1-1     By:  McReynolds (Senate Sponsor - Staples)            H.B. No. 2571
 1-2           (In the Senate - Received from the House April 23, 2001;
 1-3     April 24, 2001, read first time and referred to Committee on
 1-4     Natural Resources; May 11, 2001, reported favorably, as amended, by
 1-5     the following vote:  Yeas 4, Nays 0; May 11, 2001, sent to
 1-6     printer.)
 1-7     COMMITTEE AMENDMENT NO. 1                           By:  Barrientos
 1-8           Amend HB 2571, Section 3.02 (On page 5, engrossed version) by
 1-9     adding new subsection as follows:
1-10           (c)  In implementing this section, if the district adopts
1-11     rules that apply to electric, gas and telecommunications
1-12     facilities, pipes and lines, the rules must be consistent with and
1-13     no more stringent than state or federal requirements.
1-14                            A BILL TO BE ENTITLED
1-15                                   AN ACT
1-16     relating to the creation, administration, powers, duties,
1-17     operation, and financing of the Angelina County Water Control and
1-18     Improvement District No. 4; authorizing the imposition of taxes and
1-19     the issuance of bonds and granting the power of eminent domain;
1-20     providing a civil penalty.
1-22                       ARTICLE 1.  GENERAL PROVISIONS
1-23           SECTION 1.01.  CREATION. (a)  A conservation and reclamation
1-24     district, to be known as the Angelina County Water Control and
1-25     Improvement District No. 4, is created in Angelina County, subject
1-26     to approval at a confirmation election under Section 2.03 of this
1-27     Act. The district is a governmental agency and a body politic and
1-28     corporate.
1-29           (b)  The district is created under and is essential to
1-30     accomplish the purposes of Section 59, Article XVI, Texas
1-31     Constitution.
1-32           SECTION 1.02.  DEFINITIONS. In this Act:
1-33                 (1)  "Board" means the board of directors of the
1-34     district.
1-35                 (2)  "Commission" means the Texas Natural Resource
1-36     Conservation Commission.
1-37                 (3)  "Director" means a member of the board.
1-38                 (4)  "Disposal system" means any system for disposing
1-39     of waste, including a sewer system, drainage system, or treatment
1-40     facility.
1-41                 (5)  "District" means the Angelina County Water Control
1-42     and Improvement District No. 4.
1-43                 (6)  "Local government" means a municipality, county,
1-44     river authority, or water district or authority acting under
1-45     Section 52, Article III, or Section 59, Article XVI, Texas
1-46     Constitution.
1-47                 (7)  "Person" has the meaning assigned by Section
1-48     311.005, Government Code.
1-49                 (8)  "Pollution" has the meaning assigned by Section
1-50     26.001, Water Code.
1-51                 (9)  "System" means a network of pipelines, conduits,
1-52     canals, pumping stations, force mains, and all other constructions,
1-53     devices, and related appliances used to transport water or waste.
1-54                 (10)  "Treatment facility" means a plant, disposal
1-55     field, lagoon, incinerator, sanitary landfill, or other facility
1-56     installed for the purpose of treating, neutralizing, or stabilizing
1-57     waste.
1-58                 (11)  "Waste" means waterborne liquid, gaseous, or
1-59     solid substances that result from a discharge from a treatment
1-60     facility or disposal system.
1-61                 (12)  "Water" means groundwater, percolating or
1-62     otherwise, and a lake, pond, impounding reservoir, spring, river,
1-63     stream, creek, canal, or any other surface water, natural or
 2-1     artificial, navigable or nonnavigable, that is wholly or partially
 2-2     in the district.
 2-3           SECTION 1.03.  BOUNDARIES. The boundaries of the district are
 2-4     as follows:
 2-5           BEING all that certain tract or parcel of land lying and
 2-6           situated in Angelina County, Texas, out of the D. LEONE
 2-8           NO. 39 and being described as follows, to-wit:
 2-9           BEGINNING at the Northeast corner of WILDWOOD ADDITION, a
2-10           subdivision of record in Cabinet A on Slide 140-B of the Map
2-11           and Plat Records of Angelina County, Texas, and the Northeast
2-12           corner of that certain 17 acre tract described in a deed from
2-13           Bess M. Auld, et al to Arthur M. White, et ux dated January
2-14           3, 1972 and recorded in Volume 384 on Page 71 of the Deed
2-15           Records of Angelina County, Texas, a point for corner in the
2-16           South boundary line of that certain 671.4 acre tract
2-17           described in a deed from Charles M. Raguet to Southern Pine
2-18           Lumber Company dated March 22, 1900 and Recorded in Volume 3
2-19           on Page 428 of the Deed Records of Angelina County, Texas;
2-20           THENCE Westerly with the North boundary line of the said
2-21           WILDWOOD ADDITION, the North boundary line of the said 17
2-22           acre tract, the North boundary line of that certain 54.8 acre
2-23           tract described in a contract of sale and purchase from the
2-24           Veterans' Land Board of Texas to Arthur M. White dated
2-25           February 16, 1950 and recorded in Volume 149 on Page 43 of
2-26           the Deed Records of Angelina County, Texas, and with the
2-27           South boundary line of the said 671.4 acre tract, continuing
2-28           to the Southeast corner of the proposed W.W.T.P. site (to be
2-29           conveyed by Temple-Inland Forest Products Corporation), a
2-30           point for corner;
2-31           THENCE Northerly with the East boundary line of the said
2-32           proposed W.W.T.P. site, continuing to the Northeast corner of
2-33           the said proposed W.W.T.P. site, a point for corner;
2-34           THENCE Westerly with the North boundary line of the said
2-35           proposed W.W.T.P. site, continuing to the Northwest corner of
2-36           the said proposed W.W.T.P. site, a point for corner;
2-37           THENCE Southerly with the West boundary line of the said
2-38           proposed W.W.T.P. site, continuing to the Southwest corner of
2-39           the said proposed W.W.T.P. site, a point for corner in the
2-40           South boundary line of the aforesaid 671.4 acre tract;
2-41           THENCE Easterly with the South boundary line of the said
2-42           671.4 acre tract, continuing to the Northwest corner of the
2-43           aforesaid 54.8 acre tract and the Northwest corner of that
2-44           certain 5.10 acre tract described in a deed from Arthur M.
2-45           White, et ux to Edward M. Hurd, et ux dated January 2, 1976
2-46           and recorded in Volume 434 on Page 116 of the Deed Records of
2-47           Angelina County, a point for corner;
2-48           THENCE Southerly with the West boundary line of the said 54.8
2-49           acre tract, the West boundary line of the said 5.10 acre Gary
2-50           D. Selman tract, and the West boundary line of that certain
2-51           0.273 acre tract described in a deed from Tom Gann And
2-52           Associates, Inc. to Edward M. Hurd, et ux dated November 24,
2-53           1986 and recorded in volume 660 on Page 713 of the Real
2-54           Property Records of Angelina County, continuing to the
2-55           Southwest corner of the said 0.273 acre tract, a point for
2-56           corner in the Northwest margin of County Road No. 65
2-57           (Burkhalter Hollow);
2-58           THENCE Northeasterly with the Southeast boundary line of the
2-59           said 0.273 acre tract and the Northwest margin of the said
2-60           County Road No. 65 (Burkhalter Hollow), continuing to the
2-61           Northeast corner of the said 0.273 tract, a point for corner
2-62           in the South boundary line of the aforesaid 54.8 acre tract;
2-63           THENCE Easterly with the South boundary line of the said 54.8
2-64           acre tract, the South boundary line of the aforesaid 17 acre
2-65           tract, the South boundary line of the aforesaid WILDWOOD
2-66           ADDITION, and the North margin of the said County Road No. 65
2-67           (Burkhalter Hollow), continuing to the Southeast corner of
2-68           the said 17 acre tract and the Southeast corner of the said
2-69           WILDWOOD ADDITION, a point for corner;
 3-1           THENCE Northerly with the East boundary line of the said 17
 3-2           acre tract and the East boundary line of the said WILDWOOD
 3-3           ADDITION, continuing to the point and place of beginning.
 3-5     legislature finds that the boundaries and field notes of the
 3-6     district form a closure. A mistake in the field notes or in copying
 3-7     the field notes in the legislative process does not affect the
 3-8     organization, existence, or validity of the district, the right of
 3-9     the district to issue or refund bonds or to pay the principal of or
3-10     interest on bonds, the right of the district to levy and collect
3-11     taxes, or the legality or operation of the district or its board.
3-12           SECTION 1.05.  FINDING OF BENEFIT. All of the land and other
3-13     property included within the boundaries of the district will be
3-14     benefited by the works and projects that are to be accomplished by
3-15     the district under powers conferred by this Act. The district is
3-16     created to serve a public use and benefit.
3-18           SECTION 2.01.  BOARD OF DIRECTORS. (a)  The district's
3-19     powers, rights, duties, and functions are exercised by a board of
3-20     five directors.
3-21           (b)  Temporary directors serve until initial directors are
3-22     elected under Section 2.03 of this Act.
3-23           (c)  Initial directors serve until permanent directors are
3-24     elected under Section 2.04 of this Act.
3-25           (d)  Permanent directors serve staggered four-year terms.
3-26           (e)  To be eligible to serve as a director, a person must be
3-27     a resident of Angelina County and reside in the district.
3-28           (f)  Each director must qualify to serve as director under
3-29     Sections 49.052 and 49.055, Water Code. The district shall pay the
3-30     premiums for each director's bond required under Section 49.055,
3-31     Water Code.
3-32           (g)  A director serves until the director's successor has
3-33     qualified.
3-34           (h)  When a director dies, resigns, or is otherwise removed,
3-35     the governor shall appoint a successor to serve for the unexpired
3-36     term.
3-37           SECTION 2.02.  TEMPORARY DIRECTORS. (a)  The temporary board
3-38     of directors consists of:
3-39                 1.  Jaime Gonzalez
3-40                 2.  Josephina Perez
3-41                 3.  Julia Esteves
3-42                 4.  Jose Perez
3-43                 5.  Tomas Fuentes
3-44           (b)  If a temporary director fails to qualify for office, the
3-45     temporary directors who have qualified shall appoint a person to
3-46     fill the vacancy.  If at any time there are fewer than three
3-47     qualified temporary directors, the governor shall appoint the
3-48     necessary number of persons to fill all vacancies on the board.
3-50     (a)  The temporary board of directors shall hold an organizational
3-51     meeting of the district and take office at that time. The directors
3-52     shall hold the meeting at a location to which a majority of the
3-53     directors agree.
3-54           (b)  The temporary board of directors shall call and hold an
3-55     election to confirm establishment of the district and to elect
3-56     initial directors.
3-57           (c)  At the confirmation and initial directors' election, the
3-58     temporary board of directors shall have placed on the ballot the
3-59     name of any candidate filing for an initial director's position and
3-60     blank spaces to write in the names of other persons.  A temporary
3-61     director who is qualified to be a candidate under Section 2.01 of
3-62     this Act may file for an initial director's position.
3-63           (d)  Section 41.001(a), Election Code, does not apply to a
3-64     confirmation and initial directors' election held as provided by
3-65     this section.
3-66           (e)  Except as provided by this section, a confirmation and
3-67     initial directors' election must be conducted as provided by
3-68     Sections 49.102(a)-(g), Water Code, and the Election Code.
3-69           SECTION 2.04.  ELECTION OF DIRECTORS. (a)  On a uniform
 4-1     election date, as provided by Section 41.001, Election Code,
 4-2     selected by the initial directors, of the first even-numbered year
 4-3     after the year in which the district is authorized to be created at
 4-4     a confirmation election, an election shall be held in the district
 4-5     for the election of three directors to serve four-year terms and
 4-6     two directors to serve two-year terms.
 4-7           (b)  On the uniform election date selected under Subsection
 4-8     (a) of this section of each subsequent second year following the
 4-9     election, the appropriate number of directors shall be elected.
4-10           SECTION 2.05.  MEETINGS AND ACTIONS OF THE BOARD. (a)  The
4-11     board shall adopt bylaws at its first meeting or as soon after the
4-12     first meeting as is practicable.
4-13           (b)  The board shall meet at least four times each year and
4-14     may meet at any other time provided in its bylaws.
4-15           (c)  A majority of the directors constitutes a quorum for the
4-16     transaction of business. Except as otherwise provided in this Act,
4-17     the vote of a majority of directors present at a meeting at which a
4-18     quorum is present is required for board action.
4-19           SECTION 2.06.  ORGANIZATION OF BOARD. (a)  The board shall
4-20     elect from its members a president, vice president, secretary,
4-21     treasurer, and other officers as necessary.  An officer's period of
4-22     service begins at a time provided by the bylaws.
4-23           (b)  If a vacancy occurs in a board office, the board shall
4-24     elect one of its members to fill the unexpired period of service at
4-25     the next board meeting.
4-26           (c)  The board by its bylaws shall prescribe:
4-27                 (1)  the powers and duties of each board office; and
4-28                 (2)  procedures to remove a director from a board
4-29     office.
4-30           SECTION 2.07.  INTEREST IN CONTRACT. A director who is
4-31     financially interested in a contract proposed to be executed by the
4-32     district for the purchase of property or services or the
4-33     construction of facilities shall disclose the interest to the board
4-34     and may not vote on acceptance of the contract.
4-35           SECTION 2.08.  DIRECTORS' COMPENSATION. (a)  Subject to
4-36     Subsection (b) of this section, a director is entitled to receive
4-37     an allowance of $50 a day and reimbursement for actual and
4-38     necessary expenses incurred:
4-39                 (1)  for each day the director attends a meeting of the
4-40     board; and
4-41                 (2)  for each day the board authorizes the director to
4-42     attend to district business.
4-43           (b)  A director may not receive a per diem allowance for more
4-44     than 20 days in a calendar year.
4-45           SECTION 2.09.  GENERAL MANAGER. (a)  The board may employ a
4-46     general manager for a term and salary set by the board.
4-47           (b)  The general manager is the chief executive officer of
4-48     the district. In accordance with policies adopted by the board, the
4-49     general manager is responsible for:
4-50                 (1)  administering the board's directives;
4-51                 (2)  keeping the district's records, including minutes
4-52     of board meetings;
4-53                 (3)  coordinating with state, federal, and local
4-54     agencies;
4-55                 (4)  developing plans and programs for the board's
4-56     approval;
4-57                 (5)  hiring, supervising, training, and discharging the
4-58     district's employees;
4-59                 (6)  obtaining technical, scientific, legal, fiscal,
4-60     and other professional services; and
4-61                 (7)  performing any other duties the board assigns.
4-62           (c)  The board may discharge the general manager.
4-63           (d)  Instead of employing a general manager, the district may
4-64     contract with a local government for the services required by the
4-65     district.
4-66           SECTION 2.10.  EMPLOYEE BONDS. (a)  The general manager and
4-67     each employee of the district who is charged with the collection,
4-68     custody, or payment of any money of the district shall execute a
4-69     fidelity bond in an amount determined by the board and in a form
 5-1     and with a surety approved by the board.
 5-2           (b)  The district shall pay the premiums on the employees'
 5-3     bonds under this section.
 5-4           SECTION 2.11.  PRINCIPAL OFFICE. The district shall maintain
 5-5     its principal office at any place in Angelina County designated by
 5-6     the board.
 5-7           SECTION 2.12.  RECORDS. (a)  The district shall keep:
 5-8                 (1)  complete and accurate accounts of its business
 5-9     transactions in accordance with generally accepted methods of
5-10     accounting; and
5-11                 (2)  complete and accurate minutes of its meetings.
5-12           (b)  The district shall store its accounts, contracts,
5-13     documents, minutes, and other records at its principal office.
5-14           (c)  The district shall permit reasonable public inspection
5-15     of its records during regular business hours.
5-16           SECTION 2.13.  SEAL. The district shall adopt a seal and may
5-17     change the seal from time to time.
5-18           SECTION 2.14.  SUIT. The district may sue and be sued in its
5-19     corporate name.
5-20                        ARTICLE 3. POWERS AND DUTIES
5-21           SECTION 3.01.  GENERAL POWERS AND DUTIES. (a)  The district
5-22     shall:
5-23                 (1)  administer and enforce the terms of this Act;
5-24                 (2)  use its facilities and powers to accomplish the
5-25     purposes of this Act;
5-26                 (3)  coordinate the provision of water, wastewater, and
5-27     drainage services in the district; and
5-28                 (4)  control and abate water pollution in the district.
5-29           (b)  Subject only to the authority of the commission, the
5-30     district has exclusive authority in the district, superseding the
5-31     authority of any local government, to:
5-32                 (1)  regulate septic tanks;
5-33                 (2)  coordinate the provision of water, wastewater, or
5-34     drainage services within, to, or from the district; and
5-35                 (3)  control or abate water pollution within or caused
5-36     within the district.
5-37           (c)  Except as expressly limited by this Act, the district
5-38     has all powers, rights, and privileges necessary and convenient for
5-39     accomplishing the purposes of this Act that are conferred by
5-40     general law upon any conservation and reclamation district created
5-41     pursuant to Section 59, Article XVI, Texas Constitution.
5-42           (d)  The powers granted to the district in this Act are
5-43     cumulative of all powers granted by other law.
5-44           SECTION 3.02.  DISTRICT RULES. (a)  The district shall adopt
5-45     and enforce rules reasonably required to implement this Act,
5-46     including rules governing procedure and practice before the board.
5-47           (b)  The district shall print its rules and furnish copies of
5-48     the rules to any person on written request.
5-49           SECTION 3.03.  INSPECTIONS AND INVESTIGATIONS. The district
5-50     may enter public or private property in the district's territory
5-51     for the purpose of inspecting and investigating conditions relating
5-52     to its authorized purposes under the same provisions and
5-53     restrictions applicable to the commission.
5-54           SECTION 3.04.  CIVIL PENALTY; INJUNCTION. (a)  A person who
5-55     violates a rule, permit, or order of the district is subject to a
5-56     civil penalty of not less than $50 and not more than $1,000 for
5-57     each violation or each day of a continuing violation.
5-58           (b)  The district may sue to recover the penalty in a
5-59     district court in the county where the violation occurred. The
5-60     penalty shall be paid to the district.
5-61           (c)  The district may sue for injunctive relief in a district
5-62     court in the county where a violation of its rule, permit, or order
5-63     occurs or is threatened to occur. The court may grant to the
5-64     district, without bond or other undertaking, a prohibitory or
5-65     mandatory injunction that the facts warrant, including a temporary
5-66     restraining order, temporary injunction, or permanent injunction.
5-67           (d)  The district may sue for injunctive relief and a civil
5-68     penalty in the same proceeding.
5-69           (e)  The commission is a necessary party to a suit brought
 6-1     under this section.
 6-2           SECTION 3.05.  COURT REVIEW. (a)  A person who is adversely
 6-3     affected by a rule, act, or order of the district may sue the
 6-4     district in district court to set aside the rule, act, or order.
 6-5           (b)  The suit must be filed not later than the 20th day after
 6-6     the date on which the rule, act, or order takes effect.
 6-7           (c)  If a person challenges in court the validity of all or
 6-8     any portion of this Act and does not prevail in the challenge, the
 6-9     court shall order the person to pay the reasonable attorney's fees,
6-10     expert witness fees, and other costs incurred by all opposing
6-11     parties in defending this Act.
6-12           SECTION 3.06.  SEPTIC TANKS. (a)  If the district finds that
6-13     the nature of the soil or drainage in the district requires
6-14     regulation of septic tanks to prevent water pollution or to protect
6-15     the public health, the district by rule may:
6-16                 (1)  restrict the number and types of septic tanks
6-17     permitted in a specified area;
6-18                 (2)  forbid the use of a septic tank in a specified
6-19     area;
6-20                 (3)  forbid the installation of a new septic tank in a
6-21     specified area;
6-22                 (4)  establish a permit system for the installation of
6-23     a new septic tank in a specified area; or
6-24                 (5)  seek a gradual reduction of the number or types of
6-25     septic tanks in a specified area.
6-26           (b)  Before the board adopts a rule under this section, the
6-27     board shall:
6-28                 (1)  consult with the commission; and
6-29                 (2)  hold a public hearing in the area to be affected
6-30     by the rule.
6-32     SYSTEMS. The district may:
6-33                 (1)  acquire and provide by purchase, gift, or lease
6-34     any water service, wastewater service, drainage service, or
6-35     disposal service within the district;
6-36                 (2)  construct a disposal system and provide disposal
6-37     services within the district;
6-38                 (3)  operate or sell a disposal system that the
6-39     district constructs or acquires;
6-40                 (4)  contract with any person to operate or maintain a
6-41     disposal system that the person owns; and
6-42                 (5)  contract with any person to train or supervise
6-43     employees of a disposal system.
6-44           SECTION 3.08.  SYSTEM CONTRACTS. (a)  The district may
6-45     contract to receive and treat or dispose of water, wastewater,
6-46     drainage, or waste from any person in the district.
6-47           (b)  In a contract under this section, the district shall set
6-48     fees on the basis of:
6-49                 (1)  the quality and quantity of the water, wastewater,
6-50     drainage, or waste;
6-51                 (2)  the difficulty in treating or disposing of the
6-52     water, wastewater, drainage, or waste;
6-53                 (3)  operation and maintenance expenses and debt
6-54     retirement service costs; and
6-55                 (4)  any other reasonable consideration.
6-56           SECTION 3.09.  EMINENT DOMAIN. The district may exercise the
6-57     power of eminent domain under Chapter 21, Property Code, to acquire
6-58     property of any kind in Angelina County that is appropriate for the
6-59     exercise of the district's functions.
6-60           SECTION 3.10.  RELOCATION OF FACILITIES. If the district
6-61     requires relocating, raising, lowering, rerouting, changing the
6-62     grade of, or altering the construction of a railroad, highway, or
6-63     pipeline or an electric transmission or distribution, telegraph, or
6-64     telephone line conduit, pole, or facility, the district shall pay
6-65     the cost of that action so as to provide comparable replacement of
6-66     any replaced facility, less the replaced facility's net salvage
6-67     value.
6-68           SECTION 3.11.  USE OF PUBLIC EASEMENTS. (a)  The district may
6-69     use any public roadway, street, alley, or easement in Angelina
 7-1     County to accomplish its purposes, without the necessity of
 7-2     securing a franchise or other governmental agreement. The use is
 7-3     subject to the authority of a county to require the relocation of
 7-4     facilities, at the expense of the district, to permit the widening
 7-5     or straightening of a road. The county must give the district 30
 7-6     days' notice that relocation is required and specify the new
 7-7     location for the facilities along the right-of-way of the road.
 7-8           (b)  The district may not change, alter, or damage a portion
 7-9     of the state highway system or any county road without first
7-10     obtaining the written consent of the Texas Department of
7-11     Transportation or the county, as applicable. The placement of a
7-12     district facility in a state or county highway right-of-way is
7-13     subject to regulation by the Texas Department of Transportation or
7-14     a county, as applicable.
7-15           SECTION 3.12.  ADDITION OF TERRITORY. (a)  In accordance with
7-16     this section, the district may annex additional territory in
7-17     Angelina County.
7-18           (b)  Proceedings for the annexation of territory by the
7-19     district may be initiated by a petition signed by the owners of the
7-20     land proposed to be annexed. The petition must request that the
7-21     board hold a public hearing on the matters set out in the petition.
7-22           (c)  The board shall hear and consider the petition and may
7-23     annex the territory if the board determines that the land should be
7-24     annexed.
7-25           (d)  The consent of a municipality or other governmental
7-26     entity or political subdivision of the state is not required for
7-27     any annexation of territory by the district.
7-29     The district may purchase, lease, acquire by gift, maintain, use,
7-30     or operate property of any kind that is appropriate for the
7-31     exercise of its functions.
7-32           (b)  The board may sell to the highest bidder, at a public or
7-33     private sale, or may exchange any property owned by the district
7-34     that is not required to carry out the district's purposes. Before
7-35     conducting a public or a private sale of property, the district
7-36     shall give notice of its intent to sell the property by publishing
7-37     notice once a week for two consecutive weeks in a newspaper of
7-38     general circulation in the district.
7-39           SECTION 3.14.  FACILITIES. The district may acquire,
7-40     construct, extend, improve, maintain, reconstruct, use, or operate
7-41     any facility necessary or convenient to the exercise of its powers,
7-42     rights, duties, or functions.
7-43           SECTION 3.15. CONTRACTS. (a)  The district may make contracts
7-44     and execute instruments necessary or convenient to the exercise of
7-45     its powers, rights, duties, or functions. The district may not
7-46     enter into a contract with a term greater than 50 years.
7-47           (b)  This section does not prohibit the district from
7-48     purchasing surplus property from the United States through a
7-49     negotiated contract without bids.
7-50           (c)  An officer, agent, or employee of the district who is
7-51     financially interested in a contract of the type described in
7-52     Subsection (b) of this section shall disclose the interest to the
7-53     board before the board votes on the acceptance of the contract.
7-54           (d)  The directors are subject to Chapter 171, Local
7-55     Government Code.
7-56           SECTION 3.16.  COOPERATIVE AGREEMENTS.  The district may
7-57     enter into cooperative agreements with other local governments,
7-58     state agencies, or agencies of the United States:
7-59                 (1)  to perform water, wastewater, drainage, or waste
7-60     disposal management, inspection, and enforcement functions and to
7-61     give technical aid and education services to any party to the
7-62     agreement; and
7-63                 (2)  to transfer money or property to any party to the
7-64     agreement for the purpose of water quality and waste disposal
7-65     management, inspection, enforcement, and technical aid and
7-66     education.
7-67                    ARTICLE 4.  GENERAL FISCAL PROVISIONS
7-68           SECTION 4.01.  DISBURSEMENT OF MONEY.  The district may
7-69     disburse money only by check, draft, order, or other instrument
 8-1     signed by the person or persons authorized in the board's bylaws or
 8-2     by board resolution.
 8-3           SECTION 4.02.  FEES AND CHARGES.  The district may establish
 8-4     fees and charges not to exceed the amounts necessary to enable the
 8-5     district to fulfill the obligations imposed on it by this Act.
 8-6           SECTION 4.03.  LOANS AND GRANTS.  (a)  The district may
 8-7     borrow money and accept grants for its corporate purposes.
 8-8           (b)  The district may borrow money and accept grants from
 8-9     private sources, the United States, the state, and local
8-10     governments. The district may enter into any agreement in
8-11     connection with a loan or grant that does not conflict with state
8-12     or federal law.
8-13           (c)  Information of the source, amount, and any restriction
8-14     on expenditure of money the district accepts is public information.
8-15           SECTION 4.04.  FISCAL YEAR.  The board shall establish the
8-16     district's fiscal year.
8-17           SECTION 4.05.  INDEPENDENT AUDIT AND REPORT.  (a)  The board
8-18     shall have an audit of the district's affairs for each fiscal year
8-19     prepared by an independent certified public accountant of
8-20     recognized integrity and ability.
8-21           (b)  The district shall keep at least one copy of the most
8-22     recent audit at the district's principal office.
8-23           (c)  The district shall make a copy of the most recent audit
8-24     available for inspection by any interested person during regular
8-25     business hours.
8-26           SECTION 4.06.  DEPOSITORY BANKS.  (a)  The board shall
8-27     designate one or more banks to serve as depository for the
8-28     district's money. The district shall deposit all of its money in
8-29     the designated depository bank or banks, except:
8-30                 (1)  to the extent provided in a trust indenture, the
8-31     district may deposit bond proceeds and money pledged to pay bonds
8-32     with the trustee bank named in the trust indenture; and
8-33                 (2)  money pledged to pay bonds shall be remitted to
8-34     the bank of payment for the payment of principal and interest on
8-35     bonds.
8-36           (b)  To the extent that money in a depository bank or trustee
8-37     bank is not invested or insured by the Federal Deposit Insurance
8-38     Corporation, the money shall be secured in the manner provided by
8-39     law for the security of state money.
8-40                         ARTICLE 5.  BONDS AND TAXES
8-41           SECTION 5.01.  REVENUE BONDS.  (a)  For the purpose of
8-42     carrying out a power or authority conferred by this Act, the
8-43     district may issue bonds secured by a pledge of all or part of the
8-44     revenues accruing to the district from a source other than ad
8-45     valorem taxes, including money received from tolls, charges, the
8-46     sale of water or other products, and the provision of services.
8-47           (b)  The district's bonds shall:
8-48                 (1)  be authorized by board resolution;
8-49                 (2)  be issued in the district's name;
8-50                 (3)  be signed by the president or vice president;
8-51                 (4)  be attested by the secretary; and
8-52                 (5)  bear the district's seal.
8-53           (c)  The board may prescribe the form, denomination, and
8-54     interest rate of bonds issued by the district, except that bonds
8-55     must mature serially or otherwise not more than 50 years after
8-56     their date. The board may sell bonds at prices and under terms that
8-57     the board determines to be the most advantageous reasonably
8-58     available. The district's bonds may be made redeemable before
8-59     maturity at times and prices prescribed in the bonds. The
8-60     district's bonds may be secured by an indenture of trust with a
8-61     corporate trustee.
8-62           (d)  The district may issue bonds in more than one series as
8-63     required for carrying out the purposes of this Act. The district
8-64     may, in issuing bonds secured by the district's revenues, reserve
8-65     the right to issue additional bonds secured by the district's
8-66     revenues that are on a parity with or are senior or subordinate to
8-67     the bonds issued earlier.
8-68           (e)  The resolution authorizing the bonds or the trust
8-69     indenture securing the bonds may specify additional provisions that
 9-1     shall constitute a contract between the district and its
 9-2     bondholders. The board may provide:
 9-3                 (1)  for additional bond provisions; and
 9-4                 (2)  for a corporate trustee or receiver to take
 9-5     possession of the district's facilities if the district defaults.
 9-6           SECTION 5.02.  REFUNDING BONDS.  (a)  The district may issue
 9-7     refunding bonds to refund outstanding bonds and interest authorized
 9-8     by this Act.
 9-9           (b)  Refunding bonds may:
9-10                 (1)  be issued to refund one or more series of
9-11     outstanding bonds;
9-12                 (2)  combine the pledges for the outstanding bonds for
9-13     the security of the refunding bonds; and
9-14                 (3)  be secured by other or additional revenues.
9-15           (c)  The provisions of this Act applicable to the district's
9-16     issuance of other bonds, their security, their approval by the
9-17     attorney general, and the remedies of the holders are applicable to
9-18     refunding bonds.
9-19           (d)  Refunding bonds shall be registered by the comptroller
9-20     of public accounts on surrender and cancellation of the bonds to be
9-21     refunded. Alternatively, the resolution authorizing the issuance of
9-22     refunding bonds may provide that the bonds shall be sold and the
9-23     resulting proceeds deposited in the bank where the bonds to be
9-24     refunded are payable, in which case the refunding bonds may be
9-25     issued in an amount sufficient to pay the principal and interest of
9-26     the bonds to be refunded to their option or maturity date. The
9-27     comptroller of public accounts shall register the refunding bonds
9-28     without concurrent surrender and cancellation of the bonds to be
9-29     refunded.
9-30           SECTION 5.03.  APPROVAL AND REGISTRATION OF BONDS.  After the
9-31     district authorizes any bonds, the district shall submit the bonds
9-32     and the record relating to their issuance to the attorney general
9-33     for approval. If the bonds are secured by a pledge of the proceeds
9-34     of a contract between the district and a municipality or other
9-35     governmental agency, authority, or district, the district shall
9-36     submit to the attorney general a copy of the contract and the
9-37     proceedings of the municipality or other governmental agency,
9-38     authority, or district authorizing the contract. If the attorney
9-39     general finds that the bonds have been authorized and the
9-40     contracts, if any, have been made in accordance with the
9-41     constitution and laws of the state, the attorney general shall
9-42     approve the bonds and contracts. On approval, the bonds shall then
9-43     be registered by the comptroller of public accounts.
9-44           SECTION 5.04.  AUTHORIZED INVESTMENTS.  Bonds and refunding
9-45     bonds of the district are legal, eligible, and authorized
9-46     investments for a public fund of the state, including the state
9-47     permanent school fund, or a state agency.
9-48           SECTION 5.05.  AD VALOREM TAXATION.  The district has the
9-49     power to impose ad valorem taxes as conferred by general law upon
9-50     water control and improvement districts, including Chapter 49,
9-51     Water Code.
9-52                    ARTICLE 6.  MISCELLANEOUS PROVISIONS
9-54     (a) The proper and legal notice of the intention to introduce this
9-55     Act, setting forth the general substance of this Act, has been
9-56     published as provided by law, and the notice and a copy of this Act
9-57     have been furnished to all persons, agencies, officials, or
9-58     entities to which they are required to be furnished by the
9-59     constitution and other laws of this state, including the governor,
9-60     who has submitted the notice and the Act to the Texas Natural
9-61     Resource Conservation Commission.
9-62           (b)  The Texas Natural Resource Conservation Commission has
9-63     filed its recommendations relating to this Act with the governor,
9-64     lieutenant governor, and speaker of the house of representatives
9-65     within the required time.
9-66           (c)  All requirements of the constitution and laws of this
9-67     state and of the rules and procedures of the legislature with
9-68     respect to the notice, introduction, and passage of this Act are
9-69     fulfilled and accomplished.
 10-3    provision of this Act, this Act does not impair, limit, supersede,
 10-4    or alter the powers, rights, privileges, duties, functions, or
 10-5    jurisdiction of a river authority in existence on the effective
 10-6    date of this Act the territory of which comprises at least three
 10-7    counties and includes all or part of the district, except that such
 10-8    a river authority may not impose or apply any regulatory ordinance,
 10-9    rule, or regulation within the district without the agreement of
10-10    the district.
10-11          SECTION 6.03.  SEVERABILITY.  If any portion of this Act or
10-12    the application of any portion of this Act to any person or set of
10-13    circumstances is held by a court to be unconstitutional, void,
10-14    invalid, or unenforceable, the validity of the remaining portions
10-15    of this Act or the application of the challenged portion of the Act
10-16    to other persons or sets of circumstances shall not be affected by
10-17    the court's holding. It is the intent of the legislature in
10-18    adopting this Act that no portion of the Act become inoperative or
10-19    fail by reason of the unconstitutionality or invalidity of any
10-20    other portion of the Act.
10-21          SECTION 6.04.  EFFECTIVE DATE.  This Act takes effect
10-22    immediately if it receives a vote of two-thirds of all the members
10-23    elected to each house, as provided by Section 39, Article III,
10-24    Texas Constitution.  If this Act does not receive the vote
10-25    necessary for immediate effect, this Act takes effect September 1,
10-26    2001.
10-27                                 * * * * *