By Lewis of Orange                                     H.B. No. 622
         Line and page numbers may not match official copy.
         Bill not drafted by TLC or Senate E&E.
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to financing rural water projects in the State of Texas.
 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 new
 1-5     Subchapter O to read as follows:
 1-6              SUBCHAPTER O.  TEXAS RURAL WATER ASSISTANCE FUND.
 1-7           Sec. 15.901.  PURPOSE.  The legislature finds that the rural
 1-8     areas, characterized by small populations extended over
 1-9     disproportionately large service areas of the state, require a
1-10     means of financing water projects in addition to those established
1-11     by other provisions of this chapter.
1-12           Sec. 15.902.  DEFINITIONS.  In this subchapter:
1-13           (a)  "Federal agency" means any agency or other entity of the
1-14     United States, including the United States Department of
1-15     Agriculture or any agency or entity that is acting through or on
1-16     behalf of the United States Department of Agriculture.
1-17           (b)  "Fund" means the Rural Water Assistance Fund established
1-18     under this subchapter.
1-19           (c)  "Political subdivision" means any nonprofit water supply
1-20     or sewer service corporation, district or municipality with a
1-21     service area of 10,000 or less in population or which otherwise
1-22     qualifies for financing from a federal agency, or any county in
 2-1     which no urban area exceeds 50,000 in population.
 2-2           (d)  "State agency" means any agency or other entity of the
 2-3     State, including the Texas Department of Agriculture, the Texas
 2-4     Department of Housing and Community Affairs, or any agency or
 2-5     authority that is acting through or on behalf of the Texas
 2-6     Department of Agriculture or the Texas Department of Housing and
 2-7     Community Affairs.
 2-8           Sec. 15.903.  CREATION OF FUND. The fund consists of:
 2-9           (a)  money directly appropriated to the board;
2-10           (b)  repayment of principal and interest from loans made from
2-11     the fund;
2-12           (c)  money transferred by the board from any and all sources
2-13     available; and
2-14           (d)  interest earned on the investment of money in the fund.
2-15           Sec. 15.904.  USE OF FUND. (a)  The fund may be used to
2-16     provide low interest loans to political subdivisions for water or
2-17     water-related projects, including the purchase of well fields and
2-18     the purchase or lease of rights to produce groundwater, and interim
2-19     financing of construction projects.
2-20           (b)  The fund may be used to enable political subdivisions as
2-21     defined by this subchapter to obtain water supplied from larger
2-22     political subdivisions, or to finance the consolidation or
2-23     regionalizing of neighboring political subdivisions, or both.
2-24           (c)  The fund may be used to finance an outreach and
2-25     technical assistance program to assist political subdivisions in
2-26     obtaining assistance through the fund.  The board may use monies in
 3-1     the fund to contract for such outreach and technical assistance.
 3-2           (d)  The fund may be used to buy down interest rates on
 3-3     loans.
 3-4           (e)  A political subdivision may enter into an agreement with
 3-5     a federal agency or a state agency to submit a joint application
 3-6     for financial assistance under this subchapter.
 3-7           (f)  A nonprofit water supply or sewer service corporation is
 3-8     exempt from payment of any sales tax that may be incurred under
 3-9     other law or ordinance for any project financed by the fund.
3-10           Sec. 15.905. The board shall adopt necessary rules to
3-11     administer this subchapter, including rules establishing procedures
3-12     for application for and award of loans, distribution of loans,
3-13     investment of funds, and administration of loans and the fund.
3-14           SECTION 2.  Section 15.011, Subsection (b), Water Code, is
3-15     amended to read as follows:
3-16           (b)  After notice and hearing and subject to any limitations
3-17     established by the General Appropriations Act, the board may
3-18     transfer money from the fund to the loan fund created under
3-19     Subchapter C of this chapter, the storage acquisition fund created
3-20     under Subchapter E of this chapter, the research and planning fund
3-21     created under Subchapter F of this chapter, the hydrographic survey
3-22     account created under Subchapter M of this chapter, provided the
3-23     hydrographic survey account transfer does not exceed $425,000,
3-24     [and] the aquatic vegetation management fund created under
3-25     Subchapter N of this chapter[.], and the rural water assistance
3-26     fund created under Subchapter O of this chapter.
 4-1           SECTION 3.  This Act takes effect September 1, 2001.
 4-2           SECTION 4.  The importance of this legislation and the
 4-3     crowded condition of the calendars in both houses create an
 4-4     emergency and an imperative public necessity that the
 4-5     constitutional rule requiring bills to be read on three several
 4-6     days in each houses be suspended, and this rule is hereby
 4-7     suspended, and that this Act take effect and be in force according
 4-8     to its terms and it is so enacted.