2-14 (3) money transferred to the fund by the board from
2-15 any available source; and
2-16 (4) interest earned on the investment of money in the
2-17 fund and depository interest allocable to the fund in the general
2-18 revenue fund.
2-19 (c) Sections 403.095 and 404.071, Government Code, do not
2-20 apply to the fund.
2-21 Sec. 15.904. USE OF FUND. The fund may be used only:
2-22 (1) to provide low-interest loans to eligible
2-23 political subdivisions for water or water-related projects,
2-24 including:
2-25 (A) the purchase of well fields;
2-26 (B) the purchase or lease of rights to produce
2-27 groundwater; and
3-1 (C) the interim financing of construction
3-2 projects;
3-3 (2) to enable eligible political subdivisions to
3-4 obtain water supplied from political subdivisions as defined by
3-5 Section 15.001;
3-6 (3) to finance the consolidation or regionalization of
3-7 water or water-related projects of neighboring eligible political
3-8 subdivisions;
3-9 (4) to contract for an outreach and technical
3-10 assistance program to assist eligible political subdivisions in
3-11 obtaining assistance through the fund;
3-12 (5) to refinance loans at lower interest rates; or
3-13 (6) as a source of revenue for the payment of
3-14 principal and interest on water financial assistance bonds issued
3-15 by the board if the proceeds of the sale of those bonds will be
3-16 deposited in the rural water assistance fund.
3-17 Sec. 15.905. JOINT APPLICATION. An eligible political
3-18 subdivision may enter into an agreement with a federal or state
3-19 agency to submit a joint application for financial assistance under
3-20 this subchapter.
3-21 Sec. 15.906. RULES. The board shall adopt necessary rules to
3-22 administer this subchapter, including rules establishing procedures
3-23 for application for and award of loans, distribution of loans,
3-24 investment of funds, and administration of loans and the fund.
3-25 Sec. 15.907. FINDINGS REGARDING APPLICANT'S WATER RIGHTS.
3-26 The board may not deliver funds to an applicant for financial
3-27 assistance until the executive administrator makes a written
4-1 finding that an applicant proposing:
4-2 (1) surface water development has the necessary water
4-3 rights authorizing the applicant to appropriate and use the water
4-4 that the project will provide; or
4-5 (2) underground water development has the right to use
4-6 water that the project will provide.
4-7 Sec. 15.908. CONSIDERATIONS IN REVIEWING APPLICATION. In
4-8 reviewing an application from a political subdivision for financial
4-9 assistance, the board shall consider:
4-10 (1) the needs of the area to be served by the project;
4-11 (2) the benefit of the project to the area;
4-12 (3) the relationship of the project to the overall
4-13 state water needs;
4-14 (4) the relationship of the project to the state water
4-15 plan; and
4-16 (5) the availability of revenue to the political
4-17 subdivision from all sources for the repayment of the cost,
4-18 including interest, of the water supply project.
4-19 Sec. 15.909. APPROVAL OF APPLICATION. (a) The board by
4-20 resolution may approve an application if, after considering the
4-21 factors listed in Section 15.908 and any other relevant factors,
4-22 the board finds:
4-23 (1) that the public interest is served by state
4-24 assistance to the project; and
4-25 (2) that the revenue or taxes pledged by the political
4-26 subdivision will be sufficient to meet all the obligations assumed
4-27 by the political subdivision during the succeeding period of not
5-1 more than 50 years.
5-2 (b) Before the board approves an application or provides any
5-3 financial assistance under an application, it shall require an
5-4 applicant to adopt or implement a program of water conservation for
5-5 the more efficient use of water in the manner provided by Section
5-6 15.106.
5-7 Sec. 15.910. CONSTRUCTION CONTRACT REQUIREMENTS. Sections
5-8 17.183-17.187 apply to the construction of projects funded under
5-9 this subchapter.
5-10 SECTION 2. Section 15.011(b), Water Code, is amended to read
5-11 as follows:
5-12 (b) After notice and hearing and subject to any limitations
5-13 established by the General Appropriations Act, the board may
5-14 transfer money from the fund to the loan fund created under
5-15 Subchapter C of this chapter, the storage acquisition fund created
5-16 under Subchapter E of this chapter, the research and planning fund
5-17 created under Subchapter F of this chapter, the hydrographic survey
5-18 account created under Subchapter M of this chapter, provided the
5-19 hydrographic survey account transfer does not exceed $425,000,
5-20 [and] the aquatic vegetation management fund created under
5-21 Subchapter N of this chapter, and the rural water assistance fund
5-22 created under Subchapter O of this chapter.
5-23 SECTION 3. Section 15.012(c), Water Code, is amended to read
5-24 as follows:
5-25 (c) Money appropriated to the fund by the legislature for a
5-26 specific purpose stated in Subchapter C, E, F, M, [or] N, or O of
5-27 this chapter shall be placed in the appropriate fund created by
6-1 that subchapter.
6-2 SECTION 4. Subchapter L, Chapter 17, Water Code, is amended
6-3 by adding Section 17.9611 to read as follows:
6-4 Sec. 17.9611. TRANSFERS TO RURAL WATER ASSISTANCE FUND. (a)
6-5 The board may direct the comptroller to transfer amounts from the
6-6 financial assistance account to the rural water assistance fund
6-7 created by Section 15.903 to provide financial assistance under
6-8 this subchapter for the purposes provided by Section 15.904.
6-9 (b) The board shall use the rural water assistance fund as a
6-10 source of revenue to be deposited in accordance with this
6-11 subchapter for the payment of principal and interest on water
6-12 financial assistance bonds issued by the board, the proceeds of
6-13 which are deposited in the rural water assistance fund, and to make
6-14 payments under a bond enhancement agreement with respect to
6-15 principal or interest on the water financial assistance bonds.
6-16 SECTION 5. Subchapter H, Chapter 151, Tax Code, is amended by
6-17 adding Section 151.3095 to read as follows:
6-18 Sec. 151.3095. PROJECTS FINANCED BY THE RURAL WATER
6-19 ASSISTANCE FUND. A taxable item sold, leased, or rented to or
6-20 stored, used, or consumed by a nonprofit water supply or sewer
6-21 service corporation for any project financed by the rural water
6-22 assistance fund created under Subchapter O, Chapter 15, Water Code,
6-23 is exempted from the taxes imposed by this chapter.
6-24 SECTION 6. This Act takes effect September 1, 2001.