1-1     By:  Kolkhorst, Williams, Ellis                       H.B. No. 3655
 1-2          (Senate Sponsor - Ogden)
 1-3           (In the Senate - Received from the House April 30, 2001;
 1-4     April 30, 2001, read first time and referred to Committee on
 1-5     Natural Resources; May 11, 2001, reported adversely, with favorable
 1-6     Committee Substitute by the following vote:  Yeas 4, Nays 0;
 1-7     May 11, 2001, sent to printer.)
 1-8     COMMITTEE SUBSTITUTE FOR H.B. No. 3655                  By:  Duncan
 1-9                            A BILL TO BE ENTITLED
1-10                                   AN ACT
1-11     relating to the creation, administration, powers, duties,
1-12     operation, and financing of the Bluebonnet Groundwater Conservation
1-13     District.
1-14           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-15           SECTION 1.  CREATION.  (a)  A groundwater conservation
1-16     district, to be known as the Bluebonnet Groundwater Conservation
1-17     District, is created in Grimes, Washington, Waller, Austin, and
1-18     Walker counties, subject to approval at a confirmation election
1-19     under Section 15 of this Act.  The district is a governmental
1-20     agency and a body politic and corporate.
1-21           (b)  The district is created under and is essential to
1-22     accomplish the purposes of Section 59, Article XVI, Texas
1-23     Constitution.
1-24           (c)  The purpose of this Act is to create a locally
1-25     controlled groundwater district in order to protect and recharge
1-26     groundwater, to prevent pollution or waste of groundwater, to
1-27     control subsidence caused by withdrawal of water from the
1-28     groundwater reservoirs in the area, and to regulate the transport
1-29     of water out of the boundaries of the district.
1-30           SECTION 2.  DEFINITION.  In this Act, "district" means the
1-31     Bluebonnet Groundwater Conservation District.
1-32           SECTION 3.  BOUNDARIES.  The boundaries of the district are
1-33     coextensive with the boundaries of Grimes, Washington, Waller,
1-34     Austin, and Walker counties.
1-35           SECTION 4.  FINDING OF BENEFIT.  All of the land and other
1-36     property included within the boundaries of the district will be
1-37     benefited by the works and projects that are to be accomplished by
1-38     the district under powers conferred by Section 59, Article XVI,
1-39     Texas Constitution.  The district is created to serve a public use
1-40     and benefit.
1-41           SECTION 5.  GENERAL POWERS.  (a)  Except as otherwise
1-42     provided by this Act, the district has all the rights, powers,
1-43     privileges, authority, functions, and duties provided by the
1-44     general law of this state, including Chapter 36, Water Code,
1-45     applicable to groundwater conservation districts created under
1-46     Section 59, Article XVI, Texas Constitution.  This Act prevails
1-47     over any provision of general law, including Chapter 36, Water
1-48     Code, that is in conflict or is inconsistent with this Act.
1-49           (b)  The district does not have the authority granted by the
1-50     following provisions of Chapter 36, Water Code:
1-51                 (1)  Section 36.105, relating to eminent domain; and
1-52                 (2)  Sections 36.020 and 36.201-36.204, relating to
1-53     taxes.
1-54           SECTION 6.  FEES.  (a)  The board of directors of the
1-55     district by rule may impose reasonable fees on each well for which
1-56     a permit is issued by the district and which is not exempt from
1-57     regulation by the district.  A fee may be based on the size of
1-58     column pipe used by the well or on the actual, authorized, or
1-59     anticipated amount of water to be withdrawn from the well.
1-60           (b)  Fees may not exceed:
1-61                 (1)  $1 per acre-foot payable annually for water used
1-62     for agricultural use; or
1-63                 (2)  17 cents per thousand gallons for water used for
1-64     any other purpose.
 2-1           (c)  In addition to the fee authorized under Subsection (a)
 2-2     of this section, the district may impose a reasonable fee or
 2-3     surcharge for an export fee using one of the following methods:
 2-4                 (1)  a fee negotiated between the district and the
 2-5     transporter; or
 2-6                 (2)  a combined production and export fee not to exceed
 2-7     17 cents per thousand gallons for water used.
 2-8           (d)  Fees authorized by this section may be assessed annually
 2-9     and may be used to fund the cost of district operations.
2-10           SECTION 7.  EXEMPTIONS. (a)  The district may exempt wells
2-11     under Section 36.117, Water Code, from the requirements to obtain a
2-12     drilling permit, an operating permit, or any other permit required
2-13     by Chapter 36, Water Code, or the district's rules.
2-14           (b)  The district may not require a permit for:
2-15                 (1)  a well used solely for domestic use or for
2-16     providing water for livestock or poultry on a tract of land larger
2-17     than 10 acres that is either drilled, completed, or equipped so
2-18     that it is incapable of producing more than 25,000 gallons of
2-19     groundwater a day;
2-20                 (2)  the drilling of a water well used solely to supply
2-21     water for a rig that is actively engaged in drilling or exploration
2-22     operations for an oil or gas well permitted by the Railroad
2-23     Commission of Texas, provided that the person holding the permit is
2-24     responsible for drilling and operating the water well and the well
2-25     is located on the same lease or field associated with the drilling
2-26     rig; or
2-27                 (3)  the drilling of a water well authorized under a
2-28     permit issued by the Railroad Commission of Texas under Chapter
2-29     134, Natural Resources Code, or for production from any such well
2-30     to the extent the withdrawals are required for mining activities
2-31     regardless of any subsequent use of the water.
2-32           (c)  The district may not deny the owner of a tract of land,
2-33     or the owner's lessee, who does not have a well equipped to produce
2-34     more than 25,000 gallons a day on the tract, either a permit to
2-35     drill a well on the owner's land or the privilege to produce
2-36     groundwater from the owner's land, subject to the rules of the
2-37     district.
2-38           (d)  The district may not restrict the production of any well
2-39     that is exempt from permitting under Subsection (b)(1) of this
2-40     section.
2-41           (e)  Notwithstanding Subsection (b) of this section, the
2-42     district may require a well to be permitted by the district and to
2-43     comply with all district rules if:
2-44                 (1)  the purpose of a well exempted under Subsection
2-45     (b)(2) of this section is no longer solely to supply water for a
2-46     rig that is actively engaged in drilling or exploration operations
2-47     for an oil or gas well permitted by the Railroad Commission of
2-48     Texas; or
2-49                 (2)  the withdrawals from a well exempted under
2-50     Subsection (b)(3) of this section are no longer necessary for
2-51     mining activities or are greater than the amount necessary for
2-52     mining activities specified in the permit issued by the Railroad
2-53     Commission of Texas under Chapter 134, Natural Resources Code.
2-54           (f)  An entity holding a permit issued by the Railroad
2-55     Commission of Texas under Chapter 134, Natural Resources Code, that
2-56     authorizes the drilling of a water well shall report monthly to the
2-57     district:
2-58                 (1)  the total amount of water withdrawn during the
2-59     month;
2-60                 (2)  the quantity of water necessary for mining
2-61     activities; and
2-62                 (3)  the quantity of water withdrawn for other
2-63     purposes.
2-64           (g)  Notwithstanding Subsection (e) of this section, the
2-65     district may not require a well exempted under Subsection (b)(3) of
2-66     this section to comply with the spacing requirements of the
2-67     district.
2-68           (h)  The district may not deny an application for a permit to
2-69     drill and produce water for hydrocarbon production activities if
 3-1     the application meets the spacing, density, and production rules
 3-2     applicable to all permitted water wells in the district.
 3-3           (i)  A water well exempted under Subsection (a) or (b) of
 3-4     this section may:
 3-5                 (1)  be registered in accordance with rules adopted by
 3-6     the district; and
 3-7                 (2)  be equipped and maintained so as to conform to the
 3-8     district's rules requiring installation of casing, pipe, and
 3-9     fittings to prevent the escape of groundwater from a groundwater
3-10     reservoir to any reservoir not containing groundwater and to
3-11     prevent the pollution or harmful alteration of the character of the
3-12     water in any groundwater reservoir.
3-13           (j)  The district may require the driller of a well exempted
3-14     under Subsection (a) or (b) of this section to file the drilling
3-15     log with the district.
3-16           (k)  A well to supply water for a subdivision of land for
3-17     which a plat approval is required by Chapter 232, Local Government
3-18     Code, is not exempted under Subsection (b) of this section.
3-19           (l)  Groundwater withdrawn from a well exempt from permitting
3-20     or regulation under this section and subsequently transported
3-21     outside the boundaries of the district is subject to any applicable
3-22     production and export fees under Section 6 of this Act.
3-23           (m)  This section applies to water wells, including water
3-24     wells used to supply water for activities related to the
3-25     exploration or production of hydrocarbons or minerals.  This
3-26     section does not apply to production or injection wells drilled for
3-27     oil, gas, sulphur, uranium, or brine, for core tests, or for
3-28     injection of gas, saltwater, or other fluids, under permits issued
3-29     by the Railroad Commission of Texas.
3-30           SECTION 8.  MITIGATION ASSISTANCE. In addition to the
3-31     authority granted under Chapter 36, Water Code, the district may
3-32     assist in the mediation between landowners regarding the mitigation
3-33     of the loss of existing groundwater supply of exempt domestic and
3-34     livestock users due to the groundwater pumping of others.
3-35           SECTION 9.  MANAGEMENT PLAN.  The district shall develop or
3-36     contract to develop its own management plan under Section 36.1071,
3-37     Water Code.
3-38           SECTION 10.  PERMITTING.  The district shall issue permits
3-39     for wells based on the consideration of whether:
3-40                 (1)  the application conforms to the requirements
3-41     prescribed by Chapter 36, Water Code, and is accompanied by the
3-42     prescribed fees;
3-43                 (2)  the proposed use of water unreasonably affects
3-44     existing groundwater and surface water resources or existing permit
3-45     holders;
3-46                 (3)  the proposed use of water is dedicated to any
3-47     beneficial use;
3-48                 (4)  the proposed use of water is consistent with the
3-49     district's certified water management plan;
3-50                 (5)  the applicant has agreed to avoid waste and
3-51     achieve water conservation; and
3-52                 (6)  the applicant has agreed that reasonable diligence
3-53     will be used to protect groundwater quality and that the applicant
3-54     will follow well plugging guidelines at the time of well closure.
3-55           SECTION 11.  COORDINATION OF ACTIVITIES WITH OTHER ENTITIES.
3-56     (a)  The district may coordinate activities with the Central
3-57     Carrizo-Wilcox Coordinating Council and may appoint a nonvoting
3-58     representative to the Central Carrizo-Wilcox Coordinating Council.
3-59           (b)  The district may coordinate activities with the
3-60     Harris-Galveston Coastal Subsidence District or with other
3-61     groundwater conservation districts to manage portions of the Gulf
3-62     Coast Aquifer.
3-63           SECTION 12.  BOARD OF DIRECTORS.  (a)  The district is
3-64     governed by a board of directors of not fewer than 8 or more than
3-65     20 directors, appointed as provided by Section 13 of this Act.
3-66           (b)  Initial directors serve until permanent directors are
3-67     appointed under Section 13 of this Act and qualified as required by
3-68     Subsection (d) of this section.
3-69           (c)  Permanent directors serve four-year staggered terms.
 4-1           (d)  Each director must qualify to serve as a director in the
 4-2     manner provided by Section 36.055, Water Code.
 4-3           (e)  A director serves until the director's successor has
 4-4     qualified.
 4-5           (f)  A director may serve consecutive terms.
 4-6           (g)  If there is a vacancy on the board, the governing body
 4-7     of the entity that appointed the director who vacated the office
 4-8     shall appoint a director to serve the remainder of the term.  In
 4-9     making this appointment, the governing body shall appoint a
4-10     director to represent the interest of the director who has vacated
4-11     the office.
4-12           (h)  Directors are not entitled to receive compensation for
4-13     serving as a director but may be reimbursed for actual, reasonable
4-14     expenses incurred in the discharge of official duties.
4-15           (i)  A majority vote of a quorum is required for board
4-16     action.  If there is a tie vote, the proposed action fails.
4-17           SECTION 13.  APPOINTMENT OF DIRECTORS. (a)  The commissioners
4-18     courts of the counties within the district, if the district has two
4-19     to five counties, shall each appoint four directors, of whom:
4-20                 (1)  one must represent municipal interests;
4-21                 (2)  one must represent agricultural interests;
4-22                 (3)  one must represent industrial interests; and
4-23                 (4)  one must represent rural water suppliers'
4-24     interests.
4-25           (b)  If the district consists of one county, the
4-26     commissioners court of that county shall appoint eight directors,
4-27     of whom:
4-28                 (1)  two must represent municipal interests;
4-29                 (2)  two must represent agricultural interests;
4-30                 (3)  two must represent industrial interests; and
4-31                 (4)  two must represent rural water suppliers'
4-32     interests.
4-33           (c)  The commissioners courts of the counties within the
4-34     district shall each appoint the appropriate number of initial
4-35     directors as soon as practicable following the effective date of
4-36     this Act, but not later than the 90th day after the effective date
4-37     of this Act.
4-38           (d)  The initial directors shall draw lots to determine their
4-39     terms.  Half of the initial directors serve terms that expire on
4-40     the second anniversary of the date on which all initial directors
4-41     have qualified as required by Section 12 of this Act, and half of
4-42     the initial directors serve terms that expire on the fourth
4-43     anniversary of the date on which all initial directors have
4-44     qualified as required by Section 12 of this Act.  On the second
4-45     anniversary of the date on which all initial directors have
4-46     qualified as required by Section 12 of this Act and every two years
4-47     after that date, the appropriate commissioners courts shall appoint
4-48     the appropriate number of permanent directors.
4-49           SECTION 14.  ORGANIZATIONAL MEETING.  As soon as practicable
4-50     after all the initial directors have been appointed and have
4-51     qualified as provided in this Act, a majority of the directors
4-52     shall convene the organizational meeting of the district at a
4-53     location within the district agreeable to a majority of the
4-54     directors.  If no location can be agreed on, the organizational
4-55     meeting of the directors shall be at the Washington County
4-56     Courthouse.
4-57           SECTION 15.  CONFIRMATION ELECTION.  (a)  The initial board
4-58     of directors shall call and hold, on the same date in each county
4-59     to be included in the district, an election to confirm the creation
4-60     of the district.
4-61           (b)  Except as provided by this section, a confirmation
4-62     election must be conducted as provided by Sections 36.017, 36.018,
4-63     and 36.019, Water Code, and Section 41.001, Election Code.
4-64           (c)  If the majority of qualified voters in a county who vote
4-65     in the election vote to confirm the creation of the district, that
4-66     county is included in the district. If the majority of qualified
4-67     voters in a county who vote in the election vote not to confirm the
4-68     creation of the district, that county is excluded from the
4-69     district.
 5-1           (d)  If the creation of the district is not confirmed by an
 5-2     election held under this section before the second anniversary of
 5-3     the effective date of this Act, the district is dissolved and this
 5-4     Act expires on that date.
 5-5           SECTION 16.  FINDINGS RELATED TO PROCEDURAL REQUIREMENTS.
 5-6     (a)  The proper and legal notice of the intention to introduce this
 5-7     Act, setting forth the general substance of this Act, has been
 5-8     published as provided by law, and the notice and a copy of this Act
 5-9     have been furnished to all persons, agencies, officials, or
5-10     entities to which they are required to be furnished by the
5-11     constitution and other laws of this state, including the governor,
5-12     who has submitted the notice and Act to the Texas Natural Resource
5-13     Conservation Commission.
5-14           (b)  The Texas Natural Resource Conservation Commission has
5-15     filed its recommendations relating to this Act with the governor,
5-16     the lieutenant governor, and the speaker of the house of
5-17     representatives within the required time.
5-18           (c)  All requirements of the constitution and laws of this
5-19     state and the rules and procedures of the legislature with respect
5-20     to the notice, introduction, and passage of this Act are fulfilled
5-21     and accomplished.
5-22           SECTION 17.  EFFECTIVE DATE.  This Act takes effect September
5-23     1, 2001.
5-24                                  * * * * *