1-1     By:  Truan                                             S.B. No. 649
 1-2           (In the Senate - Filed February 12, 2001; February 13, 2001,
 1-3     read first time and referred to Committee on Natural Resources;
 1-4     February 22, 2001, reported adversely, with favorable Committee
 1-5     Substitute by the following vote:  Yeas 5, Nays 0;
 1-6     February 22, 2001, sent to printer.)
 1-7     COMMITTEE SUBSTITUTE FOR S.B. No. 649                    By:  Lucio
 1-8                            A BILL TO BE ENTITLED
 1-9                                   AN ACT
1-10     relating to training requirements for applicants for and recipients
1-11     of financial assistance for water and sewer services under the
1-12     economically distressed areas program.
1-13           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-14           SECTION 1.  Chapter 17, Water Code, is amended by adding
1-15     Subchapter M to read as follows:
1-16     SUBCHAPTER M.  REQUIRED TRAINING FOR APPLICANTS FOR AND RECIPIENTS
1-17        OF ECONOMICALLY DISTRESSED AREAS PROGRAM FINANCIAL ASSISTANCE
1-18           Sec. 17.991.  DEFINITIONS.  In this subchapter:
1-19                 (1)  "Operating entity" means the governing body of a
1-20     political subdivision responsible for providing water supply and
1-21     sewer services and the management of its water and sewer system, as
1-22     defined by rules of the board.
1-23                 (2)  "Political subdivision" has the meaning assigned
1-24     by Section 17.921.
1-25           Sec. 17.992.  TRAINING FOR APPLICANTS.  The board by rule
1-26     shall require the operating entity of a political subdivision that
1-27     applies for financial assistance under Subchapter K to complete a
1-28     training program approved by the board.
1-29           Sec. 17.993.  TRAINING FOR OPERATING ENTITIES.  (a)  The
1-30     commission or the board may evaluate whether an operating entity
1-31     needs training if the operating entity:
1-32                 (1)  requests additional funding;
1-33                 (2)  requests more time to meet its obligations under a
1-34     repayment schedule;
1-35                 (3)  does not provide required documentation; or
1-36                 (4)  has a history of compliance problems, as
1-37     determined by the commission.
1-38           (b)  The board or the commission may determine that training
1-39     is necessary if, after an examination and evaluation of the
1-40     operating entity's managerial, financial, and technical
1-41     capabilities, the board or commission finds that the operating
1-42     entity's managerial, financial, or technical capabilities are
1-43     inadequate to ensure the project will meet program requirements or
1-44     remain financially viable.
1-45           (c)  The commission by rule shall establish a preenforcement
1-46     threshold of noncompliance at which the commission may notify the
1-47     board that an operating entity needs training.
1-48           (d)  If the commission assesses a penalty against an
1-49     operating entity in an enforcement action, the enforcement order
1-50     must contain a provision requiring that the operating entity
1-51     receive training as ordered by the board.  The commission shall
1-52     notify the board when the commission assesses a penalty against an
1-53     operating entity.
1-54           Sec. 17.994.  TRAINING REQUIREMENTS.  (a)  The board by order
1-55     shall require an operating entity to undergo appropriate training
1-56     if the board:
1-57                 (1)  receives an application for funding;
1-58                 (2)  determines that training is necessary under
1-59     Section 17.993(a) or (b); or
1-60                 (3)  receives notice from the commission that the
1-61     commission finds that training is necessary under Section 17.993.
1-62           (b)  The board shall refer the operating entity to an
1-63     appropriate individual, association, business organization, or
1-64     governmental entity for training required by the order.
 2-1           (c)  The person providing the training shall conduct an
 2-2     assessment of the operating entity for which training is ordered,
 2-3     determine who needs training, and devise a training program to
 2-4     address the deficiencies identified in the assessment.
 2-5           (d)  The person providing the training shall present a
 2-6     proposed training program to the board for approval.  If the
 2-7     training program is approved by the board, the person shall conduct
 2-8     the required training.
 2-9           (e)  On completion of the training, the person who provided
2-10     the training shall issue a certificate of completion to the
2-11     participants in the training and to the board.
2-12           (f)  A political subdivision shall reimburse a participant in
2-13     training for reasonable expenses incurred in completing the
2-14     training.
2-15           (g)  Not later than January 15 each year, each person who
2-16     provides training under this section shall report to the board a
2-17     list of political subdivisions for which the person provided
2-18     training required under this section during the previous calendar
2-19     year.
2-20           SECTION 2.  Subsection (b), Section 17.927, Water Code, is
2-21     amended to read as follows:
2-22           (b)  The application and plan must:
2-23                 (1)  comply with board requirements;
2-24                 (2)  describe in detail the method for delivering water
2-25     supply and sewer services and the persons to whom the services will
2-26     be provided;
2-27                 (3)  describe the method for complying with minimum
2-28     state standards for water supply and sewer services adopted by the
2-29     board under Section 16.342 of this code;
2-30                 (4)  include a budget that estimates the total cost of
2-31     providing water supply and sewer services to the economically
2-32     distressed area and a proposed schedule and method for repayment of
2-33     financial assistance consistent with board rules and guidelines;
2-34                 (5)  describe existing water supply and sewer
2-35     facilities located in the economically distressed area and include
2-36     with the description:
2-37                       (A)  the county map required by Section 366.036,
2-38     Health and Safety Code; or
2-39                       (B)  a document prepared and certified by an
2-40     engineer registered to practice in this state describing the plan
2-41     for providing water supply and sewer services to the economically
2-42     distressed area;
2-43                 (6)  provide proof that the appropriate political
2-44     subdivision has adopted the model rules developed under Section
2-45     16.343 of this code;
2-46                 (7)  include information on the ability of potential
2-47     customers to pay for the services provided by the project including
2-48     composite data prepared by the applicant pursuant to board rules
2-49     and guidelines from surveys of those potential customers covering
2-50     income, family size, personal expenses, employment status, and
2-51     other information required by board rule;
2-52                 (8)  include an estimate of the per household cost of
2-53     providing the services contemplated by the project with supporting
2-54     data;
2-55                 (9)  describe the procedures to be used to collect
2-56     money from residents who use the proposed water supply and sewer
2-57     services including procedures for collection of delinquent
2-58     accounts;
2-59                 (10)  include a requirement that a contractor who
2-60     agrees to acquire, construct, extend, or provide water supply and
2-61     sewer services executes a performance bond in the amount of 100
2-62     percent of the contract price;
2-63                 (11)  contain an agreement to comply with applicable
2-64     procurement procedures in contract awards for water supply and
2-65     sewer services;
2-66                 (12)  if located in the service area of a retail public
2-67     utility or public utility that has a certificate of public
2-68     convenience and necessity under Chapter 13 of this code, include a
2-69     document in the form of an affidavit signed by the chief executive
 3-1     officer of the utility, which shall cooperate with the political
 3-2     subdivision, stating that the utility does not object to the
 3-3     construction and operation of the services and facilities in its
 3-4     service area;
 3-5                 (13)  include a map of the economically distressed area
 3-6     together with supporting information relating to dwellings in the
 3-7     area;
 3-8                 (14)  describe in detail the methods for incorporating
 3-9     water conservation into the provision of water and sewer services
3-10     to the economically distressed area;
3-11                 (15)  include, on request of the board, a written
3-12     determination by the commission on the managerial, financial, and
3-13     technical capabilities [capacity] of the applicant to operate the
3-14     system for which assistance is being requested; and
3-15                 (16)  include any other information required by the
3-16     board.
3-17           SECTION 3.  Subsection (b), Section 17.930, Water Code, is
3-18     amended to read as follows:
3-19           (b)  After making the considerations provided by Section
3-20     17.929 of this code, the board by resolution shall:
3-21                 (1)  approve the plan and application as submitted;
3-22                 (2)  approve the plan and application subject to the
3-23     requirements identified by the commission for the applicant to
3-24     obtain the managerial, financial, and technical capabilities
3-25     [capacity] to operate the system and any other requirements,
3-26     including training under Subchapter M, the board considers
3-27     appropriate;
3-28                 (3)  deny the application and identify the requirements
3-29     or remedial steps the applicant must complete before the applicant
3-30     may be reconsidered for financial assistance;
3-31                 (4)  if the board finds that the applicant will be
3-32     unable to obtain the managerial, financial, or technical
3-33     capabilities [capacity] to build and operate a system, deny the
3-34     application and issue a determination that a service provider other
3-35     than the applicant is necessary or appropriate to undertake the
3-36     proposed project; or
3-37                 (5)  deny the application.
3-38           SECTION 4.  (a)  This Act takes effect September 1, 2001.
3-39           (b)  Section 17.992, Water Code, as added by this Act,
3-40     applies only to an applicant for financing under Subchapter K,
3-41     Chapter 17, Water Code, whose application is filed on or after that
3-42     date.
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