By Truan                                               S.B. No. 649
         77R2214 QS-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to training requirements for applicants for and recipients
 1-3     of financial assistance for water and sewer services under the
 1-4     economically distressed areas program.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1. Chapter 17, Water Code, is amended by adding
 1-7     Subchapter M to read as follows:
 1-8     SUBCHAPTER M.  REQUIRED TRAINING FOR APPLICANTS FOR AND RECIPIENTS
 1-9        OF ECONOMICALLY DISTRESSED AREAS PROGRAM FINANCIAL ASSISTANCE
1-10           Sec. 17.991.  DEFINITIONS. In this subchapter:
1-11                 (1)  "Operating entity" means the governing body of a
1-12     political subdivision responsible for providing water supply and
1-13     sewer services and the management of its water and sewer system, as
1-14     defined by rules of the board.
1-15                 (2)  "Political subdivision" has the meaning assigned
1-16     by Section 17.921.
1-17           Sec. 17.992.  TRAINING FOR APPLICANTS. The board by rule
1-18     shall require the operating entity of a political subdivision that
1-19     applies for financial assistance under Subchapter K to complete a
1-20     training program approved by the board.
1-21           Sec. 17.993.  TRAINING FOR OPERATING ENTITIES. (a)  The
1-22     commission or the board may evaluate whether an operating entity
1-23     needs training if the operating entity:
1-24                 (1)  requests additional funding;
 2-1                 (2)  requests more time to meet its obligations under a
 2-2     repayment schedule;
 2-3                 (3)  does not provide required documentation; or
 2-4                 (4)  has a history of compliance problems, as
 2-5     determined by the commission.
 2-6           (b)  The board or the commission may determine that training
 2-7     is necessary if, after an examination and evaluation of the
 2-8     operating entity's managerial, financial, and technical
 2-9     capabilities, the board or commission finds that the operating
2-10     entity's managerial, financial, or technical capabilities are
2-11     inadequate to ensure the project will meet program requirements or
2-12     remain financially viable.
2-13           (c)  The commission by rule shall establish a preenforcement
2-14     threshold of noncompliance at which the commission may notify the
2-15     board that an operating entity needs training.
2-16           (d)  If the commission assesses a penalty against an
2-17     operating entity in an enforcement action, the enforcement order
2-18     must contain a provision requiring that the operating entity
2-19     receive training as ordered by the board.  The commission shall
2-20     notify the board when the commission assesses a penalty against an
2-21     operating entity.
2-22           Sec. 17.994.  TRAINING REQUIREMENTS. (a)  The board by order
2-23     shall require an operating entity to undergo appropriate training
2-24     if the board:
2-25                 (1)  receives an application for funding;
2-26                 (2)  determines that training is necessary under
2-27     Section 17.993(a) or (b); or
 3-1                 (3)  receives notice from the commission that the
 3-2     commission finds that training is necessary under Section 17.993.
 3-3           (b)  The board shall refer the operating entity to an
 3-4     appropriate individual, association, business organization, or
 3-5     governmental entity for training required by the order.  The board,
 3-6     in making the referral, shall give a preference to state agencies
 3-7     equipped to provide the training.
 3-8           (c)  The person providing the training shall conduct an
 3-9     assessment of the operating entity for which training is ordered,
3-10     determine who needs training, and devise a training program to
3-11     address the deficiencies identified in the assessment.
3-12           (d)  The person providing the training shall present a
3-13     proposed training program to the board for approval.  If the
3-14     training program is approved by the board, the person shall conduct
3-15     the required training.
3-16           (e)  On completion of the training, the person who provided
3-17     the training shall issue a certificate of completion to the
3-18     participants in the training and to the board.
3-19           (f)  A political subdivision shall reimburse a participant in
3-20     training for reasonable expenses incurred in completing the
3-21     training.
3-22           (g)  Not later than January 15 each year, each person who
3-23     provides training under this section shall report to the board a
3-24     list of political subdivisions for which the person provided
3-25     training required under this section during the previous calendar
3-26     year.
3-27           SECTION 2.  Section 17.927(b), Water Code, is amended to read
 4-1     as follows:
 4-2           (b)  The application and plan must:
 4-3                 (1)  comply with board requirements;
 4-4                 (2)  describe in detail the method for delivering water
 4-5     supply and sewer services and the persons to whom the services will
 4-6     be provided;
 4-7                 (3)  describe the method for complying with minimum
 4-8     state standards for water supply and sewer services adopted by the
 4-9     board under Section 16.342 of this code;
4-10                 (4)  include a budget that estimates the total cost of
4-11     providing water supply and sewer services to the economically
4-12     distressed area and a proposed schedule and method for repayment of
4-13     financial assistance consistent with board rules and guidelines;
4-14                 (5)  describe existing water supply and sewer
4-15     facilities located in the economically distressed area and include
4-16     with the description:
4-17                       (A)  the county map required by Section 366.036,
4-18     Health and Safety Code;  or
4-19                       (B)  a document prepared and certified by an
4-20     engineer registered to practice in this state describing the plan
4-21     for providing water supply and sewer services to the economically
4-22     distressed area;
4-23                 (6)  provide proof that the appropriate political
4-24     subdivision has adopted the model rules developed under Section
4-25     16.343 of this code;
4-26                 (7)  include information on the ability of potential
4-27     customers to pay for the services provided by the project including
 5-1     composite data prepared by the applicant pursuant to board rules
 5-2     and guidelines from surveys of those potential customers covering
 5-3     income, family size, personal expenses, employment status, and
 5-4     other information required by board rule;
 5-5                 (8)  include an estimate of the per household cost of
 5-6     providing the services contemplated by the project with supporting
 5-7     data;
 5-8                 (9)  describe the procedures to be used to collect
 5-9     money from residents who use the proposed water supply and sewer
5-10     services including procedures for collection of delinquent
5-11     accounts;
5-12                 (10)  include a requirement that a contractor who
5-13     agrees to acquire, construct, extend, or provide water supply and
5-14     sewer services executes a performance bond in the amount of 100
5-15     percent of the contract price;
5-16                 (11)  contain an agreement to comply with applicable
5-17     procurement procedures in contract awards for water supply and
5-18     sewer services;
5-19                 (12)  if located in the service area of a retail public
5-20     utility or public utility that has a certificate of public
5-21     convenience and necessity under Chapter 13 of this code, include a
5-22     document in the form of an affidavit signed by the chief executive
5-23     officer of the utility, which shall cooperate with the political
5-24     subdivision, stating that the utility does not object to the
5-25     construction and operation of the services and facilities in its
5-26     service area;
5-27                 (13)  include a map of the economically distressed area
 6-1     together with supporting information relating to dwellings in the
 6-2     area;
 6-3                 (14)  describe in detail the methods for incorporating
 6-4     water conservation into the provision of water and sewer services
 6-5     to the economically distressed area;
 6-6                 (15)  include, on request of the board, a written
 6-7     determination by the commission on the managerial, financial, and
 6-8     technical capabilities [capacity] of the applicant to operate the
 6-9     system for which assistance is being requested;  and
6-10                 (16)  include any other information required by the
6-11     board.
6-12           SECTION 3.  Section 17.930(b), Water Code, is amended to read
6-13     as follows:
6-14           (b)  After making the considerations provided by Section
6-15     17.929 of this code, the board by resolution shall:
6-16                 (1)  approve the plan and application as submitted;
6-17                 (2)  approve the plan and application subject to the
6-18     requirements identified by the commission for the applicant to
6-19     obtain the managerial, financial, and technical capabilities
6-20     [capacity] to operate the system and any other requirements,
6-21     including training under Subchapter M, the board considers
6-22     appropriate;
6-23                 (3)  deny the application and identify the requirements
6-24     or remedial steps the applicant must complete before the applicant
6-25     may be reconsidered for financial assistance;
6-26                 (4)  if the board finds that the applicant will be
6-27     unable to obtain the managerial, financial, or technical
 7-1     capabilities [capacity] to build and operate a system, deny the
 7-2     application and issue a determination that a service provider other
 7-3     than the applicant is necessary or appropriate to undertake the
 7-4     proposed project; or
 7-5                 (5)  deny the application.
 7-6           SECTION 4.  (a)  This Act takes effect September 1, 2001.
 7-7           (b)  Section 17.992, Water Code, as added by this Act,
 7-8     applies only to an applicant for financing under Subchapter K,
 7-9     Chapter 17, Water Code, whose application is filed on or after that
7-10     date.