By McReynolds H.B. No. 2571 A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to the creation, administration, powers, duties, 1-3 operation, and financing of the Angelina County Water Control and 1-4 Improvement District No. 4; authorizing the imposition of taxes and 1-5 the issuance of bonds and granting the power of eminent domain; 1-6 providing a civil penalty. 1-7 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-8 ARTICLE 1. GENERAL PROVISIONS 1-9 SECTION 1.01. CREATION. (a) A conservation and reclamation 1-10 district, to be known as the Angelina County Water Control and 1-11 Improvement District No. 4, is created in Angelina County, subject 1-12 to approval at a confirmation election under Section 2.03 of this 1-13 Act. The district is a governmental agency and a body politic and 1-14 corporate. 1-15 (b) The district is created under and is essential to 1-16 accomplish the purposes of Section 59, Article XVI, Texas 1-17 Constitution. 1-18 SECTION 1.02. DEFINITIONS. In this Act: 1-19 (1) "Board" means the board of directors of the 1-20 district. 1-21 (2) "Commission" means the Texas Natural Resource 1-22 Conservation Commission. 1-23 (3) "Director" means a member of the board. 1-24 (4) "Disposal system" means any system for disposing 2-1 of waste, including a sewer system, drainage system, or treatment 2-2 facility. 2-3 (5) "District" means the Angelina County Water Control 2-4 and Improvement District No. 4. 2-5 (6) "Local government" means a municipality, county, 2-6 river authority, or water district or authority acting under 2-7 Section 52, Article III, or Section 59, Article XVI, Texas 2-8 Constitution. 2-9 (7) "Person" has the meaning assigned by Section 2-10 311.005, Government Code. 2-11 (8) "Pollution" has the meaning assigned by Section 2-12 26.001, Water Code. 2-13 (9) "System" means a network of pipelines, conduits, 2-14 canals, pumping stations, force mains, and all other constructions, 2-15 devices, and related appliances used to transport water or waste. 2-16 (10) "Treatment facility" means a plant, disposal 2-17 field, lagoon, incinerator, sanitary landfill, or other facility 2-18 installed for the purpose of treating, neutralizing, or stabilizing 2-19 waste. 2-20 (11) "Waste" means waterborne liquid, gaseous, or 2-21 solid substances that result from a discharge from a treatment 2-22 facility or disposal system. 2-23 (12) "Water" means groundwater, percolating or 2-24 otherwise, and a lake, pond, impounding reservoir, spring, river, 2-25 stream, creek, canal, or any other surface water, natural or 2-26 artificial, navigable or nonnavigable, that is wholly or partially 2-27 in the district. 3-1 SECTION 1.03. BOUNDARIES. The boundaries of the district are 3-2 as follows: 3-3 BEING all that certain tract or parcel of land lying and 3-4 situated in Angelina County, Texas, out of the D. LEONE 3-5 SURVEY, ABSTRACT NO. 23 and the T. QUEVADO SURVEY, ABSTRACT 3-6 NO. 39 and being described as follows, to-wit: 3-7 BEGINNING at the Northeast corner of WILDWOOD ADDITION, a 3-8 subdivision of record in Cabinet A on Slide 140-B of the Map 3-9 and Plat Records of Angelina County, Texas, and the Northeast 3-10 corner of that certain 17 acre tract described in a deed from 3-11 Bess M. Auld, et al to Arthur M. White, et ux dated January 3-12 3, 1972 and recorded in Volume 384 on Page 71 of the Deed 3-13 Records of Angelina County, Texas, a point for corner in the 3-14 South boundary line of that certain 671.4 acre tract 3-15 described in a deed from Charles M. Raguet to Southern Pine 3-16 Lumber Company dated March 22, 1900 and Recorded in Volume 3 3-17 on Page 428 of the Deed Records of Angelina County, Texas; 3-18 THENCE Westerly with the North boundary line of the said 3-19 WILDWOOD ADDITION, the North boundary line of the said 17 3-20 acre tract, the North boundary line of that certain 54.8 acre 3-21 tract described in a contract of sale and purchase from the 3-22 Veterans' Land Board of Texas to Arthur M. White dated 3-23 February 16, 1950 and recorded in Volume 149 on Page 43 of 3-24 the Deed Records of Angelina County, Texas, and with the 3-25 South boundary line of the said 671.4 acre tract, continuing 3-26 to the Southeast corner of the proposed W.W.T.P. site (to be 3-27 conveyed by Temple-Inland Forest Products Corporation), a 4-1 point for corner; 4-2 THENCE Northerly with the East boundary line of the said 4-3 proposed W.W.T.P. site, continuing to the Northeast corner of 4-4 the said proposed W.W.T.P. site, a point for corner; 4-5 THENCE Westerly with the North boundary line of the said 4-6 proposed W.W.T.P. site, continuing to the Northwest corner of 4-7 the said proposed W.W.T.P. site, a point for corner; 4-8 THENCE Southerly with the West boundary line of the said 4-9 proposed W.W.T.P. site, continuing to the Southwest corner of 4-10 the said proposed W.W.T.P. site, a point for corner in the 4-11 South boundary line of the aforesaid 671.4 acre tract; 4-12 THENCE Easterly with the South boundary line of the said 4-13 671.4 acre tract, continuing to the Northwest corner of the 4-14 aforesaid 54.8 acre tract and the Northwest corner of that 4-15 certain 5.10 acre tract described in a deed from Arthur M. 4-16 White, et ux to Edward M. Hurd, et ux dated January 2, 1976 4-17 and recorded in Volume 434 on Page 116 of the Deed Records of 4-18 Angelina County, a point for corner; 4-19 THENCE Southerly with the West boundary line of the said 54.8 4-20 acre tract, the West boundary line of the said 5.10 acre Gary 4-21 D. Selman tract, and the West boundary line of that certain 4-22 0.273 acre tract described in a deed from Tom Gann And 4-23 Associates, Inc. to Edward M. Hurd, et ux dated November 24, 4-24 1986 and recorded in volume 660 on Page 713 of the Real 4-25 Property Records of Angelina County, continuing to the 4-26 Southwest corner of the said 0.273 acre tract, a point for 4-27 corner in the Northwest margin of County Road No. 65 5-1 (Burkhalter Hollow); 5-2 THENCE Northeasterly with the Southeast boundary line of the 5-3 said 0.273 acre tract and the Northwest margin of the said 5-4 County Road No. 65 (Burkhalter Hollow), continuing to the 5-5 Northeast corner of the said 0.273 tract, a point for corner 5-6 in the South boundary line of the aforesaid 54.8 acre tract; 5-7 THENCE Easterly with the South boundary line of the said 54.8 5-8 acre tract, the South boundary line of the aforesaid 17 acre 5-9 tract, the South boundary line of the aforesaid WILDWOOD 5-10 ADDITION, and the North margin of the said County Road No. 65 5-11 (Burkhalter Hollow), continuing to the Southeast corner of 5-12 the said 17 acre tract and the Southeast corner of the said 5-13 WILDWOOD ADDITION, a point for corner; 5-14 THENCE Northerly with the East boundary line of the said 17 5-15 acre tract and the East boundary line of the said WILDWOOD 5-16 ADDITION, continuing to the point and place of beginning. 5-17 SECTION 1.04. FINDINGS RELATIVE TO BOUNDARIES. The 5-18 legislature finds that the boundaries and field notes of the 5-19 district form a closure. A mistake in the field notes or in copying 5-20 the field notes in the legislative process does not affect the 5-21 organization, existence, or validity of the district, the right of 5-22 the district to issue or refund bonds or to pay the principal of or 5-23 interest on bonds, the right of the district to levy and collect 5-24 taxes, or the legality or operation of the district or its board. 5-25 SECTION 1.05. FINDING OF BENEFIT. All of the land and other 5-26 property included within the boundaries of the district will be 5-27 benefited by the works and projects that are to be accomplished by 6-1 the district under powers conferred by this Act. The district is 6-2 created to serve a public use and benefit. 6-3 ARTICLE 2. ADMINISTRATIVE PROVISIONS 6-4 SECTION 2.01. BOARD OF DIRECTORS. (a) The district's 6-5 powers, rights, duties, and functions are exercised by a board of 6-6 five directors. 6-7 (b) Temporary directors serve until initial directors are 6-8 elected under Section 2.03 of this Act. 6-9 (c) Initial directors serve until permanent directors are 6-10 elected under Section 2.04 of this Act. 6-11 (d) Permanent directors serve staggered four-year terms. 6-12 (e) To be eligible to serve as a director, a person must be 6-13 a resident of Angelina County and reside in the district. 6-14 (f) Each director must qualify to serve as director under 6-15 Sections 49.052 and 49.055, Water Code. The district shall pay the 6-16 premiums for each director's bond required under Section 49.055, 6-17 Water Code. 6-18 (g) A director serves until the director's successor has 6-19 qualified. 6-20 (h) When a director dies, resigns, or is otherwise removed, 6-21 the governor shall appoint a successor to serve for the unexpired 6-22 term. 6-23 SECTION 2.02. TEMPORARY DIRECTORS. (a) The temporary board 6-24 of directors consists of: 6-25 1. Jaime Gonzalez 6-26 2. Josephina Perez 6-27 3. Julia Esteves 7-1 4. Jose Perez 7-2 5. Tomas Fuentes 7-3 (b) If a temporary director fails to qualify for office, the 7-4 temporary directors who have qualified shall appoint a person to 7-5 fill the vacancy. If at any time there are fewer than three 7-6 qualified temporary directors, the governor shall appoint the 7-7 necessary number of persons to fill all vacancies on the board. 7-8 SECTION 2.03. CONFIRMATION AND INITIAL DIRECTORS' ELECTION. 7-9 (a) The temporary board of directors shall hold an organizational 7-10 meeting of the district and take office at that time. The directors 7-11 shall hold the meeting at a location to which a majority of the 7-12 directors agree. 7-13 (b) The temporary board of directors shall call and hold an 7-14 election to confirm establishment of the district and to elect 7-15 initial directors. 7-16 (c) At the confirmation and initial directors' election, the 7-17 temporary board of directors shall have placed on the ballot the 7-18 name of any candidate filing for an initial director's position and 7-19 blank spaces to write in the names of other persons. A temporary 7-20 director who is qualified to be a candidate under Section 2.01 of 7-21 this Act may file for an initial director's position. 7-22 (d) Section 41.001(a), Election Code, does not apply to a 7-23 confirmation and initial directors' election held as provided by 7-24 this section. 7-25 (e) Except as provided by this section, a confirmation and 7-26 initial directors' election must be conducted as provided by 7-27 Sections 49.102(a)-(g), Water Code, and the Election Code. 8-1 SECTION 2.04. ELECTION OF DIRECTORS. (a) On a uniform 8-2 election date, as provided by Section 41.001, Election Code, 8-3 selected by the initial directors, of the first even-numbered year 8-4 after the year in which the district is authorized to be created at 8-5 a confirmation election, an election shall be held in the district 8-6 for the election of three directors to serve four-year terms and 8-7 two directors to serve two-year terms. 8-8 (b) On the uniform election date selected under Subsection 8-9 (a) of this section of each subsequent second year following the 8-10 election, the appropriate number of directors shall be elected. 8-11 SECTION 2.05. MEETINGS AND ACTIONS OF THE BOARD. (a) The 8-12 board shall adopt bylaws at its first meeting or as soon after the 8-13 first meeting as is practicable. 8-14 (b) The board shall meet at least four times each year and 8-15 may meet at any other time provided in its bylaws. 8-16 (c) A majority of the directors constitutes a quorum for the 8-17 transaction of business. Except as otherwise provided in this Act, 8-18 the vote of a majority of directors present at a meeting at which a 8-19 quorum is present is required for board action. 8-20 SECTION 2.06. ORGANIZATION OF BOARD. (a) The board shall 8-21 elect from its members a president, vice president, secretary, 8-22 treasurer, and other officers as necessary. An officer's period of 8-23 service begins at a time provided by the bylaws. 8-24 (b) If a vacancy occurs in a board office, the board shall 8-25 elect one of its members to fill the unexpired period of service at 8-26 the next board meeting. 8-27 (c) The board by its bylaws shall prescribe: 9-1 (1) the powers and duties of each board office; and 9-2 (2) procedures to remove a director from a board 9-3 office. 9-4 SECTION 2.07. INTEREST IN CONTRACT. A director who is 9-5 financially interested in a contract proposed to be executed by the 9-6 district for the purchase of property or services or the 9-7 construction of facilities shall disclose the interest to the board 9-8 and may not vote on acceptance of the contract. 9-9 SECTION 2.08. DIRECTORS' COMPENSATION. (a) Subject to 9-10 Subsection (b) of this section, a director is entitled to receive 9-11 an allowance of $50 a day and reimbursement for actual and 9-12 necessary expenses incurred: 9-13 (1) for each day the director attends a meeting of the 9-14 board; and 9-15 (2) for each day the board authorizes the director to 9-16 attend to district business. 9-17 (b) A director may not receive a per diem allowance for more 9-18 than 20 days in a calendar year. 9-19 SECTION 2.09. GENERAL MANAGER. (a) The board may employ a 9-20 general manager for a term and salary set by the board. 9-21 (b) The general manager is the chief executive officer of 9-22 the district. In accordance with policies adopted by the board, the 9-23 general manager is responsible for: 9-24 (1) administering the board's directives; 9-25 (2) keeping the district's records, including minutes 9-26 of board meetings; 9-27 (3) coordinating with state, federal, and local 10-1 agencies; 10-2 (4) developing plans and programs for the board's 10-3 approval; 10-4 (5) hiring, supervising, training, and discharging the 10-5 district's employees; 10-6 (6) obtaining technical, scientific, legal, fiscal, 10-7 and other professional services; and 10-8 (7) performing any other duties the board assigns. 10-9 (c) The board may discharge the general manager. 10-10 (d) Instead of employing a general manager, the district may 10-11 contract with a local government for the services required by the 10-12 district. 10-13 SECTION 2.10. EMPLOYEE BONDS. (a) The general manager and 10-14 each employee of the district who is charged with the collection, 10-15 custody, or payment of any money of the district shall execute a 10-16 fidelity bond in an amount determined by the board and in a form 10-17 and with a surety approved by the board. 10-18 (b) The district shall pay the premiums on the employees' 10-19 bonds under this section. 10-20 SECTION 2.11. PRINCIPAL OFFICE. The district shall maintain 10-21 its principal office at any place in Angelina County designated by 10-22 the board. 10-23 SECTION 2.12. RECORDS. (a) The district shall keep: 10-24 (1) complete and accurate accounts of its business 10-25 transactions in accordance with generally accepted methods of 10-26 accounting; and 10-27 (2) complete and accurate minutes of its meetings. 11-1 (b) The district shall store its accounts, contracts, 11-2 documents, minutes, and other records at its principal office. 11-3 (c) The district shall permit reasonable public inspection 11-4 of its records during regular business hours. 11-5 SECTION 2.13. SEAL. The district shall adopt a seal and may 11-6 change the seal from time to time. 11-7 SECTION 2.14. SUIT. The district may sue and be sued in its 11-8 corporate name. 11-9 ARTICLE 3. POWERS AND DUTIES 11-10 SECTION 3.01. GENERAL POWERS AND DUTIES. (a) The district 11-11 shall: 11-12 (1) administer and enforce the terms of this Act; 11-13 (2) use its facilities and powers to accomplish the 11-14 purposes of this Act; 11-15 (3) coordinate the provision of water, wastewater, and 11-16 drainage services in the district; and 11-17 (4) control and abate water pollution in the district. 11-18 (b) Subject only to the authority of the commission, the 11-19 district has exclusive authority in the district, superseding the 11-20 authority of any local government, to: 11-21 (1) regulate septic tanks; 11-22 (2) coordinate the provision of water, wastewater, or 11-23 drainage services within, to, or from the district; and 11-24 (3) control or abate water pollution within or caused 11-25 within the district. 11-26 (c) Except as expressly limited by this Act, the district 11-27 has all powers, rights, and privileges necessary and convenient for 12-1 accomplishing the purposes of this Act that are conferred by 12-2 general law upon any conservation and reclamation district created 12-3 pursuant to Section 59, Article XVI, Texas Constitution. 12-4 (d) The powers granted to the district in this Act are 12-5 cumulative of all powers granted by other law. 12-6 SECTION 3.02. DISTRICT RULES. (a) The district shall adopt 12-7 and enforce rules reasonably required to implement this Act, 12-8 including rules governing procedure and practice before the board. 12-9 (b) The district shall print its rules and furnish copies of 12-10 the rules to any person on written request. 12-11 SECTION 3.03. INSPECTIONS AND INVESTIGATIONS. The district 12-12 may enter public or private property in the district's territory 12-13 for the purpose of inspecting and investigating conditions relating 12-14 to its authorized purposes under the same provisions and 12-15 restrictions applicable to the commission. 12-16 SECTION 3.04. CIVIL PENALTY; INJUNCTION. (a) A person who 12-17 violates a rule, permit, or order of the district is subject to a 12-18 civil penalty of not less than $50 and not more than $1,000 for 12-19 each violation or each day of a continuing violation. 12-20 (b) The district may sue to recover the penalty in a 12-21 district court in the county where the violation occurred. The 12-22 penalty shall be paid to the district. 12-23 (c) The district may sue for injunctive relief in a district 12-24 court in the county where a violation of its rule, permit, or order 12-25 occurs or is threatened to occur. The court may grant to the 12-26 district, without bond or other undertaking, a prohibitory or 12-27 mandatory injunction that the facts warrant, including a temporary 13-1 restraining order, temporary injunction, or permanent injunction. 13-2 (d) The district may sue for injunctive relief and a civil 13-3 penalty in the same proceeding. 13-4 (e) The commission is a necessary party to a suit brought 13-5 under this section. 13-6 SECTION 3.05. COURT REVIEW. (a) A person who is adversely 13-7 affected by a rule, act, or order of the district may sue the 13-8 district in district court to set aside the rule, act, or order. 13-9 (b) The suit must be filed not later than the 20th day after 13-10 the date on which the rule, act, or order takes effect. 13-11 (c) If a person challenges in court the validity of all or 13-12 any portion of this Act and does not prevail in the challenge, the 13-13 court shall order the person to pay the reasonable attorney's fees, 13-14 expert witness fees, and other costs incurred by all opposing 13-15 parties in defending this Act. 13-16 SECTION 3.06. SEPTIC TANKS. (a) If the district finds that 13-17 the nature of the soil or drainage in the district requires 13-18 regulation of septic tanks to prevent water pollution or to protect 13-19 the public health, the district by rule may: 13-20 (1) restrict the number and types of septic tanks 13-21 permitted in a specified area; 13-22 (2) forbid the use of a septic tank in a specified 13-23 area; 13-24 (3) forbid the installation of a new septic tank in a 13-25 specified area; 13-26 (4) establish a permit system for the installation of 13-27 a new septic tank in a specified area; or 14-1 (5) seek a gradual reduction of the number or types of 14-2 septic tanks in a specified area. 14-3 (b) Before the board adopts a rule under this section, the 14-4 board shall: 14-5 (1) consult with the commission; and 14-6 (2) hold a public hearing in the area to be affected 14-7 by the rule. 14-8 SECTION 3.07. ACQUISITION, CONSTRUCTION, AND OPERATION OF 14-9 SYSTEMS. The district may: 14-10 (1) acquire and provide by purchase, gift, or lease 14-11 any water service, wastewater service, drainage service, or 14-12 disposal service within the district; 14-13 (2) construct a disposal system and provide disposal 14-14 services within the district; 14-15 (3) operate or sell a disposal system that the 14-16 district constructs or acquires; 14-17 (4) contract with any person to operate or maintain a 14-18 disposal system that the person owns; and 14-19 (5) contract with any person to train or supervise 14-20 employees of a disposal system. 14-21 SECTION 3.08. SYSTEM CONTRACTS. (a) The district may 14-22 contract to receive and treat or dispose of water, wastewater, 14-23 drainage, or waste from any person in the district. 14-24 (b) In a contract under this section, the district shall set 14-25 fees on the basis of: 14-26 (1) the quality and quantity of the water, wastewater, 14-27 drainage, or waste; 15-1 (2) the difficulty in treating or disposing of the 15-2 water, wastewater, drainage, or waste; 15-3 (3) operation and maintenance expenses and debt 15-4 retirement service costs; and 15-5 (4) any other reasonable consideration. 15-6 SECTION 3.09. EMINENT DOMAIN. The district may exercise the 15-7 power of eminent domain under Chapter 21, Property Code, to acquire 15-8 property of any kind in Angelina County that is appropriate for the 15-9 exercise of the district's functions. 15-10 SECTION 3.10. RELOCATION OF FACILITIES. If the district 15-11 requires relocating, raising, lowering, rerouting, changing the 15-12 grade of, or altering the construction of a railroad, highway, or 15-13 pipeline or an electric transmission or distribution, telegraph, or 15-14 telephone line conduit, pole, or facility, the district shall pay 15-15 the cost of that action so as to provide comparable replacement of 15-16 any replaced facility, less the replaced facility's net salvage 15-17 value. 15-18 SECTION 3.11. USE OF PUBLIC EASEMENTS. (a) The district may 15-19 use any public roadway, street, alley, or easement in Angelina 15-20 County to accomplish its purposes, without the necessity of 15-21 securing a franchise or other governmental agreement. The use is 15-22 subject to the authority of a county to require the relocation of 15-23 facilities, at the expense of the district, to permit the widening 15-24 or straightening of a road. The county must give the district 30 15-25 days' notice that relocation is required and specify the new 15-26 location for the facilities along the right-of-way of the road. 15-27 (b) The district may not change, alter, or damage a portion 16-1 of the state highway system or any county road without first 16-2 obtaining the written consent of the Texas Department of 16-3 Transportation or the county, as applicable. The placement of a 16-4 district facility in a state or county highway right-of-way is 16-5 subject to regulation by the Texas Department of Transportation or 16-6 a county, as applicable. 16-7 SECTION 3.12. ADDITION OF TERRITORY. (a) In accordance with 16-8 this section, the district may annex additional territory in 16-9 Angelina County. 16-10 (b) Proceedings for the annexation of territory by the 16-11 district may be initiated by a petition signed by the owners of the 16-12 land proposed to be annexed. The petition must request that the 16-13 board hold a public hearing on the matters set out in the petition. 16-14 (c) The board shall hear and consider the petition and may 16-15 annex the territory if the board determines that the land should be 16-16 annexed. 16-17 (d) The consent of a municipality or other governmental 16-18 entity or political subdivision of the state is not required for 16-19 any annexation of territory by the district. 16-20 SECTION 3.13. ACQUISITION AND DISPOSITION OF PROPERTY. (a) 16-21 The district may purchase, lease, acquire by gift, maintain, use, 16-22 or operate property of any kind that is appropriate for the 16-23 exercise of its functions. 16-24 (b) The board may sell to the highest bidder, at a public or 16-25 private sale, or may exchange any property owned by the district 16-26 that is not required to carry out the district's purposes. Before 16-27 conducting a public or a private sale of property, the district 17-1 shall give notice of its intent to sell the property by publishing 17-2 notice once a week for two consecutive weeks in a newspaper of 17-3 general circulation in the district. 17-4 SECTION 3.14. FACILITIES. The district may acquire, 17-5 construct, extend, improve, maintain, reconstruct, use, or operate 17-6 any facility necessary or convenient to the exercise of its powers, 17-7 rights, duties, or functions. 17-8 SECTION 3.15. CONTRACTS. (a) The district may make contracts 17-9 and execute instruments necessary or convenient to the exercise of 17-10 its powers, rights, duties, or functions. The district may not 17-11 enter into a contract with a term greater than 50 years. 17-12 (b) This section does not prohibit the district from 17-13 purchasing surplus property from the United States through a 17-14 negotiated contract without bids. 17-15 (c) An officer, agent, or employee of the district who is 17-16 financially interested in a contract of the type described in 17-17 Subsection (b) of this section shall disclose the interest to the 17-18 board before the board votes on the acceptance of the contract. 17-19 (d) The directors are subject to Chapter 171, Local 17-20 Government Code. 17-21 SECTION 3.16. COOPERATIVE AGREEMENTS. The district may 17-22 enter into cooperative agreements with other local governments, 17-23 state agencies, or agencies of the United States: 17-24 (1) to perform water, wastewater, drainage, or waste 17-25 disposal management, inspection, and enforcement functions and to 17-26 give technical aid and education services to any party to the 17-27 agreement; and 18-1 (2) to transfer money or property to any party to the 18-2 agreement for the purpose of water quality and waste disposal 18-3 management, inspection, enforcement, and technical aid and 18-4 education. 18-5 ARTICLE 4. GENERAL FISCAL PROVISIONS 18-6 SECTION 4.01. DISBURSEMENT OF MONEY. The district may 18-7 disburse money only by check, draft, order, or other instrument 18-8 signed by the person or persons authorized in the board's bylaws or 18-9 by board resolution. 18-10 SECTION 4.02. FEES AND CHARGES. The district may establish 18-11 fees and charges not to exceed the amounts necessary to enable the 18-12 district to fulfill the obligations imposed on it by this Act. 18-13 SECTION 4.03. LOANS AND GRANTS. (a) The district may 18-14 borrow money and accept grants for its corporate purposes. 18-15 (b) The district may borrow money and accept grants from 18-16 private sources, the United States, the state, and local 18-17 governments. The district may enter into any agreement in 18-18 connection with a loan or grant that does not conflict with state 18-19 or federal law. 18-20 (c) Information of the source, amount, and any restriction 18-21 on expenditure of money the district accepts is public information. 18-22 SECTION 4.04. FISCAL YEAR. The board shall establish the 18-23 district's fiscal year. 18-24 SECTION 4.05. INDEPENDENT AUDIT AND REPORT. (a) The board 18-25 shall have an audit of the district's affairs for each fiscal year 18-26 prepared by an independent certified public accountant of 18-27 recognized integrity and ability. 19-1 (b) The district shall keep at least one copy of the most 19-2 recent audit at the district's principal office. 19-3 (c) The district shall make a copy of the most recent audit 19-4 available for inspection by any interested person during regular 19-5 business hours. 19-6 SECTION 4.06. DEPOSITORY BANKS. (a) The board shall 19-7 designate one or more banks to serve as depository for the 19-8 district's money. The district shall deposit all of its money in 19-9 the designated depository bank or banks, except: 19-10 (1) to the extent provided in a trust indenture, the 19-11 district may deposit bond proceeds and money pledged to pay bonds 19-12 with the trustee bank named in the trust indenture; and 19-13 (2) money pledged to pay bonds shall be remitted to 19-14 the bank of payment for the payment of principal and interest on 19-15 bonds. 19-16 (b) To the extent that money in a depository bank or trustee 19-17 bank is not invested or insured by the Federal Deposit Insurance 19-18 Corporation, the money shall be secured in the manner provided by 19-19 law for the security of state money. 19-20 ARTICLE 5. BONDS AND TAXES 19-21 SECTION 5.01. REVENUE BONDS. (a) For the purpose of 19-22 carrying out a power or authority conferred by this Act, the 19-23 district may issue bonds secured by a pledge of all or part of the 19-24 revenues accruing to the district from a source other than ad 19-25 valorem taxes, including money received from tolls, charges, the 19-26 sale of water or other products, and the provision of services. 19-27 (b) The district's bonds shall: 20-1 (1) be authorized by board resolution; 20-2 (2) be issued in the district's name; 20-3 (3) be signed by the president or vice president; 20-4 (4) be attested by the secretary; and 20-5 (5) bear the district's seal. 20-6 (c) The board may prescribe the form, denomination, and 20-7 interest rate of bonds issued by the district, except that bonds 20-8 must mature serially or otherwise not more than 50 years after 20-9 their date. The board may sell bonds at prices and under terms that 20-10 the board determines to be the most advantageous reasonably 20-11 available. The district's bonds may be made redeemable before 20-12 maturity at times and prices prescribed in the bonds. The 20-13 district's bonds may be secured by an indenture of trust with a 20-14 corporate trustee. 20-15 (d) The district may issue bonds in more than one series as 20-16 required for carrying out the purposes of this Act. The district 20-17 may, in issuing bonds secured by the district's revenues, reserve 20-18 the right to issue additional bonds secured by the district's 20-19 revenues that are on a parity with or are senior or subordinate to 20-20 the bonds issued earlier. 20-21 (e) The resolution authorizing the bonds or the trust 20-22 indenture securing the bonds may specify additional provisions that 20-23 shall constitute a contract between the district and its 20-24 bondholders. The board may provide: 20-25 (1) for additional bond provisions; and 20-26 (2) for a corporate trustee or receiver to take 20-27 possession of the district's facilities if the district defaults. 21-1 SECTION 5.02. REFUNDING BONDS. (a) The district may issue 21-2 refunding bonds to refund outstanding bonds and interest authorized 21-3 by this Act. 21-4 (b) Refunding bonds may: 21-5 (1) be issued to refund one or more series of 21-6 outstanding bonds; 21-7 (2) combine the pledges for the outstanding bonds for 21-8 the security of the refunding bonds; and 21-9 (3) be secured by other or additional revenues. 21-10 (c) The provisions of this Act applicable to the district's 21-11 issuance of other bonds, their security, their approval by the 21-12 attorney general, and the remedies of the holders are applicable to 21-13 refunding bonds. 21-14 (d) Refunding bonds shall be registered by the comptroller 21-15 of public accounts on surrender and cancellation of the bonds to be 21-16 refunded. Alternatively, the resolution authorizing the issuance of 21-17 refunding bonds may provide that the bonds shall be sold and the 21-18 resulting proceeds deposited in the bank where the bonds to be 21-19 refunded are payable, in which case the refunding bonds may be 21-20 issued in an amount sufficient to pay the principal and interest of 21-21 the bonds to be refunded to their option or maturity date. The 21-22 comptroller of public accounts shall register the refunding bonds 21-23 without concurrent surrender and cancellation of the bonds to be 21-24 refunded. 21-25 SECTION 5.03. APPROVAL AND REGISTRATION OF BONDS. After the 21-26 district authorizes any bonds, the district shall submit the bonds 21-27 and the record relating to their issuance to the attorney general 22-1 for approval. If the bonds are secured by a pledge of the proceeds 22-2 of a contract between the district and a municipality or other 22-3 governmental agency, authority, or district, the district shall 22-4 submit to the attorney general a copy of the contract and the 22-5 proceedings of the municipality or other governmental agency, 22-6 authority, or district authorizing the contract. If the attorney 22-7 general finds that the bonds have been authorized and the 22-8 contracts, if any, have been made in accordance with the 22-9 constitution and laws of the state, the attorney general shall 22-10 approve the bonds and contracts. On approval, the bonds shall then 22-11 be registered by the comptroller of public accounts. 22-12 SECTION 5.04. AUTHORIZED INVESTMENTS. Bonds and refunding 22-13 bonds of the district are legal, eligible, and authorized 22-14 investments for a public fund of the state, including the state 22-15 permanent school fund, or a state agency. 22-16 SECTION 5.05. AD VALOREM TAXATION. The district has the 22-17 power to impose ad valorem taxes as conferred by general law upon 22-18 water control and improvement districts, including Chapter 49, 22-19 Water Code. 22-20 ARTICLE 6. MISCELLANEOUS PROVISIONS 22-21 SECTION 6.01. FINDINGS RELATED TO PROCEDURAL REQUIREMENTS. 22-22 (a) The proper and legal notice of the intention to introduce this 22-23 Act, setting forth the general substance of this Act, has been 22-24 published as provided by law, and the notice and a copy of this Act 22-25 have been furnished to all persons, agencies, officials, or 22-26 entities to which they are required to be furnished by the 22-27 constitution and other laws of this state, including the governor, 23-1 who has submitted the notice and the Act to the Texas Natural 23-2 Resource Conservation Commission. 23-3 (b) The Texas Natural Resource Conservation Commission has 23-4 filed its recommendations relating to this Act with the governor, 23-5 lieutenant governor, and speaker of the house of representatives 23-6 within the required time. 23-7 (c) All requirements of the constitution and laws of this 23-8 state and of the rules and procedures of the legislature with 23-9 respect to the notice, introduction, and passage of this Act are 23-10 fulfilled and accomplished. 23-11 SECTION 6.02. EXISTING COUNTIES, RIVER AUTHORITIES, AND 23-12 UNDERGROUND WATER CONSERVATION DISTRICTS. Notwithstanding any 23-13 provision of this Act, this Act does not impair, limit, supersede, 23-14 or alter the powers, rights, privileges, duties, functions, or 23-15 jurisdiction of a river authority in existence on the effective 23-16 date of this Act the territory of which comprises at least three 23-17 counties and includes all or part of the district, except that such 23-18 a river authority may not impose or apply any regulatory ordinance, 23-19 rule, or regulation within the district without the agreement of 23-20 the district. 23-21 SECTION 6.03. SEVERABILITY. If any portion of this Act or 23-22 the application of any portion of this Act to any person or set of 23-23 circumstances is held by a court to be unconstitutional, void, 23-24 invalid, or unenforceable, the validity of the remaining portions 23-25 of this Act or the application of the challenged portion of the Act 23-26 to other persons or sets of circumstances shall not be affected by 23-27 the court's holding. It is the intent of the legislature in 24-1 adopting this Act that no portion of the Act become inoperative or 24-2 fail by reason of the unconstitutionality or invalidity of any 24-3 other portion of the Act. 24-4 SECTION 6.04. EFFECTIVE DATE. This Act takes effect 24-5 immediately if it receives a vote of two-thirds of all the members 24-6 elected to each house, as provided by Section 39, Article III, 24-7 Texas Constitution. If this Act does not receive the vote 24-8 necessary for immediate effect, this Act takes effect September 1, 24-9 2001.