By Danburg H.B. No. 2151
77R6889 CBH-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the authority of local governments to aggregate,
1-3 purchase, and sell energy and natural gas.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Chapter 303, Local Government Code, as added by
1-6 Chapter 405, Acts of the 76th Legislature, Regular Session, 1999,
1-7 is redesignated as Chapter 304, Local Government Code, and amended
1-8 to read as follows:
1-9 CHAPTER 304 [303]. ENERGY AND NATURAL GAS [AGGREGATION]
1-10 MEASURES FOR LOCAL GOVERNMENTS
1-11 Sec. 304.001 [303.001]. AGGREGATION, PURCHASE, AND OTHER
1-12 ACTIONS BY POLITICAL SUBDIVISIONS. (a) In this chapter, "political
1-13 subdivision" means a county, municipality, school district,
1-14 hospital district, special district, or any other political
1-15 subdivision [receiving electric service from an entity that has
1-16 implemented customer choice, as defined in Section 31.002,
1-17 Utilities Code].
1-18 (b) A political subdivision may join with another political
1-19 subdivision or subdivisions to form a political subdivision
1-20 corporation or corporations to:
1-21 (1) [act as an agent to] negotiate the purchase of
1-22 electricity, or [to] likewise aid or act on behalf of the political
1-23 subdivisions for which the corporation is created, with respect to
1-24 their own electricity use for their respective public facilities;
2-1 (2) negotiate the purchase of natural gas, or likewise
2-2 aid or act on behalf of the political subdivisions for which the
2-3 corporation is created, with respect to their own natural gas use
2-4 for their respective public facilities, in accordance with all
2-5 applicable laws and rules; and
2-6 (3) provide education and information services for the
2-7 political subdivisions for which the corporation is created,
2-8 including education and information related to:
2-9 (A) aggregation of electricity and natural gas;
2-10 (B) the purchase, sale, use, and management of
2-11 electricity and natural gas; and
2-12 (C) the operation of facilities dependent on
2-13 electricity or natural gas.
2-14 (c) The articles of incorporation and the bylaws of a
2-15 political subdivision corporation must be approved by ordinance,
2-16 resolution, or order adopted by the governing body of each
2-17 political subdivision for which the corporation is created.
2-18 (d) A political subdivision corporation may:
2-19 (1) negotiate on behalf of its incorporating political
2-20 subdivisions for the purchase of electricity;
2-21 (2) [,] make contracts for the purchase of
2-22 electricity[,] ;
2-23 (3) purchase electricity[,] ;
2-24 (4) obtain certification as a retail electric provider
2-25 in accordance with Section 39.352, Utilities Code, and related
2-26 rules adopted by the Public Utility Commission of Texas, and sell
2-27 electricity as a retail electric provider; and
3-1 (5) take any other action necessary to purchase or
3-2 sell electricity for use in the public facilities of the political
3-3 subdivision or subdivisions represented by the political
3-4 subdivision corporation.
3-5 (e) To the extent authorized by Subsection (f), a political
3-6 subdivision corporation may:
3-7 (1) negotiate on behalf of its incorporating political
3-8 subdivisions for the purchase of natural gas;
3-9 (2) make contracts for the purchase of natural gas;
3-10 (3) purchase natural gas; and
3-11 (4) take any other action necessary to purchase or
3-12 sell natural gas for use in the public facilities of the political
3-13 subdivision or subdivisions represented by the political
3-14 subdivision corporation.
3-15 (f) A political subdivision corporation may take an action
3-16 described by Subsection (e) only to the same extent its
3-17 incorporating political subdivisions have the authority to take
3-18 that action under other law. This section does not create new or
3-19 additional authority for an incorporating political subdivision to
3-20 take an action described by Subsection (e).
3-21 (g) In Subsections (d), (e), and (f):
3-22 (1) "Electricity" [this subsection, "electricity"]
3-23 means electric energy, capacity, energy services, ancillary
3-24 services, or other electric services for retail or wholesale
3-25 consumption by the political subdivisions.
3-26 (2) "Natural gas" means capacity, natural gas
3-27 services, ancillary services, or other natural gas services for
4-1 retail or wholesale consumption by the political subdivisions.
4-2 (h) [(e)] A political subdivision corporation may recover
4-3 the expenses of the political subdivision corporation through:
4-4 (1) the assessment of dues to the incorporating
4-5 political subdivisions;
4-6 (2) [or through] an aggregation fee charged per
4-7 kilowatt hour or charged according to any other appropriate formula
4-8 determined by the political subdivision corporation; or
4-9 (3) [, or] a combination of dues and an aggregation
4-10 fee [both].
4-11 (i) A political subdivision corporation may only aggregate
4-12 the purchasing of electricity for the facilities of political
4-13 subdivisions that receive electric service from an entity that has
4-14 implemented customer choice, as defined by Section 31.002,
4-15 Utilities Code.
4-16 (j) [(f)] A political subdivision corporation may appear on
4-17 behalf of its incorporating political subdivisions before the
4-18 Public Utility Commission of Texas, the Railroad Commission of
4-19 Texas, the Texas Natural Resource Conservation Commission, any
4-20 other governmental agency or regulatory authority, the Texas
4-21 Legislature, and the courts.
4-22 (k) [(g)] A political subdivision corporation has the powers
4-23 of a corporation created and incorporated pursuant to the
4-24 provisions of the Texas Non-Profit Corporation Act (Article
4-25 1396-1.01 et seq., Vernon's Texas Civil Statutes) and such other
4-26 powers as specified in Section 39.3545, Utilities Code.
4-27 (l) [(h)] The provisions of the Texas Non-Profit Corporation
5-1 Act (Article 1396-1.01 et seq., Vernon's Texas Civil Statutes)
5-2 relating to powers, standards of conduct, and interests in
5-3 contracts apply to the directors and officers of a political
5-4 subdivision corporation.
5-5 (m) [(i)] A member of the board of directors of a political
5-6 subdivision corporation:
5-7 (1) is not a public official by virtue of that
5-8 position; and
5-9 (2) unless otherwise ineligible, may be elected to
5-10 serve as an official of a political subdivision or be employed by a
5-11 political subdivision.
5-12 Sec. 304.002 [303.002]. AGGREGATION BY POLITICAL SUBDIVISION
5-13 FOR CITIZENS. (a) A political subdivision aggregator may negotiate
5-14 for the purchase of electricity and energy services on behalf of
5-15 the citizens of the political subdivision. The citizens must
5-16 affirmatively request to be included in the aggregation services by
5-17 the political subdivision aggregator.
5-18 (b) A political subdivision may contract with a third party
5-19 or another aggregator to administer the aggregation of electricity
5-20 and energy services purchased under Subsection (a).
5-21 (c) The political subdivision aggregator may use any mailing
5-22 from the subdivision to invite participation by its citizens.
5-23 SECTION 2. Section 39.354(b), Utilities Code, is amended to
5-24 read as follows:
5-25 (b) In this section, "municipal aggregator" means a person
5-26 authorized by two or more municipal governing bodies to join the
5-27 bodies into a single purchasing unit to negotiate the purchase of
6-1 electricity from retail electric providers or aggregation by a
6-2 municipality under Chapter 304 [303], Local Government Code.
6-3 SECTION 3. Section 39.3545(b), Utilities Code, is amended to
6-4 read as follows:
6-5 (b) In this section, "political subdivision aggregator"
6-6 means a person or political subdivision corporation authorized by
6-7 two or more political subdivision governing bodies to join the
6-8 bodies into a single purchasing unit or multiple purchasing units
6-9 to negotiate the purchase of electricity from retail electric
6-10 providers for the facilities of the aggregated political
6-11 subdivisions or aggregation by a person or political subdivision
6-12 under Chapter 304 [303], Local Government Code.
6-13 SECTION 4. This Act takes effect immediately if it receives
6-14 a vote of two-thirds of all the members elected to each house, as
6-15 provided by Section 39, Article III, Texas Constitution. If this
6-16 Act does not receive the vote necessary for immediate effect, this
6-17 Act takes effect September 1, 2001.