1-1                                   AN ACT
 1-2     relating to the ratification of the creation of and to the
 1-3     administration, powers, duties, operation, and financing of the Cow
 1-4     Creek Groundwater Conservation District.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1.  RATIFICATION OF CREATION. The creation by Chapter
 1-7     1331, Acts of the 76th Legislature, Regular Session, 1999 (Senate
 1-8     Bill No. 1911), of the Cow Creek Groundwater Conservation District
 1-9     in Kendall County is ratified as required by Section 15(a) of that
1-10     Act, subject to approval at a confirmation election under Section 8
1-11     of this Act.
1-12           SECTION 2.  DEFINITIONS. In this Act:
1-13                 (1)  "District" means the Cow Creek Groundwater
1-14     Conservation District.
1-15                 (2)  "Retail public utility" means a retail public
1-16     utility as defined by Section 13.002, Water Code, that is providing
1-17     service in the district on the effective date of this Act.
1-18                 (3)  "Well" includes any excavation drilled or dug into
1-19     the ground that may intercept or penetrate a water bearing strata
1-20     or formation.
1-21           SECTION 3.  BOUNDARIES. The boundaries of the district are
1-22     coextensive with the boundaries of Kendall County, Texas.
1-23           SECTION 4.  GENERAL POWERS. (a)  The district has all of the
1-24     rights, powers, privileges, authority, functions, and duties
 2-1     provided by the general law of this state, including Chapter 36,
 2-2     Water Code, applicable to groundwater conservation districts
 2-3     created under Section 59, Article XVI, Texas Constitution.  This
 2-4     Act prevails over any provision of general law that is in conflict
 2-5     or inconsistent with this Act, including any provision of Chapter
 2-6     1331, Acts of the 76th Legislature, Regular Session, 1999 (Senate
 2-7     Bill No. 1911).
 2-8           (b)  Notwithstanding Subsection (a), the following provisions
 2-9     prevail over a conflicting or inconsistent provision of this Act:
2-10                 (1)  Sections 36.1071-36.108, Water Code;
2-11                 (2)  Sections 36.159-36.161, Water Code; and
2-12                 (3)  Subchapter I, Chapter 36, Water Code.
2-13           SECTION 5.  BOARD OF DIRECTORS. (a)  The district is governed
2-14     by a board of five directors.
2-15           (b)  Temporary directors serve until initial directors are
2-16     elected under Section 8 of this Act.
2-17           (c)  Initial directors serve until permanent directors are
2-18     elected under Section 10 of this Act.
2-19           (d)  Permanent directors serve staggered four-year terms.
2-20           (e)  Each director must qualify to serve as director in the
2-21     manner provided by Section 36.055, Water Code.
2-22           (f)  A director serves until the director's successor has
2-23     qualified.
2-24           (g)  If there is a vacancy on the board, the remaining
2-25     directors shall appoint a director to serve until the next election
2-26     for directors.  At the next election for directors, a person shall
2-27     be elected to fill the position.  If the position is not scheduled
 3-1     to be filled at the election, the person elected to fill the
 3-2     position shall serve only for the remainder of the unexpired term.
 3-3           SECTION 6.  METHOD OF ELECTING DIRECTORS. (a)  The directors
 3-4     of the district shall be elected according to the commissioners
 3-5     precinct method as provided by this section.
 3-6           (b)  One director shall be elected by the qualified voters of
 3-7     the entire district, and one director shall be elected from each
 3-8     county commissioners precinct by the qualified voters of that
 3-9     precinct.
3-10           (c)  To be qualified to be a candidate for or to serve as a
3-11     director at large, a person must be a registered voter in the
3-12     district.  To be qualified to be a candidate for or to serve as a
3-13     director from a county commissioners precinct, a person must be a
3-14     registered voter of that precinct.
3-15           (d)  A person shall indicate on the application for a place
3-16     on the ballot:
3-17                 (1)  the precinct that the person seeks to represent;
3-18     or
3-19                 (2)  that the person seeks to represent the district at
3-20     large.
3-21           (e)  At the first election after the county commissioners
3-22     precincts are redrawn under Section 18, Article V, Texas
3-23     Constitution, four new directors shall be elected to represent the
3-24     precincts.  The directors elected shall draw lots to determine
3-25     which two directors serve two-year terms and which two directors
3-26     serve four-year terms.
3-27           SECTION 7. TEMPORARY DIRECTORS. (a)  The temporary board of
 4-1     directors shall be appointed by the county commissioners court. The
 4-2     county commissioners court shall appoint a temporary director from
 4-3     each commissioners precinct and one director at large.
 4-4           (b)  If a temporary director fails to qualify for office, the
 4-5     temporary directors who have qualified shall appoint a person to
 4-6     fill the vacancy.  If at any time there are fewer than three
 4-7     qualified directors, the Texas Natural Resource Conservation
 4-8     Commission shall appoint the necessary number of persons to fill
 4-9     all vacancies on the board.
4-10           SECTION 8. CONFIRMATION AND INITIAL DIRECTORS' ELECTION. (a)
4-11     The temporary board of directors shall call and hold an election to
4-12     confirm establishment of the district and to elect initial
4-13     directors.
4-14           (b)  At the confirmation and initial directors' election, the
4-15     temporary board of directors shall have placed on the ballot the
4-16     names of the five temporary directors, the name of any other
4-17     candidate filing for an initial director's position, and blank
4-18     spaces to write in the names of other persons.
4-19           (c)  Section 41.001(a), Election Code, does not apply to a
4-20     confirmation and initial directors' election held as provided by
4-21     this section.
4-22           (d)  Except as provided by this section, a confirmation and
4-23     initial directors' election must be conducted as provided by
4-24     Sections 36.017(b)-(h), Water Code, and the Election Code.
4-25           (e)  If a majority of the votes cast at the election held
4-26     under this section is against the confirmation of the district, the
4-27     temporary directors may not call another election under this
 5-1     section before the first anniversary of that election.
 5-2           (f)  If a majority of the votes cast at the election held
 5-3     under this section is in favor of the creation of the district, the
 5-4     temporary directors shall declare the district created.
 5-5           (g)  If the district is created at the confirmation election,
 5-6     the temporary directors, at the time the vote is canvassed, shall
 5-7     declare the candidate receiving the most votes from each
 5-8     commissioners precinct and at large to be elected as initial
 5-9     directors.
5-10           (h)  The temporary directors shall file a copy of the
5-11     election results with the Texas Natural Resource Conservation
5-12     Commission.
5-13           SECTION 9. TERMS OF OFFICE OF INITIAL DIRECTORS.  The initial
5-14     directors for precincts 2 and 3 shall serve as initial directors
5-15     until the first regular meeting of the board of directors held
5-16     after the first permanent director's election under Section 10 of
5-17     this Act.  The initial directors for precincts 1 and 4 and the
5-18     initial director representing the district at large shall serve as
5-19     initial directors until the first regular meeting of the board of
5-20     directors held after the second permanent director's election under
5-21     Section 10 of this Act.
5-22           SECTION 10. ELECTION OF DIRECTORS.  Beginning in the second
5-23     year after the year in which the creation of the district is
5-24     confirmed at a confirmation election, an election shall be held in
5-25     the district on the first Saturday in May every second year to
5-26     elect the appropriate number of directors to the board.
5-27           SECTION 11. ADDITIONAL AUTHORITY. (a)  The district may
 6-1     contract with one or more state agencies or other governmental
 6-2     bodies, including a county, a river authority, or another district
 6-3     to carry out any function of the district.
 6-4           (b)  The district may require a drilling permit before a new
 6-5     well is drilled or an existing well is substantially altered.
 6-6     Notwithstanding an exemption for a well under Section 36.117, Water
 6-7     Code, written authorization from the district must be received
 6-8     before a new well is drilled or an existing well is substantially
 6-9     altered.
6-10           (c)  The district may participate in the construction,
6-11     implementation, and maintenance of best management practices for
6-12     water resource management in the district and may engage in and
6-13     promote the acceptance of best management practices through
6-14     education efforts sponsored by the district.  Construction,
6-15     implementation, and maintenance of best management practices must
6-16     address water quantity and quality practices such as brush
6-17     management, prescribed grazing, recharge structures, water and silt
6-18     detention and retention structures, plugging of abandoned wells,
6-19     rainwater harvesting, and other treatment measures for the
6-20     conservation of water resources.
6-21           (d)  Reasonable fees, as determined by the district, may be
6-22     imposed on an annual basis on each nonexempt well.  The district
6-23     shall adopt any rules necessary for the assessment and collection
6-24     of fees under this subsection.
6-25           (e)  The district may use money collected from fees:
6-26                 (1)  in any manner necessary for the management and
6-27     operation of the district;
 7-1                 (2)  to pay all or part of the principal of and
 7-2     interest on district bonds or notes; and
 7-3                 (3)  for any purpose consistent with the district's
 7-4     certified water management plan.
 7-5           (f)  The district shall adopt rules providing for granting
 7-6     exemptions from ad valorem taxes on property on which a water
 7-7     conservation initiative has been implemented.  The rules adopted by
 7-8     the district must be consistent with the rules adopted by the
 7-9     comptroller to implement Section 11.32, Tax Code.
7-10           (g)  The rules must provide that a retail public utility is
7-11     eligible to receive an exemption from ad valorem taxes on property
7-12     on the same grounds as for any other district customer.  To
7-13     encourage retail public utilities to obtain water supplies from
7-14     sources other than groundwater, the rules adopted by the district
7-15     under Subsection (f) must include an exemption from ad valorem
7-16     taxes on property served by a retail public utility based on:
7-17                 (1)  the percentage of potable water supplied within
7-18     the district by the retail public utility from sources other than
7-19     groundwater compared to the total water supplied by the retail
7-20     public utility for the preceding year; and
7-21                 (2)  the percentage of wastewater effluent produced by
7-22     the retail public utility that is used as reclaimed water within
7-23     the district compared to the total wastewater effluent produced by
7-24     the retail public utility for the preceding year.
7-25           (h)  The district may consider the impact of floods and
7-26     equipment breakage upon the retail public utility's ability to
7-27     supply water from sources other than groundwater.
 8-1           (i)  The total amount of the exemption from ad valorem taxes
 8-2     shall not exceed one-half of the tax imposed by the district.
 8-3           SECTION 12.  PROHIBITED ACTS. The district may not:
 8-4                 (1)  impose an ad valorem tax for administrative,
 8-5     operation, or maintenance expenses that exceeds the lesser of the
 8-6     rate approved by the majority of the qualified voters voting in an
 8-7     election authorizing the tax or three cents per $100 of assessed
 8-8     valuation;
 8-9                 (2)  require the owner of a well used solely for
8-10     domestic or livestock purposes to install a meter or measuring
8-11     device on the well;
8-12                 (3)  sell, transport, or export groundwater outside of
8-13     the district;
8-14                 (4)  enter into a contract or engage in an action to
8-15     supply water to a person in the service area of any municipality or
8-16     retail public utility located in the district, except with the
8-17     express permission of the municipality or retail public utility; or
8-18                 (5)  issue before September 1, 2004, any bonds secured
8-19     by ad valorem taxes.
8-20           SECTION 13.  VALIDATION. (a)  Any act or proceeding taken by
8-21     or on  behalf of the Cow Creek Groundwater Conservation District
8-22     before the effective date of this Act is validated in all respects
8-23     as if the act or proceeding had occurred as authorized by law.
8-24           (b)  Subsection (a)  does not apply to any matter that on the
8-25     effective date of this Act:
8-26                 (1)  is involved in litigation if the litigation
8-27     ultimately results in the matter being held invalid by a final
 9-1     judgment of a court of competent jurisdiction; or
 9-2                 (2)  has been held invalid by a final judgment of a
 9-3     court of competent jurisdiction.
 9-4           SECTION 14.  FINDINGS RELATED TO PROCEDURAL REQUIREMENTS. (a)
 9-5     The proper and legal notice of the intention to introduce this Act,
 9-6     setting forth the general substance of this Act, has been published
 9-7     as provided by law, and the notice and a copy of this Act have been
 9-8     furnished to all persons, agencies, officials, or entities to which
 9-9     they are required to be furnished by the constitution and other
9-10     laws of this state, including the governor, who has submitted the
9-11     notice and Act to the Texas Natural Resource Conservation
9-12     Commission.
9-13           (b)  The Texas Natural Resource Conservation Commission has
9-14     filed its recommendations relating to this Act with the governor,
9-15     lieutenant governor, and speaker of the house of representatives
9-16     within the required time.
9-17           (c)  All requirements of the constitution and laws of this
9-18     state and the rules and procedures of the legislature with respect
9-19     to the notice, introduction, and passage of this Act are fulfilled
9-20     and accomplished.
9-21           SECTION 15.  EXPIRATION DATE; EFFECTIVE DATE. (a)  If the
9-22     creation of the district is not confirmed at a confirmation
9-23     election held under Section 8 of this Act before September 1, 2003,
9-24     this Act expires on that date.
9-25           (b)  This Act takes effect immediately if it receives a vote
9-26     of two-thirds of all the members elected to each house, as provided
9-27     by Section 39, Article III, Texas Constitution.  If this Act does
 10-1    not receive the vote necessary for immediate effect, this Act takes
 10-2    effect September 1, 2001.
         _______________________________     _______________________________
             President of the Senate              Speaker of the House
               I certify that H.B. No. 3544 was passed by the House on April
         20, 2001, by the following vote:  Yeas 142, Nays 0, 2 present, not
         voting; and that the House concurred in Senate amendments to H.B.
         No. 3544 on May 25, 2001, by the following vote:  Yeas 103, Nays 0,
         1 present, not voting.
                                             _______________________________
                                                 Chief Clerk of the House
               I certify that H.B. No. 3544 was passed by the Senate, with
         amendments, on May 23, 2001, by the following vote:  Yeas 30, Nays
         0, 1 present, not voting.
                                             _______________________________
                                                 Secretary of the Senate
         APPROVED:  __________________________
                              Date
                    __________________________
                            Governor