By:  Brown                                            S.B. No. 1335
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to certain river authorities and water districts, the
 1-3     codification of Acts creating and regulating the authorities and
 1-4     districts, and the creation of the Texas Water Advisory Council to
 1-5     review the authorities and districts.
 1-6           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-7           SECTION 1.  The Water Code is amended by adding Title 6 to
 1-8     read as follows:
 1-9                     TITLE 6.  SURFACE WATER AUTHORITIES
1-10                       SUBTITLE A.  GENERAL PROVISIONS
1-11                      CHAPTER 201.  GENERAL PROVISIONS
1-12           Sec. 201.001.  DEFINITIONS.  In this title:
1-13                 (1)  "Commission" means the Texas Natural Resource
1-14     Conservation Commission.
1-15                 (2)  "Surface water authority" means an entity listed
1-16     in Section 9.010(b).
1-17           Sec. 201.002.  REVIEW.  A surface water authority is subject
1-18     to review by the Texas Water Advisory Council as provided by
1-19     Chapter 9.
1-20                (Chapters 202 to 220 reserved for expansion
1-21        SUBTITLE B.  SURFACE WATER AUTHORITIES NOT CREATED BY STATUTE
1-22             CHAPTER 221.  BEXAR-MEDINA-ATASCOSA COUNTIES WATER
1-23                         IMPROVEMENT DISTRICT NO. 1
1-24           Sec. 221.001.  DISTRICT CREATED UNDER LAW.  (a)  The
1-25     "Bexar-Medina-Atascosa Counties Water Control and Improvement
 2-1     District No. 1" is a water control and improvement district.  The
 2-2     district is a governmental agency and a body politic and corporate.
 2-3           (b)  The district was created under the laws of this state
 2-4     and is essential to accomplish the purposes of Section 59, Article
 2-5     XVI, Texas Constitution.
 2-6           Sec. 221.002.  DEFINITIONS.  In this chapter:
 2-7                 (1)  "Board" means the board of directors of the
 2-8     district.
 2-9                 (2)  "Director" means a member of the board.
2-10                 (3)  "District" means the Bexar-Medina-Atascosa
2-11     Counties Water Control and Improvement District No. 1.
2-12           Sec. 221.003.  AUTHORITY TO EXCLUDE PROPERTY.  (a)  The
2-13     district may exclude property from the district if the board finds
2-14     after notice and hearing that exclusion of the property is in the
2-15     best interest of the district and that:
2-16                 (1)  the property is not irrigable with water purchased
2-17     from the district because:
2-18                       (A)  the district cannot deliver water by gravity
2-19     flow to a high point on the property to irrigate the property;
2-20                       (B)  the property is subdivided into tracts of
2-21     less than 10 acres; or
2-22                       (C)  the property is subdivided into town lots,
2-23     town lots and blocks, or similar small parcels of any size that
2-24     will not be used for agricultural purposes or are suitable for a
2-25     residential, a commercial, or another nonagricultural purpose; or
2-26                 (2)  the property has not been irrigated with water
 3-1     purchased from the district for a period of not less than three
 3-2     years before the date the notice for the hearing was mailed.
 3-3           (b)  The board may by resolution exclude land from the
 3-4     district if the land was not included in the district at the time
 3-5     the district was created and:
 3-6                 (1)  the land has been subdivided into town lots and
 3-7     blocks, with streets or other thoroughfares dedicated to the use of
 3-8     the public; and
 3-9                 (2)  a map and the dedication have been filed for
3-10     record with the county clerk of the county in which the land is
3-11     located.
3-12           (c)  When a resolution under Subsection (b) is passed, the
3-13     secretary of the board shall enter it in the minutes of the board,
3-14     and from that time, the territory is excluded from the district and
3-15     is no longer entitled to be served with water by the district.
3-16           Sec. 221.004.  HEARING ON PROPOSAL TO EXCLUDE PROPERTY;
3-17     NOTICE.  (a)  If the board has information that property in the
3-18     district is excludable under Section 221.003, the board may call
3-19     and hold a hearing to determine whether to exclude the property.
3-20           (b)  The board by certified mail, return receipt requested,
3-21     not earlier than the 21st day or later than the 16th day before the
3-22     date of the hearing shall issue written notice of the hearing to
3-23     each owner of property in the area proposed to be excluded as shown
3-24     on the current tax rolls of the district.  The notice must:
3-25                 (1)  describe the property proposed to be excluded;
3-26                 (2)  describe the basis for the proposed exclusion;
 4-1                 (3)  state the time, date, and location of the hearing;
 4-2     and
 4-3                 (4)  advise that an interested property owner has the
 4-4     right to appear at the hearing and to offer evidence to contest the
 4-5     exclusion.
 4-6           (c)  The board shall publish notice of the hearing at least
 4-7     once a week for two consecutive weeks in a newspaper of general
 4-8     circulation in each county in which the property proposed to be
 4-9     excluded is located.  The first notice must appear not earlier than
4-10     the 40th day before or later than the 16th day before the date of
4-11     the hearing.  The notice must:
4-12                 (1)  describe the property proposed to be excluded;
4-13                 (2)  state the time, date, and location of the hearing;
4-14     and
4-15                 (3)  advise that an interested property owner has the
4-16     right to appear at the hearing and to offer evidence to contest the
4-17     exclusion.
4-18           Sec. 221.005.  CONSENT FROM HOLDERS OF INDEBTEDNESS.  Before
4-19     a hearing on the exclusion of property, if the district has
4-20     outstanding bonded indebtedness or indebtedness under a loan from a
4-21     governmental agency, a written consent from an authorized
4-22     representative of the holder or holders of the indebtedness
4-23     consenting to the exclusion shall be obtained by and filed with the
4-24     district.
4-25           Sec. 221.006.  SUIT TO REVIEW EXCLUSION; APPEAL.  An
4-26     interested person may bring suit to review an order of the board
 5-1     excluding property under this chapter in the manner provided by
 5-2     Section 49.308 and may appeal as provided by that section.
 5-3           Sec. 221.007.  NOTICE TO COMMISSION.  The board shall furnish
 5-4     to the commission a copy of the order excluding property not later
 5-5     than the 30th day after the date the board issues the order.
 5-6           Sec. 221.008.  RESULTS OF EXCLUSION ORDER.  (a)  Property
 5-7     that has been excluded from the district under this chapter is not
 5-8     entitled to purchase water from or to receive any other service
 5-9     from the district.
5-10           (b)  Taxes, assessments, or other charges on the excluded
5-11     property that are owed to the district at the time the order of
5-12     exclusion takes effect remain the obligation of the owner of the
5-13     excluded property and continue to be secured by statutory liens on
5-14     the property, if any.
5-15           (c)  After property is excluded, the owner of the property
5-16     has no further liability to the district for future taxes,
5-17     assessments, or other charges of the district based on that
5-18     property.
5-19           Sec. 221.009.  RECORDATION.  After property has been excluded
5-20     from the district, the district shall record, in the real property
5-21     records of the county in which the excluded property is located, a
5-22     copy of the order excluding the property from the district.  The
5-23     copy must be certified and acknowledged by the secretary of the
5-24     board.
5-25           Sec. 221.010.  DISTRICT FACILITIES AND EASEMENTS ON EXCLUDED
5-26     PROPERTY.  An order to exclude property does not affect or
 6-1     interfere with any rights that the district has to maintain and
 6-2     continue operation of any easements, canals, ditches, pipelines,
 6-3     pumps, or other facilities of the district that are located on
 6-4     excluded property for the purpose of servicing property remaining
 6-5     in the district.
 6-6           Sec. 221.011.  SUBSTITUTION FOR EXCLUDED PROPERTY.  (a)  At
 6-7     the sole discretion of the board, after an exclusion order is
 6-8     issued by the board, property may be added to the district if the
 6-9     property is:
6-10                 (1)  practically irrigable with water purchased from
6-11     the district; and
6-12                 (2)  in the aggregate, less than or equal to the
6-13     acreage of the property being excluded.
6-14           (b)  Property may be added to the district under this chapter
6-15     only if the owner of the property files a petition requesting
6-16     inclusion.  If the owner already has acreage within the district,
6-17     all taxes and other assessments owed to the district by the owner
6-18     must be current before the petition may be considered by the board.
6-19           Sec. 221.012.  BOARD OF DIRECTORS.  (a)  The district shall
6-20     be governed by a board of seven directors.  A board election shall
6-21     be held on the first Saturday in May of even-numbered years.  At
6-22     each election the appropriate number of directors shall be elected
6-23     so that the board consists of one director elected from each of the
6-24     district's five single-member precincts and two directors elected
6-25     from the district at large.
6-26           (b)  A committee, subcommittee, or other similar entity
 7-1     created by the board is subject to Chapter 551, Government Code, if
 7-2     a majority of the members of the committee, subcommittee, or other
 7-3     similar entity are directors.
 7-4           Sec. 221.013.  TERMS OF DIRECTORS.  The directors serve
 7-5     staggered four-year terms.  Three directors' terms expire May 1,
 7-6     2002, and every fourth year after that date, and four directors'
 7-7     terms expire May 1, 2004, and every fourth year after that date.
 7-8           Sec. 221.014.  QUALIFICATIONS OF DIRECTORS.  A person seeking
 7-9     to represent a single-member precinct of the district must own land
7-10     in the precinct to be represented.  A person seeking to represent
7-11     the district at large must own land in the district.
7-12           Sec. 221.015.  APPLICATION FOR PLACEMENT ON BALLOT.  A person
7-13     seeking to be placed on the ballot for a board election must:
7-14                 (1)  indicate that the person wishes to run for a
7-15     position representing the district at large; or
7-16                 (2)  identify the single-member precinct from which the
7-17     person wishes to run.
7-18           Sec. 221.016.  DIRECTOR AS GENERAL MANAGER PROHIBITED.  The
7-19     provisions of Section 49.056(c), Water Code, do not apply to this
7-20     district.
7-21                CHAPTER 222.  TARRANT REGIONAL WATER DISTRICT
7-22           Sec. 222.001.  DISTRICT CREATED UNDER LAW.  (a)  The "Tarrant
7-23     Regional Water District" is a water control and improvement
7-24     district.  The district is a governmental agency and a body politic
7-25     and corporate.
7-26           (b)  The district was created under the laws of this state
 8-1     and is essential to accomplish the purposes of Section 59, Article
 8-2     XVI, Texas Constitution.
 8-3           (c)  Unless specifically provided otherwise, the provisions
 8-4     of this chapter are intended to supplement and expand rather than
 8-5     to limit the powers and authority of the district arising under
 8-6     other law, including Chapters 49, 50, and 51.
 8-7           Sec. 222.002.  DEFINITIONS.  In this chapter:
 8-8                 (1)  "Board" means the board of directors of the
 8-9     district.
8-10                 (2)  "Director" means a member of the board.
8-11                 (3)  "District" means the Tarrant Regional Water
8-12     District.
8-13           Sec. 222.003.  ANNEXATION OF TERRITORY.  (a)  Any territory
8-14     situated within Tarrant or Johnson County, either contiguous to the
8-15     district or not, may be annexed to the district as provided by this
8-16     section.
8-17           (b)  A petition for annexation must:
8-18                 (1)  be signed by 50 or a majority, whichever number is
8-19     less, of the qualified voters of the territory to be annexed;
8-20                 (2)  be filed with the board; and
8-21                 (3)  describe the territory to be annexed by metes and
8-22     bounds or otherwise unless the territory is the same as that
8-23     contained in a city or town, in which event it will be sufficient
8-24     to state that the territory to be annexed is that contained within
8-25     the city or town or that portion of the city or town that is not
8-26     then contained in the district.
 9-1           (c)  If the board finds that the petition complies with and
 9-2     is signed by the number of qualified voters required under
 9-3     Subsection (b), that the annexation would be in the interest of the
 9-4     territory to be annexed and the district, and that the district
 9-5     will be able to supply water to the territory to be annexed or
 9-6     cause water to be supplied to the territory, the board shall adopt
 9-7     a resolution stating the conditions, if any, under which the
 9-8     territory may be annexed to the district and requesting the
 9-9     commissioners court of Tarrant or Johnson County to annex the
9-10     territory to the district.  The resolution shall be conclusive of
9-11     the legal sufficiency of the petition and the qualifications of the
9-12     signers.  A certified copy of the resolution and of the petition
9-13     shall be filed with the commissioners court.
9-14           (d)  The commissioners court shall adopt a resolution
9-15     declaring its intention to call an election in the territory to be
9-16     annexed for the purpose of submitting the proposition of whether
9-17     the territory shall be annexed to the district.  The commissioners
9-18     court shall set a time and place for a hearing to be held by the
9-19     commissioners court on the question of whether the territory to be
9-20     annexed will benefit from the improvements, works, and facilities
9-21     then owned or operated or contemplated to be owned or operated by
9-22     the district or by the other functions of the district.  Because
9-23     railroad right-of-way that is not situated within the defined
9-24     limits of an incorporated city or town will not benefit from the
9-25     improvements, works, and facilities that the district is authorized
9-26     to construct, railroad right-of-way may not be annexed to the
 10-1    district unless the right-of-way is contained within the limit of
 10-2    an incorporated city or town that has been annexed to the district.
 10-3          (e)  Notice of the adoption of the resolution stating the
 10-4    time and place of the hearing, addressed to the citizens and owners
 10-5    of property in the territory to be annexed, shall be published one
 10-6    time in a newspaper designated by the commissioners court at least
 10-7    10 days before the date of the hearing.  The notice must describe
 10-8    the territory to be annexed in the same manner in which it is
 10-9    required or permitted by this chapter to be described in the
10-10    petition.
10-11          (f)  All interested persons may appear at the hearing and
10-12    offer evidence for or against the intended annexation.  The hearing
10-13    may proceed in the order and under the rules that may be prescribed
10-14    by the commissioners court and may be recessed from time to time.
10-15    If, at the conclusion of the hearing, the commissioners court finds
10-16    that all the lands in the territory to be annexed will benefit from
10-17    the present or contemplated improvements, works, or facilities of
10-18    the district, the commissioners court shall adopt a resolution
10-19    calling an election in the territory to be annexed stating the date
10-20    and place or places for holding the election and appointing a
10-21    presiding judge for each voting place, who shall appoint the
10-22    necessary assistant judges and clerks to assist in holding the
10-23    election.
10-24          (g)  Notice of the election, stating the date and places for
10-25    holding the election, the proposition to be voted on, and the
10-26    conditions under which the territory may be annexed, or making
 11-1    reference to the resolution of the board for that purpose, shall be
 11-2    published one time in a newspaper designated by the commissioners
 11-3    court at least 10 days before the date set for the election.
 11-4          (h)  Only qualified electors who reside in the territory
 11-5    sought to be annexed may vote in the election.  Returns of the
 11-6    election shall be made to the commissioners court.
 11-7          (i)  The commissioners court shall canvass the returns of the
 11-8    election and adopt an order declaring the results.  If the
 11-9    commissioners court finds from the returns that a majority of the
11-10    votes cast are in favor of annexation, the commissioners court
11-11    shall annex the territory to the district, and the annexation shall
11-12    be incontestable except in the manner and within the time for
11-13    contesting elections under the Election Code.  A certified copy of
11-14    the order shall be recorded in the deed records of the county in
11-15    which the territory is situated.
11-16          (j)  In calling the election on the proposition for
11-17    annexation of territory, the commissioners court may also submit a
11-18    proposition for the assumption of the territory's part of the
11-19    tax-supported bonds of the district then outstanding and those
11-20    previously voted but not yet sold and for the levy of an ad valorem
11-21    tax on taxable property in the territory to be annexed along with
11-22    the tax in the rest of the district for the payment of the bonds.
11-23          (k)  After territory is added to the district, the board may
11-24    call an election over the entire district for the purpose of
11-25    determining whether the entire district as enlarged shall assume
11-26    the tax-supported bonds then outstanding and those voted but not
 12-1    yet sold and whether an ad valorem tax shall be levied on all
 12-2    taxable property within the district as enlarged for the payment of
 12-3    the bonds, unless the proposition had been voted along with the
 12-4    annexation election and becomes lawfully binding on the territory
 12-5    annexed.  The election shall be called and held in the same manner
 12-6    as elections for the issuance of bonds as provided by this chapter.
 12-7          (l)  If the territory of more than one city is proposed to be
 12-8    annexed to the district, separate elections shall be held in each
 12-9    city, and only the territory of the city or cities in which a
12-10    majority vote favors annexation shall be annexed.  If two or more
12-11    areas which are not contiguous to each other are proposed to be
12-12    annexed to the district, separate elections shall be held in each
12-13    area, and only the area or areas in which a majority vote favors
12-14    annexation shall be annexed.
12-15          (m)  If the election for the assumption of indebtedness
12-16    fails, the commissioners court shall, on request of the board,
12-17    enter an order detaching the territory from the district.
12-18          (n)  All expenses of hearings and elections held under this
12-19    chapter shall be paid by the district.
12-20          (o)  All actions and proceedings taken before September 1,
12-21    2001, in annexing territory to the district whether or not the
12-22    territory is contiguous to the district and whether or not the
12-23    territory is contained within an incorporated city wholly or
12-24    partially located within the boundaries of the district, are
12-25    validated and that territory is declared to constitute a part of
12-26    the district.  All acts of the board in redefining the boundaries
 13-1    of the district and the redefined boundaries are validated.
 13-2          (p)  The validation provisions of Subsection (o) do not apply
 13-3    to any annexation or redefinition of boundaries that on
 13-4    September 1, 2001:
 13-5                (1)  is involved in litigation if the litigation
 13-6    ultimately results in the annexation or redefinition being held
 13-7    invalid by a final judgment of a court of competent jurisdiction;
 13-8    or
 13-9                (2)  has been held invalid by a final judgment of a
13-10    court of competent jurisdiction.
13-11          Sec. 222.004.  BONDS.  (a)  For the purpose of providing a
13-12    source of water supply for cities and other users for municipal,
13-13    domestic, industrial, and mining purposes and for the purpose of
13-14    carrying out any other power or authority of the district, the
13-15    district may issue negotiable bonds payable from revenues or taxes
13-16    or both revenues and taxes of the district as pledged by resolution
13-17    of the board.  Pending the issuance of definitive bonds, the board
13-18    may authorize the delivery of negotiable interim bonds or notes
13-19    eligible for exchange or substitution by use of the definitive
13-20    bonds.
13-21          (b)  Bonds of the district must be authorized by resolution
13-22    of the board, issued in the name of the district, signed by the
13-23    president or vice president of the board, and attested by the
13-24    secretary of the board and must bear the seal of the district.  The
13-25    facsimile signatures of the president or of the secretary or of
13-26    both may be printed or lithographed on the bonds if authorized by
 14-1    the board.  The seal of the district may be impressed on the bonds
 14-2    or may be printed or lithographed on the bonds.
 14-3          (c)  Bonds must mature serially or otherwise in not to exceed
 14-4    40 years and may be sold at a price and under terms determined by
 14-5    the board to be the most advantageous reasonably obtainable,
 14-6    provided that the interest cost to the district, including the
 14-7    discount, if any, calculated by use of standard bond interest
 14-8    tables currently in use by insurance companies and investment
 14-9    houses does not exceed six percent per year, which may be evidenced
14-10    by coupons.  Within the discretion of the board, the bonds may be
14-11    made callable prior to maturity at such times and prices as may be
14-12    prescribed in the resolution authorizing the bonds and may be made
14-13    registrable as to principal or as to both principal and interest.
14-14          (d)  Bonds may be issued in more than one series and from
14-15    time to time as required for carrying out the powers of the
14-16    district.
14-17          (e)  Bonds may be secured by a pledge of all or part of the
14-18    net revenues of the district, of the net revenues of one or more
14-19    contracts made before or after the bonds are issued, or of other
14-20    revenues or income specified by resolution of the board in the
14-21    trust indenture.  A pledge may reserve the right, under conditions
14-22    specified in the pledge, to issue additional bonds that will be on
14-23    a parity with or subordinate to the bonds being issued.
14-24          (f)  The district may issue bonds payable from ad valorem
14-25    taxes to be levied on all taxable property in the district or may
14-26    issue bonds secured by and payable from both those taxes and the
 15-1    revenues of the district.  If bonds are issued payable wholly or
 15-2    partially from ad valorem taxes, the board shall levy a tax
 15-3    sufficient to pay the bonds and the interest on the bonds as the
 15-4    bonds and interest become due.  The rate of the tax for any year
 15-5    may be set after giving consideration to the money received from
 15-6    the pledged revenues that may be available for payment of the
 15-7    principal and interest to the extent and in the manner permitted by
 15-8    the resolution authorizing the issuance of the bonds.
 15-9          (g)  If bonds payable wholly from revenues are issued, the
15-10    board shall set, and may from time to time revise, rates of
15-11    compensation for water sold and services rendered by the district
15-12    that will be sufficient to pay the expense of operating and
15-13    maintaining the facilities of the district and to pay the bonds as
15-14    they mature and the interest on the bonds as it accrues and to
15-15    maintain the reserve and other funds as provided in the resolution
15-16    authorizing the bonds.  If bonds payable partially from revenues
15-17    are issued, the board shall set rates of compensation for water
15-18    sold and services rendered by the district that will be sufficient
15-19    to assure compliance with the resolution authorizing the bonds.
15-20          (h)  From the proceeds of the sale of bonds, the district may
15-21    set aside an amount for the payment of interest expected to accrue
15-22    during construction and for a reserve interest and sinking fund,
15-23    and this provision may be made in the resolution authorizing the
15-24    bonds.  Proceeds from the sale of the bonds may also be used for
15-25    the payment of all expenses necessarily incurred in accomplishing
15-26    the purposes for which the district is created, including the
 16-1    expenses of issuing and selling the bonds.  The proceeds from the
 16-2    sale of the bonds may be temporarily invested in direct obligations
 16-3    of the United States government.
 16-4          (i)  In the event of a default or a threatened default in the
 16-5    payment of principal of or interest on bonds payable wholly or
 16-6    partially from revenues, any court of competent jurisdiction may,
 16-7    on petition of the holders of outstanding bonds, appoint a receiver
 16-8    with authority to collect and receive all income of the district
 16-9    except taxes, employ and discharge agents and employees of the
16-10    district, take charge of the district's funds on hand except funds
16-11    received from taxes, unless commingled, and manage the proprietary
16-12    affairs of the district without consent or hindrance by the board.
16-13    The receiver may also be authorized to sell or make contracts for
16-14    the sale of water or renew such contracts with the approval of the
16-15    court appointing the receiver.  The court may vest the receiver
16-16    with such other powers and duties as the court finds necessary for
16-17    the protection of the holders of the bonds.  The resolution
16-18    authorizing the issuance of the bonds or the trust indenture
16-19    securing them may limit or qualify the rights of less than all of
16-20    the outstanding bonds payable from the same source to institute or
16-21    prosecute any litigation affecting the district's property or
16-22    income.
16-23          Sec. 222.005.  REFUNDING BONDS.  (a)  The district may issue
16-24    refunding bonds for the purpose of refunding any outstanding bonds
16-25    and interest on the bonds.  Refunding bonds may be issued to refund
16-26    more than one series of outstanding bonds and combine the pledges
 17-1    for the outstanding bonds for the security of the refunding bonds
 17-2    and may be secured by other or additional revenues and mortgage
 17-3    liens.
 17-4          (b)  The provisions of this chapter with respect to the
 17-5    issuance by the district of other bonds, their security, their
 17-6    approval by the attorney general, and the remedies of the holders
 17-7    shall be applicable to refunding bonds.  Refunding bonds shall be
 17-8    registered by the comptroller on surrender and cancellation of the
 17-9    bonds to be refunded, but in lieu of that procedure, the resolution
17-10    authorizing the issuance of the refunding bonds may provide that
17-11    the refunding bonds shall be sold and the proceeds of the sale
17-12    deposited in the bank where the original bonds are payable, in
17-13    which case the refunding bonds may be issued in an amount
17-14    sufficient to pay the principal of and the interest on the original
17-15    bonds to their option date or maturity date, and the comptroller
17-16    shall register the refunding bonds without concurrent surrender and
17-17    cancellation of the original bonds.
17-18          Sec. 222.006.  TRUST INDENTURE; DEED OF TRUST OR MORTGAGE
17-19    LIEN.  (a)  Bonds, including refunding bonds, authorized by this
17-20    chapter that are not payable wholly from ad valorem taxes may be
17-21    additionally secured by a trust indenture under which the trustee
17-22    may be a bank with trust powers located either within or outside
17-23    the state.  The bonds, within the discretion of the board, may be
17-24    additionally secured by a deed of trust or mortgage lien on
17-25    physical properties of the district and all franchises, easements,
17-26    water rights and appropriation permits, leases and contracts, and
 18-1    all rights appurtenant to the properties, vesting in the trustee
 18-2    power to sell the properties for the payment of the indebtedness,
 18-3    power to operate the properties, and all other powers and authority
 18-4    for the further security of the bonds.
 18-5          (b)  The trust indenture, regardless of the existence of a
 18-6    deed of trust or mortgage lien on the properties, may contain any
 18-7    provisions prescribed by the board for the security of the bonds
 18-8    and the preservation of the trust estate, may make provision for
 18-9    amendment or modification of the trust indenture and for the
18-10    issuance of bonds to replace lost or mutilated bonds, may condition
18-11    the right to expend district money or sell district property on
18-12    approval by a registered professional engineer selected as provided
18-13    in the trust indenture, and may make provision for the investment
18-14    of funds of the district.
18-15          (c)  A purchaser under a sale under a deed of trust lien,
18-16    where one is given, shall be the absolute owner of the properties,
18-17    facilities, and rights purchased and shall have the right to
18-18    maintain and operate the properties, facilities, and rights.
18-19          Sec. 222.007.  BOND ELECTIONS.  (a)  Bonds payable wholly or
18-20    partially from ad valorem taxes, except refunding bonds, may not be
18-21    issued unless authorized by a majority vote at an election.  Only
18-22    the qualified voters who reside in the district shall be permitted
18-23    to vote at the election.  Bonds not payable wholly or partially
18-24    from ad valorem taxes may be issued without an election.
18-25          (b)  An election described by Subsection (a) may be called by
18-26    the board without a petition.  The resolution calling the election
 19-1    shall specify the time and location of the election, the purpose
 19-2    for which the bonds are to be issued, the maximum amount of the
 19-3    bonds, the maximum maturity of the bonds, the form of the ballot,
 19-4    and the presiding judge for each voting place.  The presiding judge
 19-5    serving at each voting place shall appoint one assistant judge and
 19-6    at least two clerks to assist in holding the election.  Notice of
 19-7    the election shall be given by publishing a substantial copy of the
 19-8    resolution calling the election in a newspaper with general
 19-9    circulation in Tarrant County once each week for two consecutive
19-10    weeks.  The first publication must be at least 21 days before the
19-11    election.
19-12          (c)  The returns of the election shall be made to and
19-13    canvassed by the board.
19-14          (d)  The general laws relating to elections are applicable to
19-15    elections held under this section except as otherwise provided by
19-16    this chapter.
19-17          Sec. 222.008.  APPROVAL AND REGISTRATION OF BONDS.  After
19-18    bonds, including refunding bonds, are authorized by the district,
19-19    the bonds and the record relating to their issuance shall be
19-20    submitted to the attorney general for examination as to their
19-21    validity.  If the bonds recite that they are secured by a pledge of
19-22    the proceeds of a contract previously made between the district and
19-23    a city or other governmental agency, authority, or district, a copy
19-24    of the contract and the proceedings of the city or other
19-25    governmental agency, authority, or district authorizing the
19-26    contract shall also be submitted to the attorney general.  If the
 20-1    bonds have been authorized and if any such contract has been made
 20-2    in accordance with the constitution and laws of the state, the
 20-3    attorney general shall approve the bonds and the contract, and the
 20-4    bonds then shall be registered by the comptroller.  After approval
 20-5    and registration, the bonds and the contract, if any, are valid and
 20-6    binding and are incontestable for any cause.
 20-7          Sec. 222.009.  CHAPTER AS FULL AUTHORITY.  The provisions of
 20-8    this chapter with reference to the issuance of bonds are complete,
 20-9    and no proceedings or approvals shall be required except those
20-10    required by this chapter.
20-11          Sec. 222.010.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
20-12    DEPOSITS.  Bonds of the district are legal and authorized
20-13    investments for banks, savings banks, trust companies, building and
20-14    loan associations, savings and loan associations, insurance
20-15    companies, fiduciaries, trustees, and guardians and for the sinking
20-16    funds of cities, towns, villages, counties, school districts, or
20-17    other political corporations or subdivisions of the state.  The
20-18    bonds are eligible to secure the deposits of all public funds of
20-19    the state and all public funds of cities, towns, villages,
20-20    counties, school districts, or other political corporations or
20-21    subdivisions of the state, and the bonds are lawful and sufficient
20-22    security for such deposits to the extent of their value when
20-23    accompanied by all unmatured coupons.
20-24          Sec. 222.011.  CONTRACTS WITH CITIES AND OTHERS.  The
20-25    district may enter into contracts with cities and others for the
20-26    supply of water.  The district may also contract with a city for
 21-1    the rental or leasing of or for the operation of the water
 21-2    production, water supply, or water filtration or purification and
 21-3    water supply facilities of the city for such consideration as the
 21-4    district and the city may agree.  The contract may be on such terms
 21-5    and for such time as the parties may agree and may provide that it
 21-6    shall continue in effect until bonds specified in the contract and
 21-7    refunding bonds issued in lieu of such bonds are paid.
 21-8          Sec. 222.012.  EXEMPTION FROM TAXATION.  The accomplishment
 21-9    of the purposes stated in this chapter is for the benefit of the
21-10    people of this state and for the improvement of their properties
21-11    and industries, and the district, in carrying out the purposes of
21-12    this chapter, will be performing an essential public function under
21-13    Section 59, Article XVI, Texas Constitution.  The district shall
21-14    not be required to pay any tax or assessment on its properties or
21-15    any part of its properties, and the bonds issued under this chapter
21-16    and the transfer of and income from the bonds, including profits
21-17    made on the sale of the bonds, shall at all times be free from
21-18    taxation within the state.
21-19          Sec. 222.013.  DEPOSITORY.  The board may select more than
21-20    one depository.
21-21          Sec. 222.014.  PURCHASE OF PROPERTY.  The district may
21-22    purchase the properties of any other water district located wholly
21-23    or partially in the district for such consideration as may be
21-24    agreed on by the board and the boards of directors of the other
21-25    districts, which consideration may be or include the assumption by
21-26    the district of the outstanding bonds of the district from which
 22-1    the purchase is made.  If the district proposes to pay such assumed
 22-2    bonds by the levy of a tax, the bonds shall be assumed by an
 22-3    election called and held over the entire district in the manner
 22-4    provided by this chapter for the authorization of bonds.
 22-5          Sec. 222.015.  SEWAGE TRANSPORTATION, TREATMENT, AND
 22-6    DISPOSAL.  (a)  The district may purchase, construct, improve, and
 22-7    repair works and facilities necessary for the transportation,
 22-8    treatment, and disposal of sewage and industrial wastes and
 22-9    effluent and may issue negotiable bonds for those purposes.  The
22-10    district may make contracts with cities and others under which the
22-11    district will transport, treat, and dispose of sewage from the
22-12    cities.  The district may also make contracts with a city for the
22-13    use of certain sewage transportation, treatment, and disposal
22-14    facilities owned by the city or by the district.
22-15          (b)  Bonds issued under this section may be payable from the
22-16    revenues under any contract or contracts or other income and, if
22-17    authorized by an election, bonds may be made payable from taxes or
22-18    from taxes and revenues.  The provisions of this chapter relating
22-19    to bonds issued by the district shall be applicable to bonds issued
22-20    under this section.
22-21          (c)  The district may have its bonds and sewer contracts
22-22    approved by the attorney general with the effect prescribed in this
22-23    chapter or, in the discretion of the board, may have its bonds and
22-24    sewer contracts validated by a suit in the district court as
22-25    provided in Chapter 1205, Government Code, or may have the bonds
22-26    and contracts validated by suit and approved.  The interest rate
 23-1    and sale price of the bonds need not be set until after the
 23-2    termination of the validation proceedings or suit.
 23-3          (d)  If the proposed bonds recite that they are secured by a
 23-4    pledge of the proceeds of a contract or contracts previously made
 23-5    between the district and one or more cities, the petition shall so
 23-6    allege and the notice of the suit shall mention the allegation and
 23-7    the city fund or revenues from which the contract or contracts are
 23-8    payable.  The suit shall be in the nature of a proceeding in rem.
 23-9    The judgment shall be res judicata as to the validity of the
23-10    contract or contracts and the pledge of the revenues of the
23-11    contracts.
23-12          Sec. 222.016.  EMINENT DOMAIN.  If the district, in the
23-13    exercise of any of the powers granted under this chapter, whether
23-14    it be the power of eminent domain, the power of relocation, or any
23-15    other power, makes necessary the relocation, raising, rerouting,
23-16    changing the grade, or altering the construction of any highway,
23-17    railroad, electric transmission line, telephone or telegraph
23-18    properties and facilities, or pipeline, all such necessary
23-19    relocation, raising, rerouting, changing the grade, or alteration
23-20    of construction shall be accomplished at the sole expense of the
23-21    district.  In this section, "sole expense" means the actual cost of
23-22    such relocation, raising, lowering, rerouting, change in grade, or
23-23    alteration of construction in providing comparable replacement
23-24    without enhancement of the facilities, after deducting the net
23-25    salvage value derived from the old facility.  The power of eminent
23-26    domain exercised by the district under this chapter shall be
 24-1    limited to Tarrant County.
 24-2       CHAPTER 223.  TITUS COUNTY FRESH WATER SUPPLY DISTRICT NO. 1
 24-3          Sec. 223.001.  DISTRICT CREATED UNDER LAW.  (a)  The "Titus
 24-4    County Fresh Water Supply District No. 1" is a governmental agency
 24-5    and a body politic and corporate.
 24-6          (b)  The district was created under the laws of this state
 24-7    and is essential to accomplish the purposes of Section 59, Article
 24-8    XVI, Texas Constitution.
 24-9          Sec. 223.002.  DEFINITIONS.  In this chapter:
24-10                (1)  "Board" means the board of supervisors of the
24-11    district.
24-12                (2)  "District" means the Titus County Fresh Water
24-13    Supply District No. 1.
24-14                (3)  "Supervisor" means a member of the board.
24-15          Sec. 223.003.  TERRITORY.  The district includes all of the
24-16    territory contained within the boundaries of Titus County.
24-17          Sec. 223.004.  PERMITS AND CERTIFICATION FROM COMMISSION.
24-18    (a)  The district shall obtain from the commission all permits
24-19    necessary under general law for the acquisition of water rights.
24-20          (b)  Before the district issues any bonds to construct a
24-21    reservoir and related facilities for conserving, transporting, and
24-22    distributing freshwater, it shall secure prior certification of
24-23    feasibility from the commission as provided by Section 49.181.
24-24          Sec. 223.005.  BOARD OF SUPERVISORS.  (a)  The district is
24-25    governed by a board of five elected supervisors as provided by the
24-26    laws relating to municipal utility districts.
 25-1          (b)  Supervisors shall serve for staggered terms of four
 25-2    years.  Supervisors hold office until their successors are chosen
 25-3    and have qualified.  An election shall be held on the first
 25-4    Saturday of May of each even-numbered year to elect two or three
 25-5    supervisors to replace those whose terms are expiring.
 25-6          (c)  An election for supervisors shall be called by
 25-7    resolution of the board, and the results of the election shall be
 25-8    canvassed and declared by the board.  The board shall designate the
 25-9    place or places of holding the election and shall name the election
25-10    officers.  The board is responsible for election supplies and
25-11    expenses.
25-12          (d)  A vacancy on the board shall be filled for the unexpired
25-13    term by appointment made by the remainder of the board.  If the
25-14    number of supervisors is reduced to less than three for any reason,
25-15    the remaining supervisors shall immediately call a special election
25-16    to fill the vacant positions.  If the board fails to call an
25-17    election as required by this subsection, a district court may, on
25-18    the application of a voter or taxpayer of the district, issue an
25-19    order requiring that an election be called by the remaining
25-20    supervisors.
25-21          (e)  Notice of an election shall be published in a newspaper
25-22    of general circulation in the county one time at least 30 days
25-23    before the date of the election.
25-24          (f)  Any person desiring that the person's name be printed on
25-25    the ballot as a candidate for supervisor shall file a petition,
25-26    signed by not less than 25 qualified voters, asking that the
 26-1    person's name be printed on the ballot.  The petition shall be
 26-2    filed with the secretary of the board at least 30 days before the
 26-3    date of the election.
 26-4          Sec. 223.006.  DISTRICT TAXES.  (a)  In addition to the
 26-5    powers set forth in the laws relating to municipal utility
 26-6    districts, the district by resolution of the board may authorize
 26-7    the assessor and collector of taxes for Titus County to assess and
 26-8    collect taxes for the district.
 26-9          (b)  Not later than July 20 of each year, the board shall
26-10    levy the tax on all taxable property within the district that is
26-11    subject to taxation and shall immediately certify the tax rate to
26-12    the assessor and collector of taxes for Titus County.  The tax so
26-13    levied shall be collected on all property subject to taxation by
26-14    the assessor and collector of taxes for Titus County on the county
26-15    tax values and in the same manner and under the same conditions as
26-16    county taxes.
26-17          (c)  The assessor and collector of taxes shall charge and
26-18    deduct from payments to the district the fees for assessing and
26-19    collecting the tax at a rate determined by the board; provided,
26-20    however, that the fees may not exceed two percent of the amounts
26-21    collected and may not exceed $5,000 for any one year.  The fees
26-22    shall be deposited in the county's general fund and shall be
26-23    reported as fees of office of the assessor and collector of taxes.
26-24          (d)  Interest and penalties on taxes paid to the district
26-25    shall be the same as for county taxes.
26-26          (e)  The residue of tax collections, after deduction of
 27-1    discounts and fees of assessing and collecting the taxes, shall be
 27-2    deposited in the district depository.
 27-3          Sec. 223.007.  GENERAL POWERS AND DUTIES.  (a)  In addition
 27-4    to the powers set forth in the laws relating to municipal utility
 27-5    districts and other laws relating specifically to the district, the
 27-6    district may enter into agreements with the state or any of its
 27-7    agencies, including the Texas Water Development Board, in order
 27-8    that the district may effect its purposes of conserving,
 27-9    transporting, and distributing freshwater as contemplated by
27-10    Section 59, Article XVI, Texas Constitution, and laws that have
27-11    been enacted pursuant to that section.
27-12          (b)  An agreement under Subsection (a) may provide that the
27-13    district may develop, construct, own, and operate facilities
27-14    jointly with the state or its agencies, may develop, construct, and
27-15    operate the facilities on behalf of the state or its agencies, or
27-16    may permit the state or its agencies to develop, construct, or
27-17    operate facilities on behalf of the district.
27-18          Sec. 223.008.  ADDITIONAL SPECIFIC POWERS.  (a)  In addition
27-19    to the powers set forth in the laws relating to freshwater supply
27-20    districts, the district may make contracts with cities, private
27-21    corporations, and others under which the district will sell water
27-22    to the parties.  The district may pledge the proceeds from one or
27-23    more contracts for the payment of bonds issued by the district.
27-24          (b)  In addition to the authority granted by Section 49.222,
27-25    the district may exercise the power of eminent domain to acquire
27-26    land:
 28-1                (1)  for roads;
 28-2                (2)  to prevent pollution; and
 28-3                (3)  for the construction of water filtration plants
 28-4    and distribution lines and sanitary disposal plants and related
 28-5    facilities.
 28-6          (c)  The district may lease any land acquired by eminent
 28-7    domain to private persons, firms, or corporations for the
 28-8    construction of recreational facilities, boating facilities,
 28-9    motels, lodges, homesites, and related facilities.
28-10          (d)  The district may construct and operate water filtration
28-11    plants and distribution lines, distribution systems for raw and
28-12    filtered water, and sanitary sewage disposal plants and related
28-13    facilities.  Revenue bonds of the district may be issued to pay for
28-14    these plants and facilities.
28-15          (e)  If the district, in the exercise of the power of eminent
28-16    domain or power of relocation or any other power granted by this
28-17    chapter, makes necessary the relocation, raising, rerouting,
28-18    changing the grade, or altering the construction of any highway,
28-19    railroad, electric transmission line, telegraph or telephone
28-20    properties and facilities, or pipeline, all such necessary
28-21    relocation, raising, rerouting, changing the grade, or alteration
28-22    of construction shall be accomplished at the sole expense of the
28-23    district.  In this subsection, "sole expense" means the actual cost
28-24    of such relocation, raising, lowering, rerouting, change in grade,
28-25    or alteration of construction in providing comparable replacement
28-26    without enhancement of the facilities, after deducting the net
 29-1    salvage value derived from the old facility.
 29-2          Sec. 223.009.  CONFLICTS.  Nothing in this chapter shall be
 29-3    construed to violate any provision of the federal or state
 29-4    constitutions, and all acts done under this chapter shall be done
 29-5    in such manner as will conform to those constitutions, whether
 29-6    expressly provided or not.  If any procedure under this chapter is
 29-7    held by any court to be a violation of either of those
 29-8    constitutions, the district shall have the power by resolution to
 29-9    provide an alternative procedure that conforms to those
29-10    constitutions.
29-11               (Chapters 224 to 250 reserved for expansion
29-12         SUBTITLE C.  SURFACE WATER AUTHORITIES CREATED BY STATUTE
29-13             CHAPTER 251.  ANGELINA AND NECHES RIVER AUTHORITY
29-14          Sec. 251.001.  CREATION.  (a)  A conservation and reclamation
29-15    district to be known as the "Angelina and Neches River Authority"
29-16    is created.  The authority is a governmental agency and a body
29-17    politic and corporate.
29-18          (b)  The authority is created under and is essential to
29-19    accomplish the purposes of Section 59, Article XVI, Texas
29-20    Constitution.
29-21          (c)  The authority may exercise the powers granted by Section
29-22    59, Article XVI, Texas Constitution, to districts created to
29-23    conserve, store, control, preserve, utilize, and distribute the
29-24    storm waters, floodwaters, and waters of the rivers and streams of
29-25    the state and any powers contemplated and implied by the purposes
29-26    of that section or conferred by general law and the provisions of
 30-1    this chapter.
 30-2          (d)  Nothing in this chapter shall authorize the authority to
 30-3    levy any taxes or special assessments or to create any debt payable
 30-4    out of taxation.
 30-5          (e)  The authority may exercise all the rights and powers of
 30-6    an independent governmental agency and a body politic and corporate
 30-7    to construct, maintain, and operate in the valleys of the Neches
 30-8    River and its tributaries, within or outside the boundaries of the
 30-9    authority, works considered essential to the operation and
30-10    administration of the authority in the control, storing,
30-11    preservation, and distribution to all useful purposes of the waters
30-12    of the Neches River and its tributary streams, including the storm
30-13    waters and floodwaters of the river and the streams.  The authority
30-14    may exercise the authority and power of control and regulation over
30-15    the waters of the Neches River and its tributaries as may be
30-16    exercised by the state, subject to the provisions of the
30-17    constitution and the acts of the legislature.
30-18          (f)  The rights, powers, privileges, authority, and functions
30-19    granted to the authority and the authority itself are expressly
30-20    subject to Sections 17.183-17.188, Sections 17.271-17.277, and
30-21    Chapters 11, 12, 26, and 49.
30-22          Sec. 251.002.  DEFINITIONS.  In this chapter:
30-23                (1)  "Authority" means the Angelina and Neches River
30-24    Authority.
30-25                (2)  "Board" means the board of directors of the
30-26    authority.
 31-1                (3)  "Director" means a member of the board.
 31-2          Sec. 251.003.  COORDINATION WITH OTHER DISTRICTS.  A
 31-3    drainage, conservation, reclamation, or other district created as
 31-4    provided by Section 59, Article XVI, Texas Constitution, may
 31-5    coordinate its plans with the authority and may enter into joint
 31-6    undertakings for the purposes for which the authority and the
 31-7    district are created.  Any joint undertakings must be approved by a
 31-8    majority of the boards of directors of the authority and the
 31-9    districts involved.
31-10          Sec. 251.004.  BOUNDARIES.  (a)  The territory to be included
31-11    within the boundaries of the authority shall be that part of the
31-12    state defined as follows:  All that territory lying and being
31-13    situated within the watershed of the Neches River and its
31-14    tributaries, and which includes the following named counties, lying
31-15    wholly or in part within said watershed:  Van Zandt, Angelina,
31-16    Nacogdoches, San Augustine, Sabine, Jasper, Newton, Rusk, Shelby,
31-17    Houston, Trinity, Polk, and Orange, and that portion of the
31-18    drainage area of Flat Creek in Henderson County which lies west of
31-19    presently designated Farm-to-Market Road 607 leading from LaRue
31-20    through Leagueville to Brownsboro; provided that there is excepted
31-21    from the area covered by the Angelina and Neches River Authority
31-22    all the area presently covered by the Lower Neches Valley Authority
31-23    and the Upper Neches River Municipal Water Authority.
31-24          (b)  It is the intent of the legislature to preserve the area
31-25    and authority of the Lower Neches Valley Authority, the Upper
31-26    Neches River Municipal Water Authority, and the Neches River
 32-1    Conservation District existing on August 29, 1977.
 32-2          Sec. 251.005.  BOARD OF DIRECTORS.  (a)  The management and
 32-3    control of the affairs of the authority are vested in a board of
 32-4    directors consisting of nine members, who must be freehold property
 32-5    taxpayers and legal voters of the state.
 32-6          (b)  Directors are appointed by the governor with the advice
 32-7    and consent of the senate and serve staggered six-year terms.  The
 32-8    directors shall hold office after their appointment and
 32-9    qualification until their successors are appointed and have
32-10    qualified.
32-11          (c)  A vacancy on the board is filled by the governor in the
32-12    manner provided by this section for the unexpired term.  As soon as
32-13    possible after appointment, a director shall qualify by taking the
32-14    official oath and filing a good and sufficient bond with the
32-15    secretary of state.  The official bond of each director, in the
32-16    amount of $1,000, shall be payable to the authority and conditioned
32-17    on the faithful performance of the director's duties and is subject
32-18    to approval by the secretary of state.
32-19          Sec. 251.006.  OFFICERS; VOTING REQUIREMENTS.  The board
32-20    shall elect a president, vice president, and secretary-treasurer.
32-21    Five directors constitute a quorum at board meetings, and a
32-22    concurrence of a majority of those present shall be sufficient in
32-23    all matters pertaining to the business of the authority.
32-24          Sec. 251.007.  OFFICER AND EMPLOYEE BONDS.  The board shall
32-25    require an officer or employee who collects, pays, or handles any
32-26    funds of the authority under board orders to furnish good and
 33-1    sufficient bond, with a duly authorized surety company payable to
 33-2    the authority, conditioned on the faithful performance of the
 33-3    person's duties and accounting for all funds and property of the
 33-4    authority coming into the person's hands.  Bonds required by this
 33-5    section shall be in sufficient amounts to safeguard the authority.
 33-6          Sec. 251.008.  DUTIES OF OFFICERS; MEETINGS.  (a)  The
 33-7    president is the chief executive officer of the authority and
 33-8    presides at board meetings.  The vice president acts as president
 33-9    in case of the absence or disability of the president.
33-10          (b)  The secretary-treasurer acts as the secretary of the
33-11    board and is responsible for keeping a record of all proceedings
33-12    and all orders of the board.  The secretary-treasurer shall receive
33-13    and receipt for all funds received by the authority and shall keep
33-14    books and records of all funds received and expended.  In case of
33-15    the absence or inability of the secretary-treasurer to act, a
33-16    secretary pro tempore shall be selected by the board.
33-17          (c)  The board shall hold its meetings at its office and
33-18    principal place of business, unless it directs otherwise for
33-19    specific occasions when called by order of the president, vice
33-20    president, or a majority of its members.  The board shall set, by
33-21    order entered in the minutes of its proceedings, a specified time
33-22    for its regular meetings.
33-23          Sec. 251.009.  DIRECTOR FEES.  A director is entitled to
33-24    receive a fee not to exceed that provided for a director in Chapter
33-25    49.
33-26          Sec. 251.010.  RECORDS; AUTHORITY OFFICE.  The authority
 34-1    shall keep a true and full account of all board meetings and
 34-2    proceedings, and records of the board must be maintained in a
 34-3    secure manner.  The records are the property of the authority and
 34-4    are subject to public inspection.  A regular office shall be
 34-5    established and maintained for conduct of authority business within
 34-6    the authority.
 34-7          Sec. 251.011.  ACCOUNT RECORDS; AUDIT.  (a)  The authority
 34-8    shall keep a complete book of accounts, and the account books and
 34-9    records of the authority and of the depository of the authority
34-10    shall be audited by a certified public accountant annually as soon
34-11    as practicable after the end of the year.
34-12          (b)  The audit report covering the preceding calendar year
34-13    shall be submitted at the first regular meeting of the board after
34-14    the end of the year.  A copy of the report shall be filed in the
34-15    office of the authority, with the depository of the authority, in
34-16    the office of the auditor, and with the commission, and all such
34-17    copies shall be open to public inspection.
34-18          Sec. 251.012.  GENERAL MANAGER.  The board may employ a
34-19    general manager for the authority and may delegate to the general
34-20    manager full authority to manage and operate the affairs of the
34-21    authority subject only to the orders of the board.  Compensation
34-22    for the general manager shall be set by the board.
34-23          Sec. 251.013.  SURETY BONDS.  All bonds required to be given
34-24    by managers, officers, and employees of the authority shall be
34-25    executed by a surety company authorized to do business in this
34-26    state.  The authority may pay the premiums on the bonds required by
 35-1    this section.
 35-2          Sec. 251.014.  CONFLICT OF INTEREST.  The board shall comply
 35-3    with Chapter 171, Local Government Code, relating to conflicts of
 35-4    interest with a business entity in which a board member has a
 35-5    substantial interest.
 35-6          Sec. 251.015.  POWER AND DUTIES.  (a)  The authority may
 35-7    control and employ the waters of the Neches River and its
 35-8    tributaries, including the storm waters and floodwaters of the
 35-9    rivers and their tributaries, for the conservation and beneficial
35-10    use of the waters in the manner and for the particular purposes
35-11    provided in this section.
35-12          (b)  The authority may provide through practical and legal
35-13    means for the control and coordination of the regulation of the
35-14    waters of the Neches River and its tributaries.
35-15          (c)  The authority may provide by adequate organization and
35-16    administration for the preservation of the equitable rights of the
35-17    people of the different sections of the watershed area, in the
35-18    beneficial use of the waters of the Neches River and its
35-19    tributaries.
35-20          (d)  The authority may provide for storing, controlling, and
35-21    conserving the waters of the Neches River and its tributaries
35-22    within or outside the authority in order to prevent the escape of
35-23    any of the waters without the maximum of public service, prevent
35-24    the devastation of lands from recurrent overflows, and protect life
35-25    and property in the authority from uncontrolled floodwaters.
35-26          (e)  The authority may provide for the conservation of the
 36-1    waters of the Neches River and its tributaries essential for the
 36-2    domestic uses of the people of the authority, including all
 36-3    necessary water supplies for cities and towns.
 36-4          (f)  The authority may provide for the irrigation of all
 36-5    lands in the authority, or lands outside the authority but within
 36-6    the watershed area, where irrigation is required for agricultural
 36-7    purposes, or where irrigation may be considered helpful to more
 36-8    profitable agricultural production, and for the equitable
 36-9    distribution of the waters to the regional potential requirements
36-10    for all uses, domestic, manufacturing, and irrigation.  All plans
36-11    and all works provided by the authority, and all works which may be
36-12    provided under the control of the authority, shall give primary
36-13    consideration to the necessary and potential needs for water by or
36-14    within the area in the authority constituting the watershed of the
36-15    Neches River and its tributaries.
36-16          (g)  The authority may provide for the encouragement and
36-17    development of drainage systems and provisions for drainage of
36-18    lands in the valleys of the Neches River and its tributaries
36-19    needing drainage for profitable agricultural production and for
36-20    drainage of other lands in the watershed area of the authority
36-21    requiring drainage for the most advantageous use.
36-22          (h)  The authority may provide for the encouragement of the
36-23    conservation of all soils against destructive erosion to prevent
36-24    the increased risk of flood caused by such erosion.
36-25          (i)  The authority may control and make available for
36-26    employment waters of the Neches River and its tributaries in the
 37-1    development of commercial and industrial enterprises in all
 37-2    sections of the watershed area of the authority.
 37-3          (j)  The authority may provide for the control, storing, and
 37-4    employment of waters of the Neches River and its tributaries in the
 37-5    development and distribution of hydroelectric power, where such use
 37-6    may be economically coordinated with other and superior uses and
 37-7    subordinated to the uses declared by law to be superior, and may
 37-8    provide for all other purposes for which floodwaters and storm
 37-9    waters when controlled and conserved may be used in the performance
37-10    of a useful service as contemplated and authorized by provisions of
37-11    the constitution and the public policy declared by such powers.
37-12          (k)  The authority may purchase or construct all works
37-13    necessary or convenient for the exercise of the powers and to
37-14    accomplish the purposes specified in this chapter and to purchase
37-15    or otherwise acquire all lands or other property necessary or
37-16    convenient for carrying out those purposes.
37-17          Sec. 251.016.  EMINENT DOMAIN.  The right of eminent domain
37-18    is expressly conferred on the authority to enable it to acquire the
37-19    fee simple title to, or easement or right-of-way over and through,
37-20    lands, water, or lands under water, private or public, within and
37-21    outside the authority, necessary or convenient to carry out any of
37-22    the purposes and powers conferred on the authority by this chapter.
37-23    All condemnation proceedings shall be under the direction of the
37-24    board and in the name of the authority, and the assessment of
37-25    damages and all procedures with reference to condemnation, appeal,
37-26    and payment shall be in conformity with Chapter 21, Property Code.
 38-1          Sec. 251.017.  FEES AND CHARGES.  (a)  The board shall
 38-2    prescribe fees and charges to be collected for the use of water,
 38-3    water connections, or other service.  The fees and charges shall be
 38-4    reasonable and equitable and fully sufficient to produce revenues
 38-5    adequate to pay:
 38-6                (1)  all expenses necessary for the operation and
 38-7    maintenance of the improvements and facilities of the authority,
 38-8    including the cost of the acquisition of properties and materials
 38-9    necessary to maintain the improvements and facilities in good
38-10    condition and to operate them efficiently, necessary wages and
38-11    salaries of the authority, and other expenses reasonably necessary
38-12    for the efficient operation of the improvements and facilities;
38-13                (2)  the annual or semiannual interest on any
38-14    obligation issued under this chapter payable out of the revenues of
38-15    the improvements and facilities; and
38-16                (3)  the amount required to be paid annually into the
38-17    sinking fund for the payment of any obligations issued under this
38-18    chapter payable out of the revenues of the improvements and
38-19    facilities.
38-20          (b)  No other charge shall be made on the revenues derived
38-21    from the improvements and facilities while any obligations issued
38-22    under this chapter remain outstanding and unpaid as to principal or
38-23    interest; provided, however, that out of revenues that may be
38-24    received in excess of those required for the purposes listed in
38-25    Subsections (a)(1), (2), and (3), the board may pay the cost of
38-26    improvements and replacements not covered by Subsection (a)(1) and
 39-1    may establish a reasonable depreciation and emergency fund.
 39-2          (c)  The fees and charges of the authority may not be in
 39-3    excess of what is reasonably necessary to fulfill the obligations
 39-4    imposed on the authority by this chapter.
 39-5          Sec. 251.018.  EMPLOYEES AND COMPENSATION.  The authority,
 39-6    through its board, may employ managers, engineers, attorneys, and
 39-7    all necessary employees to properly construct, operate, and
 39-8    maintain the works of the authority and carry out the provisions of
 39-9    this chapter and may pay reasonable compensation set by the board
39-10    for such services.
39-11          Sec. 251.019.  CONTRACTS.  (a)  The authority may make and
39-12    enter into contracts, leases, and agreements necessary or
39-13    convenient to carry out the powers granted in this chapter.
39-14    Contracts, leases, and agreements may be entered into with any
39-15    person, real or artificial, any corporation, municipal, public, or
39-16    private, or any government or governmental agency, including the
39-17    United States government and the state.
39-18          (b)  The authority may convey or cause to be conveyed any of
39-19    its properties, rights, lands, tenements, easements, improvements,
39-20    reservoirs, dams, canals, plants, laterals, works, and facilities
39-21    to the United States government or any of its agencies and may
39-22    enter into a lease with the United States government or any of its
39-23    agencies relative to such property or right.  The authority may
39-24    obligate itself to pay rent out of the income and revenues of the
39-25    property or right subject to the lease, with or without the
39-26    privilege of purchase; provided, however, that nothing in this
 40-1    section authorizes the assumption by the authority of any
 40-2    obligation requiring payment out of taxes.
 40-3          (c)  Contracts, leases, and agreements authorized by this
 40-4    section shall be approved by resolution of the board and shall be
 40-5    executed by the president and attested by the secretary.
 40-6          Sec. 251.020.  RIGHT TO SUE.  The authority may sue and be
 40-7    sued.
 40-8          Sec. 251.021.  APPROVAL OF CERTAIN WORKS.  Before the
 40-9    authority establishes a diversion point or constructs the canals,
40-10    pumping plants, and other works provided for in this chapter, the
40-11    authority must present plans and specifications to the commission
40-12    for approval.
40-13          Sec. 251.022.  COMMISSION SUPERVISION.  The authority is
40-14    subject to the continuing rights of supervision by the commission
40-15    in the exercise of the powers and duties provided by this chapter.
40-16    The commission may approve or refuse to approve the adequacy of any
40-17    plan or plans for flood control or conservation improvement
40-18    purposes devised by the authority for the achievement of the plans
40-19    and purposes intended in the creation of the authority that
40-20    contemplate improvements supervised by the commission under the
40-21    provisions of general law.
40-22          Sec. 251.023.  ADDITIONAL POWERS.  (a)  The authority has and
40-23    may exercise the functions, powers, authority, rights, and duties
40-24    necessary to accomplish the purposes for which the authority is
40-25    created, including investigating and planning, acquiring,
40-26    constructing, maintaining, and operating all necessary properties,
 41-1    lands, rights, tenements, easements, improvements, reservoirs,
 41-2    dams, canals, laterals, plants, works, and facilities, including
 41-3    the acquisition within or outside the authority of lands,
 41-4    rights-of-way, water rights, and all other properties, tenements,
 41-5    and easements, and other rights incident to, helpful to, or in aid
 41-6    of carrying out the purposes of the authority as provided by this
 41-7    chapter.
 41-8          (b)  This chapter shall be liberally construed to effectuate
 41-9    each and all of the purposes provided by this chapter.
41-10          Sec. 251.024.  GRANTS AND LOANS.  The authority may receive
41-11    grants and borrow money from a department or agency of the United
41-12    States or from any other source and in evidence of such debt
41-13    undertaken may issue the notes, warrants, certificates of
41-14    indebtedness, or other form of obligations of the authority,
41-15    payable solely out of the revenues to be derived from the
41-16    improvements and facilities and the operations and devices of the
41-17    improvements and facilities.
41-18          Sec. 251.025.  ISSUANCE OF OBLIGATIONS.  (a)  Each issue of
41-19    obligations authorized under this chapter constitutes a separate
41-20    series and shall be appropriately designated.  The obligations
41-21    shall not constitute an indebtedness or a pledge of the credit of
41-22    the authority and shall never be paid, in whole or in part, out of
41-23    any funds raised, or to be raised, by taxation and must contain a
41-24    recital to that effect.  Obligations issued under this chapter
41-25    shall be in registered or coupon form and if in coupon form may be
41-26    registrable as to principal only or as to both principal and
 42-1    interest.
 42-2          (b)  The obligations shall bear interest at a rate not to
 42-3    exceed six percent per year, payable annually or semiannually, and
 42-4    must be in denominations and must mature serially, or at one time,
 42-5    not more than 50 years from their date in the manner provided by
 42-6    the board.
 42-7          (c)  The principal of and interest on the obligations shall
 42-8    be made payable within or outside the state at the discretion of
 42-9    the board.  The obligations may be made redeemable at the option of
42-10    the board prior to maturity at premiums the board determines.
42-11          (d)  The obligations shall be signed by the president and
42-12    secretary of the board.  The interest coupons attached to the
42-13    obligations may be executed with facsimile signatures of the
42-14    officers.
42-15          (e)  The obligations shall be sold in the manner and at the
42-16    time the board determines to be expedient and necessary to the
42-17    interest of the authority, provided that in no event shall
42-18    obligations be sold for a price that will result in an interest
42-19    yield of more than six percent, computed to maturity according to
42-20    standard bond tables in general use by banks and insurance
42-21    companies.
42-22          (f)  If an officer whose signature is on the obligations or
42-23    coupons ceases to be an officer before the delivery of the
42-24    obligations to the purchaser, the signature nevertheless shall be
42-25    valid and sufficient for all purposes.
42-26          (g)  Obligations issued under the provisions of this chapter
 43-1    are negotiable instruments under the laws of this state.
 43-2          Sec. 251.026.  REVENUE OBLIGATIONS.  (a)  Obligations issued
 43-3    under this chapter may be payable from, and secured by the pledge
 43-4    of, all the revenues derived from the operation of the improvements
 43-5    and facilities of the authority, exclusive of any revenues derived
 43-6    from taxation of assessments; may be payable from, and secured by
 43-7    the pledge of, only such revenues as may be derived from the
 43-8    operation of the improvements and facilities acquired with the
 43-9    proceeds of the sale of such obligations; or may be payable from,
43-10    and secured by the pledge of, a specific part of the revenues
43-11    derived from the operation of the improvements and facilities of
43-12    the authority, all as may be provided in the proceedings
43-13    authorizing the issuance of such obligations.
43-14          (b)  If more than one series of obligations is issued under
43-15    the provisions of this chapter payable from and secured by
43-16    identical revenues, priority of lien against the revenues shall
43-17    depend on the time of delivery of the obligations, each series
43-18    enjoying a lien against the revenues prior and superior to that
43-19    enjoyed by any other series of obligations subsequently delivered;
43-20    provided, however, that as to any issue or series of obligations
43-21    that may be authorized as a unit but delivered from time to time in
43-22    blocks, the board may, in proceedings authorizing the issuance of
43-23    the obligations, provide that all the obligations of the series or
43-24    issue shall be coequal as to lien, regardless of the time of
43-25    delivery.
43-26          Sec. 251.027.  SINKING FUND.  (a)  A resolution or order
 44-1    authorizing the issuance of obligations under this chapter shall
 44-2    provide for the creation of a sinking fund.  Revenues pledged to
 44-3    the payment of obligations shall be paid into the sinking fund from
 44-4    month to month as the revenues are collected in amounts fully
 44-5    sufficient to pay principal of and interest on the obligations.
 44-6    The money in the sinking fund shall be applied solely to the
 44-7    payment of interest on the obligations for whose payment the fund
 44-8    is created, and for the retirement of the obligations, at or prior
 44-9    to maturity, in the manner provided by this section.
44-10          (b)  The board may at the time obligations are authorized
44-11    provide that all money in the sinking fund in excess of the amount
44-12    required for the payment of the interest on and principal of the
44-13    outstanding obligations, for the period the board may determine,
44-14    shall be expended once each year pursuant to board order in the
44-15    purchase of obligations for whose account the sinking fund has been
44-16    accumulated, if any obligations can be purchased at a price that
44-17    seems reasonable to the board, and may provide that if the
44-18    obligations contain an option permitting retirement before
44-19    maturity, such excess amounts shall be paid out as provided for the
44-20    purchase of the obligations.  If the board is unable to purchase
44-21    sufficient obligations of the issue to absorb all the surplus, the
44-22    board shall call for redemption of a sufficient amount of the
44-23    obligations to absorb, so far as practicable, the entire surplus
44-24    remaining in the sinking fund.
44-25          (c)  The resolution or order may provide that any excess in
44-26    the sinking fund that cannot be applied to the purchase or
 45-1    redemption of obligations shall remain in the sinking fund to be
 45-2    used for payment of principal or interest when due or for the
 45-3    subsequent call of obligations for purchase or redemption in the
 45-4    manner provided by this section.
 45-5          Sec. 251.028.  COVENANTS WITH HOLDERS.  A resolution or order
 45-6    authorizing the issuance of obligations under this chapter may
 45-7    contain covenants with the holders of the obligations as to the
 45-8    management and operation of the improvements and facilities,
 45-9    collection of fees and charges for the use of the improvements and
45-10    facilities, disposition of the fees and charges, issuance of future
45-11    obligations and creation of future liens, mortgages and
45-12    encumbrances against the improvements and facilities, and the
45-13    revenues of the improvements and facilities, and other pertinent
45-14    matters, that are considered necessary to insure the marketability
45-15    of the obligations, provided that the covenants are not
45-16    inconsistent with the provisions of this chapter.
45-17          Sec. 251.029.  DEDICATION OF REVENUES.  (a)  A resolution or
45-18    order authorizing the issuance of obligations under this chapter
45-19    shall provide that the revenues from which the obligations are to
45-20    be paid and that are pledged to the payment of the obligations
45-21    shall from month to month, as the obligations accrue and are
45-22    received, be set apart and placed in the sinking fund and disbursed
45-23    in the manner provided by this chapter.
45-24          (b)  The board, in setting and determining the amount of
45-25    revenues to be set aside as provided in Subsection (a), shall
45-26    provide that the amount to be set aside and paid into the sinking
 46-1    fund in any year or years shall be not less than a set amount that
 46-2    is at least sufficient to provide for the payment of the interest
 46-3    on and principal of all obligations maturing and becoming payable
 46-4    in each such year, together with a surplus or margin of 10 percent
 46-5    in excess of such amount.
 46-6          Sec. 251.030.  ACTIONS BY HOLDERS; ADMINISTRATOR OR RECEIVER.
 46-7    (a)  A holder of obligations issued under this chapter, or of
 46-8    coupons originally attached to the obligations, may either at law
 46-9    or in equity, by suit, action, mandamus, or other proceeding,
46-10    enforce and compel performance of all duties required by this
46-11    chapter to be performed by the board, including the making and
46-12    collecting of reasonable and sufficient fees or charges for the use
46-13    of the improvements and facilities of the authority, the
46-14    segregation of the income and revenues of the improvements and
46-15    facilities, and the application of the income and revenues under
46-16    the provisions of this chapter.
46-17          (b)  In the event of a default in the payment of the
46-18    principal of or interest on any of the obligations of the
46-19    authority, a holder of the obligation shall be entitled to have an
46-20    administrator or a receiver appointed by a court having
46-21    jurisdiction to administer and operate the improvements and
46-22    facilities whose revenues are pledged to the payment of the
46-23    obligations on behalf of the authority and the holders of the
46-24    obligations.  The administrator or receiver may be authorized to
46-25    fix and collect fees and charges sufficient to provide for the
46-26    payment of operation and maintenance expenses as defined by this
 47-1    chapter, to pay any outstanding obligations or interest coupons
 47-2    payable from the revenues of the improvements and facilities, and
 47-3    to apply the income and revenues of the improvements and facilities
 47-4    in conformity with the provisions of this chapter and the
 47-5    proceedings authorizing the issuance of the obligations.
 47-6          Sec. 251.031.  TRUST INDENTURE.  (a)  As additional security
 47-7    for the payment of obligations issued under this chapter, the board
 47-8    may, at its discretion, have executed in favor of the holders of
 47-9    the obligations an indenture mortgaging and encumbering the
47-10    improvements, facilities, and properties acquired with the proceeds
47-11    of the sale of the obligations, or all the improvements,
47-12    facilities, and properties of the authority, and may provide in the
47-13    encumbrance for a grant to a purchaser at foreclosure sale under
47-14    the encumbrance of a franchise to operate the improvements,
47-15    facilities, and properties, for a term of not over 50 years from
47-16    the date of the purchase, subject to all applicable laws.
47-17          (b)  An indenture under this section may contain terms and
47-18    provisions the board deems proper and shall be enforceable in the
47-19    manner provided by the laws of Texas for the enforcement of other
47-20    mortgages and encumbrances.
47-21          (c)  Under a sale ordered under the provisions of the
47-22    mortgage or encumbrance, the purchaser at the sale, and the
47-23    purchaser's successors or assigns, shall be vested with a permit
47-24    and franchise to maintain and operate the improvements, facilities,
47-25    and properties purchased at the sale, with the powers and
47-26    privileges used by the authority in the operation of the
 48-1    improvements, facilities, and properties.
 48-2          (d)  The purchaser of the improvements, facilities, and
 48-3    properties at a sale, and the purchaser's successors and assigns,
 48-4    may operate the improvements, facilities, and properties as
 48-5    provided in Subsection (c) or may at their option remove all or
 48-6    part of the improvements, facilities, and properties for diversion
 48-7    to other purposes.
 48-8          (e)  Any statutory provisions pertaining to the granting of
 48-9    franchises do not apply to the authorization or execution of any
48-10    mortgage or encumbrance entered into under the provisions of this
48-11    chapter or to the granting of any franchise under this chapter.
48-12          Sec. 251.032.  SALE PROCEEDS.  (a)  The proceeds of the sale
48-13    of any obligations issued under this chapter may be deposited in
48-14    the bank or banks agreed on by the purchaser and the board.  The
48-15    proceeds may be deposited and paid out pursuant to the terms and
48-16    conditions agreed on, provided that the general law pertaining to
48-17    the deposit of the authority funds in the depository of the
48-18    authority is not applicable to the deposit of the proceeds of the
48-19    sale.
48-20          (b)  Any part of the proceeds of the sale of obligations
48-21    issued under this chapter that remains unexpended after the project
48-22    for which the obligations were authorized has been completed may be
48-23    paid into the sinking fund for the payment of the obligations and
48-24    may be used only for the payment of principal of the obligations or
48-25    for the purposes of acquiring such outstanding obligations by
48-26    purchase in the manner provided by this chapter.
 49-1          Sec. 251.033.  INSURANCE FOR IMPROVEMENTS AND FACILITIES.
 49-2    The board may enter into an agreement with a purchaser of
 49-3    obligations issued by the authority to keep all the improvements
 49-4    and facilities whose revenues are pledged to the payment of the
 49-5    obligations insured with insurers of good standing against loss or
 49-6    damage by fire, water, or flood and from any other hazards
 49-7    customarily insured against by private companies operating similar
 49-8    properties.  The authority may also agree to carry with insurers of
 49-9    good standing insurance covering the use and occupancy of such
49-10    property that is customarily carried by private companies.  The
49-11    cost of insurance shall be budgeted as maintenance and operation
49-12    expense, and the insurance shall be carried for the benefit of the
49-13    holders of the obligations.
49-14          Sec. 251.034.  EXEMPTION FROM TAXATION.  Obligations issued
49-15    under the provisions of this chapter are exempt from taxation by
49-16    the state or by any municipal corporation, county, or other
49-17    political subdivision or taxing district of the state.
49-18          Sec. 251.035.  REFUNDING OBLIGATIONS.  After issuing
49-19    obligations under this chapter, the authority may authorize and
49-20    issue its refunding obligations on terms the board deems advisable
49-21    for the purpose of providing for the retirement of any outstanding
49-22    obligations, either due or to become due.  The refunding
49-23    obligations may be either exchanged for like par amounts of the
49-24    outstanding obligations or may be sold and the proceeds of the sale
49-25    so applied.  Refunding obligations authorized and issued under this
49-26    section are subject to the provisions of this chapter pertaining to
 50-1    the issuance of other obligations and shall be secured in all
 50-2    respects to the same extent and be payable from the same revenues
 50-3    as the obligations being refunded.
 50-4          Sec. 251.036.  APPROVAL AND REGISTRATION OF OBLIGATIONS.
 50-5    Before any obligations are issued, the authority shall submit a
 50-6    certified copy of the obligations and of the proceedings for their
 50-7    issuance, together with any additional information that may be
 50-8    required, to the attorney general for approval.  When approved the
 50-9    obligations shall be issued after registration with the comptroller
50-10    of public accounts.
50-11          Sec. 251.037.  FULL AUTHORITY.  This authority set out in
50-12    this chapter for the authorization and issuance of obligations is
50-13    in addition to, and not in lieu of, the authority otherwise
50-14    established under general law and is not to be construed as a
50-15    limitation on, or a modification of, general law providing for
50-16    authorization and issuance of bonds, notes, and other forms of
50-17    obligations.  Nothing in this chapter shall be construed as
50-18    affecting any existing contract, bond, note, or other obligation of
50-19    the authority or any indenture, covenant, mortgage, or other
50-20    agreement relating to them.
50-21          Sec. 251.038.  EXISTING WATER RIGHTS.  Nothing in this
50-22    chapter shall be construed as affecting any rights existing at the
50-23    time of the formation of the authority, or priorities in the
50-24    rights, to water from the source of supply, and neither the
50-25    formation of the authority or a contract for the purchase of water
50-26    with the authority shall ever be held to be an abandonment or
 51-1    waiver of those rights or priorities, or an abandonment of the
 51-2    original point of diversion from the source of supply, but all such
 51-3    rights existing at the time of the formation of the authority shall
 51-4    be preserved.
 51-5                   CHAPTER 252.  BRAZOS RIVER AUTHORITY
 51-6          Sec. 252.001.  CREATION.  (a)  A conservation and reclamation
 51-7    district to be known as the "Brazos River Authority" is created.
 51-8    The authority is a river authority, a governmental agency, a
 51-9    municipality, and a body politic and corporate.
51-10          (b)  The authority is created under and is essential to
51-11    accomplish the purposes of Section 59, Article XVI, Texas
51-12    Constitution.
51-13          (c)  The authority may exercise the powers expressly granted
51-14    by Section 59, Article XVI, Texas Constitution, to districts
51-15    created to conserve, control, and utilize to beneficial service the
51-16    storm waters and floodwaters of the rivers and streams of the
51-17    state, as well as such powers as may be contemplated and implied by
51-18    the purposes of that provision of the constitution and as may be
51-19    conferred by general law and the provisions of this chapter.  In
51-20    addition, the authority shall have and is recognized to exercise
51-21    such authority to discover, develop, and produce groundwater in the
51-22    Brazos River Basin for the use of its customers.
51-23          (d)  The authority may exercise all the rights and powers of
51-24    an independent governmental agency, a municipality, and a body
51-25    politic and corporate to formulate plans deemed essential to its
51-26    operation and for its administration in the control, storing,
 52-1    preservation, and distribution to all useful purposes of the storm
 52-2    waters and floodwaters of the Brazos River and its tributary
 52-3    streams.
 52-4          (e)  The authority may exercise such authority and power of
 52-5    control and regulation over the storm waters and floodwaters of the
 52-6    Brazos River and its tributaries as may be exercised by the state,
 52-7    subject to the provisions of the constitution and the acts of the
 52-8    legislature.
 52-9          Sec. 252.002.  DEFINITIONS.  In this chapter:
52-10                (1)  "Authority" means the Brazos River Authority.
52-11                (2)  "Board" means the board of directors of the
52-12    authority.
52-13                (3)  "Director" means a member of the board.
52-14          Sec. 252.003.  TERRITORY.  The territory of the authority
52-15    comprises the watershed of the Brazos River, as determined by rule
52-16    of the Texas Water Development Board, except the portions lying
52-17    within Freestone, Leon, and Madison counties.
52-18          Sec. 252.004.  POWERS.  (a)  The authority may exercise, in
52-19    addition to all the general powers vested by the constitution and
52-20    statutes in a governmental agency and body politic and corporate
52-21    for the greatest practicable measure of conservation and beneficial
52-22    utilization of storm waters, floodwaters, and unappropriated flow
52-23    waters, the powers of control and employment of the floodwaters,
52-24    storm waters, unappropriated flow waters, and groundwater of the
52-25    authority in the manner and for the purposes provided by this
52-26    section.
 53-1          (b)  The authority may provide, through all practical and
 53-2    legal means, for the control and the coordination of the regulation
 53-3    of the waters of the watershed of the Brazos River and its
 53-4    tributary streams as a unit.
 53-5          (c)  The authority may provide, by adequate organization and
 53-6    administration, for the preservation of the equitable rights of the
 53-7    people of the different sections of the watershed area in the
 53-8    beneficial use of storm waters, floodwaters, and unappropriated
 53-9    flow waters of the Brazos River and its tributary streams.
53-10          (d)  The authority may provide for storing, controlling, and
53-11    conserving storm waters, floodwaters, and unappropriated flow
53-12    waters of the Brazos River and its tributaries, preventing the
53-13    escape of any of such waters without the maximum of public service,
53-14    preventing the devastation of lands by recurrent overflows, and
53-15    protecting life and property in the watershed area from
53-16    uncontrolled floodwaters.
53-17          (e)  The authority may provide for the conservation of waters
53-18    essential for the domestic uses of the people of the watershed of
53-19    the Brazos River and its tributaries, including all necessary water
53-20    supplies for cities and towns.
53-21          (f)  The authority may provide for the irrigation of lands in
53-22    the watershed of the Brazos River and its tributary streams where
53-23    irrigation is required for agricultural purposes, or may be
53-24    considered helpful to more profitable agricultural production, and
53-25    provide for the equitable distribution of storm waters,
53-26    floodwaters, and unappropriated flow waters to the regional
 54-1    potential requirements for all uses.  Plans and works provided by
 54-2    the authority, and works provided under the authorization of the
 54-3    authority, should give primary consideration to the necessary and
 54-4    potential needs for water by or within the areas constituting the
 54-5    watershed of the Brazos River and its tributary streams.
 54-6          (g)  The authority may provide for the better encouragement
 54-7    and development of drainage systems and provisions for drainage of
 54-8    lands in the valleys of the Brazos River and its tributary streams
 54-9    needing drainage for profitable agricultural production and
54-10    drainage for other lands in the watershed area of the authority
54-11    requiring drainage for the most advantageous use.
54-12          (h)  The authority may provide for the conservation of all
54-13    soils against destructive erosion and to prevent an increased flood
54-14    danger caused by destructive soil erosion.
54-15          (i)  The authority may provide for controlling and making
54-16    available for employment floodwaters, storm waters, and
54-17    unappropriated flow waters in the development of commercial and
54-18    industrial enterprises in all sections of the watershed area of the
54-19    authority.
54-20          (j)  The authority may provide for the control, storage, and
54-21    employment of floodwaters, storm waters, and unappropriated flow
54-22    waters in the development and distribution of hydroelectric power,
54-23    where this use may be economically coordinated with other and
54-24    superior uses and subordinated to the uses declared by law to be
54-25    superior.
54-26          (k)  The authority may provide for each purpose for which
 55-1    floodwaters, storm waters, and unappropriated flow waters, when
 55-2    controlled and conserved, may be used in the performance of a
 55-3    useful service as contemplated and authorized by the provisions of
 55-4    the constitution and the public policy it declares.
 55-5          (l)  The authority may provide for the development of
 55-6    groundwater and may make groundwater available for use for
 55-7    domestic, municipal, irrigation, commercial, and industrial
 55-8    purposes.
 55-9          Sec. 252.005.  LIMITATION OF AUTHORITY; STATE SUPERVISION.
55-10    The powers and duties granted to the authority by this chapter are
55-11    subject to all legislative declarations of public policy in the
55-12    maximum utilization of the storm waters, floodwaters, and
55-13    unappropriated flow waters of the Brazos River watershed and
55-14    developed groundwater of the Brazos River Basin for the purposes
55-15    for which the authority is created, as expressed and indicated in
55-16    this chapter, and subject to the continuing rights of supervision
55-17    by the state.
55-18          Sec. 252.006.  DAMS AND RESERVOIRS; WATER SUPPLY CONTRACTS.
55-19    (a)  The authority may construct, acquire, equip, acquire storage
55-20    rights at, and operate dams and reservoirs that in the opinion of
55-21    the board are useful in carrying out the powers conferred on the
55-22    authority by this chapter, whether any such dam is designed to
55-23    serve a single purpose or multiple purposes.
55-24          (b)  The authority may provide water supply lines and water
55-25    purification and pumping facilities.
55-26          (c)  The authority may execute contracts with municipalities
 56-1    in the state substantially in the manner prescribed by Section
 56-2    402.020, Local Government Code, for districts organized or created
 56-3    pursuant to Section 59, Article XVI, Texas Constitution, and may
 56-4    execute water supply contracts with other users of water.
 56-5          Sec. 252.007.  PRIORITY OF RIGHTS.  Nothing in this chapter
 56-6    changes any existing priority of right under the laws of the state
 56-7    to the use of waters of the state, including any rights of
 56-8    municipalities that maintain and use storage structures in the bed
 56-9    of the Brazos River or its tributaries.
56-10          Sec. 252.008.  BOND PROVISIONS.  (a)  Bonds may be:
56-11                (1)  sold for cash, at public or private sale, at such
56-12    price or prices as the board determines;
56-13                (2)  issued on such terms as the board determines in
56-14    exchange for property of any kind, real, personal, or mixed, or any
56-15    interest in property, that the board determines necessary or
56-16    convenient for any corporate purpose; or
56-17                (3)  issued to refund bonds issued at any time under
56-18    authority of this chapter.
56-19          (b)  Bonds must be authorized by resolution of the board.
56-20          (c)  A resolution authorizing bonds may contain provisions,
56-21    which shall be part of the contract between the authority and the
56-22    purchasers and subsequent holders of the bonds:
56-23                (1)  reserving the right to redeem the bonds at the
56-24    time or times, in the amounts, and at the prices as may be
56-25    provided;
56-26                (2)  providing for the setting aside of sinking funds
 57-1    or reserve funds and the regulation and disposition of those funds;
 57-2                (3)  pledging, to secure the payment of the principal
 57-3    of and interest on the bonds and the sinking fund or reserve fund
 57-4    payments agreed to be made with respect to the bonds, all or any
 57-5    part of the gross or net revenues subsequently received by the
 57-6    authority with respect to the property, real, personal, or mixed,
 57-7    to be acquired or constructed with the bonds or with proceeds of
 57-8    the bonds, or all or any part of the gross or net revenues
 57-9    subsequently received by the authority from any source;
57-10                (4)  prescribing the purposes to which the bonds or any
57-11    bonds later issued, or the proceeds of the bonds, may be applied;
57-12                (5)  agreeing to set and collect rates and charges
57-13    sufficient to produce revenues that are adequate to pay the items
57-14    specified in any resolution or resolutions authorizing any bonds,
57-15    and prescribing the use and disposition of all revenues;
57-16                (6)  prescribing limitations on the issuance of
57-17    additional bonds and on all agreements that may be made with the
57-18    purchasers and successive holders of the bonds;
57-19                (7)  relating to the construction, extension,
57-20    improvement, operation, maintenance, depreciation, replacement, and
57-21    repair of the properties of the authority and the carrying of
57-22    insurance on all or any part of the property covering loss or
57-23    damage or loss of use and occupancy resulting from specified risks;
57-24                (8)  fixing the procedure, if any, by which, if the
57-25    authority so desires, the terms of any contract with the holders of
57-26    bonds may be amended or abrogated, the amount of bonds the holders
 58-1    of which must consent to such amendment or abrogation, and the
 58-2    manner in which the consent shall be evidenced;
 58-3                (9)  providing for the execution and delivery by the
 58-4    authority to a bank or trust company authorized by law to accept
 58-5    trusts, or to the United States or any office or agency of the
 58-6    United States, of indentures or agreements authorized to be made
 58-7    with or for the benefit of the holders of the bonds and such other
 58-8    provisions as may be contained in the indentures or agreements; and
 58-9                (10)  making such other provisions, not inconsistent
58-10    with provisions of this chapter, as the board may approve.
58-11          (d)  Before any bonds may be sold by the authority, a
58-12    certified copy of the proceedings for the issuance of the bonds,
58-13    including the term of the bonds, together with any other
58-14    information that the attorney general may require, shall be
58-15    submitted to the attorney general, and if the attorney general
58-16    finds that the bonds have been issued in accordance with law, the
58-17    attorney general shall approve the bonds and shall execute a
58-18    certificate to that effect which shall be filed in the office of
58-19    the comptroller and be recorded in a record kept for that purpose.
58-20    The comptroller shall register the bonds if the attorney general
58-21    has filed with the comptroller the certificate approving the bonds
58-22    and the proceedings for the issuance of the bonds as provided in
58-23    this section.  Bonds may not be issued until the bonds have been
58-24    registered by the comptroller.
58-25          (e)  Bonds approved by the attorney general, registered by
58-26    the comptroller, and issued in accordance with proceedings so
 59-1    approved are valid and binding obligations of the authority and are
 59-2    incontestable for any cause from and after the time of their
 59-3    registration.
 59-4          Sec. 252.009.  BOARD OF DIRECTORS; BONDS; QUORUM; OFFICERS.
 59-5    (a)  The board consists of 21 members.  Members of the board and
 59-6    their successors serve for terms of six years and until their
 59-7    successors are designated and have qualified.  The terms of seven
 59-8    members of the board expire on February 1 of each odd-numbered
 59-9    year.
59-10          (b)  The governor shall appoint seven persons each biennium
59-11    with the advice and consent of the senate to serve on the board.
59-12    Within 60 days after appointment, each director shall take and
59-13    subscribe an oath of office similar to the oaths administered to
59-14    county commissioners and shall execute bond in the amount of
59-15    $5,000, payable to the authority.  The premium on the bond shall be
59-16    paid by the authority.  The bond, after being recorded in the
59-17    official bond records of the county in which the authority
59-18    maintains its office, shall be deposited with a depository selected
59-19    and approved for the deposit of the funds of the authority.
59-20          (c)  All vacancies occurring on the board shall be filled by
59-21    appointment of the governor with the advice and consent of the
59-22    senate.
59-23          (d)  Seven members of the board constitute a quorum to
59-24    transact business.
59-25          (e)  The governor may not appoint more than two directors who
59-26    reside in the same county at the time of their appointment.
 60-1          (f)  The board shall elect from among its members a chairman,
 60-2    a vice chairman, and a secretary and shall appoint a treasurer.
 60-3    The treasurer shall furnish a bond in an amount equal to 75 percent
 60-4    of the amount of money estimated to be on hand during the year, in
 60-5    no event to be more than $100,000.
 60-6          Sec. 252.010.  CREATION OF MASTER DISTRICT; WATER CONTROL AND
 60-7    IMPROVEMENT DISTRICT.  A master district is created having all the
 60-8    powers, duties, and functions, and subject to applicable and
 60-9    practicable procedures for such districts, to accomplish the
60-10    purposes of this chapter, as provided by Chapter 49 and the
60-11    provisions of this code applicable to water control and improvement
60-12    districts.
60-13          Sec. 252.011.  BOND ELECTION REQUIRED.  The authority may not
60-14    issue bonds or incur any form of continuing obligation or
60-15    indebtedness, except indebtedness payable solely from revenues, for
60-16    purposes of effecting improvements comprehended in the plan of
60-17    organization and administration of the authority, or incur any
60-18    indebtedness in the form of a continuing charge on lands or
60-19    properties within the authority, unless such proposition has been
60-20    submitted to the qualified voters of the authority, or in
60-21    appropriate cases the qualified voters of a defined area within the
60-22    authority, and is approved by a majority of the electors voting on
60-23    the proposition.
60-24          Sec. 252.012.  ADDITIONAL POWERS AND DUTIES.  (a)  The
60-25    authority is a district and a river authority as defined in Chapter
60-26    30.  All the provisions of Chapter 30 are applicable to the
 61-1    authority.
 61-2          (b)  As used in this section:
 61-3                (1)  "Person" means any individual, partnership,
 61-4    corporation, public utility, or other private entity or any public
 61-5    agency.
 61-6                (2)  "Public agency" means an authority, district,
 61-7    city, town, or other political subdivision, joint board, or other
 61-8    public agency created pursuant to and operating under the laws of
 61-9    the state and any entity created to operate on behalf of a public
61-10    agency.
61-11          (c)  The authority and all persons may enter into contracts
61-12    with each other, in any manner and on terms that the parties may
61-13    agree, with respect to any power, function, facility, or service
61-14    that the authority is authorized by law to provide or finance.
61-15    Public agencies may use and pledge any available revenues for and
61-16    in the payment of amounts due under a contract as an additional
61-17    source of payment of the contract and may covenant with respect to
61-18    available revenues to assure the availability of the revenues when
61-19    required.  In this subsection, "revenues" does not mean or include
61-20    revenues from ad valorem taxes levied and collected by a public
61-21    agency or the proceeds from the sale or refunding of bonds of a
61-22    public agency that are to be wholly or partially paid from ad
61-23    valorem taxes levied and collected by the public agency unless the
61-24    use or pledge of the tax revenues or bond proceeds is approved by
61-25    the qualified voters of the public agency at an election called for
61-26    the purpose of levying taxes or issuing or refunding bonds, or
 62-1    both, for the purpose of using or pledging their revenues or
 62-2    proceeds under contracts entered into under this subsection.
 62-3          (d)  A public agency may set, charge, and collect fees,
 62-4    rates, charges, rentals, and other amounts for a service or
 62-5    facility provided by a utility operated by the public agency, or
 62-6    provided pursuant to or in connection with a contract with the
 62-7    authority, from the inhabitants of the authority or from any users
 62-8    or beneficiaries of the utility, service, or facility, including:
 62-9                (1)  water charges;
62-10                (2)  sewage charges;
62-11                (3)  solid waste disposal system fees and charges,
62-12    including garbage collection or handling fees; and
62-13                (4)  other fees or charges.
62-14          (e)  A public agency may use and pledge the fees, rates,
62-15    charges, rentals, and other amounts authorized by Subsection (c) to
62-16    make payments to the authority required under a contract with the
62-17    authority and may covenant to do so in amounts sufficient to make
62-18    all or any part of the payments to the authority when due.  If the
62-19    parties agree in the contract, the payments shall constitute an
62-20    expense of operation of any facility or utility operated by the
62-21    public agency.
62-22          (f)  The authority, acting through the board, may carry out
62-23    any activities and acquire, purchase, construct, own, operate,
62-24    maintain, repair, improve, or extend and may lease or sell, on
62-25    terms and conditions, including rentals or sale prices, on which
62-26    the parties may agree, all works, improvements, facilities, plants,
 63-1    buildings, structures, equipment, and appliances, and all real and
 63-2    personal property, or any interest in real or personal property,
 63-3    related to the works, improvements, facilities, plants, buildings,
 63-4    structures, equipment, and appliances, that are incident to or
 63-5    necessary in carrying out or performing any power or function of
 63-6    the authority under this section.
 63-7          (g)  The authority may issue bonds with respect to the
 63-8    acquisition, purchase, construction, maintenance, repair,
 63-9    improvement, and extension of works, improvements, facilities,
63-10    plants, buildings, structures, appliances, and property for the
63-11    purpose of exercising any of its powers and functions under this
63-12    section in the manner provided by this chapter or any other
63-13    applicable law.
63-14          (h)  The authority may issue revenue bonds to pay for the
63-15    costs of feasibility studies for proposed projects of the
63-16    authority, including engineering, planning and design, and
63-17    environmental studies.  The authority may include in any revenue
63-18    bond issue the funds to operate and maintain, for a period not to
63-19    exceed two years after completion, the facilities acquired or
63-20    constructed through the revenue bond issue.
63-21          (i)  If bonds issued by the authority recite that they are
63-22    secured by a pledge of payments under a contract, a copy of the
63-23    contract and the proceedings relating to the contract may be
63-24    submitted to the attorney general along with the bonds.  If the
63-25    attorney general finds that the bonds have been authorized and the
63-26    contract has been made and entered into in accordance with law, the
 64-1    attorney general shall approve the bonds and the contract, and
 64-2    after the approval, the bonds and the contract are incontestable in
 64-3    any court or other forum for any reason and are valid and binding
 64-4    in accordance with their terms and provisions for all purposes.
 64-5          (j)  The provisions of Chapters 618, 1201, 1204, 1207, and
 64-6    1371, Government Code, are applicable to bonds issued by the
 64-7    authority.
 64-8          (k)  This section is wholly sufficient authority for the
 64-9    issuance of bonds, the execution of contracts, and the performance
64-10    of other acts and procedures authorized by this section by the
64-11    authority and all persons, including public agencies, without
64-12    reference to any other provision of law or any restriction or
64-13    limitation contained in those provisions, except as specifically
64-14    provided in this section.  To the extent of any conflict or
64-15    inconsistency between any provision of this section and any other
64-16    provision of law, including any home-rule city charter, this
64-17    section shall prevail and control.  The authority and all persons,
64-18    including public agencies, may use any provision of law not in
64-19    conflict with the provisions of this section to the extent
64-20    convenient or necessary to carry out any power or authority,
64-21    expressed or implied, granted by this section.
64-22          Sec. 252.013.  DISPOSITION OF PROPERTY.  (a)  Nothing in this
64-23    chapter shall be construed as authorizing the authority, and it
64-24    shall not be authorized, to mortgage or otherwise encumber any of
64-25    its property of any kind, real, personal, or mixed, or any interest
64-26    in property, or to acquire any property or interest subject to a
 65-1    mortgage or conditional sale; provided, however, that this section
 65-2    shall not be construed as preventing the pledging of the revenues
 65-3    of the authority as provided by this chapter.
 65-4          (b)  Nothing in this chapter shall be construed as
 65-5    authorizing the sale, release, or other disposition of property of
 65-6    any kind, real, personal, or mixed, or any interest in property, by
 65-7    the authority or through any court proceedings or otherwise;
 65-8    provided, however, that the authority may sell for cash any
 65-9    property or interest if the board by affirmative vote of 11 of its
65-10    members determines that the property or interest is not necessary
65-11    to the business of the authority and approves the terms of the
65-12    sale.  Except by sale as expressly authorized in this section, such
65-13    property or interest may not come into the ownership or control,
65-14    directly or indirectly, of any person, firm, or corporation other
65-15    than a public authority created under the laws of the state.
65-16          (c)  All property of the authority shall be at all times
65-17    exempted from forced sale, and nothing provided in this chapter
65-18    shall authorize the sale of any of the property of the authority
65-19    under any judgment rendered in any suit, and such sales are
65-20    prohibited and forbidden.
65-21          (d)  Notwithstanding any restrictions or provisions in this
65-22    section or in this chapter, the authority, acting by a majority
65-23    vote of the board, may construct or purchase, from any person,
65-24    firm, or corporation (referred to in this section as "customer")
65-25    with which the authority has contracted to sell hydroelectric
65-26    power, transmission lines and other property used or to be used by
 66-1    the customer for the transmission of or in connection with power
 66-2    purchased or to be purchased from the authority.  The authority may
 66-3    lease all or any portion of such property to the customer for all
 66-4    or a portion of the time during the term of the hydroelectric power
 66-5    purchase contract.  The lease may contain provisions, which shall
 66-6    be valid and enforceable, giving the lessee the right to purchase
 66-7    from the authority all or any portion of the property at or within
 66-8    the time specified in the lease and for a price and on terms and
 66-9    conditions specified in the lease; provided, however, that the
66-10    price shall never be less than the depreciated value, determined in
66-11    the manner prescribed in the lease, plus one percent of the
66-12    original cost of the property.
66-13          Sec. 252.014.  ACQUISITION OF PROPERTY; EMINENT DOMAIN.
66-14    (a)  The authority may acquire by purchase, lease, or gift or in
66-15    any other manner and may maintain, use, and operate property of any
66-16    kind, real, personal, or mixed, or any interest in property, within
66-17    or outside the boundaries of the authority, necessary or convenient
66-18    to the exercise of the powers, rights, privileges, and functions
66-19    conferred on the authority by this chapter.
66-20          (b)  The authority may acquire, by purchase, condemnation, or
66-21    otherwise, such property as the board determines necessary to make
66-22    effectual and practicable the construction and operation of all
66-23    works, improvements, and services which may be planned ultimately
66-24    to be provided by the authority to accomplish any of the purposes
66-25    for which the authority was created.  Such acquisition or
66-26    condemnation may be either of the fee simple title or of a lesser
 67-1    title or an easement only, within the discretion of the board;
 67-2    provided, however, that no person shall be deprived of any defense
 67-3    available under the general law of eminent domain; and provided,
 67-4    further, that the authority may not acquire or operate a steam
 67-5    generating plant for the production and sale of electric energy
 67-6    and, except for the purpose of acquiring the necessary area below
 67-7    or above the anticipated high-water line of a reservoir, may not
 67-8    condemn any property of a rural electrification cooperative or
 67-9    other corporations engaged in the generation or sale of electric
67-10    energy to the public.
67-11          (c)  The authority shall have the power of eminent domain for
67-12    the purpose of acquiring by condemnation property of any kind,
67-13    real, personal, or mixed, or any interest in property, within or
67-14    outside the boundaries of the authority, other than property or an
67-15    interest in property outside the boundaries of the authority owned
67-16    by any body politic, that is necessary or convenient to the
67-17    exercise of the powers, rights, privileges, and functions conferred
67-18    on the authority by this chapter, in the manner provided by general
67-19    law with respect to condemnation or, at the option of the
67-20    authority, in the manner provided by statutes relative to
67-21    condemnation by districts organized under general law pursuant to
67-22    Section 59, Article XVI, Texas Constitution.
67-23          (d)  In condemnation proceedings being prosecuted by the
67-24    authority, the authority shall not be required to give bond for
67-25    appeal or bond for cost.
67-26          (e)  The authority may overflow and inundate any public lands
 68-1    and public property and may require the relocation of roads and
 68-2    highways in the manner and to the extent permitted to districts
 68-3    organized under general law pursuant to Section 59, Article XVI,
 68-4    Texas Constitution.
 68-5          (f)  If the authority, in the exercise of the power of
 68-6    eminent domain or power of relocation or any other power granted
 68-7    under this chapter, makes necessary the relocation, raising,
 68-8    rerouting, changing the grade, or altering the construction of any
 68-9    highway, railroad, electric transmission line, or pipeline, all
68-10    necessary relocation, raising, rerouting, changing of grade, or
68-11    alteration of construction shall be accomplished at the sole
68-12    expense of the authority.
68-13          Sec. 252.015.  CONTRACTS, GRANTS, AND LOANS.  (a)  The board
68-14    may negotiate and contract with the federal government or with any
68-15    of its agencies for grants, loans, and advancements from the United
68-16    States for the furtherance of any purpose set forth in this
68-17    chapter.
68-18          (b)  The authority may receive and accept grants, loans, or
68-19    allotments from the United States and others for furtherance of any
68-20    of the purposes set forth in this chapter.
68-21          (c)  An opinion from the attorney general as to whether a
68-22    grant, loan, or allotment has been received by the authority from
68-23    the United States or others shall be authority for the action of
68-24    any person charged with any duty contingent on such grant, loan, or
68-25    allotment.
68-26          Sec. 252.016.  RULES AND REGULATIONS.  The board may make all
 69-1    necessary rules and regulations for the government and control of
 69-2    the authority not inconsistent with the constitution and laws of
 69-3    the state.
 69-4          Sec. 252.017.  USE OF BRAZOS RIVER AND TRIBUTARIES.  In the
 69-5    prosecution of the plans for which the authority has been created
 69-6    for the storing, controlling, conserving, and distributing to
 69-7    useful purposes of the storm waters, floodwaters, and
 69-8    unappropriated flow waters of the Brazos River watershed and
 69-9    developed groundwater from the Brazos River Basin for the use of
69-10    its customers, the authority may use the bed and banks of the
69-11    Brazos River and its tributary streams for any and all purposes
69-12    necessary to the accomplishment of the plans of the authority.
69-13          Sec. 252.018.  DEFAULT PROCEDURES.  (a)  A resolution
69-14    authorizing the issuance of bonds and any indenture or agreement
69-15    entered into pursuant to the resolution may include provisions
69-16    regarding a default on the:
69-17                (1)  payment of the interest on any bonds as the
69-18    interest becomes due and payable;
69-19                (2)  payment of the principal of any bonds as they
69-20    become due and payable, whether at maturity, by call for
69-21    redemption, or otherwise; or
69-22                (3)  performance of an agreement made with the
69-23    purchasers or successive holders of any bonds.
69-24          (b)  If a default described by Subsection (a) has occurred
69-25    and has continued for a period, if any, prescribed by the
69-26    resolution authorizing the issuance of the bonds, the trustee under
 70-1    the indenture or indentures entered into with respect to the bonds
 70-2    authorized by the resolution, or, if there is no indenture, a
 70-3    trustee appointed in the manner provided in the resolution by the
 70-4    holders of 25 percent in aggregate principal amount of the bonds
 70-5    authorized by the resolution and then outstanding may, and on the
 70-6    written request of the holders of 25 percent in aggregate principal
 70-7    amount of the bonds authorized by the resolution and then
 70-8    outstanding shall, in the trustee's own name but for the equal and
 70-9    proportionate benefit of the holders of all the bonds, and with or
70-10    without having possession of the bonds:
70-11                (1)  by mandamus or other suit, action, or proceeding
70-12    at law or in equity, enforce all rights of the holders of the
70-13    bonds;
70-14                (2)  bring suit on the bonds or the appurtenant
70-15    coupons;
70-16                (3)  by action or suit in equity, require the board to
70-17    account as if it were the trustee of an express trust for the
70-18    bondholders;
70-19                (4)  by action or suit in equity, enjoin any acts or
70-20    things which may be unlawful or in violation of the rights of the
70-21    holders of the bonds; or
70-22                (5)  after such notice to the board as the resolution
70-23    may provide, declare the principal of all of the bonds due and
70-24    payable, and if all defaults have been made good, then with the
70-25    written consent of the holders of 25 percent in aggregate principal
70-26    amount of the bonds then outstanding, annul the declaration and its
 71-1    consequences; provided, however, that the holders of more than a
 71-2    majority in principal amount of the bonds authorized by the
 71-3    resolution and then outstanding shall, by written instrument
 71-4    delivered to the trustee, have the right to direct and control any
 71-5    and all actions taken or to be taken by the trustee under this
 71-6    section.
 71-7          (c)  A resolution, indenture, or agreement relating to bonds
 71-8    may provide that in a suit, action, or proceeding under this
 71-9    section, the trustee, whether or not all of the bonds have been
71-10    declared due and payable and with or without possession of any of
71-11    the bonds, shall be entitled as of right to the appointment of a
71-12    receiver who may enter and take possession of all or part of the
71-13    properties of the authority, operate and maintain the properties,
71-14    and set, collect, and receive rates and charges that will be
71-15    sufficient to provide revenues adequate to pay the items specified
71-16    in any resolution or resolutions authorizing any bonds and the
71-17    costs and disbursements of the suit, action, or proceeding and
71-18    apply such revenue in conformity with the provisions of this
71-19    chapter and the resolution authorizing the bonds.
71-20          (d)  In a suit, action, or proceeding by a trustee or
71-21    receivers, if any, under this section, counsel fees and expenses of
71-22    the trustee and of the receiver or receivers, if any, shall
71-23    constitute taxable disbursements, and all costs and disbursements
71-24    allowed by the court shall be a first charge on any revenue pledged
71-25    to secure the payment of the bonds.
71-26          (e)  Subject to the provisions of the constitution, the
 72-1    courts of McLennan County shall have jurisdiction of any suit,
 72-2    action, or proceeding under this section by any trustee on behalf
 72-3    of the bondholders and of all proceedings involved in the suit,
 72-4    action, or proceeding.
 72-5          (f)  In addition to the powers specifically provided by this
 72-6    section, the trustee shall have and possess all powers necessary or
 72-7    appropriate for the exercise of any of the powers specifically
 72-8    provided or incident to the general representation of the
 72-9    bondholders in the enforcement of their rights.
72-10          Sec. 252.019.  LIMITED LIABILITY FOR AQUATIC HERBICIDE
72-11    APPLICATION.  (a)  In this section, "commercially licensed aquatic
72-12    herbicide applicator" means a person who holds a commercial
72-13    applicator license issued by the Department of Agriculture under
72-14    Chapter 76, Agriculture Code, that authorizes the application of
72-15    aquatic herbicides.
72-16          (b)  Except as provided by Chapter 12, Parks and Wildlife
72-17    Code, an authority employee holding a noncommercial aquatic
72-18    herbicide applicator license or a commercially licensed aquatic
72-19    herbicide applicator working under contract with the authority is
72-20    not liable for damages in excess of $2 million for personal injury,
72-21    property damage, or death resulting from the application by the
72-22    applicator of aquatic herbicide in compliance with applicable law
72-23    and the terms of the license or permit.
72-24          CHAPTER 253.  CANADIAN RIVER MUNICIPAL WATER AUTHORITY
72-25          Sec. 253.001.  CREATION.  (a)  A conservation and reclamation
72-26    district to be known as the "Canadian River Municipal Water
 73-1    Authority" is created.  The authority is a governmental agency and
 73-2    body politic and corporate.
 73-3          (b)  The authority is created under and is essential to
 73-4    accomplish the purposes of Section 59, Article XVI, Texas
 73-5    Constitution.
 73-6          (c)  The authority may exercise all rights, powers,
 73-7    privileges, and functions as provided in this chapter and as may be
 73-8    contemplated and implied by Section 59, Article XVI, Texas
 73-9    Constitution, as well as those conferred by the general laws of the
73-10    state relating to water control and improvement districts except
73-11    where such laws are in conflict with the provisions of this
73-12    chapter.
73-13          Sec. 253.002.  DEFINITIONS.  In this chapter:
73-14                (1)  "Authority" means the Canadian River Municipal
73-15    Water Authority.
73-16                (2)  "Board" means the board of directors of the
73-17    authority.
73-18                (3)  "Director" means a member of the board.
73-19          Sec. 253.003.  TERRITORY.  (a)  The area of the authority
73-20    comprises all territory contained, as of May 27, 1953, within the
73-21    limits of the following cities:
73-22                (1)  Amarillo, Potter and Randall counties;
73-23                (2)  Borger, Hutchinson County;
73-24                (3)  Brownfield, Terry County;
73-25                (4)  Lamesa, Dawson County;
73-26                (5)  Levelland, Hockley County;
 74-1                (6)  Lubbock, Lubbock County;
 74-2                (7)  O'Donnell, Lynn and Dawson counties;
 74-3                (8)  Pampa, Gray County;
 74-4                (9)  Plainview, Hale County;
 74-5                (10)  Slaton, Lubbock County; and
 74-6                (11)  Tahoka, Lynn County.
 74-7          (b)  A defect or irregularity in the boundaries of any of the
 74-8    cities listed in Subsection (a) or in any of the proceedings
 74-9    relating to the annexation of territory to those cities does not
74-10    affect the validity of the authority or any of its rights, powers,
74-11    privileges, or functions.
74-12          (c)  It is affirmatively found and determined that all of the
74-13    territory within the limits of cities listed in Subsection (a) as
74-14    of May 27, 1953, and all other territory subsequently annexed to
74-15    the authority under the provisions of this chapter relating to
74-16    annexation shall comprise the authority and that all of the
74-17    territory will benefit from the improvements and facilities to be
74-18    constructed, acquired, or otherwise furnished under this chapter.
74-19          (d)  Any territory annexed to any city or town after it has
74-20    become part of the authority shall be automatically included within
74-21    the boundaries of the authority; provided, however, that if tax
74-22    obligations of any nature have previously been incurred by the
74-23    authority, the inclusion shall not become final until an election
74-24    has been held and a majority of the qualified voters residing in
74-25    the territory annexed has voted for inclusion under the provisions
74-26    for notice and election provided by Sections 253.007(g), (h), and
 75-1    (i) pertaining to elections for the addition of territory and the
 75-2    assumption of indebtedness and taxes.
 75-3          Sec. 253.004.  BOARD OF DIRECTORS.  (a)  The powers of the
 75-4    authority shall be exercised by a board of directors.  The
 75-5    directors are elected by a majority vote of the governing body of
 75-6    each city that constitutes a part of the authority.
 75-7          (b)  Constituent cities with a population of 10,000 or more
 75-8    are entitled to two members on the board.  Constituent cities with
 75-9    a population of less than 10,000 are entitled to one member on the
75-10    board.
75-11          (c)  In July of each year, the governing body of each
75-12    constituent city with a population of 10,000 or more shall elect
75-13    one director for a two-year term beginning August 1 of that year.
75-14    In July of each odd-numbered year, the governing body of each
75-15    constituent city with a population of less than 10,000 shall elect
75-16    one director for a two-year term beginning August 1 of that year.
75-17          (d)  The governing body of each constituent city may fill,
75-18    for the balance of the unexpired term, any vacancy that occurs in
75-19    the office of any director elected by it.
75-20          (e)  Directors elected as provided by this section shall be
75-21    certified to the board by the mayor of the city whose governing
75-22    body has made the election.
75-23          Sec. 253.005.  QUALIFICATIONS OF BOARD MEMBERS.  (a)  To
75-24    qualify for election to the board, a person must be a qualified
75-25    voter and a property-owning taxpayer in the city from which the
75-26    person is elected and must not be a member of the governing body or
 76-1    an employee of that city.
 76-2          (b)  Each director shall subscribe the constitutional oath of
 76-3    office and shall hold office until a successor is elected and has
 76-4    qualified.
 76-5          (c)  Each director who has been elected president, vice
 76-6    president, or secretary shall give bond for the faithful
 76-7    performance of the person's duties in the amount of $5,000.
 76-8          Sec. 253.006.  BOARD:  ACTION; DUTIES; QUORUM; COMPENSATION
 76-9    AND EXPENSES.  (a)  The board shall perform official actions by
76-10    resolution.  A majority of the members of the board constitute a
76-11    quorum for the transaction of business of the authority.  A
76-12    majority vote of the quorum present is sufficient in all official
76-13    actions including final passage and enactment of all resolutions,
76-14    except as otherwise specifically provided in this chapter.
76-15          (b)  The board shall hold regular meetings.  The dates of the
76-16    meetings are to be established in the authority's bylaws or by
76-17    resolution.
76-18          (c)  The president or any three members of the board may call
76-19    special meetings as may be necessary in the administration of the
76-20    authority's business; provided, however, that at least five days
76-21    before the meeting date, the secretary shall mail notice of the
76-22    meeting to the address that each member has on file with the
76-23    secretary.  Notice of special meetings may be waived in writing by
76-24    any director.
76-25          (d)  A director is entitled to receive fees of office and
76-26    reimbursements or a per diem for each day the director actually
 77-1    spends performing the duties of a director, in accordance with
 77-2    Section 49.060.
 77-3          (e)  The board shall elect from among its members a president
 77-4    of the authority.  The president is the chief executive officer of
 77-5    the authority.  The president presides at the meetings of the board
 77-6    and performs all other functions incident to the office.
 77-7          (f)  The board shall elect from among its members a vice
 77-8    president.  The vice president acts as president in case of the
 77-9    inability, absence, or failure of the president to act.
77-10          (g)  The board shall elect a secretary, who may or may not be
77-11    chosen from among the members of the board.  The secretary shall
77-12    ensure that all books and records of the authority are properly
77-13    kept.
77-14          Sec. 253.007.  ADDITIONAL TERRITORY MAY BE ADDED.  (a)  Other
77-15    territory may be annexed to the authority as provided by this
77-16    section.
77-17          (b)  A petition for annexation must:
77-18                (1)  be signed by 50 or a majority of the qualified
77-19    voters of the territory to be annexed;
77-20                (2)  be filed with the board; and
77-21                (3)  describe the territory to be annexed by metes and
77-22    bounds or by other appropriate description, unless the territory is
77-23    the same as that of a city or town, in which event it shall be
77-24    sufficient to state that the territory to be annexed is the same as
77-25    that contained within the city or town.
77-26          (c)  If the board finds that the petition is signed by the
 78-1    required number of qualified persons and otherwise complies with
 78-2    Subsection (b), that the annexation would be in the interest of the
 78-3    territory to be annexed and the authority, and that the authority
 78-4    will be able to render service to the territory, the board shall,
 78-5    provided two-thirds of all the board members vote in favor, adopt a
 78-6    resolution stating the conditions, if any, under which the
 78-7    territory may be annexed to the authority and declaring the board's
 78-8    intention to call an election in the territory for the purpose of
 78-9    submitting the proposition of whether the territory shall be
78-10    annexed to the authority.  The board shall set a time and place for
78-11    a hearing to be held on the question of whether the territory to be
78-12    annexed will benefit from the improvements, works, and facilities
78-13    then owned and operated by the authority.
78-14          (d)  Railroad right-of-way, transmission lines, and other
78-15    property of telephone and telegraph and electric and gas utilities
78-16    that are not situated within the defined limits of an incorporated
78-17    city or town will not benefit from the improvements, works, and
78-18    facilities that the authority is authorized to construct.  Railroad
78-19    right-of-way, transmission lines, or other property of electric and
78-20    gas utilities or right-of-way or other property and facilities of
78-21    telephone and telegraph utilities may not be annexed to the
78-22    authority unless the right-of-way, transmission lines, and other
78-23    property of electric and gas utilities are contained within the
78-24    limits of an incorporated city or town annexed to the authority.
78-25          (e)  Notice of the adoption of a resolution as provided by
78-26    Subsection (c) stating the time and place of the hearing, addressed
 79-1    to the citizens and owners of property in the territory to be
 79-2    annexed, shall be published one time in a newspaper designated by
 79-3    the board and having general circulation in the territory, at least
 79-4    10 days before the date of the hearing.  The notice must describe
 79-5    the territory in the same manner as required or permitted for the
 79-6    petition under Subsection (b).  The secretary shall mail notice of
 79-7    the hearing addressed to the mayor and governing body of each
 79-8    constituent city at least 30 days before the date of the hearing.
 79-9          (f)  All interested persons who reside in the authority or in
79-10    the territory seeking annexation may appear at the hearing and
79-11    offer evidence for or against the intended annexation.  The hearing
79-12    may proceed in the order and under the rules prescribed by the
79-13    board and may be recessed from time to time.  If, at the conclusion
79-14    of the hearing, the board finds that all of the lands in the
79-15    territory to be annexed will benefit from the present or
79-16    contemplated improvements, works, or facilities of the authority,
79-17    the board shall adopt a resolution calling an election in the
79-18    territory to be annexed, stating the date and place or places for
79-19    holding the election and appointing a presiding judge for each
79-20    voting place.  A presiding judge shall appoint the necessary
79-21    assistant judges and clerks to assist in holding the election.
79-22          (g)  Notice of the election, stating the date and places for
79-23    holding the election, the proposition to be voted on, and the
79-24    conditions under which the territory may be annexed, or making
79-25    reference to the resolution of the board for that purpose, shall be
79-26    published one time in a newspaper published in the territory to be
 80-1    annexed and designated by the board, at least 10 days before the
 80-2    dates set for the election.  If no newspaper is published in the
 80-3    territory to be annexed, it is sufficient if notices are posted at
 80-4    three public places in the territory and the notice is published
 80-5    one time, at least 10 days before the date set for the election, in
 80-6    a newspaper having general circulation in the territory.
 80-7          (h)  Only qualified electors who reside in the territory to
 80-8    be annexed may vote in the election.  Returns of the election shall
 80-9    be made to the board.
80-10          (i)  The board shall canvass the returns of the election and
80-11    adopt a resolution declaring the results.  If the resolution shows
80-12    that a majority of the votes cast are in favor of annexation to the
80-13    authority, the annexation shall be incontestable except in the
80-14    manner and within the time for contesting elections under the
80-15    Election Code.  A certified copy of the order shall be recorded in
80-16    the deed records of the county in which the territory is situated.
80-17          (j)  In calling an election on the proposition for the
80-18    annexation of territory, the board may include as part of the same
80-19    proposition the assumption of the territory's part of any
80-20    tax-supported obligations of the authority then outstanding and in
80-21    force, and, in the case of bonds, those previously voted but not
80-22    yet sold, and the levy of ad valorem taxes on taxable property in
80-23    the territory on the same basis as taxes are levied in the
80-24    remainder of the authority for the payment of the tax obligations.
80-25    If the proposition carries by a majority vote, the effect shall be
80-26    the same as that resulting from the separate assumption election
 81-1    provided for in Subsection (k).
 81-2          (k)  After territory is added to the authority, the board may
 81-3    call an election over the entire authority for the purpose of
 81-4    determining whether the entire authority as enlarged shall assume
 81-5    the taxes and tax-supported obligations then outstanding and in
 81-6    force, and, in the case of bonds, those previously voted but not
 81-7    yet sold, and whether ad valorem taxes shall be levied on all
 81-8    taxable property within the authority as enlarged for the payment
 81-9    of the obligations, unless the proposition is favorably voted along
81-10    with the annexation election and becomes lawfully binding on the
81-11    territory annexed.  Notice of the elections provided for in this
81-12    subsection and Subsection (j) shall be given and the election shall
81-13    be held in the same manner as elections for the issuance of bonds
81-14    as provided by this chapter.
81-15          Sec. 253.008.  GENERAL MANAGER; EMPLOYEES.  (a)  The board
81-16    may employ and determine the compensation of a general manager for
81-17    the authority and may delegate to the general manager full power
81-18    and authority to manage and operate the affairs of the authority,
81-19    subject only to the orders of the board.  The board may also employ
81-20    and determine the compensation of such other employees as it
81-21    considers appropriate to the proper conduct of the authority's
81-22    affairs, including engineers, technical experts, attorneys, and
81-23    assistants to the authority's officers, including the general
81-24    manager.  The board may provide for removal of all employees.
81-25          (b)  The general manager is the official treasurer of the
81-26    authority and has charge of its funds.  The general manager shall
 82-1    see that the funds are safely kept and shall account for the funds
 82-2    to the board.  The general manager shall give bond in an amount
 82-3    required by the board, but in no event may the amount be less than
 82-4    $50,000.
 82-5          Sec. 253.009.  DISBURSEMENT OF FUNDS.  The funds of the
 82-6    authority shall be disbursed only on checks, drafts, orders, or
 82-7    other instruments signed by the persons authorized by the bylaws
 82-8    and resolutions of the board.
 82-9          Sec. 253.010.  CITIES AND TOWNS MAY GIVE FINANCIAL AID TO
82-10    AUTHORITY.  In consideration of the fact that the authority may be
82-11    incurring obligations and making expenditures, before funds are
82-12    available to pay the obligations and expenditures, for the purpose
82-13    of providing funds needed to procure necessary engineering surveys
82-14    and the collection and compilation of data relating to general
82-15    conditions influencing the determination of the character and
82-16    extent of the improvements, works, and facilities essential to the
82-17    accomplishment of any purpose of the authority, any city or town
82-18    within the authority may expend funds or use its services for such
82-19    engineering surveys and data.  Any city or town within the
82-20    authority may appropriate money from its general funds or such
82-21    other funds as may be legally available for the purpose and may
82-22    donate and contribute the money to the authority, and the authority
82-23    may contract with any such city or town to repay any money advanced
82-24    as a loan to the authority.
82-25          Sec. 253.011.  AUTHORITY OFFICE; RECORDS.  An office shall be
82-26    established and maintained for the conduct of the authority's
 83-1    business at a location determined by the board.  The board shall
 83-2    keep a true and full account of the proceedings of its meetings and
 83-3    shall maintain its records in a secure manner.
 83-4          Sec. 253.012.  ACCOUNTS; AUDITS.  (a)  The board shall keep
 83-5    complete and accurate accounts conforming to approved methods of
 83-6    bookkeeping.  The accounts and all contracts, documents, and
 83-7    records of the authority shall be kept at the authority's principal
 83-8    office and shall be open to public inspection at all reasonable
 83-9    times.
83-10          (b)  Once each year, the board shall have the books of
83-11    account and financial records of the authority for the preceding
83-12    year audited by an independent certified public accountant or firm
83-13    of certified public accountants.  Copies of the written report of
83-14    the audit, certified to by the accountant or accountants, shall be
83-15    placed and kept on file at the office of the authority and shall be
83-16    open to public inspection at all reasonable times.
83-17          Sec. 253.013.  AUTHORITY DEPOSITORY.  (a)  The board shall
83-18    designate one or more banks within the authority to serve as
83-19    depository for the funds of the authority.  All funds of the
83-20    authority shall be deposited in the depository bank or banks except
83-21    funds pledged to pay bonds, which shall be deposited with the
83-22    trustee bank or paying agent named in the bond proceedings and to
83-23    the extent provided for in those proceedings.  To the extent that
83-24    funds in the depository bank and the trustee bank are not insured
83-25    by the Federal Deposit Insurance Corporation, the funds shall be
83-26    secured in the manner provided by law for the security of county
 84-1    funds.
 84-2          (b)  Before designating a depository bank or banks, the board
 84-3    shall issue a notice stating the time and place at which the board
 84-4    will meet to designate a depository bank or banks and inviting the
 84-5    banks in the authority to submit applications to be designated
 84-6    depositories.  The notice must be published one time at least 10
 84-7    days before the date of the board meeting in a newspaper or
 84-8    newspapers published in the authority and specified by the board.
 84-9          (c)  At the time mentioned in the notice, the board shall
84-10    consider the applications and the management and condition of the
84-11    banks filing them and shall designate as depositories the bank or
84-12    banks that offer the most favorable terms and conditions for the
84-13    handling of the funds of the authority and that the board finds
84-14    have proper management and are in condition to warrant handling the
84-15    funds of the authority.  The term of service for depositories shall
84-16    be prescribed by the board.
84-17          (d)  If no acceptable applications are received by the time
84-18    stated in the notice, the board shall designate some bank or banks
84-19    within or outside the authority on terms and conditions it finds
84-20    advantageous to the authority.
84-21          Sec. 253.014.  AUTHORITY POWERS.  (a)  In addition to those
84-22    otherwise provided by this chapter, the authority may exercise the
84-23    powers, rights, privileges, and functions provided by this section.
84-24          (b)  The authority may store, control, conserve, protect,
84-25    distribute, and utilize, within or outside the authority or within
84-26    or outside the state, the storm waters and floodwaters and
 85-1    unappropriated flow waters of the Canadian River and its
 85-2    tributaries, and may prevent the escape of such waters without
 85-3    first obtaining from them a maximum of public benefit, by the
 85-4    construction of a dam or dams across that river and its tributaries
 85-5    or otherwise, by complying with Chapter 11 and acting in such
 85-6    manner as shall fully recognize and be in harmony with the
 85-7    limitations of use of the waters of that river provided in the
 85-8    Canadian River Compact in Chapter 43.  The authority may also
 85-9    provide, by purchase, contract, lease, or gift or in any other
85-10    lawful manner, and develop all facilities within or outside the
85-11    authority or within or outside the state considered necessary or
85-12    useful for the purpose of storing, controlling, conserving,
85-13    protecting, distributing, processing, and utilizing such surface
85-14    water and transporting it to the cities and areas comprising the
85-15    authority for municipal, domestic, industrial, and other useful
85-16    purposes permitted by law.
85-17          (c)  The authority may acquire and develop within or outside
85-18    the authority or within or outside the state any other available
85-19    source of surface water, storm water, floodwater, groundwater, or
85-20    other water supply and may construct, acquire, and develop all
85-21    facilities deemed necessary or useful with respect to those
85-22    purposes.
85-23          (d)  The authority may acquire, construct, develop, operate,
85-24    and maintain property of any kind, real, personal, or mixed, or any
85-25    interest in property, whether within or outside the authority or
85-26    within or outside the state, and may enter into contracts with any
 86-1    person or legal entity and take actions necessary or convenient in
 86-2    order to protect and preserve, and to prevent, eliminate, reduce,
 86-3    or minimize the pollution, contamination, or deterioration of the
 86-4    quality of, the water of the Canadian River or its tributaries or
 86-5    the water of any other source of water supply to the authority and
 86-6    in order to facilitate the use of the water for any lawful purpose.
 86-7          (e)  The authority may acquire, construct, develop, operate,
 86-8    and maintain any facilities or systems for drilling, pumping,
 86-9    capturing, reducing, intercepting, eliminating, impounding,
86-10    controlling, using, injecting, or otherwise capturing and disposing
86-11    of brine, brackish water, saltwater, saline water, or other water
86-12    contaminated by any type of chlorine, sodium, sulfates, or other
86-13    chemical condition or characteristic detrimental to the quality of
86-14    the water, whether the source of contaminated water is groundwater
86-15    or surface water, within or outside the authority or within or
86-16    outside the state and whether the facilities or systems are located
86-17    within or outside the authority or within or outside the state.
86-18          (f)  The authority may acquire or utilize surface water or
86-19    groundwater rights and develop surface water or groundwater
86-20    resources in any manner in furtherance of the purposes described in
86-21    Subsections (d) and (e).
86-22          (g)  The authority may declare any facilities or system
86-23    acquired or constructed under Subsections (b)-(f) to be a part of
86-24    the authority's water supply system.
86-25          (h)  The authority may acquire, by purchase, construction,
86-26    lease, or gift or in any other lawful manner, and maintain, use,
 87-1    and operate property of any kind, real, personal, or mixed, or any
 87-2    interest in property, within or outside the boundaries of the
 87-3    authority or within or outside the state, necessary or convenient
 87-4    to the exercise of the powers, rights, privileges, and functions
 87-5    granted by the authority under this chapter.
 87-6          (i)  The authority may acquire by condemnation property of
 87-7    any kind, real, personal, or mixed, or any interest in property,
 87-8    within or outside the boundaries of the authority, necessary or
 87-9    convenient to the exercise of the powers, rights, privileges, and
87-10    functions of the authority, in the manner provided by Chapter 21,
87-11    Property Code.  The amount and character of the property to be
87-12    acquired shall be determined by the board; provided, however, that:
87-13                (1)  the authority may not condemn property that may be
87-14    owned by any other political subdivision, city, or town;
87-15                (2)  as against persons, firms, and corporations (or
87-16    their receivers or trustees) who have the power of eminent domain,
87-17    the fee title may not be condemned and the authority may condemn
87-18    only an easement; and
87-19                (3)  the authority may not condemn groundwater rights.
87-20          (j)  The authority may sell or otherwise dispose of any
87-21    surplus property of any kind, real, personal, or mixed, or any
87-22    interest in property not necessary to the operation of the
87-23    authority, in accordance with Section 49.226.
87-24          (k)  The authority may require the relocation of roads and
87-25    highways in the manner and to the extent permitted to districts
87-26    organized under Section 59, Article XVI, Texas Constitution.  The
 88-1    cost of relocation of any roads, highways, railroads, or telephone
 88-2    or telegraph properties or facilities made necessary by this
 88-3    chapter and any reasonable actual damage incurred in changing and
 88-4    adjusting the lines and grades of railroads or highways or roads or
 88-5    telephone or telegraph properties or facilities shall be paid by
 88-6    the authority.
 88-7          (l)  The authority may make contracts with any person or
 88-8    legal entity, including the United States, the state, a political
 88-9    subdivision or body politic and corporate of the state, any other
88-10    state, a political subdivision or body politic and corporate within
88-11    any other state, and any interstate compact commission or similar
88-12    organization, necessary or convenient to the exercise of the
88-13    powers, rights, privileges, and functions of the authority and may
88-14    take all actions and execute all instruments necessary or
88-15    convenient to the exercise of the powers, rights, privileges, and
88-16    functions of the authority.
88-17          (m)  The authority may make or cause to be made surveys and
88-18    engineering investigations for the information of the authority to
88-19    facilitate the accomplishment of the purposes for which the
88-20    authority is created.
88-21          (n)  The authority may borrow money for its corporate
88-22    purposes and may borrow money and accept grants, gratuities, or
88-23    other support from the United States or the state or from any
88-24    corporation or agency created or designated by the United States or
88-25    the state and in connection with any such loan, grant, or other
88-26    support may enter into such arrangement with the United States or
 89-1    the state, or such corporation or agency of either, as the
 89-2    authority may deem advisable.
 89-3          (o)  The authority may make and issue negotiable bonds for
 89-4    funds borrowed in the manner and to the extent provided in this
 89-5    chapter and, with reference to the bonds or otherwise, may contract
 89-6    in any manner it sees fit and as may be required by any law
 89-7    pertaining to loans, grants, or other support received from the
 89-8    United States or the state or from a corporation or agency of the
 89-9    United States or the state.
89-10          (p)  The authority may make such contracts in the issuance of
89-11    bonds as may be considered necessary or convenient to insure the
89-12    marketability of the bonds.
89-13          (q)  The authority may sue or be sued in its corporate name.
89-14          (r)  The authority may adopt, use, and alter a corporate
89-15    seal.
89-16          (s)  The authority may make bylaws for the management and
89-17    regulation of its affairs.
89-18          (t)  The authority may set and collect charges and rates for
89-19    water services furnished by it and may impose penalties for failure
89-20    to pay the charges and rates when due; provided, however, that the
89-21    charges, rates, and penalties shall be set only by unanimous vote
89-22    of the members of the board constituting a quorum and who are
89-23    present at a regular meeting.
89-24          (u)  The authority may cooperate and enter into contracts
89-25    with cities, persons, firms, corporations, and public agencies for
89-26    the purpose of supplying and selling them surface water, storm
 90-1    water, floodwater, groundwater, and other water for municipal,
 90-2    domestic, industrial, and other useful purposes permitted by law;
 90-3    provided, however, that cities and areas constituting the authority
 90-4    shall be accorded priority in the allocation of the authority's
 90-5    available surface water, storm water, floodwater, groundwater, and
 90-6    other water, and the board shall prescribe rules to carry out this
 90-7    provision.  A contract described by this subsection may be on such
 90-8    terms and for such time as the parties may agree, and the contract
 90-9    may provide that it shall continue in effect until the authority's
90-10    bonds specified in the contract and refunding bonds issued in lieu
90-11    of the bonds are fully paid.  The authority of each member or other
90-12    city to enter into a contract with the authority for the sale of
90-13    water or other services or for any other purpose within the powers,
90-14    rights, privileges, and functions of the authority is vested
90-15    exclusively in the governing body of each member or other city
90-16    notwithstanding any provision of a home-rule charter or any local
90-17    ordinance of the member or other city or of any other provision of
90-18    any other law placing any restriction, limitation, or requirement
90-19    on the authority of the governing body of a member or other city to
90-20    enter into any such contract.  No provision of the home-rule
90-21    charter or of any other ordinance of a member or other city, and no
90-22    provision of any other law, in conflict with this subsection will
90-23    invalidate or impair, in whole or in part, the enforceability and
90-24    validity of a contract entered into by the authority with a member
90-25    or other city pursuant to the powers, rights, privileges, and
90-26    functions of the authority.  If the authority contracts with the
 91-1    United States government or any of its agencies for a source of
 91-2    water supply or for the furnishing of any facilities necessary or
 91-3    useful to the authority in carrying out its purposes, the contract
 91-4    entered into under authority of this subsection may provide that it
 91-5    shall continue until the authority has fully discharged all
 91-6    obligations incurred by it under the terms of its contract with the
 91-7    United States government or its agencies.  The authority may also
 91-8    purchase surface water, storm water, floodwater, groundwater, and
 91-9    other water supply from any person, firm, corporation, or public
91-10    agency or from the United States government or any of its agencies.
91-11          (v)  The authority may operate and maintain, with the consent
91-12    of the governing body of any city or town located within the
91-13    authority, any works, plants, or facilities of the city considered
91-14    necessary or convenient to the accomplishment of the purposes for
91-15    which the authority is created.
91-16          (w)  The authority may levy, assess, and collect ad valorem
91-17    taxes to provide funds necessary to construct or acquire, maintain,
91-18    and operate improvements, works, plants, and facilities considered
91-19    essential and beneficial to the authority on a favorable majority
91-20    vote of the qualified electors voting at an election held for that
91-21    purpose within the authority and may also, when so authorized,
91-22    levy, assess, and collect taxes to provide funds adequate to defray
91-23    the cost of the maintenance, operation, and administration of the
91-24    authority.  Elections for the voting of such taxes shall be ordered
91-25    by the board and shall be held and conducted as provided by this
91-26    chapter for elections for the issuance of bonds and the levy of
 92-1    taxes in support of the bonds.  When so levied such taxes, as well
 92-2    as taxes levied in support of bond indebtedness as provided by this
 92-3    chapter, constitute a lien on the property against which such taxes
 92-4    are levied and assessed, and limitations shall not bar the
 92-5    collection of the taxes and enforcement of such liens.
 92-6          (x)(1)  The authority may:
 92-7                      (A)  develop, generate, transmit, or distribute
 92-8    water power and electric energy within the authority's service area
 92-9    for its own use;
92-10                      (B)  purchase electric energy from any available
92-11    source for use at a facility the authority owns, operates, or
92-12    maintains within the authority's service area irrespective of
92-13    whether customer choice as defined by Section 31.002(4), Utilities
92-14    Code, is offered in the area in which the authority's facility is
92-15    located or whether the power region in the area in which the
92-16    authority's facility is located is subject to unbundling under
92-17    Sections 39.051 and 39.403, Utilities Code;
92-18                      (C)  acquire, install, construct, finance,
92-19    operate, make an addition to, own, or operate an electric energy
92-20    generating, transmission, or distribution facility or enter into an
92-21    agreement to jointly do so with another person; or
92-22                      (D)  sell or otherwise dispose of any of the
92-23    authority's interest in a jointly owned facility described by
92-24    Paragraph (C).
92-25                (2)  This subsection does not affect the applicability
92-26    of Title 2, Utilities Code, to the authority or to actions of the
 93-1    authority.
 93-2          (y)  The authority may do any and all acts and things
 93-3    necessary or convenient to the exercise of the powers, rights,
 93-4    privileges, or functions conferred on or permitted the authority by
 93-5    any other law.
 93-6          Sec. 253.015.  CONSTRUCTION CONTRACTS; BIDDING.  A contract
 93-7    requiring an expenditure of more than $25,000 shall not be made
 93-8    until after publication of a notice to bidders once each week for
 93-9    two weeks before the contract is awarded.  The notice shall be
93-10    sufficient if it states the time and place when and where the bids
93-11    will be opened, states the general nature of the work to be done or
93-12    the material, equipment, or supplies to be purchased, and states
93-13    when and on what terms copies of the plans and specifications may
93-14    be obtained.  The publication shall be in a newspaper published in
93-15    the authority designated by the board.
93-16          Sec. 253.016.  ISSUANCE OF BONDS.  (a)  For the purpose of
93-17    providing a source or sources of water supply for cities and other
93-18    users for municipal, domestic, industrial, and other useful
93-19    purposes permitted by law, as authorized by this chapter, and for
93-20    the purpose of carrying out any other power or authority conferred
93-21    by this chapter, including the powers conferred by Section 253.014,
93-22    the authority may issue negotiable bonds to be payable from such
93-23    net operating income and revenues or from such taxes, or from both
93-24    such revenues and taxes, of the authority as are pledged by
93-25    resolution of the board.  In addition to the authority to issue
93-26    bonds for such purposes, the authority may also contract in any
 94-1    other lawful manner and may prescribe the method of payment of any
 94-2    such contract either by the use of net revenues, taxes, or both.
 94-3          (b)  Bonds must be authorized by resolution of the board,
 94-4    bear the date or dates, mature at the time or times, and bear
 94-5    interest at the rate or rates the board determines.  The bonds must
 94-6    be signed by the president and attested by the secretary and must
 94-7    bear the seal of the authority.  All bonds may be sold at a price
 94-8    and under terms the board determines to be the most advantageous
 94-9    and reasonably obtainable.  Within the discretion of the board,
94-10    bonds may be made callable and subject to redemption before their
94-11    maturity at the times and prices prescribed in the authorizing
94-12    resolution.  Interest on all bonds shall be payable annually or
94-13    semiannually within the discretion of the board.  Bonds may be
94-14    issued in one or more than one series and from time to time as
94-15    required in carrying out the purpose of this chapter.  The bonds
94-16    must be in such form, either coupon or registered, carry such
94-17    registration privileges as to principal only or as to both
94-18    principal and interest and as to exchange of coupon bonds for
94-19    registered bonds or vice versa and exchange of bonds of one
94-20    denomination for bonds of other denominations, and be payable at
94-21    such place or places within or outside the state as the board
94-22    determines and prescribes in the resolution or resolutions
94-23    authorizing the bonds.
94-24          (c)  Bonds may be secured by a pledge of all or part of the
94-25    net revenues of the authority, of the net revenues of one or more
94-26    contracts made before or after the bonds are issued, or of other
 95-1    revenues, in such manner as may be specified by resolution of the
 95-2    board.  A pledge may reserve the right, under conditions specified
 95-3    in the pledge, to issue additional bonds which will be on a parity
 95-4    with or subordinate to the bonds being issued.  In this chapter,
 95-5    "net revenues" means the gross revenues of the authority less the
 95-6    amount necessary to pay the cost of maintaining and operating the
 95-7    authority and its properties.
 95-8          (d)  If bonds are issued payable wholly or partially from ad
 95-9    valorem taxes, the board shall levy a tax sufficient to pay the
95-10    bonds and the interest on the bonds as the bonds and interest
95-11    become due, but the rate of the tax for any year may be set after
95-12    giving consideration to the money received from the pledged
95-13    revenues that may be available for the payment of principal and
95-14    interest to the extent and in the manner permitted by the
95-15    resolution authorizing the issuance of the bonds.
95-16          (e)  If bonds or any other contract payable wholly or
95-17    partially from revenues are issued or entered into, the board shall
95-18    set, by contract with all cities, persons, firms, corporations, or
95-19    public agencies that may contract with it for a water supply or
95-20    water facilities, rates of compensation for water sold and services
95-21    rendered by the authority sufficient to pay the expenses of
95-22    operating and maintaining the authority and its facilities and to
95-23    pay all such obligations incurred by it as they mature, including
95-24    such reserve and other funds as may be provided for the bonds or
95-25    other contracts under their terms and as may be provided in the
95-26    resolution pertaining to the bonds or contracts.
 96-1          (f)  From the proceeds of the sale of bonds, the authority
 96-2    may set aside an amount for the payment of interest expected to
 96-3    accrue during construction and for a reserve interest and sinking
 96-4    fund, which provisions shall be made in the resolution authorizing
 96-5    the bonds.  Proceeds from the sale of bonds may also be used for
 96-6    the payment of all expenses necessarily incurred in accomplishing
 96-7    the purposes for which the authority is created, including the
 96-8    expenses of issuing and selling the bonds.  Pending the use of bond
 96-9    proceeds for the purpose for which the bonds were issued, the
96-10    board, in its discretion, may invest the proceeds as authorized by
96-11    the Public Funds Investment Act, Chapter 2256, Government Code.
96-12          (g)  In the event of a default or a threatened default in the
96-13    payment of the principal of or interest on bonds payable wholly or
96-14    partially from revenues, any court of competent jurisdiction may,
96-15    on petition of the holders of 25 percent of the outstanding bonds
96-16    of the issue in default or threatened with default, appoint a
96-17    receiver with authority to collect and receive all income of the
96-18    authority except taxes, employ and discharge agents and employees
96-19    of the authority, take charge of the authority's funds on hand
96-20    (except funds received from taxes, unless commingled), and manage
96-21    the proprietary affairs of the authority without consent or
96-22    hindrance by the board.  The receiver may also be authorized to
96-23    sell or make contracts for the sale of water or renew such
96-24    contracts with the approval of the court appointing the receiver.
96-25          (h)  Bonds issued by the authority pursuant to the provisions
96-26    of this chapter are negotiable instruments under the laws of this
 97-1    state.
 97-2          (i)  Before bonds are sold by the authority, a certified copy
 97-3    of the proceedings for the issuance of the bonds, including the
 97-4    form of the bonds, together with any other information the attorney
 97-5    general may require, shall be submitted to the attorney general.
 97-6    If the attorney general finds that the bonds have been issued in
 97-7    accordance with law, the attorney general shall approve the bonds
 97-8    and execute a certificate of approval, which shall be filed in the
 97-9    office of the comptroller and be recorded in a record kept for that
97-10    purpose.  A bond may not be issued until the bond has been
97-11    registered by the comptroller, who shall register the bond if the
97-12    attorney general has filed a certificate approving the bonds and
97-13    the proceedings for the issuance of the bonds with the comptroller
97-14    as provided in this section.  If bonds or the proceedings
97-15    pertaining to the bonds recite that they are secured by a pledge of
97-16    the proceeds of a contract previously made between the authority
97-17    and a city, district, or other user, a copy of the contract and the
97-18    proceedings of the contracting parties shall be submitted to the
97-19    attorney general along with the bond record, and if the bonds have
97-20    been duly authorized and the contracts made in compliance with law,
97-21    the attorney general shall approve the bonds and contracts and the
97-22    bonds shall be registered by the comptroller.  After approval by
97-23    the attorney general, the bonds and contracts are valid and binding
97-24    and are incontestable for any cause.
97-25          (j)  Whenever the authority has issued bonds, including
97-26    interim or temporary bonds, or has contracted with the United
 98-1    States or with the state, or a corporation or agency of either, in
 98-2    connection with the financing of its works or facilities, the
 98-3    authority may validate the bonds or contracts by suit as provided
 98-4    by Sections 51.423-51.431.
 98-5          (k)  Pending the issuance of definitive bonds, the authority
 98-6    may issue and deliver interim or temporary bonds.  The interim or
 98-7    temporary bonds thus issued may be taken up with the proceeds of
 98-8    the definitive bonds, or the definitive bonds may be issued and
 98-9    delivered in exchange for and in substitution of the interim or
98-10    temporary bonds.  After an exchange and substitution, the authority
98-11    shall file proper certificates with the comptroller as to the
98-12    exchange, substitution, and cancellation.  The certificates shall
98-13    be recorded by the comptroller.
98-14          (l)  The board may issue refunding bonds for the purpose of
98-15    refunding any outstanding bonds authorized by this chapter and
98-16    interest on the bonds without the necessity of an election.
98-17    Refunding bonds may be issued to refund more than one series of
98-18    outstanding bonds, and in the case of bonds secured in whole or in
98-19    part by net revenues, the authority may combine the pledges for the
98-20    outstanding bonds for the security of the refunding bonds and may
98-21    secure the refunding bonds by other or additional revenues.  The
98-22    provisions of this chapter with reference to the issuance of other
98-23    bonds and their approval by the attorney general and the rights and
98-24    remedies of the holders shall be applicable to refunding bonds.
98-25    Refunding bonds shall be registered by the comptroller on surrender
98-26    and cancellation of the bonds to be refunded; but in lieu of this
 99-1    procedure, the resolution authorizing the issuance of the refunding
 99-2    bonds may provide that the refunding bonds shall be sold and the
 99-3    proceeds deposited in the bank where the original bonds are
 99-4    payable, in which case the refunding bonds may be issued in an
 99-5    amount sufficient to pay the interest on the original bonds to
 99-6    their option date or maturity date and the comptroller shall
 99-7    register the refunding bonds without concurrent surrender and
 99-8    cancellation of the original bonds.
 99-9          (m)  Bonds, including refunding bonds, authorized by this
99-10    chapter that are not payable wholly from ad valorem taxes may be
99-11    additionally secured by a trust indenture under which the trustee
99-12    may be a bank with trust powers that is situated either within or
99-13    outside the state.  The trust indenture or mortgage may include
99-14    provisions for a lien on all or part of the physical properties of
99-15    the authority and franchises, easements, water rights and
99-16    appropriation permits, leases and contracts, and all rights
99-17    appurtenant to such properties, vesting in the trustee power to
99-18    sell the properties for payment of the indebtedness thus secured
99-19    and power to operate the properties and all other powers and
99-20    authority for the further security of the bonds.  The trust
99-21    indenture, regardless of the existence of a deed of trust lien, may
99-22    contain provisions prescribed by the board for the security of the
99-23    bonds and the preservation of the trust estate, including provision
99-24    for amendment or modification thereof and the issuance of bonds to
99-25    replace lost or mutilated bonds secured by the trust indenture.  A
99-26    purchaser under a sale under a deed of trust lien, where one is
 100-1   given, shall be the owner of the properties, facilities, and rights
 100-2   so purchased and shall have the right to maintain and operate the
 100-3   properties, facilities, and rights during the period prescribed by
 100-4   the trust indenture.
 100-5         (n)  Bonds supported in whole or in part by taxes to be
 100-6   levied by the authority, except refunding bonds related to the
 100-7   bonds, may not be issued unless the bonds are authorized by an
 100-8   election at which only the qualified voters who reside in the
 100-9   authority may vote and unless a majority of the votes cast at the
100-10   authoritywide election is in favor of the issuance of the bonds.
100-11         (o)  A bond election for the issuance of bonds supported in
100-12   whole or in part by taxes may be called by the board without a
100-13   petition.  The resolution calling the election shall specify the
100-14   time and location of the election, the purpose for which the bonds
100-15   are to be issued, the maximum amount of the bonds, the maximum
100-16   maturity of the bonds, the maximum interest rate, the form of the
100-17   ballot, and the presiding judge for each voting place.  The
100-18   presiding judge serving at each voting place shall appoint the
100-19   necessary assistant judges and clerks for holding the election.
100-20   Notice of the election must be given by publishing a substantial
100-21   copy of the resolution calling the election in a newspaper or
100-22   newspapers of general circulation in each city contained in the
100-23   authority once a week for two consecutive weeks.  The first
100-24   publication must be at least 21 days before the date of the
100-25   election.  The returns of the election shall be made to and
100-26   canvassed by the board.  The Election Code applies to elections
 101-1   held under this section, except as otherwise provided in this
 101-2   chapter.
 101-3         (p)  Bonds of the authority supported by revenues or sources
 101-4   other than taxes to be levied by the authority may be issued as
 101-5   otherwise provided by this chapter without holding an election to
 101-6   approve the bonds.
 101-7         (q)  The authority may issue bond anticipation notes for any
 101-8   purpose for which bonds of the authority may be authorized or for
 101-9   the purpose of refunding previously issued bond anticipation notes.
101-10   The authority may covenant with the purchasers of the bond
101-11   anticipation notes that the authority will use the proceeds of sale
101-12   of any bonds authorized by the authority for the purpose of
101-13   refunding the bond anticipation notes, in which case the authority
101-14   will be required to use the proceeds received from sale of the
101-15   bonds to pay principal, interest, or redemption price on the bond
101-16   anticipation notes.  To the extent applicable, the terms and
101-17   conditions of this chapter relating to bonds of the authority apply
101-18   to the bond anticipation notes.
101-19         (r)  In addition to the power to issue bonds as provided by
101-20   this chapter, the authority may issue bonds for any purpose and in
101-21   any manner authorized by general law for water control and
101-22   improvement districts or may issue bonds in any other manner
101-23   authorized by law.  Section 49.181 does not apply to the issuance
101-24   of bonds or to the construction projects funded by bonds.
101-25         Sec. 253.017.  NO EXCLUSION OF LANDS OR OTHER PROPERTY
101-26   REQUIRED.  The provisions of Subchapter J, Chapter 49, or other
 102-1   statutes relating to the exclusion of lands or other property shall
 102-2   not be applicable to the authority.
 102-3         Sec. 253.018.  CONTRACTS WITH UNITED STATES OR ITS AGENCIES;
 102-4   ELECTIONS.  (a)  The authority may contract with the United States
 102-5   government and any of its agencies or contract under the federal
 102-6   reclamation laws for the construction, operation, and maintenance
 102-7   of any work or facility by which water may be supplied and
 102-8   distributed to the authority under any act of Congress providing or
 102-9   permitting such contract, and for the accomplishment of all other
102-10   powers and purposes of the authority including those described in
102-11   Section 253.014, and the authority shall further have all the
102-12   rights, powers, privileges, and authority granted under the general
102-13   laws of the state in that respect.
102-14         (b)  A contract entered into pursuant to Subsection (a) may
102-15   provide that on the repayment of all amounts to become due under
102-16   the contract, title to all facilities constructed pursuant to the
102-17   contract, including any dam or reservoir, shall pass to and be
102-18   lodged in the authority, or the contract may provide that the
102-19   authority shall be vested with absolute control over the release
102-20   and use of waters stored in the facilities and belonging to the
102-21   authority as long as the authority remains current in the payment
102-22   of the amounts due the United States government or its agency under
102-23   the contract.  In all events, title to its water rights shall
102-24   continue to remain in the authority.
102-25         (c)  If a contract is proposed to be made whereby the
102-26   authority will become obligated to make payments wholly or
 103-1   partially from ad valorem taxes to be levied by the authority, the
 103-2   contract shall not be entered into unless authorized by an election
 103-3   at which only the qualified voters who reside in the authority may
 103-4   vote and a majority of the votes cast at the election is in favor
 103-5   of the execution of the contract.  All methods prescribed in
 103-6   Sections 253.016 (n) and (o) relating to the voting of bonds are
 103-7   applicable to the voting of contracts if an election is required
 103-8   under this section.
 103-9         (d)  If the authority enters into a contract with the United
103-10   States government or any of its agencies as provided in this
103-11   section, no subsequent alteration in the organization of the
103-12   authority shall be effected and no proceedings for the exclusion of
103-13   any area of the authority shall be undertaken under the provisions
103-14   of any law unless such alterations and exclusions have first
103-15   received the approval of the United States government or its
103-16   contracting agency.
103-17         Sec. 253.019.  WATER PERMITS.  The authority is authorized to
103-18   acquire and own water permits on compliance with the provisions of
103-19   the general law pertaining to such permits as provided by Chapter
103-20   11.
103-21         Sec. 253.020.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
103-22   DEPOSITS.  Bonds of the authority are legal and authorized
103-23   investments for banks, savings banks, trust companies, building and
103-24   loan associations, savings and loan associations, insurance
103-25   companies, fiduciaries, trustees, and guardians, for the sinking
103-26   funds of cities, towns, villages, counties, school districts, or
 104-1   other political subdivisions of the state, and for all public funds
 104-2   of the state or its agencies including the permanent school fund.
 104-3   Such bonds are eligible to secure the deposit of all public funds
 104-4   of the state and all public funds of cities, towns, villages,
 104-5   counties, school districts, or other political corporations or
 104-6   subdivisions of the state, and such bonds shall be lawful and
 104-7   sufficient security for such deposits to the extent of their value
 104-8   when accompanied by all unmatured coupons.
 104-9         Sec. 253.021.  BONDS EXEMPT FROM TAXATION.  The
104-10   accomplishment of the purposes stated in this chapter are for the
104-11   benefit of the people of this state and for the improvement of
104-12   their properties and industry.  The authority, in carrying out the
104-13   purposes of this chapter, will be performing an essential public
104-14   function under the constitution and shall not be required to pay
104-15   any tax or assessment on the project or any part of the project,
104-16   and the bonds or other obligations issued under this chapter and
104-17   the transfer of and income from the bonds, including profits on the
104-18   sale of the bonds, shall at all times be free from taxation by the
104-19   state or by any municipal corporation, county, or other political
104-20   subdivision or taxing district of the state.
104-21         Sec. 253.022.  TAXATION.  Before the issuance of authority
104-22   bonds or the execution of a contract payable wholly or partially
104-23   from ad valorem taxes, the board shall appoint a tax assessor and
104-24   collector and a board of equalization and shall cause taxes to be
104-25   assessed, valuations to be equalized, and tax rolls to be prepared.
104-26   The board may also appoint deputies to assist the tax assessor and
 105-1   collector in the manner and for the period it may order.  Where
 105-2   applicable and not in conflict with this section, the general laws
 105-3   relating to water control and improvement districts with reference
 105-4   to tax assessors and collectors, boards of equalization, tax rolls,
 105-5   and the levy and collection of taxes and delinquent taxes shall be
 105-6   applicable to the authority, except that the board of equalization
 105-7   to be appointed each year by the board shall consist of one member
 105-8   residing in each city then contained in the authority.  All taxes
 105-9   to be levied, assessed, and collected by the authority shall be on
105-10   an ad valorem basis and all provisions of the general laws
105-11   pertaining to the levy, assessment, and collection of ad valorem
105-12   taxes by water control and improvement districts, including the
105-13   enforcement of such provisions and the processes for the collection
105-14   of delinquent taxes provided in such provisions, shall be
105-15   applicable to the authority.
105-16         Sec. 253.023.  ADOPTION OF RULES AND REGULATIONS.  The board
105-17   may adopt and promulgate reasonable rules and regulations to
105-18   secure, maintain, and preserve the sanitary condition of all water
105-19   in and to flow into any reservoir owned by the authority or which
105-20   it may control, by contract or otherwise, to prevent the waste or
105-21   unauthorized use of water, and to regulate residence, hunting,
105-22   fishing, boating, and camping, and all recreational and business
105-23   privileges, along, around, or on any such reservoir or any body of
105-24   land or easement owned or controlled by the authority.
105-25         Sec. 253.024.  RECREATIONAL FACILITIES.  The authority may
105-26   establish or otherwise provide for public parks and recreation
 106-1   facilities and may acquire for such purposes land adjacent to any
 106-2   reservoir in which the authority owns water storage rights;
 106-3   provided, however, that no money received from taxation or bonds
 106-4   payable wholly or partially from taxation shall be used for such
 106-5   purposes.  The authority may also contract for the lease of lands
 106-6   acquired by it for recreation or concession purposes under terms as
 106-7   the board may determine.
 106-8         Sec. 253.025.  VOTING PLACES.  For the purposes of all
 106-9   authority elections to be conducted under the provisions of this
106-10   chapter, the voting places shall conform as nearly as conveniently
106-11   possible with those customarily designated for election purposes in
106-12   the various cities or areas comprising the authority.
106-13         Sec. 253.026.  TERRITORY DETACHED FROM ANY OTHER DISTRICT OR
106-14   AUTHORITY.  The authority, with its granted powers, shall take
106-15   precedence over and stand in lieu of any other water district
106-16   previously organized over the same territory or organized and
106-17   created in any manner over the same territory under any general or
106-18   special law, and such territory under the provisions of this
106-19   chapter is declared to be detached from all other districts or
106-20   authorities established under Section 59, Article XVI, Texas
106-21   Constitution, including particularly the Panhandle Water
106-22   Conservation Authority, established by Chapter 256, Acts of the
106-23   45th Legislature, Regular Session, 1937.  The authority may
106-24   coordinate its plans with any conservation, reclamation, or other
106-25   district previously created, with powers provided in Section 59,
106-26   Article XVI, Texas Constitution, and may enter into joint
 107-1   undertaking for the purposes for which the districts are created;
 107-2   provided, however, that all such acts must be approved by a
 107-3   majority of the board of directors of each district or authority
 107-4   involved.
 107-5         Sec. 253.027.  BONDS OF OFFICERS AND EMPLOYEES.  All bonds
 107-6   required to be given by officers and employees of the authority
 107-7   shall be executed by a surety company authorized to do business in
 107-8   the state.  The authority may pay the premiums on the bonds.
 107-9         Sec. 253.028.  CONFLICTS.  (a) All powers conferred by the
107-10   general laws of the state pertaining to water control and
107-11   improvement districts shall be applicable to the authority to the
107-12   extent that those laws are not in conflict with the provisions of
107-13   this chapter.
107-14         (b)  Nothing in this chapter shall be construed to violate
107-15   any provision of the federal or state constitutions, and all acts
107-16   done under this chapter shall be done in such a manner as will
107-17   conform to the provisions of those constitutions, whether expressly
107-18   provided in this chapter or not.  If any procedure under this
107-19   chapter is held by a court to be violative of either constitution,
107-20   the authority shall have the power by resolution to provide an
107-21   alternative procedure conformable with the constitutions.
107-22         Sec. 253.029.  COMPLIANCE WITH CANADIAN RIVER COMPACT.
107-23   Nothing in this chapter shall be construed in any manner that might
107-24   preclude full compliance with the provisions of the Canadian River
107-25   Compact, entered into and signed by the states of Texas, New
107-26   Mexico, and Oklahoma and the federal government on December 6,
 108-1   1950.  All actions and rights existing under the authority of this
 108-2   chapter shall be controlled to the extent necessary to afford full
 108-3   compliance with the terms of the compact.
 108-4         Sec. 253.030.  BOND NOT REQUIRED.  The authority shall not be
 108-5   required to give a cost or supersedeas bond or to pay a cost
 108-6   deposit on any appeal from the judgment of any court of this state.
 108-7         Sec. 253.031.  The provisions of Chapter 572, Government
 108-8   Code, relating to personal financial disclosure, standards of
 108-9   conduct, and conflicts of interest, shall not apply to the
108-10   authority.
108-11             CHAPTER 254.  CENTRAL COLORADO RIVER AUTHORITY
108-12         Sec. 254.001.  CREATION.  (a)  A conservation and reclamation
108-13   district to be known as the "Central Colorado River Authority" is
108-14   created.  The authority is a governmental agency and a body politic
108-15   and corporate.
108-16         (b)  The authority is created under and is essential to
108-17   accomplish the purposes of Section 59, Article XVI, Texas
108-18   Constitution.
108-19         (c)  The authority may exercise the rights, privileges, and
108-20   functions provided by this chapter including, to the extent
108-21   authorized by this chapter, the control, storing, preservation, and
108-22   distribution of the waters of the Central Colorado River and its
108-23   tributaries for domestic, municipal, flood control, irrigation,
108-24   power, and other useful purposes; the reclamation and irrigation of
108-25   arid, semiarid, and other lands needing irrigation; and the
108-26   conservation and development of the forests, water, and
 109-1   hydroelectric power of the state.
 109-2         (d)  Nothing in this chapter or in any other law shall be
 109-3   construed as authorizing the authority to levy or collect taxes or
 109-4   assessments, or to create any indebtedness payable out of taxes or
 109-5   assessments, or in any way to pledge the credit of the state.
 109-6         Sec. 254.002.  DEFINITIONS.  In this chapter:
 109-7               (1)  "Authority" means the Central Colorado River
 109-8   Authority.
 109-9               (2)  "Board" means the board of directors of the
109-10   authority.
109-11               (3)  "Director" means a member of the board.
109-12         Sec. 254.003.  TERRITORY.  The authority consists of all the
109-13   territory included within the boundaries of Coleman County.
109-14         Sec. 254.004.  POWERS AND DUTIES.  (a)  Except as expressly
109-15   limited by this chapter, the authority may exercise all the powers,
109-16   rights, privileges, and functions conferred by general law on
109-17   districts created under Section 59, Article XVI, Texas
109-18   Constitution, and as provided by this section.
109-19         (b)  The authority may control, store, and preserve, within
109-20   the boundaries of the authority, the waters of the Colorado River
109-21   and its tributaries for any useful purpose and may use, distribute,
109-22   and sell those waters within the boundaries of the authority for
109-23   any useful purpose.
109-24         (c)  The authority may develop and generate waterpower and
109-25   electric energy within the boundaries of the authority and may
109-26   distribute and sell waterpower and electric energy within or
 110-1   outside the boundaries of the authority; but such use shall be
 110-2   subordinate and inferior to all requirements for domestic,
 110-3   municipal, and irrigation purposes.
 110-4         (d)  The authority may prevent or aid in the prevention of
 110-5   damage to person or property from the waters of the Colorado River
 110-6   and its tributaries.
 110-7         (e)  The authority may forest and reforest and aid in the
 110-8   foresting and reforesting of the watershed area of the Colorado
 110-9   River and its tributaries and may prevent and aid in the prevention
110-10   of soil erosion and floods within the watershed area.
110-11         (f)  The authority may acquire by purchase, lease, or gift or
110-12   in any other manner, other than by condemnation, and may maintain,
110-13   use, and operate property of any kind, real, personal, or mixed, or
110-14   any interest in property, within or outside the boundaries of the
110-15   authority, necessary or convenient to the exercise of the powers,
110-16   rights, privileges, and functions conferred on the authority by
110-17   this chapter.
110-18         (g)  The authority may acquire by condemnation property of
110-19   any kind, real, personal, or mixed, or any interest in property,
110-20   within the boundaries of the authority necessary or convenient to
110-21   the exercise of the powers, rights, privileges, and functions
110-22   conferred on the authority by this chapter.  The authority may
110-23   condemn property in the manner provided by general law with respect
110-24   to condemnation or, at the option of the authority, in the manner
110-25   provided by the statutes relating to condemnation by districts
110-26   organized under general law pursuant to Section 59, Article XVI,
 111-1   Texas Constitution.
 111-2         (h)  The authority may, subject to the provisions of this
 111-3   chapter, sell or otherwise dispose of property of any kind, real,
 111-4   personal, or mixed, or any interest in property, that is not
 111-5   necessary to carrying on the business of the authority.
 111-6         (i)  The authority may overflow and inundate any public lands
 111-7   and public property and may require the relocation of roads and
 111-8   highways in the manner and to the extent permitted to districts
 111-9   organized under general law pursuant to Section 59, Article XVI,
111-10   Texas Constitution.
111-11         (j)  The authority may construct, extend, improve, maintain,
111-12   and reconstruct, or cause to be constructed, extended, improved,
111-13   maintained, and reconstructed, and may use and operate facilities
111-14   of any kind necessary or convenient to the exercise of its powers,
111-15   rights, privileges, and functions.
111-16         (k)  The authority may sue and be sued in its corporate name.
111-17         (l)  The authority may make bylaws for the management and
111-18   regulation of its affairs.
111-19         (m)  The authority may adopt, use, and alter a corporate
111-20   seal.
111-21         (n)  The authority may appoint officers, agents, and
111-22   employees and may prescribe their duties and fix their
111-23   compensation.
111-24         (o)  The authority may make contracts and execute instruments
111-25   necessary or convenient to the exercise of the powers, rights,
111-26   privileges, and functions conferred on the authority by this
 112-1   chapter.
 112-2         (p)  The authority may borrow money for its corporate
 112-3   purposes and may borrow money and accept grants from the United
 112-4   States or a corporation or agency created or designated by the
 112-5   United States and, in connection with such loan or grant, may enter
 112-6   into such agreements as the United States or such corporation or
 112-7   agency may require.  The authority may make and issue negotiable
 112-8   bonds for funds borrowed in the manner and to the extent provided
 112-9   by Section 254.012.  Nothing in this chapter shall be construed to
112-10   authorize the issuance of any bonds, notes, or other evidences of
112-11   indebtedness of the authority except as specifically provided by
112-12   this chapter, and no issuance of bonds, notes, or other evidences
112-13   of indebtedness of the authority except as specifically provided by
112-14   this chapter shall ever be authorized except by an act of the
112-15   legislature.
112-16         (q)  The authority may do any and all other acts or things
112-17   necessary or convenient to the exercise of the powers, rights,
112-18   privileges, or functions conferred on the authority by this chapter
112-19   or any other act or law.
112-20         Sec. 254.005.  LIMITATIONS ON AUTHORITY.  (a)  The authority
112-21   may not be permitted to use for irrigation purposes any water under
112-22   any law or permits issued or held, owned, or enjoyed by the
112-23   authority or which have been acquired from the Colorado River
112-24   Corporation or any other company or person unless such use is
112-25   expressly authorized by permits granted to the authority by the
112-26   commission under authority of law.  In considering applications by
 113-1   the authority, the commission shall at all times consider the needs
 113-2   of the people living within and on the lands lying within the
 113-3   watershed of the Colorado River and its tributaries above the
 113-4   authority; provided, however, that nothing in this subsection shall
 113-5   prevent the authority from selling, for irrigation purposes within
 113-6   the boundaries of the authority, any water impounded by it under
 113-7   authority of law.
 113-8         (b)  Notwithstanding any rights or permits issued by the
 113-9   commission or its predecessor agency that are held or acquired by
113-10   the authority, the impounding and use of the floodwaters of the
113-11   Colorado River or its tributaries for the generation of
113-12   hydroelectric power by the authority or anyone who may succeed to
113-13   the rights and privileges conferred on the authority by this
113-14   chapter are subject to the rights of a person, municipal
113-15   corporation, or body politic that is impounding or putting to
113-16   beneficial use such waters for the purposes set forth in Section
113-17   11.024(1)-(3) if the person, municipal corporation, or body
113-18   politic:
113-19               (1)  has received a permit for the use from the
113-20   commission; or
113-21               (2)  is permitted by law to impound water for the
113-22   purposes described by this subsection.
113-23         (c)  Nothing in this chapter shall be construed to subject to
113-24   condemnation by the authority, or by any successors of the
113-25   authority or anyone who may succeed to the rights and privileges
113-26   conferred on the authority by this chapter, any waters:
 114-1               (1)  impounded or to be impounded within or outside the
 114-2   authority under any law authorizing water to be impounded or under
 114-3   any permits granted to a municipal corporation or body politic; or
 114-4               (2)  impounded or permitted to be impounded or used
 114-5   outside the authority under permits granted to any person.
 114-6         (d)  Nothing in this chapter shall be construed as depriving
 114-7   any person or municipality of the right to impound the waters of
 114-8   the Colorado River or its tributaries for domestic or municipal
 114-9   purposes or as repealing any law granting such rights to persons
114-10   and municipalities.
114-11         (e)  All rights of the authority to impound, use, and sell
114-12   the waters of the Colorado River and its tributaries for the
114-13   generation of hydroelectric power are subordinate and inferior to
114-14   the rights of:
114-15               (1)  cities and towns situated within the watershed of
114-16   the Colorado River and its tributaries to build dams and impound
114-17   floodwaters for municipal purposes; and
114-18               (2)  any citizens of Texas, or bodies politic, to build
114-19   dams and impound the floodwaters within the watershed of the
114-20   Colorado River and its tributaries for domestic purposes and for
114-21   the purposes of irrigation.
114-22         (f)  The title to any rights, properties, licenses,
114-23   franchises, or permits acquired, or to be acquired, by the
114-24   authority shall be subject to the limitations imposed by Subsection
114-25   (e).
114-26         Sec. 254.006.  BOARD OF DIRECTORS.  (a)  The powers, rights,
 115-1   privileges, and functions of the authority shall be exercised by a
 115-2   board consisting of nine directors.
 115-3         (b)  Each director must be a resident and freehold property
 115-4   taxpayer of the state and a resident of the authority.
 115-5         (c)  The directors shall be appointed by the governor with
 115-6   the advice and consent of the senate.  A person is not eligible for
 115-7   appointment if the person has, during the three years immediately
 115-8   preceding the person's appointment, been employed by an electric
 115-9   power and light company, gas company, telephone company, or any
115-10   other utility company of any kind.  Directors are appointed for
115-11   staggered terms of six years, with three directors' terms expiring
115-12   on February 1 of each odd-numbered year.  At the expiration of the
115-13   term of a director, a successor shall be appointed by the governor.
115-14         (d)  Each director shall hold office until the expiration of
115-15   the term for which the director was appointed and until a successor
115-16   is appointed and has qualified, unless removed sooner as provided
115-17   by this chapter.
115-18         (e)  A director may be removed by the governor for
115-19   inefficiency, neglect of duty, or misconduct in office after at
115-20   least 10 days' written notice of the charges against the director
115-21   and an opportunity to be heard in person or by counsel at a public
115-22   hearing.  A vacancy resulting from the death, resignation, or
115-23   removal of a director shall be filled by the governor for the
115-24   unexpired term.  Each director shall qualify by taking the official
115-25   oath of office prescribed by general statute.
115-26         (f)  Each director is entitled to receive a fee of $10 per
 116-1   day for each day spent in attending meetings of the board.
 116-2         (g)  Until the adoption of bylaws setting the time and place
 116-3   of regular meetings and the manner in which special meetings may be
 116-4   called, meetings of the board shall be held at such times and
 116-5   places as five of the directors may designate in writing.  Five
 116-6   directors constitute a quorum at any meeting.
 116-7         (h)  Except as otherwise provided in this chapter or in the
 116-8   bylaws, all actions may be taken by the affirmative vote of a
 116-9   majority of the directors present at any meeting, except that an
116-10   affirmative vote of at least five directors is required to
116-11   authorize or ratify a contract that involves an amount greater than
116-12   $10,000 or that is to run for a period longer than one year, the
116-13   issuance of bonds, notes, or other evidence of indebtedness, or
116-14   amendment of the bylaws.
116-15         Sec. 254.007.  OFFICERS; EMPLOYEES.  (a)  The board shall
116-16   select a secretary, who shall keep true and complete records of all
116-17   proceedings of the board.  Until the appointment of a secretary, or
116-18   in the event of the secretary's absence or inability to act, a
116-19   secretary pro tempore shall be selected by the board.
116-20         (b)  The board shall select a general manager, who shall be
116-21   the chief executive officer of the authority.
116-22         (c)  The board shall select a treasurer, who may also hold
116-23   the office of secretary.
116-24         (d)  The officers have the powers and duties, hold office for
116-25   the term, and are subject to removal in the manner provided in the
116-26   bylaws.  The board shall set the compensation of the officers.
 117-1         (e)  The board may appoint officers, agents, and employees,
 117-2   may set their compensation and term of office and the method by
 117-3   which they may be removed, and may delegate to them the power and
 117-4   duties it determines appropriate.
 117-5         Sec. 254.008.  DISBURSEMENT OF FUNDS; SURETY BONDS.  (a)  The
 117-6   funds of the authority may be disbursed only on checks, drafts,
 117-7   orders, or other instruments signed by the persons authorized by
 117-8   the bylaws or a resolution concurred in by not less than five
 117-9   directors.
117-10         (b)  The general manager, the treasurer, and all other
117-11   officers, agents, and employees of the authority charged with the
117-12   collection, custody, or payment of any funds of the authority shall
117-13   give bond conditioned on the faithful performance of their duties
117-14   and an accounting for all funds and property of the authority
117-15   coming under their control.
117-16         (c)  The bonds must be in a form and amount and with a surety
117-17   (by a surety company authorized to do business in the state)
117-18   approved by the board.
117-19         (d)  The premiums on the bonds shall be paid by the authority
117-20   and charged as an operating expense.
117-21         Sec. 254.009.  AUTHORITY OFFICE; RECORDS.  (a)  The domicile
117-22   of the authority shall be in the city of Coleman, Coleman County,
117-23   where the authority shall maintain its principal office in the
117-24   charge of the general manager.
117-25         (b)  The authority shall keep complete and accurate accounts
117-26   conforming to approved methods of bookkeeping.
 118-1         (c)  The accounts and all contracts, documents, and records
 118-2   of the authority shall be kept at the principal office.  The
 118-3   accounts and contracts shall be open to public inspection at all
 118-4   reasonable times.
 118-5         (d)  The board shall cause to be made and completed, within
 118-6   90 days after the end of each calendar year, an audit of the books
 118-7   of account and financial records of the authority for that calendar
 118-8   year.  The audit shall be made by an independent certified public
 118-9   accountant or firm of certified public accountants.
118-10         (e)  Copies of a written report of the audit, certified to by
118-11   the accountant or accountants, shall be placed and kept on file
118-12   with the commission, with the comptroller, and at the principal
118-13   office of the authority, and the report shall be open to public
118-14   inspection at all reasonable times.
118-15         Sec. 254.010.  CONFLICT OF INTEREST; PENALTY.  A director,
118-16   officer, agent, or employee of the authority may not have an
118-17   interest, directly or indirectly, in any contract for the purchase
118-18   of any property or construction of any work by or for the
118-19   authority.  If a director, officer, agent, or employee of the
118-20   authority is or becomes interested in a contract described by this
118-21   section, the person shall be guilty of a felony and on conviction
118-22   shall be subject to a fine not to exceed $10,000 or confinement in
118-23   the county jail for not less than one year or more than 10 years,
118-24   or both a fine and confinement.
118-25         Sec. 254.011.  RATES AND CHARGES.  (a)  The board shall
118-26   establish and collect rates and other charges for the sale or use
 119-1   of water, water connections, power, electric energy, or other
 119-2   services sold, furnished, or supplied by the authority.  The fees
 119-3   and charges must be reasonable and nondiscriminatory and sufficient
 119-4   to produce revenues adequate to:
 119-5               (1)  pay all expenses necessary to the operation and
 119-6   maintenance of the properties and facilities of the authority;
 119-7               (2)  pay the interest on and principal of all bonds
 119-8   issued under this chapter as the interest and principal become due
 119-9   and payable;
119-10               (3)  pay all sinking fund and reserve fund payments
119-11   agreed to be made with respect to bonds and payable out of
119-12   revenues, as the payments become due and payable; and
119-13               (4)  fulfill the terms of any agreements made with the
119-14   holders of bonds or with any person in their behalf.
119-15         (b)  Out of the revenues that may be received in excess of
119-16   those required for the purposes specified in Subsection (a), the
119-17   board may, in its discretion:
119-18               (1)  establish a reasonable depreciation and emergency
119-19   fund;
119-20               (2)  retire, by purchase and cancellation or
119-21   redemption, bonds issued under this chapter; or
119-22               (3)  apply the excess revenues to any corporate
119-23   purpose.
119-24         (c)  The rates and charges of the authority may not be in
119-25   excess of what may be necessary to fulfill the obligations imposed
119-26   on the authority by this chapter.  Nothing in this section shall be
 120-1   construed as depriving the state of its power to regulate and
 120-2   control fees or charges to be collected for the use of water, water
 120-3   connections, power, electric energy, or other service; provided,
 120-4   however, that the state pledges to and agrees with the purchasers
 120-5   and successive holders of the bonds issued under this chapter that
 120-6   the state will not limit or alter the power vested in the authority
 120-7   by this chapter to establish and collect such fees and charges as
 120-8   will produce revenues sufficient to pay the items specified in
 120-9   Subsection (a) or in any way impair the rights or remedies of the
120-10   holders of the bonds, or of any person in their behalf, until the
120-11   bonds, together with the interest on the bonds, and the interest on
120-12   unpaid installments of interest and all costs and expenses in
120-13   connection with any action or proceedings by or on behalf of the
120-14   bondholders and all other obligations of the authority in
120-15   connection with the bonds are fully met and discharged.
120-16         Sec. 254.012.  PAYMENT OF DEBTS.  Each indebtedness,
120-17   liability, or obligation of the authority for the payment of money,
120-18   however entered into or incurred and whether arising from contract,
120-19   implied contract, or otherwise, shall be payable solely:
120-20               (1)  out of the revenues received by the authority with
120-21   respect to its properties, subject to any prior lien on the
120-22   revenues conferred by any resolution previously adopted authorizing
120-23   the issuance of bonds as provided in this chapter; or
120-24               (2)  if the board so determines, out of the proceeds of
120-25   the sale by the authority of bonds payable solely from revenues.
120-26         Sec. 254.013.  ISSUANCE OF BONDS.  (a)  The authority may
 121-1   issue bonds as provided by this section for any corporate purpose,
 121-2   not to exceed $500,000 in aggregate principal amount.  Any
 121-3   additional amount of bonds must be authorized by an act of the
 121-4   legislature.
 121-5         (b)  Bonds may be:
 121-6               (1)  sold for cash, at public or private sale, at such
 121-7   price or prices as the board determines, provided that the interest
 121-8   cost of the money received for the bonds, computed to maturity in
 121-9   accordance with standard bond tables in general use by banks and
121-10   insurance companies, does not exceed six percent per year; or
121-11               (2)  issued on such terms as the board determines in
121-12   exchange for property of any kind, real, personal, or mixed, or any
121-13   interest in property, that the board determines necessary or
121-14   convenient for any corporate purpose; or
121-15               (3)  issued in exchange for like principal amounts of
121-16   other obligations of the authority, matured or unmatured.
121-17         (c)  The proceeds of the sale of bonds shall be deposited in
121-18   a bank or banks or trust company or trust companies and shall be
121-19   paid out pursuant to the terms and conditions agreed on between the
121-20   authority and the purchasers of the bonds.
121-21         (d)  Bonds must be authorized by a resolution of the board
121-22   that is concurred in by at least five members.  Bonds must bear
121-23   such date or dates; mature at such time or times; bear interest at
121-24   such rate or rates, not exceeding six percent per year, payable
121-25   annually or semiannually; be in such denominations; be in such
121-26   form, either coupon or registered; carry such registration
 122-1   privileges as to principal only or as to both principal and
 122-2   interest and as to exchange of coupon bonds for registered bonds,
 122-3   or vice versa, and exchange of bonds of one denomination for bonds
 122-4   of other denominations; be executed in such manner; and be payable
 122-5   at such place or places within or outside the state, as the
 122-6   resolution provides.
 122-7         (e)  A resolution authorizing bonds may contain provisions,
 122-8   which shall be part of the contract between the authority and the
 122-9   purchasers and successive holders of the bonds:
122-10               (1)  reserving the right to redeem the bonds at such
122-11   time or times, in such amounts, and at such prices, not exceeding
122-12   105 percent of the principal amount of the bonds plus accrued
122-13   interest, as may be provided in the resolution;
122-14               (2)  providing for the setting aside of sinking funds
122-15   or reserve funds and the regulation and disposition of the funds;
122-16               (3)  pledging, to secure the payment of the principal
122-17   of and interest on the bonds and of the sinking fund or reserve
122-18   fund payments agreed to be made with respect to the bonds, all or
122-19   any part of the gross or net revenues received by the authority
122-20   with respect to the property, real, personal, or mixed, to be
122-21   acquired or constructed with the bonds or the proceeds of the
122-22   bonds, or all or part of the gross or net revenues received by the
122-23   authority from any source;
122-24               (4)  prescribing the purposes to which the bonds or any
122-25   bonds later issued, or the proceeds of the bonds, may be applied;
122-26               (5)  agreeing to set and collect rates and charges
 123-1   sufficient to produce revenues adequate to pay the items specified
 123-2   in Section 254.011(a) and prescribing the use and disposition of
 123-3   all revenues;
 123-4               (6)  prescribing limitations on the issuance of
 123-5   additional bonds and on the agreements that may be made with the
 123-6   purchasers and successive holders of such bonds;
 123-7               (7)  relating to the construction, extension,
 123-8   improvement, reconstruction, operation, maintenance, and repair of
 123-9   the properties of the authority and the carrying of insurance on
123-10   all or any part of the properties covering loss or damage or loss
123-11   of use and occupancy resulting from specified risks;
123-12               (8)  fixing the procedure, if any, by which, if the
123-13   authority so desires, the terms of any contract with the holders of
123-14   the bonds may be amended or abrogated, the amount of the bonds
123-15   whose holders must consent to the amendment or abrogation, and the
123-16   manner in which such consent may be given;
123-17               (9)  providing for the execution and delivery by the
123-18   authority to a bank or trust company authorized by law to accept
123-19   trusts, or to the United States or any officer or agency of the
123-20   United States, of indentures and agreements for the benefit of the
123-21   holders of the bonds setting forth all of the agreements authorized
123-22   by this chapter to be made with or for the benefit of the holders
123-23   of the bonds and such other provisions as may be customary in such
123-24   indentures or agreements; and
123-25               (10)  making such other provisions not inconsistent
123-26   with the provisions of this chapter as the board may approve.
 124-1         Sec. 254.014.  DEFAULT PROCEDURES.  (a)  A resolution
 124-2   authorizing the issuance of bonds and any indenture or agreement
 124-3   entered into pursuant to the resolution may include provisions
 124-4   regarding a default on the:
 124-5               (1)  payment of the interest on any bonds as the
 124-6   interest becomes due and payable;
 124-7               (2)  payment of the principal of any bonds as they
 124-8   become due and payable, whether at maturity, by call for
 124-9   redemption, or otherwise; or
124-10               (3)  performance of an agreement made with the
124-11   purchasers or successive holders of any bonds.
124-12         (b)  If a default described by Subsection (a) has occurred
124-13   and has continued for a period, if any, prescribed by the
124-14   resolution authorizing the issuance of the bonds, the trustee under
124-15   the indenture or indentures entered into with respect to the bonds
124-16   authorized by the resolution, or, if there is no indenture, a
124-17   trustee appointed in the manner provided in the resolution by the
124-18   holders of 25 percent in aggregate principal amount of the bonds
124-19   authorized by the resolution and then outstanding, may, and on the
124-20   written request of the holders of 25 percent in aggregate principal
124-21   amount of the bonds authorized by the resolution and then
124-22   outstanding shall, in the trustee's own name but for the equal and
124-23   proportionate benefit of the holders of all of the bonds, and with
124-24   or without having possession of the bonds:
124-25               (1)  by mandamus or other suit, action, or proceeding
124-26   at law or in equity, enforce all rights of the holders of the
 125-1   bonds;
 125-2               (2)  bring suit on the bonds or the appurtenant
 125-3   coupons;
 125-4               (3)  by action or suit in equity, require the authority
 125-5   to account as if it were the trustee of an express trust for the
 125-6   bondholders;
 125-7               (4)  by action or suit in equity, enjoin any acts or
 125-8   things which may be unlawful or in violation of the rights of the
 125-9   holders of the bonds; or
125-10               (5)  after such notice to the authority as the
125-11   resolution may provide, declare the principal of all the bonds due
125-12   and payable, and if all defaults have been made good, then with the
125-13   written consent of the holders of 25 percent in aggregate principal
125-14   amount of the bonds then outstanding, annul the declaration and its
125-15   consequences; provided, however, that the holders of more than a
125-16   majority in principal amount of the bonds authorized by the
125-17   resolution and then outstanding shall, by written instrument
125-18   delivered to the trustee, have the right to direct and control any
125-19   and all action taken or to be taken by the trustee under this
125-20   section.
125-21         (c)  A resolution, indenture, or agreement relating to bonds
125-22   may provide that in a suit, action, or proceeding under this
125-23   section the trustee, whether or not all of the bonds have been
125-24   declared due and payable and with or without possession of any of
125-25   the bonds, shall be entitled as of right to the appointment of a
125-26   receiver who may enter and take possession of all or part of the
 126-1   properties of the authority and operate and maintain the properties
 126-2   and set, collect, and receive rates and charges sufficient to
 126-3   provide revenues adequate to pay the items set forth in Section
 126-4   254.011(a) and the costs and disbursements of the suit, action, or
 126-5   proceeding and may apply such revenues in conformity with the
 126-6   provisions of this chapter and the resolution authorizing the
 126-7   bonds.
 126-8         (d)  In a suit, action, or proceeding by a trustee under this
 126-9   section, the reasonable fees, counsel fees, and expenses of the
126-10   trustee and of the receiver or receivers, if any, shall constitute
126-11   taxable disbursements, and all costs and disbursements allowed by
126-12   the court shall be a first charge on any revenues pledged to secure
126-13   the payment of the bonds.
126-14         (e)  Subject to the provisions of the constitution, the
126-15   courts of Coleman County shall have jurisdiction of any suit,
126-16   action, or proceeding under this section by a trustee on behalf of
126-17   the bondholders and of all property involved in the suit, action,
126-18   or proceeding.
126-19         (f)  In addition to the powers specifically provided by this
126-20   section, the trustee shall have all powers necessary or appropriate
126-21   for the exercise of the powers specifically provided or incident to
126-22   the general representation of the bondholders in the enforcement of
126-23   their rights.
126-24         Sec. 254.015.  BOND APPROVAL AND REGISTRATION.  (a)  Before
126-25   any bonds may be sold by the authority, a certified copy of the
126-26   proceedings for the issuance of the bonds, including the form of
 127-1   the bonds, together with any other information that the attorney
 127-2   general may require, shall be submitted to the attorney general,
 127-3   and if the attorney general finds that the bonds have been issued
 127-4   in accordance with law, the attorney general shall approve the
 127-5   bonds and execute a certificate to that effect, which shall be
 127-6   filed in the office of the comptroller and be recorded in a record
 127-7   kept for that purpose.  The comptroller shall register the bonds if
 127-8   the attorney general has filed with the comptroller the certificate
 127-9   approving the bonds and the proceedings for the issuance of the
127-10   bonds as provided in this section.  No bonds shall be issued until
127-11   the bonds have been registered by the comptroller.
127-12         (b)  Bonds approved by the attorney general, registered by
127-13   the comptroller, and issued in accordance with the proceedings so
127-14   approved are valid and binding obligations of the authority and are
127-15   incontestable for any cause from and after the time of
127-16   registration.
127-17         Sec. 254.016.  BONDS AS NEGOTIABLE INSTRUMENTS.  Bonds issued
127-18   by the authority under the provisions of this chapter are
127-19   negotiable instruments within the meaning of the laws of this
127-20   state.
127-21         Sec. 254.017.  ADDITIONAL POWERS RELATING TO CONTRACTS,
127-22   RULES, AND REGULATIONS.  The authority may, but without intending
127-23   by this provision to limit any powers of the authority as granted
127-24   to it by this chapter, enter into and carry out contracts or
127-25   establish or comply with rules and regulations concerning labor and
127-26   materials and other related matters, in connection with any
 128-1   project, as the authority deems desirable or as requested by the
 128-2   United States, or any corporation or agency created, designated, or
 128-3   established by the United States that may assist in the financing
 128-4   of the project.
 128-5         Sec. 254.018.  CONTRACTS FOR WATER OR SOIL CONSERVATION
 128-6   PROJECTS.  (a)  The authority may enter into contracts with
 128-7   individuals, firms, associations, or corporations for the
 128-8   construction of water or soil conservation projects on property
 128-9   owned or controlled by such individuals, firms, associations, or
128-10   corporations and may use machinery, equipment, or facilities owned
128-11   or controlled by the authority for that purpose.  The individual,
128-12   association, firm, or corporation shall pay a reasonable charge to
128-13   the authority for construction carried out under this subsection.
128-14   The authority is not liable for damages to any person or property
128-15   because of projects contracted for and constructed under this
128-16   subsection and is not liable for the maintenance or upkeep of such
128-17   projects.
128-18         (b)  The authority may enter into contracts with the
128-19   governing boards of duly constituted governmental agencies within
128-20   or outside the boundaries of the authority for the purpose of
128-21   supervising the construction of water or soil conservation projects
128-22   on property located within the control or within the limits of the
128-23   other governmental agencies.  The other governmental agencies shall
128-24   pay to the authority a reasonable charge for construction carried
128-25   out under this subsection.  The authority is not liable for damages
128-26   to any person or property because of projects contracted for and
 129-1   constructed under this subsection and is not liable for the
 129-2   maintenance or upkeep of such projects.
 129-3         Sec. 254.019.  REDEMPTION OF BONDS.  The authority may out of
 129-4   any funds available for the purpose purchase bonds issued by it at
 129-5   a price not exceeding the redemption price applicable at the time
 129-6   of the purchase or, if the bonds are not redeemable, at a price not
 129-7   exceeding the principal amount of the bonds plus accrued interest.
 129-8   All bonds so purchased shall be canceled and no bonds shall ever be
 129-9   issued in lieu of the canceled bonds.
129-10         Sec. 254.020.  DISPOSITION OF PROPERTY.  (a)  Nothing in this
129-11   chapter shall be construed as authorizing the authority, and the
129-12   authority is not authorized, to mortgage or otherwise encumber any
129-13   of its property of any kind, real, personal, or mixed, or any
129-14   interest in property, or to acquire any property or interest
129-15   subject to a mortgage or conditional sale, provided that this
129-16   section shall not be construed as preventing the pledging of the
129-17   revenues of the authority as authorized by this chapter.
129-18         (b)  Nothing in this chapter shall be construed as
129-19   authorizing the sale, lease, or other disposition of any property
129-20   or interest by the authority or by any receiver of any of its
129-21   properties or through any court proceeding or otherwise; provided,
129-22   however, that the authority may sell for cash any property or
129-23   interest with an aggregate value not exceeding $50,000 in any one
129-24   year if the board, by the affirmative vote of six of its members,
129-25   has determined that the property or interest is not necessary or
129-26   convenient to the business of the authority and has approved the
 130-1   terms of the sale.  Except by sale as expressly authorized in this
 130-2   section, no such property or interest, except personal property,
 130-3   shall ever come into the ownership or control, directly or
 130-4   indirectly, of any person, firm, or corporation other than a public
 130-5   authority created under the laws of the state.
 130-6         (c)  All property of the authority except personal property
 130-7   shall be at all times exempted from forced sale, and nothing in
 130-8   this chapter shall be construed to authorize the sale of any of the
 130-9   property of the authority, except personal property, under any
130-10   judgment rendered in any suit, and such sales are prohibited.
130-11         Sec. 254.021.  PUBLIC ACCESS.  (a)  The authority may not
130-12   prohibit the free public use of its lands for recreation purposes
130-13   and for hunting and fishing except as, in the opinion of the board,
130-14   such use would interfere with the proper conduct and maintenance of
130-15   the authority's property.
130-16         (b)  All public rights-of-way traversing the areas adjacent
130-17   to the areas to be flooded by the impounded waters shall remain
130-18   open as a way of free public passage to and from the lakes created.
130-19   A charge may be made to the public for the right to engage in
130-20   hunting, fishing, or boating on the lakes.
130-21         (c)  If any citizen of the state notifies the attorney
130-22   general that this section has not been complied with, the attorney
130-23   general shall institute the proper legal proceedings to require the
130-24   authority or its successor to comply with the provisions of this
130-25   section.
130-26         (d)  If any of the land owned by the authority bordering the
 131-1   lakes to be created under the authority of this chapter is sold by
 131-2   the authority, the authority shall retain in each tract a strip 20
 131-3   feet wide abutting the high-water line of the lake for the purpose
 131-4   of passage and use by the public for public sports and amusements;
 131-5   provided, however, that this subsection does not apply to any sales
 131-6   of land by the authority to any state or federal agency to be used
 131-7   for game or fish sanctuaries or preserves or for propagation
 131-8   purposes.
 131-9         Sec. 254.022.  BONDS EXEMPT FROM TAXATION.  Bonds and the
131-10   interest on bonds issued under the provisions of this chapter are
131-11   exempt from taxation, except inheritance taxes, by the state or by
131-12   any municipal corporation, county, or other political subdivision
131-13   or taxing district of the state.
131-14         Sec. 254.023.  SOURCE OF AUTHORITY.  This chapter, without
131-15   reference to other statutory provisions of the state, constitutes
131-16   full authority for the authorization and issuance of bonds under
131-17   this chapter, and no other act or law with regard to the
131-18   authorization or issuance of obligations or the deposit of the
131-19   proceeds of such obligations or in any way impeding or restricting
131-20   the carrying out of the acts authorized by this chapter to be done
131-21   shall be construed as applying to any proceedings taken or acts
131-22   done under this chapter.
131-23         Sec. 254.024.  CONSTRUCTION.  This chapter and all of its
131-24   terms and provisions shall be liberally construed to effectuate the
131-25   purposes set forth in this chapter.
 132-1          CHAPTER 255.  COLORADO RIVER MUNICIPAL WATER DISTRICT
 132-2         Sec. 255.001.  CREATION.  A district known as the "Colorado
 132-3   River Municipal Water District" was created by Chapter 340, Acts of
 132-4   the 51st Legislature, Regular Session, 1949.  The district is a
 132-5   governmental agency and a body politic and corporate.
 132-6         (b)  The district was created under and is essential to
 132-7   accomplish the purposes of Section 59, Article XVI, Texas
 132-8   Constitution.
 132-9         (c)  The district is declared to be a water control and
132-10   improvement district within the meaning of Chapter 51, authorizing
132-11   water supply contracts between cities and water control and
132-12   improvement districts, and, in addition to the powers conferred by
132-13   this chapter, the district has all of the powers conferred by
132-14   Chapters 49, 50, and 51.  It is provided, however, that should any
132-15   provision of Chapter 49, 50, or 51 conflict with a provision of
132-16   this chapter, the provision of this chapter shall prevail.
132-17         Sec. 255.002.  DEFINITIONS.  In this chapter:
132-18               (1)  "Board" means the board of directors of the
132-19   district.
132-20               (2)  "Director" means a member of the board.
132-21               (3)  "District" means the Colorado River Municipal
132-22   Water District.
132-23         Sec. 255.003.  TERRITORY.  (a)  The district includes all of
132-24   the territory contained within the boundaries of the cities of Big
132-25   Spring, in Howard County, Odessa, in Ector County, and Snyder, in
132-26   Scurry County, on January 1, 1981; provided, however, that no
 133-1   defect in the definition of the boundaries of any of those cities
 133-2   shall affect the validity of the district or any of its powers or
 133-3   duties.  All territory within the boundaries of the district will
 133-4   benefit from the present and contemplated improvements, works, and
 133-5   facilities of the district.
 133-6         (b)  Territory annexed after January 1, 1981, to any city
 133-7   described in Subsection (a) or to any city annexed to the district
 133-8   under Section 255.006 may be annexed to the district in the manner
 133-9   provided in Subsections (c)-(f).
133-10         (c)  At any time after final passage of an ordinance or
133-11   resolution annexing territory to the city, the board may issue a
133-12   notice of hearing on the question of annexing that territory to the
133-13   district.  The notice shall be sufficient if it states the date and
133-14   place of the hearing and a description of the area proposed to be
133-15   annexed, but in lieu of that description, the notice may make
133-16   reference to the annexation ordinance or resolution of the city.
133-17         (d)  The notice shall be published three times in a newspaper
133-18   with general circulation in the city not less than 30 days before
133-19   the date set for the hearing.
133-20         (e)  If, pursuant to the hearing, the board finds that the
133-21   territory proposed to be annexed will benefit from the present or
133-22   contemplated improvements, works, or facilities of the district,
133-23   the board shall adopt a resolution annexing the territory to the
133-24   district.
133-25         (f)  After the territory is added to the district, the board
133-26   may call an election for the entire district as enlarged for the
 134-1   purpose of determining whether the entire district as enlarged will
 134-2   assume any tax-supported bonds of the district then outstanding and
 134-3   previously voted but not yet sold and whether an ad valorem tax
 134-4   will be levied on all taxable property within the district as
 134-5   enlarged for the payment of the bonds.  The election shall be
 134-6   called and held and notice given in the same manner as elections
 134-7   for the issuance of tax-supported bonds under this chapter.
 134-8         Sec. 255.004.  BOARD OF DIRECTORS.  (a)  All powers of the
 134-9   district shall be exercised by a board of directors.  Except as
134-10   provided in this chapter with reference to cities with a population
134-11   of less than 5,000, four of the directors shall be appointed by a
134-12   majority vote of the governing body of each of the cities described
134-13   in Section 255.003 and any city annexed to the district under
134-14   Section 255.006.  In May of each year the governing body of each of
134-15   the cities in Section 255.003 shall appoint two directors for the
134-16   two-year term beginning on June 1 of that year.  Each director
134-17   serves for the term of office as provided in this section and until
134-18   a successor is appointed and qualified.  A person may not be
134-19   appointed a director unless the person resides in and owns taxable
134-20   property in the city from which the person is appointed.  A member
134-21   of the governing body or an employee of a city may not be appointed
134-22   a director.  Directors shall subscribe the constitutional oath of
134-23   office, and each director shall give bond for the faithful
134-24   performance of the director's duties in the amount of $5,000, the
134-25   cost of which shall be paid by the district.  A majority
134-26   constitutes a quorum.
 135-1         (b)  Each director is entitled to receive a fee of $50 for
 135-2   attending each meeting of the board, provided that not more than
 135-3   $100 is paid to any director for meetings held in any one calendar
 135-4   month.  Each director is also entitled to receive $50 per day
 135-5   devoted to the business of the district and to reimbursement for
 135-6   actual expenses incurred in attending to district business provided
 135-7   that the service and expense are expressly approved by the board.
 135-8         Sec. 255.005.  OFFICERS; EMPLOYEES; SEAL.  The board shall
 135-9   elect from among its members a president and a vice president of
135-10   the district and such other officers as in the judgment of the
135-11   board are necessary.  The president is the chief executive officer
135-12   of the district and the presiding officer of the board and has the
135-13   same right to vote as any other director.  The vice president shall
135-14   perform all duties and exercise all powers conferred by this
135-15   chapter on the president when the president is absent or fails or
135-16   declines to act.  The board shall also appoint a secretary and a
135-17   treasurer, who may or may not be members of the board, and it may
135-18   combine those offices.  The treasurer shall give bond in an amount
135-19   required by the board, but in no event less than $100,000.  The
135-20   bond must be conditioned on the treasurer faithfully accounting for
135-21   all money that comes into that officer's custody as treasurer of
135-22   the district.  The board shall appoint all necessary engineers,
135-23   attorneys, and other employees.  The board shall adopt a seal for
135-24   the district.
135-25         Sec. 255.006.  ANNEXATION OF TERRITORY.  (a)  Other territory
135-26   may be annexed to the district in the manner provided by this
 136-1   section.
 136-2         (b)  A petition seeking annexation must be filed with the
 136-3   board.  The petition must be signed by 50 or a majority of the
 136-4   qualified voters of the territory to be annexed who own taxable
 136-5   property in the territory to be annexed and who have duly rendered
 136-6   the property to the city or county for taxation.  The petition must
 136-7   describe the territory to be annexed by metes and bounds or
 136-8   otherwise unless the territory is the same as that contained in a
 136-9   city or town, in which case it is sufficient to state that the
136-10   territory to be annexed is that contained within the city or town.
136-11         (c)  If the board finds that the petition complies with and
136-12   is signed by the number of qualified persons required by Subsection
136-13   (b), that the annexation would be in the interest of the territory
136-14   to be annexed and the district, and that the district will be able
136-15   to supply water to the territory to be annexed, the board shall
136-16   adopt a resolution stating the conditions, if any, under which the
136-17   territory may be annexed and requesting the commission to annex the
136-18   territory to the district.  A certified copy of the resolution and
136-19   of the petition must be filed with the commission.
136-20         (d)  The commission shall adopt a resolution declaring its
136-21   intention to call an election in the territory to be annexed for
136-22   the purpose of submitting the proposition of whether the territory
136-23   shall be annexed to the district and shall set a time and place
136-24   when and where a hearing will be held by the commission on the
136-25   question of whether the territory to be annexed will benefit from
136-26   the improvements, works, and facilities then owned or operated or
 137-1   contemplated to be owned or operated by the district.  Railroad
 137-2   right-of-way that is not situated within the defined limits of an
 137-3   incorporated city or town will not benefit from improvements,
 137-4   works, and facilities that the district is authorized to construct.
 137-5   No railroad right-of-way may be annexed to the district except a
 137-6   right-of-way that is contained within the limits of an incorporated
 137-7   city or town annexed to the district.
 137-8         (e)  Notice of the adoption of the resolution stating the
 137-9   time and place of the hearing, addressed to the citizens and owners
137-10   of property in the territory to be annexed, shall be published one
137-11   time in a newspaper designated by the commission at least 10 days
137-12   before the date of the hearing.  The notice must describe the
137-13   territory to be annexed in the same manner as required or permitted
137-14   for the petition.
137-15         (f)  All interested persons may appear at the hearing and
137-16   offer evidence for or against the intended annexation.  The hearing
137-17   may proceed in the order and under rules prescribed by the
137-18   commission and may be recessed from time to time.  If, at the
137-19   conclusion of the hearing, the commission finds that all the land
137-20   in the territory to be annexed will benefit from the present or
137-21   contemplated improvements, works, or facilities of the district,
137-22   the commission shall adopt a resolution calling an election in the
137-23   territory to be annexed stating the date of and the place or places
137-24   of holding the election and appointing a presiding judge for each
137-25   voting place, who shall appoint the necessary assistant judges and
137-26   clerks to assist in holding the election.
 138-1         (g)  Notice of the election, stating the date and places for
 138-2   holding the election, the proposition to be voted on, and the
 138-3   conditions under which the territory may be annexed, or making
 138-4   reference to the resolution of the board for that purpose, shall be
 138-5   published one time in a newspaper designated by the commission at
 138-6   least 10 days before the day set for the election.
 138-7         (h)  Only qualified electors who reside in the territory to
 138-8   be annexed may vote in the election.  Returns of the election shall
 138-9   be made to the commission.
138-10         (i)  The commission shall canvass the returns of the election
138-11   and adopt a resolution declaring the results.  If the resolution
138-12   shows that a majority of the votes cast are in favor of annexation,
138-13   the commission shall enter an order annexing the territory to the
138-14   district, and the annexation shall thereafter be incontestable
138-15   except in the manner and within the time for contesting elections
138-16   under the Election Code.  A certified copy of the order shall be
138-17   recorded in the deed records of the county in which the territory
138-18   is situated.
138-19         (j)  In calling the election on the proposition for
138-20   annexation of territory, the commission may include as a part of
138-21   the same proposition a proposition for the:
138-22               (1)  assumption of that territory's part of the
138-23   tax-supported bonds of the district then outstanding and those
138-24   voted but not yet sold; and
138-25               (2)  levy of an ad valorem tax on taxable property in
138-26   the territory to be annexed along with the tax in the rest of the
 139-1   district for the payment of the bonds.
 139-2         (k)  After territory is added to the district, the board may
 139-3   call an election over the entire district for the purpose of
 139-4   determining whether the entire district as enlarged shall assume
 139-5   the tax-supported bonds then outstanding and those voted but not
 139-6   yet sold and whether an ad valorem tax shall be levied on all
 139-7   taxable property within the district as enlarged for the payment of
 139-8   the bonds, unless such proposition is voted along with the
 139-9   annexation election and becomes lawfully binding on the territory
139-10   annexed.  The election shall be called and held in the same manner
139-11   as elections for the issuance of bonds as provided in this
139-12   chapter.
139-13         (l)  If no newspaper is published in the territory to be
139-14   annexed, the notices shall be posted in three public places in that
139-15   territory.
139-16         Sec. 255.007.  APPOINTMENT OF DIRECTORS BY CITIES IN ANNEXED
139-17   TERRITORY.  (a)  If the territory of a city with a population of
139-18   more than 5,000 is annexed to the district, the governing body of
139-19   the city shall appoint two directors for the term ending the
139-20   following May 31 and two directors for the term ending one year
139-21   after the following May 31 and in May of each year shall appoint
139-22   two directors for a two-year term as provided in this chapter for
139-23   cities included in the district at the time of the creation of the
139-24   district.
139-25         (b)  If the territory of a city with a population of 5,000 or
139-26   less is annexed to the district, the governing body of the city
 140-1   shall appoint one director whose term expires one year after the
 140-2   following May 31, one director for the term ending one year after
 140-3   the following May 31, and in May of each year shall appoint one
 140-4   director for a two-year term.
 140-5         (c)  If the population of a city that was subject to
 140-6   Subsection (b) at the time of its annexation later has a population
 140-7   that exceeds 5,000, the city shall be entitled to four directors to
 140-8   be appointed as provided in Subsection (a).
 140-9         Sec. 255.008.  AUTHORITY TO IMPOUND AND TRANSPORT WATER; PLAN
140-10   APPROVAL BY COMMISSION.  The district may impound the storm waters
140-11   and floodwaters and the unappropriated flow of the Colorado River
140-12   and its tributaries by the construction of a dam or dams across the
140-13   river and tributaries or otherwise by complying with the applicable
140-14   provisions of this code and may develop or otherwise acquire
140-15   underground sources of water.  The district may construct or
140-16   otherwise acquire all works, plants, and other facilities necessary
140-17   or useful for the purpose of processing such water and transporting
140-18   it to cities and others for all beneficial purposes of use.  No dam
140-19   or other works for the impounding of water from the river may be
140-20   constructed until the plan for that purpose is approved by the
140-21   commission.
140-22         Sec. 255.009.  ADDITIONAL POWERS.  (a)  The district may
140-23   construct, finance, or otherwise provide any kind or type of water
140-24   pollution control facilities, wastewater treatment and reuse
140-25   facilities, waste disposal facilities, or air pollution control
140-26   facilities at any place or places within the area of the watershed
 141-1   (river basin) of the Colorado River that lies west of the east
 141-2   boundary line of Coleman County and at any place or places in
 141-3   Reeves, Loving, Culberson, Ector, Ward, and Winkler counties.
 141-4   Within that area, the district also may exercise all powers granted
 141-5   to a district or a river authority operating under Section 59,
 141-6   Article XVI, Texas Constitution, Chapter 383, Health and Safety
 141-7   Code, Chapter 30, and any other general law relating to those
 141-8   specific powers and facilities.  If the district creates a
 141-9   nonprofit corporation to act on its behalf under the Development
141-10   Corporation Act of 1979 (Article 5190.6, Vernon's Texas Civil
141-11   Statutes), the corporation may exercise any of its powers with
141-12   respect to projects within the area described in this subsection.
141-13         (b)  As used in this section, "person" means any individual,
141-14   partnership, corporation, or other private entity and any public
141-15   agency, including an authority, district, city, town, or other
141-16   political subdivision, joint board, or other public agency created
141-17   and operating under the laws of this state and any entity defined
141-18   as a person under Section 311.005, Government Code.  The district
141-19   and all persons may contract, on terms and conditions on which the
141-20   parties may agree, with respect to any power, function, or duty of
141-21   the district, including those additionally granted in this section,
141-22   and the district and all persons may execute appropriate documents
141-23   and instruments in connection with the contracts.  The district may
141-24   issue bonds, in the manner provided in Section 255.013, with
141-25   respect to any of its powers, including the powers granted in this
141-26   section, and for the purpose of providing funds to enable the
 142-1   district to pay for the costs of engineering design and studies,
 142-2   surveying, title research, appraisals, options on real or personal
 142-3   property, and other related activities in connection with planning
 142-4   and implementing proposed projects or improvements and also for the
 142-5   purpose of providing funds to operate and maintain any facilities.
 142-6   The district may invest any of its funds, including bond proceeds,
 142-7   in any manner or securities as determined by the board.
 142-8         (c)  Notwithstanding any other provisions of this chapter,
 142-9   and in addition to all other powers granted by this chapter or by
142-10   any other provision of law, the district may:
142-11               (1)  enter into loan agreements, leases, or installment
142-12   sales agreements; and
142-13               (2)  acquire, purchase, construct, own, operate,
142-14   maintain, repair, improve, or extend, and loan, lease, sell, or
142-15   otherwise dispose of, on terms and conditions, including loan
142-16   payments, rentals, sale price, or installment sale payments, as the
142-17   parties may agree, at any place or location within the area
142-18   described in Subsection (a), or at any other place or location
142-19   outside the area with respect to facilities that are designed
142-20   primarily to serve inhabitants within that area, all works,
142-21   improvements, facilities, plants, buildings, structures, equipment,
142-22   and appliances, real and personal property or any interest in real
142-23   or personal property, and all money or bond proceeds that are
142-24   incident, helpful, or necessary:
142-25                     (A)  to provide for the control, storage,
142-26   preservation, transmission, treatment, distribution, and use of
 143-1   storm water, floodwater, and the water of rivers and streams for
 143-2   municipal, domestic, electric energy or power, industrial,
 143-3   irrigation, oil flooding, mining, recreation, agricultural,
 143-4   commercial, and all other beneficial uses and purposes;
 143-5                     (B)  to collect, transport, process, treat,
 143-6   dispose of, and control waste, including municipal, domestic,
 143-7   industrial, agricultural, recreational, and other waste, whether in
 143-8   fluid, solid, or composite state and to control, abate, or reduce
 143-9   all types of pollution, including air pollution and water
143-10   pollution;
143-11                     (C)  to reclaim and provide drainage and drainage
143-12   systems for land;
143-13                     (D)  to establish or otherwise provide for public
143-14   parks and recreation facilities; or
143-15                     (E)  to facilitate the carrying out of any power,
143-16   duty, or function of the district.
143-17         (d)  The purposes stated in Subsection (c) are determined by
143-18   the legislature to be for the conservation and development of the
143-19   natural resources of the state within the meaning of Section 59,
143-20   Article XVI, Texas Constitution.
143-21         (e)  The district is considered a district and constitutes a
143-22   river authority under Chapter 383, Health and Safety Code, and
143-23   Chapter 30, and those chapters are applicable to the district,
143-24   except to the extent of any conflict with this chapter, in which
143-25   case this chapter prevails over the provisions of Chapter 383,
143-26   Health and Safety Code, and Chapter 30.
 144-1         (f)  Any person may contract with the district in any manner
 144-2   authorized by this chapter, Chapter 383, Health and Safety Code, or
 144-3   Chapter 30 with respect to water, waste, pollution control, or any
 144-4   other facilities or services provided by the district.  A public
 144-5   agency additionally may enter into and execute a contract with the
 144-6   district and may determine, agree, and pledge that all or any part
 144-7   of its payments under the contract shall be payable from the source
 144-8   described in Section 30.030(c), subject only to the authorization
 144-9   of the contract, pledge, and payments by a two-thirds vote of the
144-10   governing body of the public agency.  Public agencies may use and
144-11   pledge any other available revenues or resources for the payment of
144-12   amounts due under the contracts, as an additional source or sources
144-13   of payment or as the sole source or sources of payment, and may
144-14   covenant with respect to those revenues to assure the availability
144-15   of the revenues when required.  If bonds issued by the district
144-16   recite that they are secured by a pledge of revenues from any
144-17   contract, a copy of the contract and the proceedings relating to
144-18   the contract shall be submitted to the attorney general along with
144-19   the bonds that must be submitted under Section 255.013.  If the
144-20   attorney general finds that the bonds are authorized and the
144-21   contract has been made and entered into in accordance with law, the
144-22   attorney general shall approve the bonds and the contract.  After
144-23   approval, the bonds and the contract are incontestable in any court
144-24   or other forum for any reason and are valid and binding in
144-25   accordance with their terms and provisions for all purposes.
144-26         (g)  Each public agency:
 145-1               (1)  may set, charge, and collect fees, rates, charges,
 145-2   rentals, and other amounts for services or facilities provided by a
 145-3   utility operated by the agency, or provided under or in connection
 145-4   with a contract with the district, from its inhabitants or from
 145-5   users or beneficiaries of the utility, services, or facilities,
 145-6   including specifically water charges, sewage charges, waste
 145-7   disposal system fees and charges, including garbage collection or
 145-8   handling fees, and other fees or charges;
 145-9               (2)  may use and pledge those amounts to make payments
145-10   to the district that are required under the contract;
145-11               (3)  may covenant to do so in amounts sufficient to
145-12   make all or any part of those payments to the district when due;
145-13   and
145-14               (4)  if the parties agree in the contract, shall have
145-15   the payments constitute an expense of operation of any facilities
145-16   or utility operated by the public agency provided that an agreement
145-17   may not be made that would violate the United States Constitution
145-18   or the Texas Constitution.
145-19         (h)  This section is wholly sufficient authority for the
145-20   exercise of the powers, the issuance of bonds, the execution of
145-21   contracts, and the performance of the other acts and procedures
145-22   authorized in this section, by the district and all persons,
145-23   including specifically public agencies, without reference to any
145-24   other law, or restrictions or limitations contained in any other
145-25   law, except as specifically provided in this section.  To the
145-26   extent of any conflict or inconsistency between this section and
 146-1   any other law, including a home-rule city charter, this section
 146-2   shall prevail and control; provided, however, that the district and
 146-3   all persons, including public agencies, may use any other law not
 146-4   in conflict with this section to the extent convenient or necessary
 146-5   to carry out any power or authority, express or implied, granted by
 146-6   this section.
 146-7         (i)  This section does not compel any person, including any
 146-8   public agency, to secure water, sewer service, or any other service
 146-9   from the district, except under contracts voluntarily executed.
146-10         Sec. 255.010.  CONTROL OF POLLUTION AND SALTWATER.  The
146-11   district may:
146-12               (1)  provide for the study, correction, prevention, and
146-13   control of both artificial and natural pollution of the Colorado
146-14   River and its tributaries, upstream from the north boundary line of
146-15   Coke County, Texas, and adopt and promulgate all reasonable
146-16   regulations with regard to such pollution, both artificial and
146-17   natural, to secure, maintain, and preserve the purity, usefulness,
146-18   and sanitary condition of the water in and to flow into the
146-19   Colorado River and its tributaries;
146-20               (2)  eliminate oil field brine pollution of the
146-21   Colorado River and its tributaries, upstream from the north
146-22   boundary line of Coke County, Texas, by capping and plugging
146-23   abandoned oil wells, covering saltwater pits with earth,
146-24   constructing channel dams to collect polluted low flows of the
146-25   Colorado River and its tributaries, developing saltwater disposal
146-26   wells, and by other practical means of eliminating oil field brine
 147-1   pollution of the Colorado River and its tributaries; and
 147-2               (3)  develop, drill for, or otherwise acquire sources
 147-3   of underground and surface saltwater and sell salt well water,
 147-4   saltwater collected by channel dams, fresh water from the
 147-5   district's reservoirs and wells, and commingled saltwater and fresh
 147-6   water for mining, oil field flooding and repressuring, industrial,
 147-7   manufacturing, or other purposes.
 147-8         Sec. 255.011.  EMINENT DOMAIN.  For the purpose of carrying
 147-9   out any power or authority conferred by this chapter the district
147-10   may acquire property, including water, water rights, land, and
147-11   easements, within and outside the district, by condemnation in the
147-12   manner provided by Chapter 21, Property Code.  The amount of and
147-13   character of interest in land and easements thus to be acquired
147-14   shall be determined by the board.
147-15         Sec. 255.012.  CONTRACTS; BIDDING.  A construction contract
147-16   for the purchase of material, equipment, or supplies requiring an
147-17   expenditure of more than $25,000 may be made only after publication
147-18   of a notice to bidders once each week for two weeks before the
147-19   contract is awarded.  The notice is sufficient if it states the
147-20   time and place when and where the bids will be opened and the
147-21   general nature of the work to be done or the material, equipment,
147-22   or supplies to be purchased and states where and the terms on which
147-23   copies of the plans and specifications may be obtained.  The
147-24   publication shall be in a newspaper published in the district and
147-25   designated by the board.
147-26         Sec. 255.013.  ISSUANCE OF BONDS.  (a)  For the purpose of
 148-1   providing a source of water supply for cities and other users for
 148-2   municipal, domestic, and industrial purposes as authorized by this
 148-3   chapter and for the purpose of carrying out any other power or
 148-4   authority conferred by this chapter, the district may issue
 148-5   negotiable bonds to be payable from such revenues of the district
 148-6   as are pledged by resolution of the board.
 148-7         (b)  Bonds must be authorized by resolution of the board and
 148-8   must be issued in the name of the district, signed by the president
 148-9   or vice president, and attested by the secretary and must have the
148-10   seal of the district impressed on them.  The bonds must mature
148-11   serially or otherwise in not to exceed 40 years and may be sold at
148-12   a price and under terms determined by the board to be the most
148-13   advantageous reasonably obtainable, provided that the interest cost
148-14   to the district, calculated by use of standard bond interest tables
148-15   currently in use by insurance companies and investment houses, does
148-16   not exceed six percent per year.  Within the discretion of the
148-17   board, bonds may be made callable prior to maturity at such times
148-18   and prices as may be prescribed in the resolution authorizing the
148-19   bonds and may be made registrable as to principal or as to both
148-20   principal and interest.
148-21         (c)  Bonds may be issued in more than one series and from
148-22   time to time as required for carrying out the purposes of this
148-23   chapter.
148-24         (d)  Bonds may be secured by a pledge of all or part of the
148-25   net revenues of the district, of the net revenues of any one or
148-26   more contracts made before or after the bonds are issued, or of
 149-1   other revenues specified by resolution of the board.  Any such
 149-2   pledge may reserve the right, under conditions specified in the
 149-3   pledge resolution, to issue additional bonds which will be on a
 149-4   parity with or subordinate to the bonds being issued.  The term
 149-5   "net revenues" means the gross revenues of the district after
 149-6   deduction of the amount necessary to pay the cost of maintaining
 149-7   and operating the district and its properties.
 149-8         (e)  For the purposes stated in Subsection (a), the district
 149-9   may issue bonds payable from ad valorem taxes to be levied on all
149-10   taxable property in the district or issue bonds secured both by and
149-11   payable from such taxes and the revenues of the district.  If bonds
149-12   are issued payable wholly or partially from ad valorem taxes, the
149-13   board shall levy a tax sufficient to pay the bonds and the interest
149-14   on the bonds as the bonds and interest become due, but the rate of
149-15   the tax for any year may be set after giving consideration to the
149-16   money received from the pledged revenues that may be available for
149-17   payment of principal and interest to the extent and in the manner
149-18   permitted by the resolution authorizing the issuance of the bonds.
149-19         (f)  If bonds payable wholly from revenues are issued, the
149-20   board shall set, and from time to time revise, rates of
149-21   compensation for water sold and services rendered by the district
149-22   that will be sufficient to pay the expense of operating and
149-23   maintaining the facilities of the district and to pay bonds as they
149-24   mature and the interest as it accrues and to maintain the reserve
149-25   and other funds as provided in the resolution authorizing the
149-26   bonds.  If bonds payable partially from revenues are issued, the
 150-1   board shall set, and from time to time revise, rates of
 150-2   compensation for water sold and services rendered by the district
 150-3   that will be sufficient to assure compliance with the resolution
 150-4   authorizing the bonds.
 150-5         (g)  The district may set aside from the proceeds from the
 150-6   sale of the bonds an amount for the payment of interest expected to
 150-7   accrue during construction and for a reserve interest and sinking
 150-8   fund, and such provision may be made in the resolution authorizing
 150-9   the bonds.  Proceeds from the sale of the bonds may also be used
150-10   for the payment of all expenses necessarily incurred in
150-11   accomplishing the purposes for which the district is created.
150-12         (h)  In the event of a default or a threatened default in the
150-13   payment of principal of or interest on bonds payable wholly or
150-14   partially from revenues of the district, any court of competent
150-15   jurisdiction may, on petition of the holders of 25 percent of the
150-16   outstanding bonds of the issue in default or threatened with
150-17   default, appoint a receiver with authority to collect and receive
150-18   all income of the district except taxes, employ and discharge
150-19   agents and employees of the district, take charge of the district's
150-20   funds on hand except funds received from taxes, unless commingled,
150-21   and manage the proprietary affairs of the district without consent
150-22   or hindrance by the directors.  The receiver may also be authorized
150-23   to sell or make contracts for the sale of water or renew such
150-24   contracts with the approval of the court appointing the receiver.
150-25   The court may vest the receiver with other powers and duties the
150-26   court finds necessary for the protection of the holders of the
 151-1   bonds.
 151-2         Sec. 255.014.  REFUNDING BONDS.  (a)  The district may issue
 151-3   refunding bonds for the purpose of refunding any outstanding bonds
 151-4   authorized by this chapter and interest on the bonds.  Refunding
 151-5   bonds may be issued to refund more than one series of outstanding
 151-6   bonds and may combine the pledges for the outstanding bonds for the
 151-7   security of the refunding bonds, and refunding bonds may be secured
 151-8   by other or additional revenues.
 151-9         (b)  The provisions of this chapter with reference to the
151-10   issuance of other bonds, their approval by the attorney general,
151-11   and the remedies of the holders shall be applicable to refunding
151-12   bonds.  Refunding bonds shall be registered by the comptroller on
151-13   surrender and cancellation of the bonds to be refunded, but in lieu
151-14   thereof, the resolution authorizing the issuance of the refunding
151-15   bonds may provide that the refunding bonds shall be sold and the
151-16   proceeds of the sale deposited in the bank where the original bonds
151-17   are payable, in which case the refunding bonds may be issued in an
151-18   amount sufficient to pay the interest on the original bonds to
151-19   their option date or maturity date, and the comptroller shall
151-20   register the refunding bonds without concurrent surrender and
151-21   cancellation of the original bonds.
151-22         Sec. 255.015.  DEED OF TRUST LIEN.  Any bonds, including
151-23   refunding bonds, authorized by this chapter that are not payable
151-24   wholly from ad valorem taxes may be additionally secured by a deed
151-25   of trust lien upon physical properties of the district and all
151-26   franchises, easements, water rights and appropriation permits,
 152-1   leases, and contracts, and all rights appurtenant to such
 152-2   properties, vesting in the trustee power to sell the properties for
 152-3   payment of the indebtedness, power to operate the properties, and
 152-4   all other powers and authority for the further security of the
 152-5   bonds.  The deed of trust may contain any provisions prescribed by
 152-6   the board for the security of the bonds and the preservation of the
 152-7   trust estate and may make provision for amendment or modification
 152-8   thereof and the issuance of bonds to replace lost or mutilated
 152-9   bonds.  A purchaser under a sale under a deed of trust shall be the
152-10   owner of the dam or dams and the other properties and facilities
152-11   purchased and shall have the right to maintain and operate such
152-12   dams, properties, or facilities.
152-13         Sec. 255.016.  BONDS PAYABLE FROM AD VALOREM TAXES; ELECTION.
152-14   (a)  No bonds payable wholly or partially from ad valorem taxes,
152-15   except refunding bonds, may be issued unless the issuance is
152-16   authorized by an election at which only the qualified voters who
152-17   reside in the district may vote and a majority of the votes cast in
152-18   each city contained in the district is in favor of the issuance of
152-19   the bonds.  Bonds not payable wholly or partially from ad valorem
152-20   taxes may be issued without an election.
152-21         (b)  An election for the authorization of bonds may be called
152-22   by the board without a petition.  The resolution calling the
152-23   election must specify the time and places of holding the election,
152-24   the purpose for which the bonds are to be issued, the maximum
152-25   amount of the bonds, the maximum maturity of the bonds, the form of
152-26   the ballot, and the presiding judge for each voting place.  The
 153-1   presiding judge serving at each voting place shall appoint one
 153-2   assistant judge and at least two clerks to assist in holding the
 153-3   election.  Notice of the election shall be given by publishing a
 153-4   substantial copy of the notice in one newspaper published in each
 153-5   city contained in the district for two consecutive weeks.  The
 153-6   first publication must be at least 21 days prior to the date of the
 153-7   election.  In any city in which no newspaper is published, notice
 153-8   must be given by posting a copy of the resolution in three public
 153-9   places.
153-10         (c)  The returns of the election shall be made to and
153-11   canvassed by the board.
153-12         (d)  Elections held under this section are governed by the
153-13   Election Code except as otherwise provided in this chapter.
153-14         Sec. 255.017.  EXAMINATION BY ATTORNEY GENERAL.  After bonds
153-15   are authorized by the district, the bonds and the record relating
153-16   to their issuance shall be submitted to the attorney general for
153-17   examination as to the validity of the bonds.  If the bonds recite
153-18   that they are secured by a pledge of the proceeds of a contract
153-19   previously made between the district and a city or other
153-20   governmental agency or district, a copy of the contract and the
153-21   proceedings of the city or other governmental agency or district
153-22   authorizing the contract shall be submitted to the attorney
153-23   general.  If the bonds have been authorized and if any such
153-24   contract has been made in accordance with the constitution and laws
153-25   of the state, the attorney general shall approve the bonds and such
153-26   contracts and the bonds then shall be registered by the
 154-1   comptroller.  After approval and registration, the bonds and the
 154-2   contracts, if any, are valid and binding and are incontestable for
 154-3   any cause.
 154-4         Sec. 255.018.  CONTRACTS WITH CITIES AND OTHERS.  The
 154-5   district may enter into contracts with cities and others for
 154-6   supplying water and wastewater treatment service to them.  The
 154-7   district may contract with a city for the rental or leasing of, or
 154-8   for the operation of, the water production, water supply, water
 154-9   supply facilities, and wastewater treatment facilities of the city
154-10   for such consideration as the district and the city may agree.  The
154-11   contract may be on such terms and for such time as the parties
154-12   agree and may provide that the contract shall continue in effect
154-13   until bonds specified in the contract and refunding bonds issued in
154-14   lieu of such bonds are paid.
154-15         Sec. 255.019.  DISTRICT DEPOSITORY.  (a)  The board shall
154-16   designate one or more banks within the district to serve as
154-17   depository for the funds of the district.  All funds of the
154-18   district shall be deposited in the depository bank or banks, except
154-19   that funds pledged to pay bonds may be deposited with the trustee
154-20   bank named in the trust agreement and except that funds shall be
154-21   remitted to the bank of payment for the payment of principal of and
154-22   interest on bonds.  To the extent that funds in the depository
154-23   banks and the trustee bank are not insured by the Federal Deposit
154-24   Insurance Corporation, the funds shall be secured in the manner
154-25   provided by law for the security of county funds.
154-26         (b)  Before designating a depository bank or banks, the board
 155-1   shall issue a notice stating the time and place when and where the
 155-2   board will meet for such purpose and inviting the banks in the
 155-3   district to submit applications to be designated depositories.  The
 155-4   notice must be published one time in a newspaper published in the
 155-5   district and specified by the board.  The term of service for
 155-6   depositories shall be prescribed by the board.
 155-7         (c)  At the time specified in the notice, the board shall
 155-8   consider the applications and the management and condition of the
 155-9   banks filing them and shall designate as depositories the bank or
155-10   banks that offer the most favorable terms and conditions for the
155-11   handling of the funds of the district and that the board finds have
155-12   proper management and are in condition to warrant handling of
155-13   district funds.  Membership on the board of an officer or director
155-14   of a bank does not disqualify that bank from being designated as
155-15   depository.
155-16         (d)  If no applications are received by the time stated in
155-17   the notice, the board shall designate a bank or banks within or
155-18   outside the district on terms and conditions it determines
155-19   advantageous to the district.
155-20         Sec. 255.020.  WATER APPROPRIATION PERMITS; PURCHASE OF
155-21   WATER.  The district may acquire water appropriation permits
155-22   directly from the commission or from owners of permits.  The
155-23   district may purchase water or a water supply from any person,
155-24   firm, corporation, or public agency of Texas or another state.
155-25         Sec. 255.021.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
155-26   DEPOSITS.  All bonds of the district are legal and authorized
 156-1   investments for banks, savings banks, trust companies, building and
 156-2   loan associations, savings and loan associations, insurance
 156-3   companies, fiduciaries, trustees, and guardians and for the sinking
 156-4   funds of cities, towns, villages, counties, school districts, or
 156-5   other political corporations or subdivisions of the state.  Such
 156-6   bonds are eligible to secure the deposit of all public funds of the
 156-7   state and all public funds of cities, towns, villages, counties,
 156-8   school districts, or other political corporations or subdivisions
 156-9   of the state; and the bonds are lawful and sufficient security for
156-10   the deposits to the extent of their value when the bonds are
156-11   accompanied by all unmatured coupons.
156-12         Sec. 255.022.  BONDS EXEMPT FROM TAXATION.  The
156-13   accomplishment of the purposes stated in this chapter is for the
156-14   benefit of the people of this state and for the improvement of
156-15   their properties and industries, and the district in carrying out
156-16   the purposes of this chapter will be performing an essential public
156-17   function under Section 59, Article XVI, Texas Constitution, and
156-18   shall not be required to pay any tax or assessment on the project
156-19   or any part of the project, and the bonds issued under this chapter
156-20   and the transfer of and income from the bonds, including the
156-21   profits made on the sale of the bonds, shall at all times be free
156-22   from taxation within this state.
156-23         Sec. 255.023.  TAX ROLLS.  (a)  The tax rolls of the cities
156-24   in the district as created and in annexed territory shall
156-25   constitute the tax rolls of the district until assessments and tax
156-26   rolls are made by the district.
 157-1         (b)  Before the sale and delivery of district bonds that are
 157-2   payable wholly or partially from ad valorem taxes, the board shall
 157-3   appoint a tax assessor and collector and a board of equalization
 157-4   and shall cause taxes to be assessed, valuations to be equalized,
 157-5   and tax rolls to be prepared.  General laws applicable to water
 157-6   control and improvement districts with reference to tax assessors
 157-7   and collectors, boards of equalization, tax rolls, and the levy and
 157-8   collection of taxes and delinquent taxes shall be applicable to the
 157-9   district, except that the board of equalization, to be appointed
157-10   each year by the board, shall consist of one member residing in
157-11   each city in the district.
157-12         Sec. 255.024.  ADOPTION OF RULES AND REGULATIONS.  (a)  The
157-13   board may adopt and promulgate all reasonable rules and regulations
157-14   to secure, maintain, and preserve the sanitary condition of all
157-15   water in and to flow into any reservoir owned by the district, to
157-16   prevent the waste or the unauthorized use of water, and to regulate
157-17   residence, hunting, fishing, boating, and camping, and all
157-18   recreational and business privileges, along or around any such
157-19   reservoir and the Colorado River and its tributaries or any body of
157-20   land or easement owned or controlled by the district.  The board
157-21   may make contracts with responsible persons for the construction
157-22   and operation of toll bridges over the district's water or for
157-23   ferry service on or over the district's water, for periods not to
157-24   exceed 20 years in the case of a bridge and not to exceed 10 years
157-25   in the case of a ferry, setting the compensation to be charged for
157-26   service by any such facility so that the charges are reasonable and
 158-1   requiring adequate bond or bonds from the contracting person,
 158-2   association, or corporation, payable to the district, of such
 158-3   amount and conditioned as the board determines appropriate.  The
 158-4   contracts may provide for forfeiture of the particular franchise in
 158-5   case of a failure of the licensee to render adequate public
 158-6   service.
 158-7         (b)  The district may prescribe reasonable penalties for the
 158-8   breach of a rule or regulation of the district, which penalties
 158-9   shall not exceed a fine of more than $200 or imprisonment for not
158-10   more than 30 days, or both a fine and imprisonment.  The penalties
158-11   are in addition to any other penalties provided by the laws of the
158-12   state and may be enforced by complaints filed in the appropriate
158-13   court of jurisdiction.  A rule or regulation that provides a
158-14   penalty for the violation of a rule or regulation is not effective
158-15   or enforceable unless the district has published a substantive
158-16   statement of the particular rule or regulation and the penalty for
158-17   its violation once a week for two consecutive weeks in the
158-18   territory of the district.  The substantive statement must be as
158-19   condensed as possible to afford sufficient notice of the act
158-20   forbidden by the rule or regulation.  A single notice may embrace a
158-21   number of regulations.  The notice must state that breach of the
158-22   regulation or regulations will subject the violator to a penalty
158-23   and that the full text of the rule or regulation is on file in the
158-24   principal office of the district, where it may be read by an
158-25   interested person.  Five days after the second publication of the
158-26   required notice, the rule or regulation shall be in effect, and
 159-1   ignorance of the rule or regulation does not constitute a defense
 159-2   to a prosecution for the enforcement of a penalty.  The court shall
 159-3   take judicial notice of rules and regulations authorized by this
 159-4   subsection, and the rules and regulations shall be considered
 159-5   similar in nature to a valid penal ordinance of a city.
 159-6         (c)  The district may employ and constitute its own peace
 159-7   officers, and any such officer or any county peace officer may make
 159-8   arrests when necessary to prevent or stop the commission of any
 159-9   offense against the regulations of the district, or against the
159-10   laws of the state, when the offense, or threatened offense, occurs
159-11   on any land, water, or easement owned or controlled by the district
159-12   or may make an arrest at any place if an offense involves injury or
159-13   detriment to any property owned or controlled by the district.
159-14         Sec. 255.025.  PARKS AND RECREATION.  The district may
159-15   establish or otherwise provide for public parks and recreation
159-16   facilities and may acquire land adjacent to any of its reservoirs
159-17   for such purposes; provided, however, that no money received from
159-18   taxation or from bonds payable wholly or partially from taxation
159-19   may be used for such purpose.
159-20      CHAPTER 256.  DALLAS COUNTY UTILITY AND RECLAMATION DISTRICT
159-21         Sec. 256.001.  CREATION.  (a)  A conservation, utility, and
159-22   reclamation district to be known as the "Dallas County Utility and
159-23   Reclamation District" is created.  The district is a governmental
159-24   agency and a body politic and corporate.
159-25         (b)  The district is created under and is essential to
159-26   accomplish the purposes of Section 59, Article XVI, Texas
 160-1   Constitution.
 160-2         Sec. 256.002.  DEFINITIONS.  In this chapter:
 160-3               (1)  "Board" means the board of directors of the
 160-4   district.
 160-5               (2)  "Director" means a member of the board.
 160-6               (3)  "District" means the Dallas County Utility and
 160-7   Reclamation District.
 160-8         Sec. 256.003.  TERRITORY.  (a)  The district includes all
 160-9   property situated within the boundaries of the district as
160-10   redefined, described, and filed of record in Volume 72226, page
160-11   0508, of the Deed Records of Dallas County and includes areas
160-12   annexed to the district, regardless of the date of such annexation,
160-13   and filed of record in such deed records.  It is found and
160-14   determined that the boundaries and field notes of the district form
160-15   a closure.  If a mistake is made in copying the field notes on file
160-16   in such records or in field notes filed pursuant to annexation, the
160-17   mistake does not affect the organization, existence, and validity
160-18   of the district or the right to issue bonds voted in the district
160-19   or the right to assess, levy, and collect taxes or its operations,
160-20   projects, or activities.
160-21         (b)  The legislature finds and determines that all property
160-22   situated within the boundaries of the district has been, is, and
160-23   will be benefited by the district, by the provisions of this
160-24   chapter, and by the projects and properties permitted by this
160-25   chapter and by prior applicable law.
160-26         (c)  All bonds, contracts, and other obligations issued,
 161-1   executed, or incurred by the district before February 1, 1984, to
 161-2   the extent not satisfied or paid, constitute lawful obligations of
 161-3   the district in accordance with their respective terms.
 161-4         Sec. 256.004.  POWERS AND DUTIES.  (a)  The district may
 161-5   exercise all of the rights, powers, privileges, authorities, and
 161-6   functions conferred and imposed by the general laws of this state
 161-7   applicable to districts created under the authority of Section 59,
 161-8   Article XVI, Texas Constitution, including without limitation those
 161-9   conferred by Chapters 49 and 54; provided, however, that the
161-10   district shall obtain specific written approval in the form of a
161-11   resolution of the city council of the City of Irving as a condition
161-12   precedent to the issuance of bonds for fire-fighting purposes or to
161-13   engage in fire-fighting activities.  All general laws not in
161-14   conflict with or inconsistent with the provisions of this chapter
161-15   are adopted and incorporated in this chapter by reference with the
161-16   same effect as if copied in full in this chapter.  If any provision
161-17   of general law conflicts with or is inconsistent with the
161-18   provisions of this chapter, the provisions of this chapter prevail.
161-19         (b)  Subject to the provisions of Subsection (c), the powers
161-20   of the district include the power to purchase, construct, acquire,
161-21   own, operate, maintain, repair, and improve within its boundaries
161-22   any works, improvements, facilities, plants, equipment, appliances,
161-23   vehicles, and other equipment incident, helpful, or necessary to
161-24   provide a land-based transportation system within the district, but
161-25   not within the city of Irving streets and roadway system, capable
161-26   of transporting people and personal property across and along the
 162-1   lakes, waterways, watercourses, and lands within and to the
 162-2   boundaries of the district.  The legislature finds and determines
 162-3   that the exercise of this power and the development and furnishing
 162-4   of transportation projects under this subsection are necessary,
 162-5   appropriate, and desirable in the conservation and development of
 162-6   the state's natural resources, including the waters, lands, and
 162-7   projects within the district, in order to fully develop those
 162-8   purposes.
 162-9         (c)  The powers granted in Subsection (b) are subject to the
162-10   provisions of this subsection.  The district may not issue any
162-11   bonds that are payable in whole or in part from ad valorem taxes
162-12   and that are issued for the purposes authorized in Subsection (b)
162-13   unless the district has obtained a final judgment of a court having
162-14   jurisdiction under Chapter 1205, Government Code, or under other
162-15   appropriate and applicable rules or statutes, and the judgment
162-16   holds in substance, in the opinion of the attorney general, that
162-17   the issuance of tax bonds for the purposes described in Subsection
162-18   (b) will be for purposes authorized by Section 59, Article XVI,
162-19   Texas Constitution.  The provisions of this subsection do not apply
162-20   to revenue bonds that are not payable in any part from ad valorem
162-21   taxes levied within the district.  The district has the authority,
162-22   without reference to the requirements of this subsection, to issue
162-23   bonds payable solely from contracts or other revenues entered into
162-24   or collected for the purposes described in Subsection (b) and to
162-25   pay the costs of operation of a land-based transportation system
162-26   from funds other than ad valorem taxes.
 163-1         (d)  The district may sell potable water to retail or
 163-2   wholesale customers if the governing body of the City of Irving
 163-3   gives its written consent.
 163-4         Sec. 256.005.  ROADS AND TURNPIKES.  (a)  The district may
 163-5   provide for the construction, maintenance, and operation of
 163-6   macadamized, graveled, or paved roads and turnpikes, or works,
 163-7   facilities, or improvements in aid of such roads or turnpikes,
 163-8   within or outside the boundaries of the district, to the fullest
 163-9   extent authorized and contemplated by the provisions of Section 52,
163-10   Article III, Texas Constitution, and, subject to the provisions of
163-11   this chapter, may issue, sell, and deliver bonds, notes, or other
163-12   obligations of the district for such purposes; provided, however,
163-13   that without the consent and approval of the City of Irving, the
163-14   district shall not undertake to construct, maintain, operate,
163-15   repair, reconstruct, cross, intersect, or connect with any public
163-16   streets or roads of the City of Irving;
163-17         (b)  The board may expend funds, borrow money, issue bonds,
163-18   issue bond anticipation notes and tax anticipation notes, levy and
163-19   collect maintenance taxes, and carry out all acts and have all
163-20   power and authority authorized by Section 52, Article III, Texas
163-21   Constitution; provided, however, that bonds may not be issued by
163-22   the district for the purposes described in this section unless
163-23   authorized by an election at which a two-thirds majority of the
163-24   resident, qualified electors of the district vote in favor of the
163-25   issuance of the bonds; and provided further, that bonds, notes, or
163-26   other obligations of the district issued or incurred for the
 164-1   purposes described in this chapter may not exceed one-fourth of the
 164-2   assessed valuation of the real property of the district.
 164-3         Sec. 256.006.  TAX ABATEMENT AGREEMENTS.  (a)  The district
 164-4   may enter into tax abatement agreements and may designate areas as
 164-5   reinvestment zones pursuant to Section 1-g, Article VIII, Texas
 164-6   Constitution, this chapter, and Chapter 312, Tax Code.  Chapter
 164-7   312, Tax Code, applies to the district except as otherwise provided
 164-8   by this chapter.  In the case of any conflict between this chapter
 164-9   and Chapter 312, Tax Code, the provisions of this chapter prevail.
164-10         (b)  Notwithstanding any amendment or repeal of this chapter,
164-11   the applicable provisions of this chapter under which a tax
164-12   abatement agreement is entered into shall apply to the agreement
164-13   during the effective date of the agreement and those provisions
164-14   shall remain in effect for that purpose.
164-15         (c)  The board may designate as a reinvestment zone for a
164-16   period of 50 years or until the termination of all outstanding tax
164-17   abatement agreements, whichever occurs last, an area within its
164-18   boundaries that satisfies the requirements of Section 312.202, Tax
164-19   Code.
164-20         (d)  The district and the board have all of a municipality's
164-21   rights, powers, and authorization contained in Chapter 312, Tax
164-22   Code.
164-23         (e)  The district shall enter into tax abatement agreements
164-24   for single-family residential property, as defined by the district,
164-25   for periods of 50 years and for property other than single-family
164-26   residential property for periods not to exceed:
 165-1               (1)  25 years if the notice for the project is
 165-2   submitted in 1999;
 165-3               (2)  24 years if the notice for the project is
 165-4   submitted in 2000;
 165-5               (3)  23 years if the notice for the project is
 165-6   submitted in 2001;
 165-7               (4)  22 years if the notice for the project is
 165-8   submitted in 2002;
 165-9               (5)  21 years if the notice for the project is
165-10   submitted in 2003; and
165-11               (6)  20 years if the notice for the project is
165-12   submitted in 2004 or later.
165-13         (f)  A tax abatement agreement is subject to the rights of
165-14   credit providers of the district, including holders of
165-15   tax-supported bonds of the district, regardless of when the bonds
165-16   were issued.
165-17         (g)  Except as provided by Subsection (h), a tax abatement
165-18   agreement shall provide that the portion of the taxable value of
165-19   the property subject to the agreement that exceeds the taxable
165-20   value of the property for the year in which notice for the project
165-21   to which the agreement pertains is submitted is:
165-22               (1)  subject to an effective tax rate of:
165-23                     (A)  60 cents for each $100 of taxable value of
165-24   property if the property is residential real property other than
165-25   single-family residential property; and
165-26                     (B)  50 cents for each $100 of taxable value of
 166-1   property if the property is nonresidential real property; and
 166-2               (2)  exempt from taxation if the property is
 166-3   single-family residential property.
 166-4         (h)  The applicable effective tax rate under Subsection (g)
 166-5   is increased by the amount that the district's debt rate at the
 166-6   time the notice for the project to which the tax abatement
 166-7   agreement pertains is submitted exceeds 90 cents for each $100 of
 166-8   taxable value of property but may not exceed 75 cents for each $100
 166-9   of taxable value of property.  This subsection applies only to a
166-10   tax abatement agreement pertaining to a project for which notice is
166-11   submitted in 2001 or later and does not apply to single-family
166-12   residential property.
166-13         (i)  The district may enter into tax abatement agreements
166-14   with owners of real and personal property within the district for
166-15   proposed projects.
166-16         (j)  The district shall adopt guidelines and criteria
166-17   governing tax abatement agreements by the district.  The guidelines
166-18   and criteria must specify the criteria for an eligible project.
166-19   The guidelines and criteria are effective until the termination of
166-20   all outstanding tax abatement agreements.  The district may amend
166-21   the guidelines and criteria by a vote of a majority of the
166-22   directors.
166-23         (k)  The district shall adopt a form of tax abatement
166-24   agreement to be used by the district.
166-25         (l)  A tax abatement agreement entered into by the district:
166-26               (1)  must be consistent with:
 167-1                     (A)  the guidelines and criteria adopted by the
 167-2   district;
 167-3                     (B)  the form of tax abatement agreement adopted
 167-4   by the district; and
 167-5                     (C)  the requirements of deed restrictions, or
 167-6   other equivalent restrictions, enforced by the Las Colinas
 167-7   Association or by the district; and
 167-8               (2)  may:
 167-9                     (A)  include phased projects;
167-10                     (B)  incorporate the district's infrastructure
167-11   requirements; and
167-12                     (C)  generally describe the kind, number, and
167-13   location of all proposed improvements, subject to any change
167-14   provided by a notice of intent to construct the project, specifying
167-15   the details of the project, submitted by the owner to the district.
167-16         (m)  Tax abatement agreements entered into by the district
167-17   are not required to contain identical terms as other tax abatement
167-18   agreements, if any, covering:
167-19               (1)  the same property that are entered into by other
167-20   taxing units; or
167-21               (2)  different property that are entered into by the
167-22   district.
167-23         (n)  The district may enter into tax abatement agreements for
167-24   facilities and structures that commenced or were modified on or
167-25   after January 1, 1995, but before April 24, 1995.
167-26         (o)  The district may tax at a reduced rate as provided by
 168-1   Subsection (g) personal property located on property described in
 168-2   Subsection (n) in each year covered by the agreement except for
 168-3   personal property located on the property at any time before the
 168-4   period covered by the agreement began.
 168-5         Sec. 256.007.  BOARD OF DIRECTORS.  (a)  All powers of the
 168-6   district shall be exercised by a board of five directors.  Each
 168-7   director serves for a term of office as provided by this section
 168-8   and until a successor is appointed and has qualified.  If a
 168-9   director ceases to possess the qualifications prescribed by this
168-10   section, the director's office shall be declared vacant by the
168-11   board and a successor shall be appointed by the city council of the
168-12   City of Irving.
168-13         (b)  Each director must be at least 18 years of age and
168-14   possess one of the following qualifications:
168-15               (1)  own land within the district subject to taxation;
168-16               (2)  be a qualified voter residing within the district
168-17   at the time of qualification as a director;
168-18               (3)  be an agent, employee, officer, or director of any
168-19   individual, corporation, trust, or partnership that owns or leases
168-20   real property within the district; or
168-21               (4)  be a resident of the city of Irving.
168-22         (c)  At least three of the five directors must qualify as
168-23   directors under Section 49.052(a), without consideration of any
168-24   exceptions from that subsection provided by other provisions of
168-25   Section 49.052.  Section 49.052 applies only for purposes of this
168-26   section.
 169-1         (d)  Each director shall qualify by subscribing the
 169-2   constitutional oath of office and by giving bond in the amount of
 169-3   $5,000 for the faithful performance of the director's duties.  The
 169-4   directors' bonds must be approved by the district's board and
 169-5   recorded in the official bond records of the county clerk of Dallas
 169-6   County.
 169-7         (e)  Directors serve for staggered terms of four years, with
 169-8   the terms of two or three directors expiring October 1 of each
 169-9   odd-numbered year.  Each director serves for a term of office as
169-10   provided by this subsection and until a successor is appointed and
169-11   takes office.
169-12         (f)  Directors are appointed by the city council of the City
169-13   of Irving.  All vacancies on the board shall be filled by
169-14   appointment to the unexpired term by the city council of the City
169-15   of Irving.  The city council of the City of Irving may remove and
169-16   replace any director it appoints at any time without cause.
169-17         (g)  Except for an action to dissolve the district under
169-18   state law or any other specific action taken by the city that must
169-19   be evidenced in writing, the city by its appointment and removal of
169-20   directors or any other action taken directly relating to any bond,
169-21   note, financial obligation, or contractual obligation of the
169-22   district, does not assume, agree to pay, or guarantee the payment
169-23   of any bond, note, or other financial obligation or undertaking of
169-24   the district, whether in the form of securities or in other
169-25   contractual forms, including the district's bonds.
169-26         (h)  The directors shall establish in the district's bylaws
 170-1   what shall constitute a quorum for any meeting, and a concurrence
 170-2   of a majority of the quorum shall be necessary in all district
 170-3   matters.  The board shall prescribe the method of execution of all
 170-4   contracts, the signing of checks, and the handling of any other
 170-5   matters approved by the board as shown in the official minutes of
 170-6   the district.
 170-7         (i)  Annually in the month of October, the board shall
 170-8   reorganize and elect new officers as soon as practicable.  The
 170-9   board may designate one or more assistant secretaries and an
170-10   assistant treasurer, who may but need not be a member of the board.
170-11   The secretary or one of the assistant secretaries of the board
170-12   shall be responsible for keeping the minutes of the meetings and
170-13   official records of the board and may certify to any action taken
170-14   by the board.
170-15         (j)  Each director is entitled to receive a per diem payment
170-16   of $50 for each regular or special board or committee meeting and
170-17   shall be reimbursed for actual expenses approved by the board.  The
170-18   board shall hold regular and special meetings, at such times and on
170-19   such dates as the board shall determine, on giving notice as
170-20   required by the district's bylaws.  The board shall designate a
170-21   meeting place or places.  A meeting place of the district is a
170-22   public place for matters pertaining to the district's business.
170-23         (k)  The board shall appoint a person to the office of tax
170-24   assessor-collector and may appoint deputies as the board considers
170-25   necessary.  Each tax assessor-collector and deputy shall qualify by
170-26   executing a bond for $10,000 payable to the district and approved
 171-1   by the board conditioned on the faithful performance of the
 171-2   person's duties.  The compensation of the tax assessor-collector
 171-3   and deputies shall be fixed by the board.  One of the directors
 171-4   shall serve as treasurer of the district and shall see that all
 171-5   funds of the district are deposited in the depository bank or banks
 171-6   designated by the board as the official depository bank of the
 171-7   district.  To the extent that funds in the depository bank or banks
 171-8   are not insured by the Federal Deposit Insurance Corporation, such
 171-9   funds shall be secured in the manner provided by law for the
171-10   security of funds of counties of this state.  Funds of the district
171-11   may be invested and reinvested at the direction of the board, its
171-12   treasurer, or other qualified representative in direct or indirect
171-13   obligations of the United States, the state, or any county, city,
171-14   or school district or other political subdivision of the state or
171-15   may be placed in certificates of deposit of state or national banks
171-16   within the state, provided that the same are secured in the manner
171-17   provided for the security of funds of counties of this state.
171-18         Sec. 256.008.  ELECTIONS.  Elections required to be held by
171-19   the district shall be called by the board.  The results of the
171-20   elections shall be canvassed by the board.  Elections shall be held
171-21   in accordance with the Election Code, except as otherwise provided
171-22   by this chapter.  Notice of all district elections shall be given
171-23   by publication in a newspaper of general circulation in Dallas
171-24   County once a week for two consecutive weeks, with the first
171-25   publication at least 14 days before the election.  Any elections
171-26   held by the district for any purpose may be held separately or may
 172-1   be held at the same time as an election to be held for other
 172-2   purposes, including a maintenance tax election, which may be held
 172-3   on the same day as a bond election or any other election.
 172-4   Elections held at the same time may be called by the board in a
 172-5   single election order, and the results of the elections may be
 172-6   canvassed in a single order.
 172-7         Sec. 256.009.  EXCLUSION AND ANNEXATION OF PROPERTY.
 172-8   (a)  The board may exclude land from the district and add land to
 172-9   the district as provided by this section.
172-10         (b)  The board may, solely on its own motion, call a hearing
172-11   on the question of exclusion of land from the district if the board
172-12   finds that the exclusion is practicable, just, or desirable and
172-13   that the holders of all outstanding bonds, notes, securities, and
172-14   other obligations of the district are or will be protected as a
172-15   result of the district's providing a substantial equivalent as
172-16   security in lieu of the excluded land for the bonds, notes,
172-17   securities, and other obligations.
172-18         (c)  If the board determines that a hearing should be held on
172-19   the exclusion of land, the board shall give notice of a time and
172-20   place for the hearing by publishing the notice once a week for two
172-21   consecutive weeks in one or more newspapers of general circulation
172-22   in the district.  The first publication shall appear at least 14
172-23   days before the hearing date.
172-24         (d)  After considering all matters presented during the
172-25   hearing by the district's staff, property owners, taxpayers, and
172-26   others, on the board's finding and concluding that the exclusion of
 173-1   land from the district is practicable, just, or desirable, and that
 173-2   the holders of all outstanding bonds, notes, securities, and other
 173-3   obligations of the district are or will be protected as a result of
 173-4   the district's providing a substantial equivalent as security for
 173-5   payment of the bonds, notes, securities, and other obligations in
 173-6   the form of newly annexed property or other lawful and adequate
 173-7   security, the board may, solely at its own discretion, enter an
 173-8   order excluding the land and property from the district and shall
 173-9   redefine in the order the boundaries of the district to embrace all
173-10   land not excluded.  A copy of the order excluding the land and
173-11   redefining the boundaries of the district shall be filed in the
173-12   deed records of Dallas County.
173-13         (e)  The district may annex property to the district in the
173-14   manner provided by Subchapter J, Chapter 49.
173-15         (f)  The district must obtain the approval of the City of
173-16   Irving in the form of a city council resolution as a condition
173-17   precedent to the annexation of any additional land and the approval
173-18   of the district's annual operation and maintenance budget.
173-19         Sec. 256.010.  ADDITIONAL SPECIFIC POWERS AND DUTIES.
173-20   (a)  The board may expend funds, borrow money, and issue bond
173-21   anticipation notes, tax anticipation notes, and bonds or notes
173-22   payable from revenue derived from the ownership of all or any
173-23   designated part of the district's works, plant, improvements,
173-24   facilities, or equipment, including the revenue derived from the
173-25   district's raw water supply system and the use and lease of the
173-26   district's land and facilities after deduction of the reasonable
 174-1   cost of maintaining and operating these facilities, and may levy
 174-2   and collect maintenance taxes and carry out all acts and have all
 174-3   power and authority in accordance with the provisions of Subchapter
 174-4   E, Chapter 49, and Sections 49.057(f) and 49.107.
 174-5         (b)  The board may issue bonds pursuant to and in accordance
 174-6   with Sections 49.106, 49.184, 49.215, 54.501, 54.507, 54.5161, and
 174-7   54.521.  Sections 49.181 and 49.182 shall not be applicable to the
 174-8   district.
 174-9         (c)  The board may enter into and execute a credit agreement,
174-10   including a letter of credit, line of credit, convertible line of
174-11   credit, loan agreement, revolving credit agreement, reimbursement
174-12   agreement, insurance contract, commitment to purchase obligations,
174-13   or sale agreement, or may authorize and approve a commitment or
174-14   other contract or agreement in connection with the operation,
174-15   maintenance, financial management, and financing of the district.
174-16   The board by order or resolution shall fix the terms, conditions,
174-17   and covenants of any credit agreement.  A credit agreement
174-18   authorized under this section is payable from and secured by the
174-19   sources and resources of the district as determined by the board,
174-20   including ad valorem taxes levied and collected by the district and
174-21   other lawfully available revenues of the district.  The proceeds
174-22   received from a credit agreement may be used in furtherance of the
174-23   purposes of the district as provided by Section 59, Article XVI,
174-24   Texas Constitution, and this chapter, including the maintenance of
174-25   the district and its assets through the stabilization of the
174-26   district tax rate, improvements to district property, and the
 175-1   ongoing maintenance of those improvements.  The district may not
 175-2   enter into a credit agreement payable from ad valorem taxes unless
 175-3   that action has been approved by a majority of the qualified voters
 175-4   of the district.
 175-5         (d)  The board may issue tax-supported bonds and notes and
 175-6   revenue bonds and notes and make all expenditures of funds and
 175-7   issue all bonds, notes, and credit agreements authorized under
 175-8   Subsections (a), (b), and (c) as a political subdivision authorized
 175-9   as an aggregator or an owner or joint owner of generation
175-10   facilities, lessor or lessee, and be authorized to take any and all
175-11   actions authorized for any political subdivisions pursuant to and
175-12   in accordance with Chapter 39, Title 2, the Public Utility
175-13   Regulatory Act, Utilities Code.
175-14         Sec. 256.011.  WRITTEN NOTICE TO REAL PROPERTY PURCHASERS NOT
175-15   REQUIRED.  Sections 49.452 and 49.453 do not apply to the district.
175-16         Sec. 256.012.  USE OF MAINTENANCE TAX PROCEEDS.  The board
175-17   may use the money received from maintenance taxes:
175-18               (1)  to maintain, repair, and make additions,
175-19   extensions, and improvements to the district's properties, works,
175-20   projects, facilities, and improvements;
175-21               (2)  to pay the principal of or interest on any tax
175-22   anticipation notes or bond anticipation notes or to pay other
175-23   contracts or obligations of the district; and
175-24               (3)  for any other lawful purpose other than the
175-25   payment of the principal of or interest on bonds, for the payment
175-26   of which separate taxes shall be levied and collected to the extent
 176-1   the bonds are required to be paid from taxes; provided, however,
 176-2   that maintenance taxes may not be used for the purposes permitted
 176-3   by Section 256.004(b) unless the district has complied with the
 176-4   provisions of Section 256.004(c).
 176-5         Sec. 256.013.  LEVY, ASSESSMENT, AND COLLECTION OF TAXES.
 176-6   The ad valorem plan of taxation shall be used by the district, and
 176-7   the provisions of Subchapter G, Chapter 54, and the applicable
 176-8   provisions of Title 1, Tax Code, shall be applicable to all matters
 176-9   relating to the levy, assessment, and collection of both current
176-10   and delinquent taxes by the district.
176-11         Sec. 256.014.  CONTRACTS.  The district may enter into
176-12   contracts with the United States or any of its agencies, with the
176-13   City of Irving and any other public bodies, with individuals or
176-14   corporations, or with any other entity for the operation and
176-15   maintenance of or construction of any facility or improvement
176-16   authorized by this chapter.  Any contract obligating the district
176-17   to make payments in whole or in part from ad valorem taxes, other
176-18   than maintenance taxes, shall be subject to approval at an election
176-19   held under the same procedures as those required for the issuance
176-20   of bonds payable from ad valorem taxes.  All contracts, agreements,
176-21   and obligations previously incurred or entered into between the
176-22   City of Irving and the district shall remain in full force and
176-23   effect until the year 2023 or until the effective date of a
176-24   dissolution of the district by the exercise of a lawful right by
176-25   the city, whichever comes first, and those contracts, agreements,
176-26   and obligations are ratified and affirmed.
 177-1         Sec. 256.015.  RISK MANAGEMENT PROGRAM.  The board may
 177-2   implement a funded risk management program to self-insure the
 177-3   district against such risks, liabilities, and casualties as the
 177-4   board may determine.  The board may:
 177-5               (1)  create or provide for a risk management fund and
 177-6   pay or discharge from the fund such claims, losses, risks,
 177-7   liabilities, and casualties as may be defined and specified by the
 177-8   board, along with the expenses and costs of administering the fund;
 177-9               (2)  issue, guarantee, or otherwise pledge the
177-10   district's assets, properties, or credit to secure any and all such
177-11   bonds, notes, contracts, or other obligations as may be appropriate
177-12   for the creation of the risk management funds;
177-13               (3)  notwithstanding any limitations in Section
177-14   256.014, levy, assess, collect, and pledge ad valorem taxes for the
177-15   payment of bonds, notes, contracts, and other obligations
177-16   authorized pursuant to Subsection (b), and, notwithstanding any
177-17   limitations contained in Section 256.012, pledge the district's
177-18   maintenance taxes for the payment of the bonds, notes, contracts,
177-19   and other obligations;
177-20               (4)  organize a nonprofit corporation as a risk
177-21   management authority for the purpose of administering the risk
177-22   management fund and the risk management program in a manner
177-23   consistent with the provisions of this section and may contract
177-24   with that corporation and guarantee and secure its obligations and
177-25   indebtedness for that purpose;
177-26               (5)  execute and deliver such other notes, bonds,
 178-1   contracts, agreements, documents, certificates, or instruments and
 178-2   perform such other acts and things as the board determines
 178-3   necessary, advisable, or appropriate to implement and administer a
 178-4   risk management program in a manner consistent with this section.
 178-5         Sec. 256.016.  EMINENT DOMAIN.  The district shall have and
 178-6   may exercise all rights of eminent domain provided in Chapter 49;
 178-7   provided, however, that the district shall not exercise any right
 178-8   of eminent domain for the purpose of acquiring any land or
 178-9   improvements owned by the City of Irving.
178-10         Sec. 256.017.  ABOLITION AND DISSOLUTION OF DISTRICT BY CITY
178-11   OF IRVING.  The City of Irving shall have the right to abolish and
178-12   dissolve the district and to assume all bonded indebtedness and
178-13   other district obligations under Section 43.074, Local Government
178-14   Code.
178-15         Sec. 256.018.  REGULATORY AND POLICE POWER.  (a)  The
178-16   district shall have all regulatory and police power under Chapters
178-17   49 and 54 except as provided by this section.
178-18         (b)  All rules and regulations containing penal provisions to
178-19   be enforced by a peace officer shall be approved by the City of
178-20   Irving as a condition precedent to their enactment except as to
178-21   rules and regulations regulating privileges on the lakes, and on
178-22   walkways contiguous to the lakes, constructed or to be constructed
178-23   and owned or controlled by the district.  The rules shall be
178-24   submitted to the City of Irving for review at least 30 days in
178-25   advance of approval of the rules by the district.
178-26         (c)  The district may not make penal rules or regulations
 179-1   that conflict with any City of Irving ordinances, including the
 179-2   Irving Building Code, Fire Code, Traffic Ordinances, Electrical
 179-3   Code, and Mechanical Code.
 179-4         (d)  The district may not promulgate rules or regulations
 179-5   relating to the City of Irving's streets or roads, and the
 179-6   district's peace officers may not enforce any rules or regulations
 179-7   on the city's streets or roads.
 179-8         (e)  Peace officers employed by the district shall have the
 179-9   power authorized in Chapter 49 except that such officers shall not
179-10   have the power to enforce city ordinances or state law but shall
179-11   have the authority to make arrests when necessary to prevent or
179-12   stop the commission of any offense against the rules and
179-13   regulations of the district, as provided in Section 49.216.
179-14              CHAPTER 257.  FRANKLIN COUNTY WATER DISTRICT
179-15         Sec. 257.001.  CREATION.  (a)  A conservation and reclamation
179-16   district to be known as the "Franklin County Water District" is
179-17   created.  The district is a governmental agency, a body politic and
179-18   corporate, and a political subdivision of this state.
179-19         (b)  The district is created under and is essential to
179-20   accomplish the purposes of Section 59, Article XVI, Texas
179-21   Constitution.
179-22         Sec. 257.002.  DEFINITIONS.  In this chapter:
179-23               (1)  "Board" means the board of directors of the
179-24   district.
179-25               (2)  "Director" means a member of the board.
179-26               (3)  "District" means the Franklin County Water
 180-1   District.
 180-2         Sec. 257.003.  TERRITORY.  The area of the district consists
 180-3   of all of Franklin County, and the boundaries of the district shall
 180-4   be identical with the boundaries of that county.
 180-5         Sec. 257.004.  NO CONFIRMATION ELECTION, HEARING ON EXCLUSION
 180-6   OF LAND OR PLAN OF TAXATION REQUIRED.  It being found and
 180-7   determined that all of the land included within the boundaries of
 180-8   the district will benefit and that the district is created to serve
 180-9   a public use and benefit, the board is not required to call a
180-10   confirmation election or to hold a hearing on the exclusion of
180-11   lands or a hearing on the adoption of a plan of taxation.  The ad
180-12   valorem plan of taxation shall be used by the district.
180-13         Sec. 257.005.  BOARD OF DIRECTORS.  (a)  All powers of the
180-14   district shall be exercised by a board of five directors.  Each
180-15   director serves for a term of office as provided by this section
180-16   and until a successor is elected or appointed and has qualified.  A
180-17   person may not serve as a director unless the person is at least 21
180-18   years of age and resides and owns land in the territorial limits of
180-19   the district.  Each director shall subscribe the constitutional
180-20   oath of office and shall give bond in the amount of $5,000 for the
180-21   faithful performance of the person's duties as director.  The cost
180-22   of the bond shall be paid by the district.
180-23         (b)  Directors serve for four-year terms.  A directors
180-24   election shall be held on the first Saturday in May of each
180-25   odd-numbered year to elect the appropriate number of directors.
180-26   Except as provided by this chapter, a directors election is held as
 181-1   provided by Chapter 49 and the Election Code.  Notice of the
 181-2   election shall be  published in accordance with the general law
 181-3   applicable to water control and improvement districts.  The
 181-4   election order must state the time, places, and purpose of the
 181-5   election.  The board shall appoint presiding judges as necessary.
 181-6   Each presiding judge shall appoint one assistant judge and at least
 181-7   two clerks to assist in holding the election.  As determined by the
 181-8   board, the board may contract with the county clerk of Franklin
 181-9   County to conduct its elections.
181-10         (c)  One director represents the district as a whole and is
181-11   elected at large.  A candidate for the at-large directorship must
181-12   be a qualified voter who resides in the district.  One director
181-13   represents each of the county commissioners precincts in Franklin
181-14   County.  The director for a precinct is elected by qualified voters
181-15   residing in the precinct.  A candidate for a precinct's
181-16   directorship must be a qualified voter who resides in the precinct.
181-17         (d)  Only qualified voters residing in the district are
181-18   entitled to vote at the election.  Returns of the election shall be
181-19   made to and canvassed by the board, which shall enter its order
181-20   declaring the results of the election.
181-21         (e)  Any candidate for director desiring to have the
181-22   candidate's name printed on the ballot may do so by a petition
181-23   signed by not less than 10 residents of the district who are
181-24   qualified to vote at the election.  The petition must be presented
181-25   to the secretary of the board in accordance with Section
181-26   144.005(a), Election Code.  A declaration of write-in candidacy
 182-1   must be filed in accordance with Section 49.101.
 182-2         (f)  If a vacancy occurs in the membership of the board, the
 182-3   remaining members of the board shall appoint a person from the
 182-4   precinct where the vacancy occurs, or from the county in the case
 182-5   of an at-large position, to fill the vacancy for the unexpired
 182-6   term.
 182-7         (g)  A director is entitled to receive fees of office in
 182-8   accordance with Section 49.060.
 182-9         (h)  The board shall elect from among its members a president
182-10   and a vice president and such other officers as in the judgment of
182-11   the board are necessary.  The president is the chief executive
182-12   officer and the presiding officer of the board and has the same
182-13   right to vote as any other director.  When the president is absent
182-14   or fails to or declines to act, the vice president shall perform
182-15   all duties and exercise all power conferred by this chapter on the
182-16   president.  The board shall also appoint a secretary, who may or
182-17   may not be a member of the board.
182-18         (i)  Three members of the board constitute a quorum for the
182-19   transaction of all business, and a favorable vote of a majority of
182-20   a quorum present is sufficient for the enactment of all measures.
182-21   The board shall hold regular meetings at least once a month at the
182-22   time and place designated by resolution or bylaws of the board.
182-23   The president or any two members may call special meetings as
182-24   necessary in the administration of the district's business provided
182-25   that, at least five days before the meeting date, the secretary
182-26   mails notice to each director, unless the director has waived
 183-1   notice of special meetings in writing.
 183-2         (j)  The board shall keep and preserve a true and full
 183-3   account of all its meetings and proceedings and shall preserve the
 183-4   board's minutes, contracts, notices, accounts, receipts, and
 183-5   records of all kinds.  Those documents are the property of the
 183-6   district and are subject to public inspection.  A regular office
 183-7   shall be established and maintained within the district for the
 183-8   conduct of its business.
 183-9         (k)  All records and accounts must conform to approved
183-10   methods of bookkeeping.  The board shall have an audit made and
183-11   completed annually, as soon as practicable after the expiration of
183-12   each calendar year, of the books of account and financial records
183-13   of the district for that calendar year.  The audit must be made by
183-14   an individual public accountant or firm of public accountants.  The
183-15   report on the audit shall be submitted at the first regular meeting
183-16   of the board after the report is completed.  One copy of the report
183-17   shall be filed with the office of the district, one with the
183-18   depository of the district, and one in the office of the auditor,
183-19   all of which shall be open to public inspection.  Additional copies
183-20   of the report shall be filed with any state or governmental
183-21   agencies as may be required by law.
183-22         Sec. 257.006.  DISTRICT POWERS.  (a)  The district has all
183-23   the rights, powers, and privileges conferred by the general laws of
183-24   the state applicable to water control and improvement districts
183-25   created under the authority of Section 59, Article XVI, Texas
183-26   Constitution.  To the extent that general laws applicable to water
 184-1   control and improvement districts may be inconsistent or in
 184-2   conflict with this chapter, the provisions of this chapter prevail.
 184-3         (b)  It is the intention of the legislature that the district
 184-4   have all the power and authority necessary to fully qualify and
 184-5   gain the benefits of all laws that are helpful in carrying out the
 184-6   purposes for which the district is created, and the provisions of
 184-7   all such laws of which the district may lawfully avail itself are
 184-8   adopted by this reference and made applicable to the district.
 184-9         (c)  The district shall exercise the powers, privileges, and
184-10   functions provided by this section, including the power to:
184-11               (1)  control, store, preserve, and distribute its
184-12   waters and floodwaters and the waters of its rivers and streams for
184-13   all useful purposes and to accomplish these ends by all practicable
184-14   means, including the construction, maintenance, and operation of
184-15   all appropriate improvements, plants, works, and facilities and the
184-16   acquisition of water rights and all other properties, lands,
184-17   tenements, easements, and rights necessary to the purpose of the
184-18   organization of the district;
184-19               (2)  process, store, and distribute water for
184-20   municipal, domestic, irrigation, and industrial purposes, subject
184-21   to the requirements of Chapter 11;
184-22               (3)  dispose of property or rights in property when the
184-23   property or rights are no longer needed for the purposes for which
184-24   the district is created and to lease property or rights in property
184-25   for purposes that will not interfere with the use of the property
184-26   of the district;
 185-1               (4)  cooperate with and contract with the state or the
 185-2   United States or any of their departments or agencies to carry out
 185-3   any of the powers or to further any of the purposes of the district
 185-4   and, for such purposes, to receive grants, loans, or advancements
 185-5   from the state or United States or their departments or agencies;
 185-6   and
 185-7               (5)  make or cause to be made surveys and engineering
 185-8   investigations for the information of the district to facilitate
 185-9   the accomplishment of its purposes, to employ a general manager,
185-10   attorneys, accountants, engineers, financial experts, or other
185-11   technical or nontechnical employees or assistants and set the
185-12   amount and manner of their compensation, and to provide for the
185-13   payment of all expenditures considered essential to the proper
185-14   operation and maintenance of the district and its affairs.
185-15         (d)  The district may exercise all functions to permit the
185-16   accomplishment of its purposes including the acquisition, within or
185-17   outside the district, of land, easements, and rights-of-way and any
185-18   other character of property incident to or necessary in carrying
185-19   out the purposes and work of the district by way of gift, device,
185-20   purchase, leasehold, or condemnation.  The right of eminent domain
185-21   is expressly conferred on the district, and the procedure with
185-22   reference to condemnation, the assessment of and estimating of
185-23   damages, payment, appeal, the entering upon the property pending
185-24   appeal, and other procedures prescribed in Chapter 21, Property
185-25   Code, apply to the district.
185-26         (e)  If the district, in the exercise of the power of eminent
 186-1   domain or power of relocation or any other power granted under this
 186-2   chapter, makes necessary the taking of any property or the
 186-3   relocation, raising, rerouting, changing the grade, or altering the
 186-4   construction of any highway, railroad, electric transmission line,
 186-5   telephone or telegraph properties and facilities, or pipeline, all
 186-6   such necessary taking, relocation, raising, rerouting, changing of
 186-7   grade, or alteration of construction shall be accomplished at the
 186-8   expense of the district.  It is provided, however, that the expense
 186-9   of the district shall be strictly confined to that amount which is
186-10   equal to the actual cost of the property taken or work required
186-11   without enhancement of the property and after deducting the net
186-12   salvage value which may be derived from any property taken.
186-13         (f)  The district may do any and all other acts or things
186-14   necessary or proper to carry into effect the purpose for which the
186-15   district is created and organized.
186-16         Sec. 257.007.  AWARDING CONTRACTS.  The district shall comply
186-17   with the requirements of Section 49.273 when awarding a contract.
186-18         Sec. 257.008.  ISSUANCE OF BONDS.  (a)  For the purpose of
186-19   providing funds for purchasing or otherwise providing works,
186-20   plants, facilities, or appliances necessary to the accomplishment
186-21   of the purposes authorized by this chapter, and for the purpose of
186-22   carrying out any other power or authority conferred by this
186-23   chapter, the district may borrow money and issue negotiable bonds
186-24   payable from such ad valorem taxes or revenues or from both taxes
186-25   and revenues of the district as are pledged by resolution of the
186-26   board.  Pending the issuance of definitive bonds, the board may
 187-1   authorize the delivery of negotiable interim bonds or notes
 187-2   eligible for exchange or substitution by use of definitive bonds.
 187-3         (b)  Bonds must be issued in the name of the district, signed
 187-4   by the president, and attested by the secretary and must bear the
 187-5   seal of the district.  The signature of the president or secretary,
 187-6   or of both, may be printed or lithographed on the bonds authorized
 187-7   by the board.  The seal of the district may be impressed on the
 187-8   bonds or may be printed or lithographed on the bonds, if so
 187-9   authorized.
187-10         (c)  Bonds must mature, serially or otherwise, in not to
187-11   exceed 40 years and may be sold at a price and under terms
187-12   determined by the board to be the most advantageous reasonably
187-13   obtainable, provided that the interest cost to the district,
187-14   calculated by the use of standard bond interest tables currently in
187-15   use by insurance companies and investment houses, does not exceed
187-16   six percent per year.  Within the discretion of the board, bonds
187-17   may be made callable before maturity at such times and prices as
187-18   may be prescribed in the resolution authorizing the bonds and may
187-19   be made registrable as to principal or as to both principal and
187-20   interest.
187-21         (d)  Bonds may be issued in one or more than one series and
187-22   from time to time as required for carrying out the purposes of this
187-23   chapter.
187-24         (e)  Bonds may be secured by a pledge of all or part of the
187-25   net revenues of the district, of the net revenues of one or more
187-26   contracts made before or after the bonds are issued, or of other
 188-1   revenues and income specified by the resolution of the board or in
 188-2   the trust indenture.  A pledge may reserve the right, under
 188-3   conditions specified in the pledge, to issue additional bonds that
 188-4   would be on a parity with or subordinate to the bonds being issued.
 188-5   In this subsection, "net revenues" means the gross revenues of the
 188-6   district less the amount necessary to pay the reasonable cost of
 188-7   maintaining and operating the district and its properties.
 188-8         (f)  If bonds are issued that are payable wholly or partially
 188-9   from ad valorem taxes, the board shall levy, assess, and cause to
188-10   be collected a tax sufficient to pay the bonds and the interest on
188-11   the bonds as the bonds and interest become due.  In levying the
188-12   tax, the board shall take into consideration reasonable
188-13   delinquencies and costs of collection.  In the case of bonds
188-14   payable partially from ad valorem taxes, the rate of the tax for
188-15   any year may be set after giving consideration to the money
188-16   reasonably expected to be received from the pledged revenues
188-17   available for payment of principal and interest and to the extent
188-18   and in the manner permitted by the resolution authorizing the
188-19   issuance of the bonds.
188-20         (g)  If bonds payable wholly from revenues are issued, the
188-21   board shall set, establish, and from time to time as necessary
188-22   revise the rates of compensation for the sale of water and other
188-23   services furnished, supplied, and rendered by the district and
188-24   collect the rates in amounts sufficient to pay the expenses of
188-25   operating and maintaining the facilities of the district, to pay
188-26   the bonds as they mature and the interest as it accrues, and to
 189-1   maintain the reserve and other funds as provided in the resolution
 189-2   authorizing the bonds.  If bonds payable partially from revenues
 189-3   are issued, the board shall set, establish, and from time to time
 189-4   as necessary revise the rates of compensation for the sale of water
 189-5   and other services furnished, supplied, and rendered by the
 189-6   district and shall collect the rates in amounts sufficient to
 189-7   assure compliance with the resolution authorizing the bonds.
 189-8         (h)  From the proceeds of the sale of bonds, the district may
 189-9   set aside an amount for the payment of interest expected to accrue
189-10   during construction and for a reserve interest and sinking fund,
189-11   and this provision may be made in the resolution authorizing the
189-12   bonds.  Proceeds from the sale of bonds may also be used for the
189-13   payment of all expenses necessarily incurred in accomplishing the
189-14   purposes for which the district is created, including expenses of
189-15   its organization, of engineering investigations, and of the
189-16   issuance and sale of the bonds.  The proceeds from the sale of the
189-17   bonds may be placed on time deposit with the district's depository
189-18   bank or may be temporarily invested in direct obligations of the
189-19   United States government maturing in not more than one year from
189-20   the date of investment.
189-21         (i)  In the event of a default or a threatened default in the
189-22   payment of principal of or interest on bonds payable wholly or
189-23   partially from revenues, any court of competent jurisdiction may,
189-24   on petition of the holders of the outstanding bonds, appoint a
189-25   receiver with authority to collect and receive all income of the
189-26   district except taxes, employ and discharge agents and employees of
 190-1   the district, take charge of the district's funds on hand, except
 190-2   funds received from taxes, unless commingled, and manage the
 190-3   proprietary affairs of the district without consent or hindrance by
 190-4   the board.  The receiver may also be authorized to sell or make
 190-5   contracts for the sale of water or other services furnished by the
 190-6   district or renew the contracts with the approval of the court
 190-7   appointing the receiver.  The court may vest the receiver with
 190-8   other powers and duties the court finds necessary for the
 190-9   protection of the holders of the bonds.  The resolution authorizing
190-10   the issuance of the bonds or the trust indenture securing them may
190-11   limit or qualify the rights of less than all of the outstanding
190-12   bonds payable from the same source to institute or prosecute any
190-13   litigation affecting the district's property or income.
190-14         (j)  The provisions of Section 49.181 relating to commission
190-15   approval of plans and specifications for projects to be financed by
190-16   the sale of bonds apply to the sale of bonds under this chapter.
190-17         Sec. 257.009.  REFUNDING BONDS.  (a)  The district may issue
190-18   refunding bonds for the purpose of refunding any outstanding bonds
190-19   authorized by this chapter and the interest on the bonds.
190-20   Refunding bonds may be issued to refund more than one series of
190-21   outstanding bonds and may combine the pledges of the outstanding
190-22   bonds for the security of the refunding bonds, and the refunding
190-23   bonds may be secured by other or additional revenues and mortgage
190-24   liens.
190-25         (b)  The provisions of this chapter with respect to the
190-26   issuance by the district of other bonds, their security, their
 191-1   approval by the attorney general, and the remedies of the holders
 191-2   are applicable to refunding bonds.  Refunding bonds shall be
 191-3   registered by the comptroller on surrender and cancellation of the
 191-4   bonds to be refunded, but in lieu of that procedure, the resolution
 191-5   authorizing the issuance of the refunding bonds may provide that
 191-6   the refunding bonds shall be sold and the proceeds of the sale
 191-7   deposited in the bank where the original bonds were payable, in
 191-8   which case the refunding bonds may be issued in an amount
 191-9   sufficient to pay the principal of and interest on the original
191-10   bonds to their effective option date or maturity date, and the
191-11   comptroller shall register the refunding bonds without concurrent
191-12   surrender and cancellation of the original bonds.
191-13         Sec. 257.010.  TRUST INDENTURE.  (a)  Bonds, including
191-14   revenue bonds, authorized by this chapter that are not payable
191-15   wholly from ad valorem taxes may be additionally secured by a trust
191-16   indenture under which the trustee may be a bank with trust powers
191-17   located either within or outside the state.  The bonds may, within
191-18   the discretion of the board, be additionally secured by a deed of
191-19   trust or mortgage lien on physical properties of the district and
191-20   all franchises, easements, water rights and appropriation permits,
191-21   leases and contracts, and all rights appurtenant to the properties,
191-22   vesting in the trustee power to sell the properties for payment of
191-23   the indebtedness, power to operate the properties, and all other
191-24   powers and authority for the further security of the bonds.
191-25         (b)  The trust indenture, regardless of the existence of a
191-26   deed of trust or mortgage lien on the properties, may contain any
 192-1   provisions prescribed by the board for the security of the bonds
 192-2   and the preservation of the trust estate, may make provision for
 192-3   amendment or modification of the trust indenture and for the
 192-4   issuance of bonds to replace lost or mutilated bonds, may condition
 192-5   the right to expend district money or sell district property on
 192-6   approval by a registered professional engineer selected as provided
 192-7   in the trust indenture, and may make provision for the investment
 192-8   of funds of the district.
 192-9         (c)  A purchaser under a sale under a deed of trust lien,
192-10   where one is given, is the absolute owner of the properties,
192-11   facilities, and rights purchased and has the right to maintain and
192-12   operate the properties, facilities, and rights.
192-13         Sec. 257.011.  BOND ELECTIONS.  (a)  Bonds payable wholly or
192-14   partially from ad valorem taxes, except refunding bonds, may not be
192-15   issued unless authorized at an election at which only the qualified
192-16   voters who reside in the district may vote and a majority of the
192-17   votes cast is in favor of the issuance of the bonds.  Bonds not
192-18   payable wholly or partially from ad valorem taxes may be issued
192-19   without an election.
192-20         (b)  A bond election described by Subsection (a) may be
192-21   called by the board without a petition.  The resolution calling the
192-22   election must specify the time and place or places of holding the
192-23   election, the purpose for which the bonds are to be issued, the
192-24   maximum amount of the bonds, the maximum interest rate, the maximum
192-25   maturity of the bonds, the form of the ballot, and the presiding
192-26   judge for each voting place.  The presiding judge serving at each
 193-1   voting place shall appoint one assistant judge and at least two
 193-2   clerks to assist in holding the election.  Notice of the election
 193-3   for the issuance of bonds shall be given by publication of a
 193-4   substantial copy of the resolution calling the election in a
 193-5   newspaper with general circulation in the district once each week
 193-6   for at least four consecutive weeks.  The first publication must
 193-7   appear not less than 28 days before the election.
 193-8         (c)  The returns of the election shall be made to and
 193-9   canvassed by the board.
193-10         (d)  Except as otherwise provided in this chapter, the
193-11   Election Code applies to bond elections.  If a bond issue election
193-12   fails, another bond election may not be called for a period of six
193-13   months.
193-14         Sec. 257.012.  APPROVAL AND REGISTRATION OF BONDS.  After
193-15   bonds, including refunding bonds, are authorized by the district,
193-16   the bonds and the record relating to their issuance shall be
193-17   submitted to the attorney general for examination as to their
193-18   validity.  If the bonds recite that they are secured by a pledge of
193-19   the proceeds of a contract previously made between the district and
193-20   a city or other governmental agency, authority, or district, a copy
193-21   of the contract and the proceedings of the city or other
193-22   governmental agency, authority, or district authorizing the
193-23   contract shall also be submitted to the attorney general.  If the
193-24   bonds have been authorized and the contract has been made in
193-25   accordance with the constitution and laws of the state, the
193-26   attorney general shall approve the bonds and the contract and the
 194-1   bonds shall then be registered by the comptroller.  After the
 194-2   approval and registration, the bonds and the contract, if any, are
 194-3   valid and binding and are incontestable for any cause.
 194-4         Sec. 257.013.  TAXES AUTHORIZED.  (a)  On a favorable
 194-5   majority vote of the qualified voters of the district voting at an
 194-6   election held for the purpose within the boundaries of the
 194-7   district, the board may levy, assess, and collect annual taxes to
 194-8   provide funds necessary to construct or acquire, maintain, and
 194-9   operate works, plants, and facilities considered essential or
194-10   beneficial to the district and its purposes and, when so
194-11   authorized, may also levy, assess, and collect annual taxes to
194-12   provide funds adequate to defray the cost of the maintenance,
194-13   operation, and administration of the district.
194-14         (b)  Elections for the levy of such taxes shall be ordered by
194-15   the board and notice of the election shall be given and the
194-16   election shall be held and conducted and the results of the
194-17   election determined in the manner provided in this chapter with
194-18   relation to elections for the authorization of bonds.  In calling
194-19   an election for taxes under this section, the board shall specify
194-20   the maximum rate of tax that is sought to be levied, and no tax in
194-21   excess of that amount may be levied without submitting the question
194-22   of the increased rate of taxation at an election as provided in
194-23   this section.
194-24         (c)  Taxes levied by the district for any purpose constitute
194-25   a lien on the property levied against, and limitation shall not bar
194-26   the enforcement or collection of the taxes.
 195-1         Sec. 257.014.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
 195-2   DEPOSITS.  Bonds of the district are legal and authorized
 195-3   investments for banks, savings banks, trust companies, building and
 195-4   loan associations, savings and loan associations, insurance
 195-5   companies, fiduciaries, and trustees, for sinking funds of cities,
 195-6   towns and villages, counties, school districts, or other political
 195-7   subdivisions of the state, and for all public funds of the state or
 195-8   its agencies, including the state permanent school fund.  The bonds
 195-9   are eligible to secure deposits of all public funds of the state
195-10   and all public funds of cities, towns, villages, counties, school
195-11   districts, or other political subdivisions or corporations of the
195-12   state, and the bonds are lawful and sufficient security for the
195-13   deposits to the extent of their value when accompanied by all
195-14   unmatured coupons.
195-15         Sec. 257.015.  DISTRICT DEPOSITORY.  The board shall
195-16   designate one or more banks within the district to serve as
195-17   depository for the funds of the district.  All funds of the
195-18   district shall be deposited in the depository bank or banks except
195-19   that sufficient funds shall be remitted to the bank or banks for
195-20   payment of the principal of and interest on the outstanding bonds
195-21   of the district and in time that the funds may be received by the
195-22   bank or banks on or before the date of the maturity of the
195-23   principal and interest to be paid.  To the extent that funds in the
195-24   depository bank or banks are not insured by the Federal Deposit
195-25   Insurance Corporation, the funds shall be secured in the manner
195-26   provided by law for the security of county funds.  Membership on
 196-1   the board of an officer or director of a bank shall not disqualify
 196-2   that bank from being designated as depository.
 196-3         Sec. 257.016.  DISTRICT AND BONDS EXEMPT FROM TAXATION.  The
 196-4   accomplishment of the purposes stated in this chapter will benefit
 196-5   the people of this state and improve their properties and
 196-6   industries, and the district in carrying out the purposes of this
 196-7   chapter will be performing an essential public function under
 196-8   Section 59, Article XVI, Texas Constitution, and may not be
 196-9   required to pay any tax or assessment on a project or any part of
196-10   the project, and the bonds issued under this chapter and the
196-11   transfer of and income from the bonds, including the profits made
196-12   on the sale of the bonds, shall at all times be free from taxation
196-13   within the state.
196-14         Sec. 257.017.  WATER SUPPLY CONTRACTS.  The district may
196-15   enter into contracts with cities and others for supplying water
196-16   services to them.  The district may also contract with any city for
196-17   the rental or leasing of, or for the operation of, the city's water
196-18   production, water supply, or water filtration or purification and
196-19   water supply facilities.  The contract may be on such terms, for
196-20   such consideration, and for such time as the parties may agree, and
196-21   the contract may provide that it shall continue in effect until
196-22   bonds specified in the contract and any refunding bonds issued in
196-23   lieu of such bonds are paid.
196-24         Sec. 257.018.  ACQUISITION OF WATER AND STORAGE CAPACITY IN
196-25   RESERVOIRS.  The district may lease or acquire rights in and to
196-26   storage and storage capacity in any reservoir constructed or to be
 197-1   constructed by any person, firm, corporation, or public agency or
 197-2   from the United States government or any of its agencies.  The
 197-3   district may also purchase or make contracts for the purchase of
 197-4   water or a water supply from any person or firm, corporation, or
 197-5   public agency or from the United States government or any of its
 197-6   agencies.
 197-7             CHAPTER 258.  GUADALUPE-BLANCO RIVER AUTHORITY
 197-8         Sec. 258.001.  CREATION.  (a)  A conservation and reclamation
 197-9   district to be known as the "Guadalupe-Blanco River Authority" is
197-10   created.  The authority is a governmental agency and body politic
197-11   and corporate.
197-12         (b)  The authority is created under and is essential to
197-13   accomplish the purposes of Section 59, Article XVI, Texas
197-14   Constitution.
197-15         (c)  The authority may exercise the rights, privileges, and
197-16   functions provided by Section 59, Article XVI, Texas Constitution,
197-17   and this chapter including, to the extent authorized by this
197-18   chapter, the control, storage, preservation, and distribution of
197-19   storm waters, floodwaters, and the waters of rivers and streams,
197-20   including the Guadalupe and Blanco rivers and their tributaries,
197-21   for irrigation, power, and all other useful purposes; the
197-22   reclamation and irrigation of arid, semiarid, and other lands
197-23   needing irrigation; the reclamation and drainage of overflowed
197-24   lands and other lands needing drainage, but not the reclamation or
197-25   drainage of coastal wetlands or inland marshes; the conservation
197-26   and development of the forests, water, and hydroelectric power of
 198-1   the state; the navigation of inland waters; and the preservation
 198-2   and conservation of all such natural resources of the state.
 198-3         (d)  Nothing in this chapter or in any other law shall be
 198-4   construed as authorizing the authority to levy or collect taxes or
 198-5   assessments or to create any indebtedness payable out of taxes or
 198-6   assessments or in any way to pledge the credit of the state.
 198-7         Sec. 258.002.  DEFINITIONS.  In this chapter:
 198-8               (1)  "Authority" means the Guadalupe-Blanco River
 198-9   Authority.
198-10               (2)  "Board" means the board of directors of the
198-11   authority.
198-12               (3)  "Director" means a member of the board.
198-13         Sec. 258.003.  TERRITORY.  The authority consists of all the
198-14   territory within the boundaries of Hays, Comal, Guadalupe,
198-15   Caldwell, Gonzales, DeWitt, Victoria, Kendall, Refugio, and Calhoun
198-16   counties.
198-17         Sec. 258.004.  POWERS OF THE AUTHORITY.  (a)  Except as
198-18   expressly limited by this chapter, the authority may exercise all
198-19   powers, rights, privileges, and functions conferred by general law
198-20   on any district or districts, excluding groundwater conservation
198-21   districts, created under Section 59, Article XVI, Texas
198-22   Constitution, including the power:
198-23               (1)  to control, store, and preserve, within or
198-24   adjoining the boundaries of the authority, the waters of any rivers
198-25   and streams, including the waters of the Guadalupe and Blanco
198-26   rivers and their tributaries, for all useful purposes and to use,
 199-1   distribute, and sell such waters, within the boundaries of the
 199-2   authority, for any such purposes;
 199-3               (2)  to conserve, preserve, and develop groundwater
 199-4   resources within the boundaries of the authority, subject to any
 199-5   applicable regulation by the state or any political subdivision,
 199-6   for all useful purposes and to use, distribute, and sell
 199-7   groundwater, within the boundaries of the authority, for any such
 199-8   purposes;
 199-9               (3)  to acquire water, water supply facilities, and
199-10   conservation storage capacity within or outside the authority from
199-11   any person, including the state or any of its agencies and
199-12   subdivisions and the United States and any of its agencies and
199-13   subdivisions;
199-14               (4)  to use, distribute, and sell, outside the
199-15   boundaries of the authority, any waters that may be controlled,
199-16   stored, preserved, conserved, developed, or acquired by the
199-17   authority, if the board determines that adequate provision can be
199-18   made to continue to serve the water requirements within the
199-19   boundaries of the authority; provided, however, that the authority
199-20   may not enter into any agreement that contemplates or results in
199-21   the removal from the watershed of the Guadalupe and Blanco rivers
199-22   and their tributaries of any surface water of the authority
199-23   necessary to supply the reasonably foreseeable future water
199-24   requirements for municipal uses within such watershed during the
199-25   next ensuing 50-year period, except on a temporary, interim basis;
199-26               (5)  to develop and generate water power and electric
 200-1   energy within the boundaries of the authority and to distribute and
 200-2   sell water power and electric energy, within or outside the
 200-3   boundaries of the authority;
 200-4               (6)  to prevent or aid in the prevention of damage to
 200-5   person or property from the waters of the Guadalupe and Blanco
 200-6   rivers and their tributaries;
 200-7               (7)  to forest and reforest and to aid in the foresting
 200-8   and reforesting of the watershed area of the Guadalupe and Blanco
 200-9   rivers and their tributaries and to prevent and to aid in the
200-10   prevention of soil erosion and floods within the watershed area;
200-11               (8)  to develop the navigation of inland waters within
200-12   the boundaries of the authority and any facilities in aid of that
200-13   purpose;
200-14               (9)  to develop the reclamation and drainage of
200-15   overflowed lands and other lands needing drainage within the
200-16   boundaries of the authority and any facilities in aid of those
200-17   purposes but not the power to reclaim or drain coastal wetlands or
200-18   inland marshes;
200-19               (10)  to develop the collection, transportation,
200-20   treatment, disposal, and handling of any waste, as that term is
200-21   defined by general law, and any facilities in aid of those
200-22   purposes, but if sanitary sewer facilities for the collection,
200-23   treatment, and disposal of sewage are to be constructed or acquired
200-24   within a city's corporate limits, only with the consent of the
200-25   affected city;
200-26               (11)  to conserve and develop waters and lands for
 201-1   recreation purposes and any facilities in aid of those purposes;
 201-2               (12)  to acquire by purchase, lease, or gift or in any
 201-3   other manner, other than by condemnation, and to maintain, use, and
 201-4   operate property of any kind, real, personal, or mixed, or any
 201-5   interest in property, within or outside the boundaries of the
 201-6   authority, necessary or convenient to the exercise of the powers,
 201-7   rights, privileges, and functions conferred on the authority by
 201-8   this chapter;
 201-9               (13)  to acquire by condemnation property of any kind,
201-10   real, personal, or mixed, or any interest in the property, within
201-11   or outside the boundaries of the authority, other than property or
201-12   any interest in property outside the boundaries of the authority
201-13   owned by any body politic, that is necessary or convenient to the
201-14   exercise of the powers, rights, privileges, and functions conferred
201-15   on the authority by this chapter, in the manner provided by general
201-16   law with respect to condemnation or, at the option of the
201-17   authority, in the manner provided by the statutes relating to
201-18   condemnation by districts organized under general law pursuant to
201-19   Section 59, Article XVI, Texas Constitution;
201-20               (14)  subject to the provisions of this chapter, to
201-21   sell, lease, or otherwise dispose of property of any kind, real,
201-22   personal, or mixed, or any interest in the property, that the board
201-23   determines is not necessary to accomplish the purposes of the
201-24   authority or whose sale, lease, or disposition, in the judgment of
201-25   the board, is necessary or convenient to the exercise of the
201-26   powers, rights, privileges, and functions conferred on the
 202-1   authority by this chapter or by general law;
 202-2               (15)  to overflow and inundate any public lands and
 202-3   public property and to require the relocation of roads, pipelines,
 202-4   transmission lines, railroads, cemeteries, and highways in the
 202-5   manner and to the extent permitted to districts organized under
 202-6   general law pursuant to Section 59, Article XVI, Texas
 202-7   Constitution; provided that if the authority requires the
 202-8   relocation, raising, lowering, rerouting, change in grade, or
 202-9   alteration of the construction of any railroad, transmission lines,
202-10   conduits, poles, properties, facilities, or pipelines in the
202-11   exercise of the power of eminent domain or any other power, all of
202-12   the relocation, raising, lowering, rerouting, changes in grade, or
202-13   alteration of construction shall be at the sole expense of the
202-14   authority, whereby the term "sole expense" means the actual cost of
202-15   relocation, raising, lowering, rerouting, change in grade, or
202-16   alteration of construction to provide comparable replacement
202-17   without enhancement of facilities, after deducting the net salvage
202-18   value derived from the old facility;
202-19               (16)  to construct, extend, improve, maintain, and
202-20   reconstruct, to cause to be constructed, extended, improved,
202-21   maintained, and reconstructed, and to use and operate facilities of
202-22   any kind necessary or convenient to the exercise of the powers,
202-23   rights, privileges, and functions conferred on the authority by
202-24   this chapter or by general law;
202-25               (17)  to sue and to be sued in the authority's
202-26   corporate name;
 203-1               (18)  to adopt, use, and alter a corporate seal;
 203-2               (19)  to invest and reinvest the funds of the
 203-3   authority;
 203-4               (20)  to make bylaws for the management and regulation
 203-5   of the authority's affairs;
 203-6               (21)  to appoint officers, agents, and employees, to
 203-7   prescribe their duties and to set their compensation;
 203-8               (22)  to make contracts and execute instruments
 203-9   necessary or convenient to the exercise of the powers, rights,
203-10   privileges, and functions conferred on the authority by this
203-11   chapter or general law for such term and with such provisions as
203-12   the board determines to be in the best interests of the authority
203-13   (including contracts with the state and the United States, and any
203-14   corporation or agency of either the state or the United States, and
203-15   districts, cities, towns, persons, organizations, associations,
203-16   firms, corporations, entities, or others, as the board determines
203-17   necessary or proper for or in connection with any corporate
203-18   purpose) to provide for the construction, acquisition, ownership,
203-19   financing, operation, maintenance, sale, leasing to or from, or
203-20   other use or disposition of any facilities authorized to be
203-21   developed, preserved, conserved, acquired, or constructed under
203-22   this chapter or general law, including any improvements,
203-23   structures, facilities, and equipment and all other property of any
203-24   kind in connection with such improvements, structures, facilities,
203-25   and equipment and any lands, leaseholds, and easements and any
203-26   interests in any of the property described by this subdivision;
 204-1               (23)  to authorize and allow any of the persons
 204-2   described by Subdivision (22), including the state and the United
 204-3   States, and any corporation or agency of either the state or the
 204-4   United States, and districts, agencies, cities, towns, persons,
 204-5   organizations, associations, firms, corporations, entities, or
 204-6   others, to participate with the authority in the joint
 204-7   construction, acquisition, ownership, financing, operation, and
 204-8   maintenance of the improvements, structures, facilities, and
 204-9   equipment described by Subdivision (22) and any other property in
204-10   connection with the improvements, structures, facilities, and
204-11   equipment and such lands, leaseholds, easements, and interests in
204-12   the improvements, structures, facilities, and equipment and the
204-13   other property as the board determines necessary or proper for or
204-14   in connection with any corporate purpose, and to allow such persons
204-15   to receive such portion of the revenues derived from projects or
204-16   property described by this subdivision as the board determines
204-17   just, equitable, and proper; and
204-18               (24)  to borrow money for its corporate purposes,
204-19   including the power to borrow money and accept grants from persons,
204-20   including the state and the United States or any corporation or
204-21   agency created or designated by the state or the United States,
204-22   and, in connection with any such loan or grant, to enter into such
204-23   agreements as the state or the United States or the corporations or
204-24   agency may require; and to make and issue negotiable bonds or notes
204-25   for funds borrowed, in the manner and to the extent provided in
204-26   this chapter, and to refund or refinance any outstanding bonds or
 205-1   notes and to make and issue negotiable bonds or notes for that
 205-2   purpose in the manner and to the extent provided in this chapter.
 205-3         (b)  Nothing in this chapter shall be construed to authorize
 205-4   the issuance of any bonds, notes, or other evidences of
 205-5   indebtedness of the authority except as specifically provided in
 205-6   this chapter, and no issuance of bonds, notes, or other evidences
 205-7   of indebtedness of the authority shall ever be authorized except by
 205-8   this chapter or general law.
 205-9         (c)  Nothing in this chapter shall be construed as conferring
205-10   any water rights on the authority or as setting any priority of
205-11   rights.  The authority shall obtain its water rights by application
205-12   to and permit from the commission as provided by general law, and
205-13   nothing in this chapter shall be construed as authorizing the
205-14   authority to make any regulation of the withdrawal of groundwater.
205-15         (d)  To the extent the provisions of general law that are
205-16   adopted by reference in this chapter may be in conflict with the
205-17   express provisions of this chapter, the provisions of this chapter
205-18   shall prevail unless the general law is made cumulative.  The
205-19   rights, powers, privileges, authority, and functions granted to the
205-20   authority under this chapter, and the authority itself, are subject
205-21   to Chapters 11, 12, 17, and 26.
205-22         Sec. 258.005.  CONTINUING OVERSIGHT.  The powers and duties
205-23   of the authority as provided by this chapter are subject to the
205-24   continuing rights of oversight by the state.  The oversight shall
205-25   be exercised through the commission.  The commission shall be
205-26   charged with the authority and duty to approve, or to refuse to
 206-1   approve, the adequacy of any plan or plans for flood control or
 206-2   conservation improvement purposes devised by the authority for the
 206-3   achievement of the plans and purposes intended in the creation of
 206-4   the authority and which plans contemplate improvements supervised
 206-5   by the state authorities under the provisions of general law,
 206-6   excluding federal projects.  Nothing in this section affects the
 206-7   commission's permitting authority.
 206-8         Sec. 258.006.  BOARD OF DIRECTORS; COMPENSATION; VOTING
 206-9   REQUIREMENTS.  (a)  The powers, rights, privileges, and functions
206-10   of the authority shall be exercised by a board, which shall consist
206-11   of nine directors.  The board is a state board of a state agency as
206-12   contemplated by Section 30a, Article XVI, Texas Constitution.
206-13         (b)  Each member of the board must be a freehold property
206-14   taxpayer of the state and must reside in one of the counties
206-15   included within the boundaries of the authority, but only one
206-16   director shall be appointed from any county.
206-17         (c)  The directors are appointed by the governor.  The
206-18   appointments are subject to confirmation by the senate.
206-19         (d)  Directors serve for staggered terms of six years with
206-20   the terms of one-third of the directors expiring February 1 of each
206-21   odd-numbered year.  Each director shall hold office until the
206-22   expiration of the term for which the director was appointed and
206-23   until a successor is appointed and has qualified, unless removed
206-24   sooner as provided by this chapter.
206-25         (e)  A director may be removed by the governor for
206-26   inefficiency, neglect of duty, or misconduct in office, after at
 207-1   least 10 days' written notice of the charges and an opportunity to
 207-2   be heard in person or by counsel at a public hearing.  A vacancy
 207-3   resulting from the death, resignation or removal of a director is
 207-4   filled for the unexpired term by the governor.
 207-5         (f)  Each director shall qualify by taking the official oath
 207-6   of office prescribed by general statute.
 207-7         (g)  Each director is entitled to receive $100 per day, or
 207-8   such amount as may be prescribed by general law, for each day spent
 207-9   in attending meetings of the board and any other business of the
207-10   authority that the board determines necessary, plus actual
207-11   traveling and other expenses.
207-12         (h)  Until the adoption of bylaws setting the time and place
207-13   of regular meetings and the manner in which special meetings may be
207-14   called, meetings of the board shall be held at such times and
207-15   places as five of the directors may designate in writing.
207-16         (i)  Five directors constitute a quorum at any meeting and,
207-17   except as otherwise provided in this chapter or in the bylaws, all
207-18   action may be taken by the affirmative vote of a majority of the
207-19   directors present at any such meeting, except that no contract that
207-20   involves an amount greater than $25,000 or that is to run for a
207-21   period longer than a year, and no bonds, notes, or other evidence
207-22   of indebtedness, and no amendment of the bylaws shall be valid
207-23   unless authorized or ratified by the affirmative vote of at least
207-24   five directors.
207-25         Sec. 258.007.  OFFICERS, AGENTS, AND EMPLOYEES.  (a)  The
207-26   board shall select a secretary, who shall keep true and complete
 208-1   records of all proceedings of the board.  Until the appointment of
 208-2   a secretary, or in the event of the secretary's absence or
 208-3   inability to act, a secretary pro tempore shall be selected by the
 208-4   board.
 208-5         (b)  The board shall select a general manager, who shall be
 208-6   the chief executive officer of the authority, and a treasurer.
 208-7         (c)  The officers shall have such powers and duties, shall
 208-8   hold office for such term, and shall be subject to removal in such
 208-9   manner as may be provided in the bylaws of the authority.  The
208-10   board shall set the compensation of the officers.
208-11         (d)  The board may appoint such officers, agents, and
208-12   employees, may set their compensation and term of office and the
208-13   method by which they may be removed, and may delegate to them the
208-14   power and duties the board considers appropriate.
208-15         Sec. 258.008.  AUTHORITY FUNDS; SURETY BONDS.  (a)  The funds
208-16   of the authority may be disbursed only on checks, drafts, orders,
208-17   or other instruments signed by the persons authorized to sign those
208-18   instruments by the bylaws or by a resolution concurred in by not
208-19   less than five directors.
208-20         (b)  The general manager, the treasurer, and all other
208-21   officers, agents, and employees of the authority charged with the
208-22   collection, custody, or payment of any funds of the authority shall
208-23   give bond conditioned on the faithful performance of the person's
208-24   duties and an accounting of all funds and property of the authority
208-25   coming into the person's hands.  The bonds shall be in a form and
208-26   an amount and with a surety company authorized to do business in
 209-1   the state approved by the board.  The premiums on the bonds shall
 209-2   be paid by the authority and charged as an operating expense.
 209-3         Sec. 258.009.  AUTHORITY OFFICE; ACCOUNTS; RECORDS; AUDIT.
 209-4   (a)  The domicile of the authority shall be in the City of New
 209-5   Braunfels, Comal County, where the authority shall maintain an
 209-6   office, in charge of its general manager.
 209-7         (b)  The authority shall keep complete and accurate accounts
 209-8   conforming to approved methods of accounting principles.
 209-9         (c)  The accounts and all contracts, documents, and records
209-10   of the authority shall be kept at an official office of the
209-11   authority.  The accounts and contracts shall be open to public
209-12   inspection at all reasonable times.
209-13         (d)  The board shall have an audit made of the books of
209-14   account and financial records of the authority for each fiscal
209-15   year.
209-16         (e)  The audit required under Subsection (d) must be:
209-17               (1)  completed not later than the 90th day after the
209-18   last day of each fiscal year; and
209-19               (2)  conducted by the state auditor, an independent
209-20   certified public accountant, or a firm of certified public
209-21   accountants.
209-22         (f)  Copies of a written report of the audit required under
209-23   Subsection (d), certified to by the accountant or accountants,
209-24   shall be placed and kept on file with the commission, with the
209-25   comptroller, and at the official office and shall be open to public
209-26   inspection at all reasonable times.
 210-1         Sec. 258.010.  CONFLICT OF INTEREST.  The provisions of
 210-2   Chapter 171, Local Government Code, apply to conflicts of interest
 210-3   in the award of authority contracts.
 210-4         Sec. 258.011.  RATES AND CHARGES.  (a)  The board shall
 210-5   establish and collect rates and other charges for the sale or use
 210-6   of water, water connections, power, electric energy, and all other
 210-7   services sold, furnished, or supplied by the authority.  The fees
 210-8   and charges shall be reasonable and nondiscriminatory and
 210-9   sufficient to produce revenues adequate to:
210-10               (1)  pay all expenses necessary to the operation and
210-11   maintenance and replacements and additions to the properties and
210-12   facilities of the authority;
210-13               (2)  pay the interest on, the principal of, and the
210-14   premium, if any, on all bonds issued under this chapter when and as
210-15   the interest, principal, and premium become due and payable;
210-16               (3)  pay all sinking fund and reserve fund payments
210-17   agreed to be made with respect to bonds and payable out of the
210-18   revenues, when and as the payments become due and payable;
210-19               (4)  fulfill the terms of agreements made with the
210-20   holders of bonds or with a person in their behalf; and
210-21               (5)  discharge all other lawful obligations of the
210-22   authority as the obligations become due.
210-23         (b)  From the revenues received in excess of those required
210-24   for the purposes provided in Subsections (a)(1)-(3) and (5), the
210-25   board may establish a reasonable depreciation and emergency fund,
210-26   may retire, by purchase and cancellation or redemption, bonds
 211-1   issued under this chapter, or may apply the excess revenues to any
 211-2   corporate purpose.
 211-3         (c)  The rates and charges of the authority shall not be in
 211-4   excess of what is necessary to fulfill the obligations imposed on
 211-5   the authority by this chapter.  Nothing in this chapter shall be
 211-6   construed as depriving the state of its power to regulate and
 211-7   control fees or charges to be collected for the use of water, water
 211-8   connections, power, electric energy, or other service, provided
 211-9   that the state pledges to and agrees with the purchasers and
211-10   successive holders of bonds issued under this chapter that the
211-11   state will not limit or alter the power vested in the authority by
211-12   this chapter to establish and collect such fees and charges as will
211-13   produce revenues sufficient to pay the items specified in
211-14   Subsection (a) or in any way impair the rights or remedies of the
211-15   holders of the bonds, or of any person in their behalf, until the
211-16   bonds, together with the interest on the bonds and any premium,
211-17   along with interest on unpaid installments of interest and all
211-18   costs and expenses in connection with an action or proceeding by or
211-19   on behalf of the bondholders and all other obligations of the
211-20   authority in connection with the bonds, are fully met and
211-21   discharged.
211-22         (d)  If the authority enters into agreements to lease, sell,
211-23   or otherwise dispose of any property or facilities to any person,
211-24   the person shall be subject to such regulations and control of fees
211-25   and charges by the state as may be provided by agreement or general
211-26   law, but the board shall set payments under the leases or other
 212-1   contracts and agreements for the use or sale of any property in
 212-2   order that the payments, together with any other pledged revenues,
 212-3   will be sufficient to pay the interest on, the principal of, and
 212-4   any premium on all bonds to which the payments are pledged when and
 212-5   as the interest, principal, and premium become due and payable; to
 212-6   pay all sinking fund and reserve fund payments agreed to be made
 212-7   with respect to the bonds and payable out of such payments, when
 212-8   and as the payments become due and payable; and to fulfill the
 212-9   terms of any agreement made with the holders of the bonds or any
212-10   person in their behalf and to discharge all other obligations of
212-11   the authority in connection with the bonds as and when the
212-12   obligations become due.
212-13         Sec. 258.012.  PAYMENT OF DEBTS.  Each indebtedness,
212-14   liability, or obligation of the authority for the payment of money,
212-15   however entered into or incurred and whether arising from contract,
212-16   implied contract, or otherwise, shall be payable:
212-17               (1)  out of the revenues received by the authority with
212-18   respect to its properties, subject to any prior lien on the
212-19   revenues conferred by resolution authorizing the issuance of bonds
212-20   adopted as provided by this chapter; or
212-21               (2)  if the board so determines, out of the proceeds of
212-22   sale by the authority of bonds payable solely from revenues.
212-23         Sec. 258.013.  ISSUANCE OF BONDS.  (a)  The authority may
212-24   issue bonds or notes as provided in this section for any corporate
212-25   purpose.  Bonds or notes, hereinafter called "bonds," may be:
212-26               (1)  sold for cash, at public or private sale, at a
 213-1   price the board determines, provided that the interest cost of the
 213-2   money received for the bonds, computed to maturity, does not exceed
 213-3   the maximum per annum rate authorized by Chapter 1204, Government
 213-4   Code;
 213-5               (2)  issued on terms the board determines in exchange
 213-6   for property of any kind, real, personal, or mixed, or an interest
 213-7   in property that the board determines necessary or convenient for
 213-8   any corporate purpose; or
 213-9               (3)  issued in exchange for like principal amounts of
213-10   other obligations of the authority, matured or unmatured.
213-11         (b)  The proceeds from the sale of bonds shall be deposited
213-12   in a bank or banks or a trust company or trust companies, and shall
213-13   be paid out pursuant to terms and conditions agreed between the
213-14   authority and the purchasers of the bonds.  Bonds shall be
213-15   authorized by a resolution or resolutions of the board concurred in
213-16   by at least five members.  Bonds shall bear such date or dates;
213-17   mature at such time or times; bear interest at such rate or rates,
213-18   which may be fixed, variable, floating, or otherwise, not exceeding
213-19   the maximum rate authorized by Chapter 1204, Government Code,
213-20   payable annually, semiannually, or otherwise; be in such
213-21   denominations; be in such form, either coupon or registered; carry
213-22   such registration privileges as to principal only or as to both
213-23   principal and interest and as to exchange of coupon bonds for
213-24   registered bonds or vice versa and exchange of bonds of one
213-25   denomination for bonds of other denominations; be executed in such
213-26   manner; and be payable at such place or places within or outside
 214-1   the state, as such resolution or resolutions may provide.
 214-2         (c)  A resolution or resolutions authorizing bonds may
 214-3   contain provisions, which shall be part of the contract between the
 214-4   authority and the initial and successive holders of the bonds:
 214-5               (1)  reserving the right to redeem the bonds or
 214-6   requiring the redemption of the bonds, at such time or times, in
 214-7   such amounts, and at such prices, not exceeding 105 percent of the
 214-8   principal amount of the bonds plus accrued interest, as may be
 214-9   provided in the resolution;
214-10               (2)  providing for the setting aside of sinking funds
214-11   or reserve funds and the regulation and disposition of those funds;
214-12               (3)  pledging, to secure the payment of the principal
214-13   of and interest on the bonds and of the sinking fund or reserve
214-14   fund payments agreed to be made with respect to the bonds, all or
214-15   any part of the gross or net revenues received by the authority
214-16   with respect to the property, real, personal, or mixed, to be
214-17   acquired or constructed with the bonds or the proceeds of the
214-18   bonds, or all or part of the gross or net revenues received by the
214-19   authority from any source;
214-20               (4)  prescribing the purposes to which the bonds or
214-21   bonds later issued, or the proceeds of the bonds, may be applied;
214-22               (5)  agreeing to set and collect rates and charges
214-23   sufficient to produce revenues adequate to pay the items specified
214-24   in Section 258.011(a) and prescribing the use and disposition of
214-25   all revenues;
214-26               (6)  prescribing limitations on the issuance of
 215-1   additional bonds and subordinate lien bonds and on the agreements
 215-2   that may be made with the purchasers and successive holders of the
 215-3   bonds;
 215-4               (7)  relating to the construction, extension,
 215-5   improvement, reconstruction, operation, maintenance, and repair of
 215-6   the properties of the authority and the carrying of insurance on
 215-7   all or part of the properties covering loss or damage or loss of
 215-8   use and occupancy resulting from specified risks;
 215-9               (8)  setting the procedure, if any, by which, if the
215-10   authority so desires, the terms of a contract with the holders of
215-11   the bonds may be amended or abrogated, the amount of bonds whose
215-12   holders must consent to the amendment or abrogation, and the manner
215-13   in which the consent may be given;
215-14               (9)  providing for the execution and delivery by the
215-15   authority to a bank or trust company authorized by law to accept
215-16   trusts, or to the United States or any officer or agency of the
215-17   United States, of indentures and agreements for the benefit of the
215-18   holders of the bonds setting forth any or all of the agreements
215-19   authorized by this section to be made with or for the benefit of
215-20   the holders of such bonds, and any other provisions that may be
215-21   customary in such indentures or agreements; and
215-22               (10)  making other provisions, not inconsistent with
215-23   the provisions of this chapter, as the board may approve.
215-24         Sec. 258.014.  DEFAULT PROCEDURES.  (a)  A resolution
215-25   authorizing the issuance of bonds and any indenture or agreement
215-26   entered into pursuant to the resolution may include provisions
 216-1   regarding a default on:
 216-2               (1)  the payment of the interest on any bonds as the
 216-3   interest becomes due and payable;
 216-4               (2)  the payment of the principal of any bonds as they
 216-5   become due and payable, whether at maturity, by call for
 216-6   redemption, or otherwise; or
 216-7               (3)  the performance of an agreement made with the
 216-8   purchasers or successive holders of any bonds.
 216-9         (b)  If a default described by Subsection (a) has occurred
216-10   and has continued for the period, if any, prescribed by the
216-11   resolution authorizing the issuance of the bonds, the trustee under
216-12   the indenture or indentures entered into with respect to the bonds
216-13   authorized by the resolution or resolutions, or, if there is no
216-14   indenture, a trustee appointed in the manner provided in the
216-15   resolution or resolutions by the holders of 25 percent in aggregate
216-16   principal amount of the bonds authorized by the resolution or
216-17   resolutions and then outstanding, and on the written request of
216-18   those bondholders, shall, in the trustee's own name but for the
216-19   equal and proportionate benefit of the holders of all the bonds,
216-20   and with or without having possession of the bonds:
216-21               (1)  by mandamus or other suit, action, or proceeding
216-22   at law or in equity, enforce all rights of the holders of the
216-23   bonds;
216-24               (2)  bring suit on the bonds or the appurtenant
216-25   coupons;
216-26               (3)  by action or suit in equity, require the authority
 217-1   to account as if it were the trustee of an express trust for the
 217-2   bondholders;
 217-3               (4)  by action or suit in equity, enjoin any acts or
 217-4   things which may be unlawful or in violation of the rights of the
 217-5   holders of the bonds; or
 217-6               (5)  after such notice to the authority as the
 217-7   resolution may provide, declare the principal of all of the bonds
 217-8   due and payable, and if all defaults have been made good, then with
 217-9   the written consent of the holders of 25 percent in aggregate
217-10   principal amount of the bonds then outstanding, annul the
217-11   declaration and its consequences; provided, however, that the
217-12   holders of more than a majority in principal amount of the bonds
217-13   authorized by the resolution and then outstanding shall, by written
217-14   instrument delivered to the trustee, have the right to direct and
217-15   control all action taken or to be taken by the trustee under this
217-16   section.
217-17         (c)  A resolution, indenture, or agreement relating to bonds
217-18   may provide that in a suit, action, or proceeding under this
217-19   section, the trustee, whether or not all of the bonds have been
217-20   declared due and payable and with or without possession of any of
217-21   the bonds, shall be entitled as of right to the appointment of a
217-22   receiver who may enter and take possession of all or any part of
217-23   the properties of the authority and operate and maintain the
217-24   properties and set, collect, and receive rates and charges
217-25   sufficient to provide revenues adequate to pay the items set forth
217-26   in Section 258.011(a) and the costs and disbursements of the suit,
 218-1   action, or proceeding and apply such revenues in conformity with
 218-2   the provisions of this chapter and the resolution or resolutions
 218-3   authorizing the bonds.
 218-4         (d)  In a suit, action, or proceeding by a trustee under this
 218-5   section, the reasonable fees, counsel fees, and expenses of the
 218-6   trustee and of the receiver or receivers, if any, constitute
 218-7   taxable disbursements, and all costs and disbursements allowed by
 218-8   the court shall be a first charge on any revenues pledged to secure
 218-9   the payment of the bonds.
218-10         (e)  Subject to the provisions of the constitution, the
218-11   courts of Comal County shall have jurisdiction of any suit, action,
218-12   or proceeding under this section by a trustee on behalf of the
218-13   bondholders and of all property involved in the suit, action, or
218-14   proceeding.
218-15         (f)  In addition to the powers specifically provided by this
218-16   section, the trustee shall have and possess all powers necessary or
218-17   appropriate for the exercise of the powers specifically provided or
218-18   incident to the general representation of the bondholders in the
218-19   enforcement of their rights.
218-20         Sec. 258.015.  INTERIM BONDS.  Pending the issuance of
218-21   definitive bonds, the authority is authorized to make and issue
218-22   interim bonds.  The interim bonds will be taken up with the
218-23   proceeds of the definitive bonds, or the definitive bonds may be
218-24   issued and delivered in exchange for and in substitution of the
218-25   interim bonds.  After exchange and substitution the authority shall
218-26   file proper certificates with the comptroller as to the exchange,
 219-1   substitution, and cancellation, and the certificates shall be
 219-2   recorded by the comptroller in the same manner as the record of
 219-3   proceedings authorizing the issuance of the bonds.  The authority
 219-4   may also make and issue temporary bonds for the purpose of interim
 219-5   financing and may make agreements or other provision to refinance
 219-6   the temporary bonds with bonds to provide permanent financing at
 219-7   the time, in the manner, and on the conditions determined by the
 219-8   board.
 219-9         Sec. 258.016.  APPROVAL BY ATTORNEY GENERAL.  (a)  Before any
219-10   bonds may be sold by the authority, a certified copy of the
219-11   proceedings for the issuance of the bonds, including the form of
219-12   the bonds, together with any other information which the attorney
219-13   general may require, shall be submitted to the attorney general.
219-14   If the attorney general finds that the bonds have been issued in
219-15   accordance with law, the attorney general shall approve the bonds
219-16   and execute a certificate to that effect, which shall be filed in
219-17   the office of the comptroller and be recorded in a record kept for
219-18   that purpose.  The comptroller shall register the bonds if the
219-19   attorney general has filed with the comptroller his certificate
219-20   approving the bonds and the proceedings for the issuance of the
219-21   bonds as provided in this section.  No bonds shall be issued until
219-22   the bonds have been registered by the comptroller.
219-23         (b)  Bonds approved by the attorney general and registered by
219-24   the comptroller are valid and binding obligations of the authority
219-25   and are incontestable for any cause after their registration.
219-26         (c)  If bonds recite that they are secured by a pledge of the
 220-1   proceeds of a contract, lease, sale, or other agreement, herein
 220-2   called "contract," a copy of the contract and the proceedings of
 220-3   the contracting parties shall also be submitted to the attorney
 220-4   general.  If the bonds have been authorized and the contracts made
 220-5   in compliance with law, the attorney general shall approve the
 220-6   bonds and contracts, and the bonds shall then be registered by the
 220-7   comptroller.  When so approved, the bonds and the contracts are
 220-8   valid and binding and are incontestable for any cause after their
 220-9   registration.
220-10         Sec. 258.017.  REFUNDING BONDS.  (a)  The authority may issue
220-11   bonds or notes, herein called "refunding bonds," for the purpose of
220-12   refunding or refinancing any outstanding bonds or notes, herein
220-13   called "bonds," authorized and issued by the authority pursuant to
220-14   this chapter or other law and the interest and premium, if any, on
220-15   the bonds to maturity or on any earlier redemption date specified
220-16   in the resolution authorizing the issuance of the refunding bonds.
220-17   Refunding bonds may be issued to refund more than one series of
220-18   outstanding bonds, may combine the pledges of the outstanding bonds
220-19   for the security of the refunding bonds, or may be secured by other
220-20   or additional revenues.
220-21         (b)  Provisions of this chapter with reference to the
220-22   issuance of bonds, the terms and provisions of the bonds, their
220-23   approval by the attorney general, and the remedies of the
220-24   bondholders shall be applicable to refunding bonds.  Refunding
220-25   bonds shall be registered by the comptroller on surrender and
220-26   cancellation of the bonds to be refunded, but in lieu of that
 221-1   procedure, the resolution authorizing the issuance of refunding
 221-2   bonds may provide that they shall be sold and the proceeds of the
 221-3   sale deposited at the places at which the original bonds are
 221-4   payable, in which case the refunding bonds may be issued in an
 221-5   amount sufficient to pay the interest and premium, if any, on the
 221-6   original bonds to their maturity date or specified earlier
 221-7   redemption date, and the comptroller shall register the refunding
 221-8   bonds without concurrent surrender and cancellation of the original
 221-9   bonds.  The authority may also refund any outstanding bonds in the
221-10   manner provided by any applicable general law.
221-11         Sec. 258.018.  OTHER BONDS.  If the authority issues bonds
221-12   payable in whole or in part from utility system revenues the
221-13   authority receives under a contract with a municipality, district,
221-14   river authority, or other political subdivision of the state, the
221-15   payments made under the contract are the paying party's operating
221-16   expenses for the utility system or systems from which the payments
221-17   are to be made to the authority if the contract so provides.
221-18         Sec. 258.019.  PURCHASE OF BONDS BY AUTHORITY.  The authority
221-19   may, out of funds available for the purpose, purchase bonds issued
221-20   by the authority at a price not exceeding the redemption price
221-21   applicable at the time of the purchase, or if the bonds are not
221-22   redeemable, at a price not exceeding the principal amount of the
221-23   bonds plus accrued interest.  Bonds so purchased shall be canceled,
221-24   and no bonds shall ever be issued in lieu of the canceled bonds.
221-25         Sec. 258.020.  BONDS EXEMPT FROM TAXATION.  Bonds and the
221-26   interest on the bonds issued under the provisions of this chapter
 222-1   are exempt from taxation, except for inheritance taxes, by the
 222-2   state or any municipal corporation, county, or other political
 222-3   subdivision or taxing district of the state.
 222-4         Sec. 258.021.  BONDS ELIGIBLE FOR INVESTMENTS AND DEPOSITS.
 222-5   Bonds of the authority are legal, eligible, and authorized
 222-6   investments for banks, savings and loan associations, insurance
 222-7   companies, fiduciaries, trustees, and guardians and for the sinking
 222-8   funds of cities, towns, villages, counties, school districts, or
 222-9   other political corporations or subdivisions of the state.  The
222-10   bonds are eligible to secure the deposit of all public funds of the
222-11   state and of cities, towns, villages, counties, school districts,
222-12   or other political corporations or subdivisions of the state, and
222-13   the bonds are lawful and sufficient security for such deposits to
222-14   the extent of their face value when accompanied by all unmatured
222-15   coupons.
222-16         Sec. 258.022.  CHAPTER AS FULL AUTHORITY.  This chapter,
222-17   without reference to other statutes of the state, constitutes full
222-18   authority for the authorization and issuance of bonds under this
222-19   chapter.  No other act or law with regard to the authorization or
222-20   issuance of obligations or the deposit of the proceeds of the
222-21   obligations, or in any way impeding or restricting the carrying out
222-22   of the acts authorized by this chapter, shall be construed as
222-23   applying to any proceedings or acts under this chapter.
222-24         Sec. 258.023.  ADDITIONAL SPECIFIC POWERS.  The authority may
222-25   enter into and carry out contracts or establish or comply with
222-26   rules and regulations concerning labor and materials and other
 223-1   related matters in connection with any project or projects as the
 223-2   authority deems desirable or as requested by the state, the United
 223-3   States, or any corporation or agency created, designated, or
 223-4   established by the state or the United States that may assist in
 223-5   the financing of the project or projects.
 223-6         Sec. 258.024.  PUBLIC USE OF SURPLUS LANDS OF THE AUTHORITY.
 223-7   The authority shall not prevent free public use of its surplus
 223-8   lands for recreation purposes and for hunting and fishing except at
 223-9   such point where, in the opinion of the board, the use would
223-10   interfere with the proper conduct of business.
223-11         Sec. 258.025.  LIBERAL CONSTRUCTION.  This chapter and all of
223-12   its terms and provisions shall be liberally construed to effectuate
223-13   the purposes set forth in this chapter.
223-14         Sec. 258.026.  ACT CREATING OTHER DISTRICT NOT REPEALED.
223-15   This chapter shall not be construed as repealing Chapter 75, Acts
223-16   of the 43rd Legislature, 1st Called Session, 1933, which created a
223-17   conservation and reclamation district, and the entity created under
223-18   that chapter may, by resolution of its board of directors, merge
223-19   with the authority.
223-20         Sec. 258.027.  LIMITED LIABILITY FOR AQUATIC HERBICIDE
223-21   APPLICATION.  (a)  In this section, "commercially licensed aquatic
223-22   herbicide applicator" means a person who holds a commercial
223-23   applicator license issued by the Department of Agriculture under
223-24   Chapter 76, Agriculture Code, that authorizes the application of
223-25   aquatic herbicides.
223-26         (b)  Except as provided by Chapter 12, Parks and Wildlife
 224-1   Code, an authority employee holding a noncommercial aquatic
 224-2   herbicide applicator license or a commercially licensed aquatic
 224-3   herbicide applicator working under contract with the authority is
 224-4   not liable for damages in excess of $2 million for personal injury,
 224-5   property damage, or death resulting from the application by the
 224-6   applicator of aquatic herbicide in compliance with applicable law
 224-7   and the terms of the license or permit.
 224-8                CHAPTER 259.  GULF COAST WATER AUTHORITY
 224-9         Sec. 259.001.  CREATION.  (a)  A conservation and reclamation
224-10   district to be known as the "Gulf Coast Water Authority" is
224-11   created.  The authority is a governmental agency and body politic
224-12   and corporate and a municipal corporation.
224-13         (b)  The authority is created under and is essential to
224-14   accomplish the purposes of Section 59, Article XVI, Texas
224-15   Constitution.
224-16         Sec. 259.002.  DEFINITIONS.  In this chapter:
224-17               (1)  "Authority" means the Gulf Coast Water Authority.
224-18               (2)  "Board" means the board of directors of the
224-19   authority.
224-20               (3)  "Director" means a member of the board.
224-21         Sec. 259.003.  TERRITORY.  The authority comprises all the
224-22   territory contained within Galveston County, and the boundaries of
224-23   the authority are the same as and coextensive with the boundaries
224-24   of Galveston County.
224-25         Sec. 259.004.  POWERS AND DUTIES.  (a)  Except as expressly
224-26   limited by this chapter, the authority may exercise all rights,
 225-1   powers, privileges, and authority conferred by the general laws of
 225-2   this state applicable to municipal utility districts created under
 225-3   authority of Section 59, Article XVI, Texas Constitution, including
 225-4   those conferred by Chapters 49 and 54, but to the extent that the
 225-5   provisions of such general laws may be in conflict with or
 225-6   inconsistent with the provisions of this chapter, the provisions of
 225-7   this chapter prevail.  All such general laws are adopted and
 225-8   incorporated by reference with the same effect as if incorporated
 225-9   in full in this chapter.
225-10         (b)  The authority may make, construct, or otherwise acquire
225-11   improvements, either within or outside the boundaries of the
225-12   authority, necessary to carry out the powers and authority granted
225-13   by this chapter and general law and may exercise the power of
225-14   eminent domain for such purposes; provided, however, that the
225-15   authority shall not have the power of eminent domain as to all or
225-16   any part of the water supply, property, works, or facilities of any
225-17   private person or persons or of any private or public corporation
225-18   or  association engaged in the business of supplying water in
225-19   Galveston County to any class of consumers for any use on June 18,
225-20   1965.  This subsection does not restrict the power of the authority
225-21   to acquire necessary crossing easements and rights-of-way.
225-22         (c)  The authority may conserve, store, transport, treat and
225-23   purify, distribute, sell, and deliver water, both surface water and
225-24   groundwater, to persons, corporations, both public and private,
225-25   political subdivisions of the state, and others and may purchase,
225-26   construct, or lease all property, works, and facilities, both
 226-1   within and outside the authority, necessary or useful for such
 226-2   purposes.
 226-3         (d)  The authority may acquire water supplies from sources
 226-4   within or outside the boundaries of the authority, may sell,
 226-5   transport, and deliver water to customers within or outside the
 226-6   authority, and may acquire all properties and facilities necessary
 226-7   or useful for such purposes.  For any or all of such purposes the
 226-8   authority may enter into contracts with persons, corporations, both
 226-9   public and private, and political subdivisions of the state for
226-10   such periods and on such terms and conditions as the board may
226-11   consider appropriate.
226-12         (e)  Subject to the provisions of this chapter, the authority
226-13   may sell, lease, or exchange property of any kind, or any interest
226-14   in property, that is not necessary to the carrying on of the
226-15   business of the authority or whose sale, lease, or exchange, in the
226-16   judgment of the board, is necessary for the exercise of the powers,
226-17   rights, privileges, and functions conferred on the authority by
226-18   this chapter or by Chapters 49 and 54.
226-19         (f)  Subject to the provisions of this chapter, the authority
226-20   may acquire by purchase, lease, gift, or otherwise and may
226-21   maintain, use, and operate any property of any kind, or any
226-22   interest in property, within or outside the boundaries of the
226-23   authority, necessary to the exercise of the powers, rights,
226-24   privileges, and functions conferred on the authority by this
226-25   chapter or by Chapters 49 and 54.
226-26         (g)  The authority may construct, extend, improve, maintain,
 227-1   and reconstruct, cause to be constructed, extended, improved,
 227-2   maintained, and reconstructed, and use and operate facilities of
 227-3   any kind necessary to the exercise of its powers, rights,
 227-4   privileges, and functions.
 227-5         (h)  The authority may sue and be sued in its corporate name.
 227-6         (i)  The authority may adopt, use, and alter a corporate
 227-7   seal.
 227-8         (j)  The authority may invest and reinvest its funds.
 227-9         (k)  The authority may make bylaws for management and
227-10   regulation of its affairs.
227-11         (l)  The authority may appoint officers, agents, and
227-12   employees and may prescribe their duties and fix their
227-13   compensation.
227-14         (m)  The authority may make contracts and execute instruments
227-15   necessary to the exercise of the powers, rights, privileges, and
227-16   functions conferred by this chapter or Chapters 49 and 54 for such
227-17   term and with such provisions as the board may determine to be in
227-18   the best interests of the authority, including contracts with
227-19   persons including the state, the United States, and any corporation
227-20   or agency of the state or the United States and districts, cities,
227-21   towns, persons, organizations, firms, corporations, or other
227-22   entities as the board considers necessary or proper for or in
227-23   connection with any of its corporate purposes.
227-24         (n)  The authority may borrow money for its corporate
227-25   purposes and may borrow money and accept grants from persons,
227-26   including the state, the United States, or any corporation, agency,
 228-1   or entity created or designated by the state or the United States,
 228-2   and in connection with any such loan or grant may enter into such
 228-3   agreements as the state, the United States, or any such
 228-4   corporation, agency, or entity may require.  The authority may
 228-5   issue negotiable bonds or notes for money borrowed, in the manner
 228-6   and to the extent provided in this chapter, and may refund or
 228-7   refinance any outstanding bonds or notes and make and issue
 228-8   negotiable bonds or notes for that purpose in the manner provided
 228-9   by this chapter.
228-10         Sec. 259.005.  LIMITATIONS ON AUTHORITY.  (a)  The authority
228-11   may not levy and collect taxes on any property, real, personal, or
228-12   mixed, within the boundaries of the authority and may not issue
228-13   bonds or create indebtedness that would in any way be payable from
228-14   ad valorem taxes levied by the authority on property within the
228-15   authority.
228-16         (b)  The authority shall have none of the powers conferred by
228-17   general law for the purposes of the collection, transportation,
228-18   processing, disposal, and control of domestic, industrial, or
228-19   communal wastes and the gathering, conducting, directing, and
228-20   controlling of local storm waters or other local harmful excesses
228-21   of water.
228-22         (c)  Nothing in this chapter shall be construed as impairing
228-23   or affecting the powers, authority, rights, or duties of any
228-24   municipal corporation or conservation and reclamation district
228-25   previously or subsequently created within, or partially within, the
228-26   boundaries of the authority or as requiring any such corporation or
 229-1   district to contract with the authority for its water supply.
 229-2         (d)  If the authority in the exercise of the power of eminent
 229-3   domain or power of relocation or any other power granted under this
 229-4   chapter makes necessary the relocation, raising, rerouting,
 229-5   changing the grade, or altering the construction of any highway,
 229-6   railroad, electric transmission line, telephone or telegraph
 229-7   properties and facilities, or pipeline, all such necessary
 229-8   relocation, raising, rerouting, changing the grade, or alteration
 229-9   of construction shall be accomplished at the sole expense of the
229-10   authority.  In this subsection "sole expense" means the actual cost
229-11   of relocation, raising, rerouting, changing the grade, or
229-12   alteration of construction in providing comparable replacement
229-13   without enhancement of the facilities after deducting the net
229-14   salvage value derived from the old facility.
229-15         (e)  Nothing in this chapter shall be construed as conferring
229-16   any water rights on the authority or as setting any priority of
229-17   rights.
229-18         (f)  Nothing in this chapter shall be construed as
229-19   authorizing the authority to make any regulation of the withdrawal
229-20   of groundwater.
229-21         (g)  The powers, rights, privileges, and functions conferred
229-22   on the authority shall be subject to the continuing rights of
229-23   supervision by the state, which shall be exercised by the
229-24   commission.  Notwithstanding any provision in Chapter 49 to the
229-25   contrary, the authority shall not be required to submit its
229-26   projects or bonds for approval or supervision by the commission.
 230-1         Sec. 259.006.  BOARD OF DIRECTORS.  (a)  The management and
 230-2   control of the authority is vested in a board of seven directors.
 230-3   The membership of the board must represent the geographic and
 230-4   ethnic diversity of the county.  Three of the members appointed by
 230-5   the commissioners court must be registered professional engineers
 230-6   under the laws of Texas.  Vacancies on the board, whether by death,
 230-7   resignation, or termination of the term of office, are filled by
 230-8   appointment by the commissioners court of Galveston County.  All
 230-9   terms of office are for a period of two years.  Terms are
230-10   staggered, with the terms of three directors expiring one year and
230-11   the terms of four directors expiring the next year.
230-12         (b)  One director shall be appointed by the commissioners
230-13   court of Galveston County on the recommendation of the city council
230-14   of the City of Galveston.  The remaining six directors shall be
230-15   appointed by the commissioners court of Galveston County, with two
230-16   of the directors appointed at large and the remaining four
230-17   directors appointed on the written recommendation of advisory
230-18   committees appointed by the board.  Two directors shall be
230-19   recommended by the Mainland Municipal Advisory Committee and two
230-20   directors by the Industrial Advisory Committee.  The commissioners
230-21   court of Galveston County is entitled to accept or reject the
230-22   recommendations made to the court by the advisory committees.  If a
230-23   recommendation made by an advisory committee is rejected, the
230-24   advisory committee shall submit additional recommendations to the
230-25   court.
230-26         (c)  The Industrial Advisory Committee is composed of one
 231-1   representative of each industrial customer of the authority.  The
 231-2   Mainland Municipal Advisory Committee is composed of one
 231-3   representative of each municipal or water district customer of the
 231-4   authority that uses at least 2 million gallons of water per day.
 231-5   The names of the representatives of each of the committees shall be
 231-6   submitted to the board by the respective industrial and municipal
 231-7   or water district customers.  The board shall submit the names of
 231-8   the advisory committee members to the commissioners court of
 231-9   Galveston County, which shall record the names in the minutes of
231-10   the court.
231-11         Sec. 259.007.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
231-12   DEPOSITS.  The bonds of the authority are legal and authorized
231-13   investments for banks, savings banks, trust companies, building and
231-14   loan associations, savings and loan associations, insurance
231-15   companies, fiduciaries, and trustees and for the sinking funds of
231-16   cities, towns, villages, counties, school districts, or other
231-17   political corporations or subdivisions of the state.  The bonds are
231-18   eligible to secure the deposit of all public funds of the state and
231-19   all public funds of cities, towns, villages, counties, school
231-20   districts, or other political corporations or subdivisions of the
231-21   state, and the bonds shall be lawful and sufficient security for
231-22   such deposits to the extent of their value when accompanied by all
231-23   unmatured coupons.
231-24         Sec. 259.008.  ISSUANCE OF BONDS.  (a)  The authority may
231-25   issue, from time to time, bonds as authorized by this chapter for
231-26   any corporate purpose.  The bonds may be:
 232-1               (1)  sold for cash, at public or private sale, at such
 232-2   price or prices as the board determines, provided that the net
 232-3   effective interest rate, calculated in accordance with Chapter
 232-4   1204, Government Code, does not exceed 10 percent;
 232-5               (2)  issued on such terms as the board determines in
 232-6   exchange for property of any kind, real, personal, or mixed, or any
 232-7   interest in property, that the board determines necessary for any
 232-8   corporate purpose; or
 232-9               (3)  issued in exchange for like principal amounts of
232-10   other obligations of the authority, matured or unmatured.
232-11         (b)  The proceeds of the sale of bonds shall be deposited in
232-12   such bank or banks or trust company or trust companies, and shall
232-13   be paid out pursuant to such terms and conditions, as may be agreed
232-14   between the authority and the purchasers of the bonds.
232-15         (c)  Bonds of the authority must be authorized by resolution
232-16   of the board and shall bear such date or dates, mature at such time
232-17   or times, bear interest payable annually, semiannually, or
232-18   otherwise, be in such denominations, be in such form, either coupon
232-19   or registered, carry such registration privileges as to principal
232-20   only or as to both principal and interest and as to exchange of
232-21   coupon bonds for registered bonds, or vice versa, and exchange of
232-22   bonds of one denomination for bonds of other denominations, be
232-23   executed in such manner and be payable at such place or places,
232-24   within or outside the state, as the resolution may provide.
232-25         (d)  A resolution authorizing bonds may contain provisions,
232-26   which shall be part of the contract between the authority and the
 233-1   purchasers or successive holders of the bonds:
 233-2               (1)  reserving the right to redeem the bonds or
 233-3   requiring the redemption of the bonds, at such time or times, in
 233-4   such amounts, and at such prices, not exceeding 105 percent of the
 233-5   principal amount of the bonds, plus accrued interest, as may be
 233-6   provided;
 233-7               (2)  providing for the setting aside of sinking funds
 233-8   or reserve funds and the regulation and disposition of those funds;
 233-9               (3)  pledging, to secure the payment of the principal
233-10   of and interest on the bonds and of the sinking fund or reserve
233-11   fund payments agreed to be made with respect to the bonds, all or
233-12   any part of the gross or net revenues received by the authority
233-13   with respect to the property, real, personal, or mixed, to be
233-14   acquired or constructed with the bonds or the proceeds of the
233-15   bonds, or all or part of the gross or net revenues received by the
233-16   authority from whatever source derived;
233-17               (4)  prescribing the purposes to which the bonds or any
233-18   bonds to be issued later, or the proceeds of bonds, may be applied;
233-19               (5)  agreeing to set and collect rates and charges
233-20   sufficient to produce revenues adequate to pay (A) all expenses
233-21   necessary to the operation and maintenance and replacements and
233-22   additions to the properties and facilities of the authority; (B)
233-23   the principal of and the interest and premium, if any, on bonds
233-24   issued under this chapter as the bonds, interest, and premiums
233-25   become due and payable; (C) all sinking fund and reserve fund
233-26   payments agreed to be made with respect to the bonds out of such
 234-1   revenues as the payments become due and payable, and agreeing to
 234-2   fulfill the terms of any agreements made with the holders of the
 234-3   bonds or with any person on their behalf and to discharge all other
 234-4   lawful obligations of the authority as and when they become due;
 234-5               (6)  prescribing limitations on the issuance of
 234-6   additional bonds and subordinate lien bonds and on the agreements
 234-7   that may be made with the purchasers and successive holders of such
 234-8   bonds;
 234-9               (7)  relating to the construction, extension,
234-10   improvement, reconstruction, operation, maintenance, and repair of
234-11   the properties of the authority and carrying insurance on all or
234-12   any part of the properties covering loss or damage or loss of use
234-13   and occupancy resulting from specified risks;
234-14               (8)  setting the procedure, if any, by which, if the
234-15   authority so desires, the terms of a contract with the holders of
234-16   the bonds may be amended or abrogated, the amount of the bonds
234-17   whose holders must consent to the amendment or abrogation, and the
234-18   manner in which such consent may be given;
234-19               (9)  providing for the execution and delivery by the
234-20   authority to a bank or trust company authorized by law to accept
234-21   trusts, or to the United States or any officer or agency of the
234-22   United States, of indentures and agreements for the benefit of the
234-23   holders of the bonds and such other provisions as may be customary
234-24   in such indentures or agreements; and
234-25               (10)  making such other provisions, not inconsistent
234-26   with the provisions of this chapter, as the board may approve.
 235-1         (e)  The board may declare an emergency in the matter of
 235-2   funds not being available to pay the principal of and interest on
 235-3   bonds of the authority or to meet any other needs of the authority.
 235-4         (f)  Bond anticipation notes may bear interest at any rate or
 235-5   rates not to exceed 10 percent and must mature within one year of
 235-6   their date.  The bond anticipation notes so issued will be taken up
 235-7   with the proceeds of bonds, or the bonds may be issued and
 235-8   delivered in exchange for and in substitution of such notes.
 235-9         (g)  Before any bonds may be sold or exchanged or substituted
235-10   by the authority, a certified copy of the proceedings of the
235-11   issuance of the bonds, including the form of the bonds, together
235-12   with any other information that the attorney general may require,
235-13   shall be submitted to the attorney general for examination, and if
235-14   the attorney general finds that the bonds have been issued in
235-15   accordance with law, the attorney general shall approve the bonds
235-16   and shall execute a certificate to that effect which shall be filed
235-17   in the office of the comptroller and be recorded in a record kept
235-18   for that purpose.  Bonds may not be issued until they have been
235-19   registered by the comptroller, who shall register the bonds if the
235-20   attorney general has filed with the comptroller the certificate
235-21   approving the bonds and the proceedings for the issuance of the
235-22   bonds as provided in this subsection.
235-23         (h)  Bonds approved by the attorney general and registered by
235-24   the comptroller and issued in accordance with the proceedings so
235-25   approved are valid and binding obligations of the authority and are
235-26   incontestable for any cause from and after the time of their
 236-1   registration.
 236-2         (i)  If bonds recite that they are secured by a pledge of the
 236-3   proceeds of a contract, lease, sale, or other agreement, a copy of
 236-4   the contract and the proceedings of the contracting parties will
 236-5   also be submitted to the attorney general for examination.  If the
 236-6   bonds have been authorized and the contract made in compliance with
 236-7   law, the attorney general shall approve the bonds and contract, and
 236-8   the bonds shall then be registered by the comptroller.  When so
 236-9   approved, the bonds and the contract are valid and binding and are
236-10   incontestable for any cause from and after the time of their
236-11   registration.
236-12         (j)  The authority may issue refunding bonds for the purpose
236-13   of refunding or refinancing any outstanding bonds or notes
236-14   authorized and issued by the authority as provided by this chapter
236-15   or other law and the interest and premium, if any, on the bonds to
236-16   maturity or on any earlier redemption date specified in the
236-17   resolution authorizing the issuance of the refunding bonds.
236-18   Refunding bonds may be issued to refund more than one series of
236-19   outstanding bonds, may combine the pledges of the outstanding bonds
236-20   for the security of the refunding bonds, or may be secured by other
236-21   or additional revenues.  All provisions of this chapter with
236-22   reference to the issuance of bonds, the terms and provisions of the
236-23   bonds, their approval by the attorney general, and the remedies of
236-24   the bondholders are applicable to refunding bonds.  Refunding bonds
236-25   shall be registered by the comptroller on surrender and
236-26   cancellation of the bonds to be refunded, but in lieu of that
 237-1   procedure, the resolution authorizing the issuance of refunding
 237-2   bonds may provide that the refunding bonds shall be sold and the
 237-3   proceeds of the sale deposited at the places at which the original
 237-4   bonds are payable, in which case the refunding bonds may be issued
 237-5   in an amount sufficient to pay the interest and premium, if any, on
 237-6   the original bonds to their maturity date or specified earlier
 237-7   redemption date, and the comptroller shall register the refunding
 237-8   bonds without concurrent surrender and cancellation of the original
 237-9   bonds.  The authority may also refund any outstanding bonds in the
237-10   manner provided by any applicable general law.
237-11         (k)  All bonds issued by the authority pursuant to the
237-12   provisions of this chapter are investment securities within the
237-13   meaning of Chapter 8, Business & Commerce Code.
237-14         (l)  This chapter, without reference to other statutory
237-15   provisions, constitutes full authority for the authorization and
237-16   issuance of bonds under this chapter, and no other Act or law with
237-17   regard to the authorization or issuance of obligations or the
237-18   deposit of the proceeds of the obligations, or in any way impeding
237-19   or restricting the carrying out of the acts authorized by this
237-20   chapter, may be construed as applying to any proceedings taken
237-21   under this chapter or acts done pursuant to this chapter.
237-22         Sec. 259.009.  CHARGES, FEES, AND TOLLS.  If revenues are
237-23   pledged to the payment of bonds issued by the authority, the board
237-24   shall set, maintain, and enforce charges, fees, or tolls for
237-25   services rendered by properties and facilities, whose revenues have
237-26   been pledged, at rates and amounts at least sufficient to comply
 238-1   with and carry out the covenants and provisions contained in the
 238-2   resolution authorizing the issuance of the bonds.  The authority
 238-3   may impose a penalty for failure to pay a charge, fee, or toll when
 238-4   due.
 238-5         Sec. 259.010.  AUTHORITY DEPOSITORY.  The board shall from
 238-6   time to time by resolution designate one or more banks to serve as
 238-7   the authority's depository, and all funds of the authority shall be
 238-8   secured in the manner provided for the security of county funds.
 238-9              CHAPTER 260.  LAVACA-NAVIDAD RIVER AUTHORITY
238-10         Sec. 260.001.  CREATION.  (a)  A conservation and reclamation
238-11   district to be known as the "Lavaca-Navidad River Authority" is
238-12   created.  The authority is a governmental agency and body politic
238-13   and corporate.
238-14         (b)  The authority is created under and is essential to
238-15   accomplish the purposes of Section 59, Article XVI, Texas
238-16   Constitution.
238-17         (c)  The authority may exercise the rights, privileges, and
238-18   functions provided by Section 59, Article XVI, Texas Constitution,
238-19   and this chapter, including the control, storage, preservation, and
238-20   distribution of the storm waters, floodwaters, and the waters of
238-21   the rivers and streams of Jackson County and their tributaries for
238-22   domestic, municipal, flood control, irrigation, and other useful
238-23   purposes, the reclamation and drainage of the overflow land of
238-24   Jackson County, and the conservation of forests, and the authority
238-25   may aid in the protection and promotion of navigation on the
238-26   navigable waters by regulating the floodwaters and storm waters
 239-1   that flow into the navigable streams.
 239-2         Sec. 260.002.  DEFINITIONS.  In this chapter:
 239-3               (1)  "Authority" means the Lavaca-Navidad River
 239-4   Authority.
 239-5               (2)  "Board" means the board of directors of the
 239-6   authority.
 239-7               (3)  "Director" means a member of the board.
 239-8         Sec. 260.003.  BOUNDARIES.  The boundaries of the authority
 239-9   are coextensive with the boundaries of Jackson County and the
239-10   authority includes all of the lands and other property, both real
239-11   and personal, within the boundaries of Jackson County.
239-12         Sec. 260.004.  BOARD OF DIRECTORS; DIRECTOR BONDS.  (a)  The
239-13   management and control of the authority shall be vested in a board
239-14   consisting of nine directors.
239-15         (b)  A director must reside within the authority and must be
239-16   a freehold property taxpayer and a legal voter of the state.
239-17         (c)  The governor shall appoint the directors with the advice
239-18   and consent of the senate.
239-19         (d)  Directors serve for staggered terms of six years, with
239-20   the terms of one-third of the directors expiring on May 1 of each
239-21   odd-numbered year, and hold office until their successors are
239-22   appointed and have qualified.
239-23         (e)  The governor shall appoint three directors during the
239-24   month of April of each odd-numbered year to succeed the directors
239-25   whose terms of office are to expire on the following May 1.  If a
239-26   vacancy on the board occurs because of the resignation or death of
 240-1   a director or otherwise, the governor shall fill the vacancy for
 240-2   the unexpired term by the appointment of a successor.
 240-3         (f)  A director shall qualify by taking the official oath and
 240-4   filing a good and sufficient bond with the secretary of state in an
 240-5   amount set by resolution of the board, payable to the authority,
 240-6   and conditioned on the faithful performance of the person's
 240-7   official duties as director.
 240-8         Sec. 260.005.  BOARD MEETINGS; OFFICERS; VOTING REQUIREMENTS.
 240-9   (a)  The board shall meet at such times and places as it shall
240-10   designate and shall hold regular and special meetings as it
240-11   determines appropriate.
240-12         (b)  The board shall elect from among its members a
240-13   president, a vice president, a secretary, and a treasurer.  The
240-14   offices of secretary and treasurer may be combined into one office
240-15   of secretary-treasurer on a majority vote of the board.
240-16         (c)  Except for the original board, the officers serve for a
240-17   term of one year, and the board shall elect the officers annually
240-18   during the month of May.
240-19         (d)  Special meetings of the board may be called by the
240-20   president or by any three members.
240-21         (e)  A majority of the members of the board constitutes a
240-22   quorum to transact any and all business.  A majority vote of the
240-23   members present at any regular or special meeting is sufficient for
240-24   the adoption of any proceedings or for the taking of any official
240-25   action.
240-26         Sec. 260.006.  RECORDS; ACCOUNTS; AUTHORITY OFFICE.  (a)  The
 241-1   board shall keep complete and accurate records and accounts
 241-2   conforming to approved methods of bookkeeping and shall preserve
 241-3   its minutes, contracts, records, notices, accounts, receipts, and
 241-4   records of all kinds in a fireproof vault or safe.
 241-5         (b)  The authority shall establish and maintain an office for
 241-6   the conduct of authority business within the authority.
 241-7         Sec. 260.007.  DIRECTOR FEES.  Each director is entitled to
 241-8   receive fees of office of not more than $100 per day, or the amount
 241-9   permitted under Section 49.060, for each day served plus actual
241-10   traveling expenses, provided that the compensation and expenses are
241-11   approved by a vote of the board, and provided further that no
241-12   director receives more than $6,000 per year or the amount permitted
241-13   under Section 49.060.  Each director shall file with the secretary
241-14   a statement showing the amount due the director each month or as
241-15   soon after each month as practicable, before a check is issued for
241-16   the services and expenses.
241-17         Sec. 260.008.  CONFLICT OF INTEREST; PENALTY.  A director,
241-18   engineer, officer, or employee of the authority may not either for
241-19   the person's own self or as an agent for anyone else, benefit
241-20   directly or indirectly by reason of any sale, purchase, or contract
241-21   entered into by the board.  If a director, engineer, officer, or
241-22   employee of the authority directly or indirectly becomes interested
241-23   in a sale, purchase, or contract, the person is guilty of a
241-24   misdemeanor and on conviction entered into by the board shall be
241-25   punished by a fine not to exceed $1,000 or by confinement in the
241-26   county jail for not less than six months or more than one year, or
 242-1   by both a fine and imprisonment.
 242-2         Sec. 260.009.  SURETY BONDS.  All bonds required to be given
 242-3   by officers and employees of the authority shall be executed by a
 242-4   surety company authorized to do business in the state.  The
 242-5   authority may pay the premium on the bonds.
 242-6         Sec. 260.010.  REFERENCES TO FORMER NAME OF AUTHORITY.  In
 242-7   all laws a reference to Jackson County Flood Control District shall
 242-8   mean and be interpreted to mean Lavaca-Navidad River Authority.
 242-9   Lavaca-Navidad River Authority has all rights, powers, and duties
242-10   conferred or imposed by law on the Jackson County Flood Control
242-11   District and all rights, powers, and duties conferred by or assumed
242-12   in all contracts to which the Jackson County Flood Control District
242-13   is a party.
242-14         Sec. 260.011.  POWERS OF THE AUTHORITY.  (a)  Except as
242-15   expressly limited by this chapter, the authority may exercise all
242-16   powers, rights, privileges, and functions provided by this chapter
242-17   or conferred by general or special law on any flood control
242-18   district or districts created pursuant to, or operating under,
242-19   Section 59, Article XVI, Texas Constitution, including the power:
242-20               (1)  to acquire by gift, devise, purchase,
242-21   condemnation, or otherwise lands and rights and interests in lands
242-22   and rights and any other character of property necessary or useful
242-23   for any of the purposes provided in Section 260.001;
242-24               (2)  to lease, sell, trade, or otherwise dispose of
242-25   land or other property or rights in land or property when the land
242-26   or property or rights in land or property are no longer needed for
 243-1   the purposes provided in Section 260.001;
 243-2               (3)  to appoint a manager and other officers, agents,
 243-3   and employees, including an engineer or engineers and counsel, and
 243-4   to prescribe their duties and set their compensation;
 243-5               (4)  to authorize the authority's officers, employees,
 243-6   or agents to go on any lands lying within the authority for the
 243-7   purpose of making surveys and examining the lands in connection
 243-8   with any authority plans or projects and for any other lawful
 243-9   purpose within the scope of its authority;
243-10               (5)  to devise plans and construct works to lessen and
243-11   control floods or to reclaim lands in the authority; to prevent the
243-12   deposit of silt in navigable streams; to remove obstructions,
243-13   natural or artificial, from streams and watercourses; to regulate
243-14   the flow of surface waters and floodwaters; to provide drainage;
243-15   and to accomplish any other purpose within the scope of its
243-16   authority;
243-17               (6)  to borrow money for any of the purposes,
243-18   consistent with the constitution, provided by this chapter or by
243-19   general law; to borrow money and accept grants from the United
243-20   States, or from any corporation or agency created or designated by
243-21   the United States, and in connection with any such loan or grant to
243-22   enter into such agreements as the United States or the corporations
243-23   or agencies may require; and to make and issue negotiable bonds,
243-24   including bonds to finance capital projects, which may be tax
243-25   bonds, revenue bonds, or combination tax-revenue bonds, for such
243-26   borrowed money in the manner and to the extent provided in this
 244-1   chapter;
 244-2               (7)  to cooperate or contract with any agency or
 244-3   political subdivision of the state or any city or town within the
 244-4   boundaries of the authority with regard to surveys, the acquisition
 244-5   of land or rights-of-way, the construction or maintenance of
 244-6   projects or parts of projects, or the financing of such surveys,
 244-7   acquisitions, or construction or maintenance in connection with any
 244-8   matter within the scope of this chapter;
 244-9               (8)  to sue and be sued in its corporate name;
244-10               (9)  to adopt, use, and alter a corporate seal;
244-11               (10)  to make bylaws, rules, and regulations for the
244-12   management and regulation of the authority's affairs;
244-13               (11)  to make contracts and execute instruments
244-14   necessary or convenient to the exercise of the powers, rights,
244-15   privileges, and functions conferred on the authority by this
244-16   chapter; and
244-17               (12)  to do anything necessary or proper to carry into
244-18   effect any of the foregoing powers.
244-19         (b)  The authority may own, operate, and construct
244-20   facilities, including facilities for water supply and treatment,
244-21   wastewater treatment and distribution, solid waste, power
244-22   generation, flood monitoring, flood warning and control, water
244-23   quality protection, including non-point source pollution control
244-24   measures, and may monitor and collect data to support these
244-25   functions.
244-26         (c)  The authority may construct projects outside of its area
 245-1   of jurisdiction.
 245-2         (d)  The authority may develop and provide groundwater.
 245-3         (e)  The authority may provide for emergency communication
 245-4   support to other political subdivisions, peace officer functions
 245-5   around lakes, aquatic weed control and development, and the
 245-6   operation and maintenance of parks and recreational facilities.
 245-7         Sec. 260.012.  EMINENT DOMAIN.  (a)  If the authority, in the
 245-8   exercise of the power of eminent domain or power of relocation, or
 245-9   any other power granted under this chapter, makes necessary the
245-10   relocation, raising, rerouting, changing the grade, or altering the
245-11   construction of any highway, railroad, electric transmission line,
245-12   telephone or telegraph properties and facilities, or pipeline, all
245-13   such necessary relocation, raising, rerouting, changing the grade,
245-14   or alteration of construction shall be accomplished at the sole
245-15   expense of the authority.
245-16         (b)  The authority may not exercise the power of eminent
245-17   domain beyond the limits of Jackson County.
245-18         Sec. 260.013.  AUTHORITY DEPOSITORY.  The board shall select
245-19   a depository or depositories of the authority under the general
245-20   provisions provided by law for the selection of depositories for
245-21   counties in this state.  All checks or vouchers of the authority
245-22   shall be signed by two directors, by one director and an officer or
245-23   employee of the authority, or by two of the authority's employees
245-24   designated by the board, as may be provided in an order or
245-25   resolution adopted by the board.
245-26         Sec. 260.014.  AD VALOREM TAX.  The authority may levy and
 246-1   cause to be assessed and collected for the maintenance, operation,
 246-2   and upkeep of the authority and the facilities, properties, and
 246-3   improvements constructed or acquired by the authority an annual ad
 246-4   valorem tax not to exceed 15 cents on each $100 valuation of
 246-5   taxable property within the authority, whether real, personal,
 246-6   mixed, or otherwise, if the levying of the tax is first submitted
 246-7   to the qualified voters of the authority at an election called and
 246-8   held as provided by this chapter and the proposition is adopted by
 246-9   a majority vote of those voting at the election.  Subsequent
246-10   elections may be ordered and held for the purpose of increasing,
246-11   reducing, or abating the tax; provided, however, that the tax shall
246-12   never exceed the maximum prescribed by this section.
246-13         Sec. 260.015.  ISSUANCE OF BONDS.  (a)  For the purpose of
246-14   providing funds for any of the purposes provided by this chapter or
246-15   any other laws relating to flood control districts, the board may
246-16   issue negotiable bonds for and on behalf of the authority secured
246-17   by:
246-18               (1)  a pledge of and payable from the net revenues
246-19   derived from the operation of all or a designated part of the
246-20   improvements and facilities of the authority then in existence or
246-21   to be constructed or acquired, with the duty on the board to charge
246-22   and collect fees, tolls, and charges, while the bonds are
246-23   outstanding, sufficient to pay all maintenance and operation
246-24   expenses of the improvements and facilities, the income of which is
246-25   pledged, the interest on the bonds as it accrues, and the principal
246-26   of the bonds as it matures and to make any and all other payments
 247-1   as may be prescribed in the bond order or resolution;
 247-2               (2)  a pledge of and payable from an ad valorem tax on
 247-3   all taxable property within the authority under Section 59, Article
 247-4   XVI, Texas Constitution, with the duty on the board, each year
 247-5   while the bonds or any part of them are outstanding, to levy and
 247-6   cause to be assessed and collected a tax sufficient to pay the
 247-7   interest on the bonds as it accrues and the principal of the bonds
 247-8   as it matures; or
 247-9               (3)  a combination of the methods prescribed under
247-10   Subdivisions (1) and (2), whereby the bonds are supported and
247-11   secured by an ad valorem tax, with the duty on the board while the
247-12   bonds are outstanding, to charge and collect fees, tolls, and
247-13   charges, so that, in the manner prescribed in the bond order or
247-14   resolution, the amount of tax to be collected from time to time may
247-15   be reduced or abated to the extent that the revenues from the
247-16   operation of the improvements and facilities, whose income is
247-17   pledged, are sufficient to meet the requirements for maintenance
247-18   and operation of the improvements and facilities and to provide
247-19   funds for the bonds as prescribed in the bond order or resolution.
247-20         (b)  In this section, "net revenues" means the gross revenues
247-21   derived from the operation of the improvements and facilities of
247-22   the authority, whose income is pledged to the payment of the bonds,
247-23   less the reasonable expense of maintaining and operating the
247-24   improvements and facilities.  The maintenance and operation
247-25   expenses include necessary repair, upkeep, and insurance of the
247-26   improvements and facilities.
 248-1         (c)  In the resolution or order adopted by the board
 248-2   authorizing the issuance of bonds payable in whole or in part from
 248-3   net revenues, the board may provide for the flow of funds, the
 248-4   establishment and maintenance of an interest and sinking fund, a
 248-5   reserve fund, and other funds and may make additional covenants
 248-6   with respect to the bonds and the pledged revenues and the
 248-7   operation, maintenance, and upkeep of the improvements and
 248-8   facilities whose income is pledged, including provision for the
 248-9   leasing of all or a part of those improvements and facilities and
248-10   the use or pledge of funds derived from leases of those
248-11   improvements and facilities, as the board determines appropriate.
248-12   The resolution or order may also prohibit the further issuance of
248-13   bonds or other obligations payable from the pledged net revenues or
248-14   may reserve the right to issue additional bonds to be secured by a
248-15   pledge of and payable from the net revenues on a parity with, or
248-16   subordinate to, the lien and pledge in support of the bonds being
248-17   issued, subject to the conditions set forth in the resolution or
248-18   order.  The resolution or order may contain, within the discretion
248-19   of the board, other provisions and covenants not prohibited by the
248-20   constitution or by this chapter, and the board may adopt and cause
248-21   to be executed any other proceedings or instruments necessary or
248-22   convenient in the issuance of the bonds.
248-23         (d)  Bonds payable solely from net revenues may be issued by
248-24   resolution or order of the board without an election.  Bonds wholly
248-25   or partially supported by taxes, except refunding bonds, may not be
248-26   issued unless the bonds have been authorized at an election called
 249-1   by the board at which a majority of the duly qualified resident
 249-2   electors of the authority voting at the election have voted in
 249-3   favor of the issuance of the bonds.  An election must be held not
 249-4   less than 14 days after the date of adoption of the order or
 249-5   resolution calling the election, and notice of the election must be
 249-6   given by publication in a newspaper of general circulation within
 249-7   the authority, on the same day in each of two successive weeks, of
 249-8   a substantial copy of the order or resolution calling the election,
 249-9   the first publication to be not less than 14 days prior to the date
249-10   of the election.  No other notice of election is required.  If the
249-11   bonds are to be payable solely from taxes, the proposition to
249-12   appear on the ballot shall be:  "For the bonds and the levy of
249-13   taxes in payment thereof; and the contrary thereof."  If the bonds
249-14   are to be payable both from net revenues and taxes, the proposition
249-15   to appear on the ballot shall be:  "For the bonds, the pledge of
249-16   net revenues, and the levy of taxes adequate to provide for the
249-17   payment thereof; and the contrary thereof."
249-18         (e)  Bonds must be authorized by resolution or order of the
249-19   board, be issued in the name of the authority, be signed by the
249-20   president and attested by the secretary, and have the seal of the
249-21   authority impressed on them; provided, however, that the resolution
249-22   or order authorizing the bonds may provide for the bonds to be
249-23   signed by the facsimile signatures of the president and secretary,
249-24   either or both, and for the seal of the authority on the bonds to
249-25   be a printed facsimile seal of the seal of the authority; and
249-26   provided further, that the interest coupons attached to the bonds
 250-1   may also be executed by the facsimile signatures of the officers.
 250-2   Bonds must mature, serially or otherwise, in not to exceed 40 years
 250-3   from their date or dates, and may be sold at a price and under
 250-4   terms determined by the board to be the most advantageous
 250-5   reasonably obtainable, provided that the interest cost to the
 250-6   authority, calculated by the use of standard bond interest tables
 250-7   currently in use by insurance companies and investment houses, does
 250-8   not exceed six percent per year.  Within the discretion of the
 250-9   board, bonds may be callable prior to maturity at the times and at
250-10   the prices prescribed in the resolution or order authorizing the
250-11   bonds.  Bonds may be made registrable as to principal or as to both
250-12   principal and interest.
250-13         (f)  After bonds have been authorized by the authority, the
250-14   bonds and the record relating to their issuance shall be submitted
250-15   to the attorney general for examination as to the validity of the
250-16   bonds and the record.  If the attorney general approves the bonds,
250-17   the bonds shall be registered by the comptroller.  After the bonds
250-18   have been approved by the attorney general, registered by the
250-19   comptroller, and delivered to the purchasers, the bonds are
250-20   incontestable except for forgery or fraud.  If bonds payable in
250-21   whole or in part from net revenues recite that they are secured
250-22   partially or otherwise by a pledge of the proceeds of a contract or
250-23   contracts made between the authority and another party or parties,
250-24   public agency or otherwise, a copy of the contract or contracts and
250-25   the proceedings authorizing the contract or contracts shall be
250-26   submitted to the attorney general along with the bond record.
 251-1   Approval by the attorney general of the bonds constitutes an
 251-2   approval of the contract or contracts, and after the approval the
 251-3   contract or contracts are incontestable except for forgery or
 251-4   fraud.
 251-5         (g)  From the proceeds of sale of bonds, the board may
 251-6   appropriate or set aside an amount for the payment of interest
 251-7   expected to accrue during the period of construction of the
 251-8   improvements or facilities, an amount or amounts to establish a
 251-9   reserve fund or funds as provided in the bond order or resolution,
251-10   and an amount necessary to pay all expenses incurred and to be
251-11   incurred in issuance, sale, and delivery of the bonds.
251-12         Sec. 260.016.  REFUNDING BONDS.  (a)  The board may issue
251-13   refunding bonds for the purpose of refunding any outstanding bonds
251-14   of the authority and accrued interest on the bonds.  Refunding
251-15   bonds may be issued to refund more than one series or issue of
251-16   outstanding bonds payable wholly from taxes.  Refunding bonds may
251-17   be issued to refund more than one series or issue of outstanding
251-18   bonds payable in whole or in part from net revenues and to combine
251-19   pledges for the outstanding bonds for the security of the refunding
251-20   bonds, and the refunding bonds may be secured by other and
251-21   additional revenues; provided, however, that bonds payable solely
251-22   from net revenues may not be refunded into bonds secured by taxes
251-23   unless authorized by a majority vote of the qualified voters voting
251-24   at an election called and held in the same manner as bond
251-25   elections; and provided further, that such refunding may not impair
251-26   the contract rights of the holders of any of the outstanding bonds
 252-1   that are not being refunded.
 252-2         (b)  Refunding bonds must be authorized by resolution or
 252-3   order of the board and must be executed and mature as is provided
 252-4   in this chapter for original bonds.  Refunding bonds bear interest
 252-5   at the same or a lower rate than that of the bonds refunded unless
 252-6   it is shown mathematically that a saving will result in the total
 252-7   amount of interest to be paid.
 252-8         (c)  Refunding bonds shall be approved by the attorney
 252-9   general as in the case of original bonds and shall be registered by
252-10   the comptroller on surrender and cancellation of the bonds to be
252-11   refunded, but in lieu of this procedure, the resolution or order
252-12   authorizing the issuance of the refunding bonds may provide that
252-13   the refunding bonds shall be sold and the proceeds of the sale
252-14   deposited in the place or places where the original bonds are
252-15   payable, in which case the refunding bonds may be issued in an
252-16   amount sufficient to pay the interest on the original bonds to
252-17   their option or maturity date and the comptroller shall register
252-18   the refunding bonds without the surrender and cancellation of the
252-19   original bonds.  Refunding bonds, after they have been approved by
252-20   the attorney general and registered by the comptroller, are
252-21   incontestable except for forgery or fraud.
252-22         Sec. 260.017.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
252-23   DEPOSITS.  (a)  Bonds issued under this chapter are negotiable
252-24   instruments under the laws of the state, and the bonds are legal
252-25   and authorized investments for banks, savings banks, trust
252-26   companies, building and loan associations, insurance companies,
 253-1   fiduciaries, trustees, and guardians and for the sinking funds of
 253-2   cities, towns, villages, counties, school districts, or other
 253-3   political corporations or subdivisions of the state.
 253-4         (b)  The bonds are eligible to secure the deposit of public
 253-5   funds of the state and public funds of cities, towns, villages,
 253-6   counties, school districts, or other political corporations or
 253-7   subdivisions of the state; and the bonds are lawful and sufficient
 253-8   security for such deposits to the extent of their face value when
 253-9   accompanied by all unmatured coupons.
253-10         Sec. 260.018.  MAINTENANCE TAX ELECTIONS.  (a)  All
253-11   maintenance tax elections shall be called and held as provided in
253-12   Section 260.015(d) of this chapter relating to elections for bonds
253-13   payable in whole or in part from taxes, and the following language
253-14   shall appear on the ballot in maintenance tax elections:  "For
253-15   maintenance tax; and the contrary thereof."
253-16         (b)  The regular voting or election precincts established by
253-17   the commissioners court of Jackson County for countywide elections
253-18   shall be the voting or election precincts for all elections called
253-19   and held under the provisions of this chapter.  Except as modified
253-20   in this chapter, the Election Code shall apply to and govern all
253-21   elections called and held under the provisions of this section.
253-22         Sec. 260.019.  TAXATION.  (a)  The board shall levy all taxes
253-23   of the authority, whether maintenance taxes or taxes to support
253-24   bonds, and the tax rolls of Jackson County shall be the tax rolls
253-25   of the authority.
253-26         (b)  The authority shall furnish the officer responsible for
 254-1   assessing and collecting taxes for the authority a certified copy
 254-2   of each resolution or order adopted by the board in which taxes are
 254-3   levied, and that officer shall assess and collect the taxes at the
 254-4   same time as county taxes are assessed and collected and shall turn
 254-5   the proceeds of such taxes, when collected, over to the authority
 254-6   or its depository.
 254-7         (c)  All laws of the state relating to the assessing and
 254-8   collecting of state and county taxes shall be applied to the
 254-9   assessment and collection of current and delinquent taxes of the
254-10   authority, to the extent that such laws are applicable.
254-11         (d)  The board may contract as provided by Chapter 791,
254-12   Government Code, with the board of directors of the Jackson County
254-13   Appraisal District for the performance of duties relating to
254-14   assessment or collection of taxes on behalf of the authority.  The
254-15   board may contract with any other political subdivision of the
254-16   state having authority to assess or collect taxes in Jackson County
254-17   for the assessment or collection of taxes on behalf of the
254-18   authority.
254-19         Sec. 260.020.  POWERS OF WATER CONTROL AND IMPROVEMENT
254-20   DISTRICTS.  (a)  Except as limited by this chapter, the authority
254-21   and the board shall have, with respect to the powers and privileges
254-22   granted under this chapter, all the powers and privileges granted
254-23   to water control and improvement districts and the board of
254-24   directors of such districts by Chapters 49 and 51.
254-25         (b)  In addition to all other vested powers, the authority
254-26   may exercise all powers, rights, privileges, and functions that are
 255-1   conferred by general or special law on water improvement districts
 255-2   and water control and improvement districts created pursuant to
 255-3   Section 59, Article XVI, Texas Constitution.
 255-4         Sec. 260.021.  CONSTRUCTION.  The terms and provisions of
 255-5   this chapter shall be liberally construed to effectuate the
 255-6   purposes set forth in this chapter.
 255-7         Sec. 260.022.  FINDING OF BENEFIT.  All property, both real
 255-8   and personal, within the authority and within the state will
 255-9   benefit from the authority and from the improvements and facilities
255-10   acquired or constructed and to be acquired or constructed under the
255-11   provisions of this chapter.
255-12         Sec. 260.023.  LIMITED LIABILITY FOR AQUATIC HERBICIDE
255-13   APPLICATION.  (a)  In this section, "commercially licensed aquatic
255-14   herbicide applicator" means a person who holds a commercial
255-15   applicator license issued by the Department of Agriculture under
255-16   Chapter 76, Agriculture Code, that authorizes the application of
255-17   aquatic herbicides.
255-18         (b)  Except as provided by Chapter 12, Parks and Wildlife
255-19   Code, an authority employee holding a noncommercial aquatic
255-20   herbicide applicator license or a commercially licensed aquatic
255-21   herbicide applicator working under contract with the authority is
255-22   not liable for damages in excess of $2 million for personal injury,
255-23   property damage, or death resulting from the application by the
255-24   applicator of aquatic herbicide in compliance with applicable law
255-25   and the terms of the license or permit.
 256-1              CHAPTER 261.  LOWER COLORADO RIVER AUTHORITY
 256-2         Sec. 261.001.  CREATION.  (a)  A conservation and reclamation
 256-3   district to be known as the "Lower Colorado River Authority" is
 256-4   created.  The authority is a governmental agency and a body politic
 256-5   and corporate.
 256-6         (b)  The authority is created under and is essential to
 256-7   accomplish the purposes of Section 59, Article XVI, Texas
 256-8   Constitution, including the control, storing, preservation, and
 256-9   distribution of the waters of the Colorado River and its
256-10   tributaries within the boundaries of the authority for irrigation,
256-11   generation of electric energy and power, and other useful purposes;
256-12   the reclamation and irrigation of arid, semiarid, and other lands
256-13   needing irrigation; the development of parks on lands owned or
256-14   hereafter acquired by the authority; and the conservation and
256-15   development of the forests, water, and electric power in the state.
256-16         (c)  Nothing in this chapter or in any other law shall be
256-17   construed as authorizing the authority to levy or collect taxes or
256-18   to create any indebtedness payable out of taxes or in any way to
256-19   pledge the credit of the state.
256-20         Sec. 261.002.  DEFINITIONS.  In this chapter:
256-21               (1)  "Authority" means the Lower Colorado River
256-22   Authority.
256-23               (2)  "Board" means the board of directors of the
256-24   authority.
256-25               (3)  "Director" means a member of the board.
256-26         Sec. 261.003.  TERRITORY.  The authority consists of the
 257-1   territory included within the boundaries of the counties of Blanco,
 257-2   Burnet, Llano, Travis, Bastrop, Fayette, Colorado, Wharton, San
 257-3   Saba, and Matagorda.
 257-4         Sec. 261.004.  POWERS AND DUTIES.  (a)  Except as expressly
 257-5   limited by this chapter, the authority has all the powers, rights,
 257-6   privileges, and functions conferred by general law on any district
 257-7   or districts created under Section 59, Article XVI, Texas
 257-8   Constitution, and as provided by this section.
 257-9         (b)  The authority may control, store, and preserve, within
257-10   the boundaries of the authority, the waters of the Colorado River
257-11   and its tributaries and the lands of the authority for any useful
257-12   purpose and may use, distribute, and sell those waters, within the
257-13   boundaries of the authority or within the boundaries of the
257-14   watershed that contributes inflow to the Colorado River below the
257-15   intersection of Coleman, Brown, and McCulloch counties, for any
257-16   such purpose.
257-17         (c)  The authority may develop and generate water power and
257-18   electric energy within the boundaries of the authority and may
257-19   distribute and sell water power and electric energy, within or
257-20   outside the boundaries of the authority.
257-21         (d)  The authority may prevent or aid, within the boundaries
257-22   of the authority, in the prevention of damage to person or property
257-23   from the waters of the Colorado River and its tributaries.
257-24         (e)  The authority may forest and reforest and aid in the
257-25   foresting and reforesting of the watershed area of the Colorado
257-26   River and its tributaries, within the boundaries of the authority,
 258-1   and may prevent and aid in the prevention of soil erosion and
 258-2   floods within the watershed area.
 258-3         (f)  The authority may acquire by purchase, lease, or gift or
 258-4   in any other manner provided by law and may maintain, use, and
 258-5   operate any property of any kind, real, personal, or mixed, or any
 258-6   interest in property, within or outside the boundaries of the
 258-7   authority that is necessary or convenient to the exercise of the
 258-8   powers, rights, privileges, and functions conferred on the
 258-9   authority by this chapter.
258-10         (g)  The authority may acquire by condemnation property of
258-11   any kind, real, personal, or mixed, or any interest in property,
258-12   within or outside the boundaries of the authority, other than
258-13   property or any interest in property outside the boundaries of the
258-14   authority owned by any body politic, that is necessary or
258-15   convenient to the exercise of the powers, rights, privileges, and
258-16   functions conferred on the authority by this chapter.  The
258-17   authority shall exercise the condemnation power in the manner
258-18   provided by general law with respect to condemnation or, at the
258-19   option of the authority, in the manner provided by state law
258-20   relating to condemnation by districts organized under general law
258-21   pursuant to Section 59, Article XVI, Texas Constitution.
258-22         (h)  Subject to the provisions of this chapter, the authority
258-23   may sell or otherwise dispose of property of any kind, real,
258-24   personal, or mixed, or any interest in the property, that is not
258-25   necessary to the carrying on of the business of the authority.
258-26         (i)  The authority may overflow and inundate within the
 259-1   boundaries of the authority any public lands and public property
 259-2   and may require the relocation of roads, pipelines, transmission
 259-3   lines, railroads, cemeteries, and highways in the manner and to the
 259-4   extent permitted to districts organized under general law pursuant
 259-5   to Section 59, Article XVI, Texas Constitution.
 259-6         (j)  The authority may construct, extend, improve, maintain,
 259-7   and reconstruct, cause to be constructed, extended, improved,
 259-8   maintained, and reconstructed, and use and operate facilities of
 259-9   any kind necessary or convenient to the exercise of its powers,
259-10   rights, privileges, and functions.
259-11         (k)  The authority may sue and be sued in its corporate name.
259-12         (l)  The authority may adopt and use a corporate seal.
259-13         (m)  The authority may make bylaws for the management and
259-14   regulation of its affairs.
259-15         (n)  The authority may appoint officers, agents, and
259-16   employees, prescribe their duties, and set their compensation.
259-17         (o)  The authority may make contracts and execute instruments
259-18   necessary or convenient to the exercise of the powers, rights,
259-19   privileges, and functions conferred on the authority by this
259-20   chapter or permitted by general law.
259-21         (p)  The authority may borrow money for its corporate
259-22   purposes on notes or other written evidence of indebtedness for a
259-23   period not to exceed five years as may be authorized from time to
259-24   time by an affirmative vote of 12 members of the board, which loans
259-25   or indebtedness shall be repaid from the proceeds of bonds of the
259-26   authority at the next bond offering.  The authority may borrow
 260-1   money and accept grants from the United States, the state, or any
 260-2   corporation or agency created or designated by the United States or
 260-3   the state and, in connection with any such loans or grants, may
 260-4   enter into such agreements as the United States, the state, or the
 260-5   corporation or agency may require.  The authority may make and
 260-6   issue negotiable bonds for money borrowed in the manner provided by
 260-7   Sections 261.013, 261.014, and 261.015 or other general law.
 260-8   Nothing in this chapter shall authorize the issuance of any bonds,
 260-9   notes, or other evidences of indebtedness of the authority except
260-10   as specifically provided by this chapter or other general law.
260-11         (q)  The authority may provide for the study, correcting, and
260-12   control of both artificial and natural pollution, including
260-13   organic, inorganic, and thermal, of all ground or surface water of
260-14   the Colorado River and its tributaries within the boundaries of the
260-15   authority.  The authority may promulgate by ordinance rules and
260-16   regulations with regard to the pollution, both artificial and
260-17   natural, and possesses police power to enforce its rules and
260-18   regulations.  The authority may provide a reasonable penalty for
260-19   the violation of any rule or regulation, which shall be cumulative
260-20   of any penalties fixed by the general law of this state.  A penalty
260-21   under this subsection may not exceed the limit for penalties
260-22   provided by Section 49.004.  An ordinance enacted under this
260-23   section may not be promulgated in any county or counties outside
260-24   the existing boundaries of the authority.
260-25         (r)  As a necessary aid to the conservation, control,
260-26   preservation, purification, and distribution of surface waters and
 261-1   groundwater of the Colorado River and its tributaries within the
 261-2   boundaries of the authority, the authority may have the power to
 261-3   construct, own, operate, maintain, or otherwise provide sewage
 261-4   gathering, treatment, and disposal services, including waste
 261-5   disposal services, and may make contracts regarding those services
 261-6   with the United States, the state, counties, municipalities, and
 261-7   others.  The authority shall charge the actual cost of those
 261-8   services.
 261-9         (s)  The authority may develop and manage parks, recreational
261-10   facilities, and natural science laboratories and may promote the
261-11   preservation of fish and wildlife within the boundaries of the
261-12   authority.  The authority may negotiate contracts with any county,
261-13   municipality, municipal corporation, person, firm, corporation,
261-14   nonprofit organization, or state or federal agency for the
261-15   operation and maintenance of any such park, recreational facility,
261-16   or natural science laboratory.  The preservation of fish and
261-17   wildlife shall be in accordance with the rules and regulations of
261-18   the Parks and Wildlife Commission.  Notwithstanding any other
261-19   provisions of this chapter, the board may charge and collect
261-20   reasonable entrance, gate, or use fees for the development,
261-21   management, and use of parks and recreational facilities developed
261-22   in whole or in part by the authority.
261-23         (t)  The authority may enter into agreements authorized by
261-24   Chapter 163, Utilities Code, to acquire, install, construct,
261-25   operate, enlarge and make additions to, and own and operate
261-26   electric power and energy generating facilities as provided by that
 262-1   chapter, in joint ownership with others, either as cotenants or
 262-2   under such other arrangements as may be approved by a three-fourths
 262-3   vote of the statutory membership of the board.  In accordance with
 262-4   and subject to the terms of the agreements, if any, the authority
 262-5   may sell or otherwise dispose of any or all of its interest in the
 262-6   jointly owned electric power and generating facilities.  This
 262-7   subsection does not apply to generating facilities or other
 262-8   property wholly owned by the authority.
 262-9         (u)  The authority may do any and all other acts or things
262-10   necessary or convenient, including controlling the use of the
262-11   surface of any lake or island located in such lake developed by the
262-12   authority and levying a charge for the commercial use of the lake
262-13   or island, to the exercise of all powers, rights, privileges,
262-14   authority, or functions conferred on the authority by the
262-15   constitution, this chapter, or any law.
262-16         (v)  The authority may enter into contracts with the state
262-17   through the General Services Commission providing for direct sale
262-18   by the authority of electrical power to the state for use in
262-19   buildings or other facilities owned, leased, or rented by the state
262-20   in Travis County.
262-21         Sec. 261.005.  LIMITATIONS OF AUTHORITY.  (a)  The authority
262-22   may not use for irrigation purposes any water under any permit or
262-23   permits acquired from any other company or person unless such use
262-24   is expressly authorized by, and granted to the authority by, the
262-25   commission or its predecessor agency under authority of law.  In
262-26   considering subsequent applications by the authority, the
 263-1   commission shall at all times consider the needs of the people
 263-2   living within and on lands lying within the watershed of the
 263-3   Colorado River and its tributaries above the authority.
 263-4         (b)  Notwithstanding any rights or permits issued by the
 263-5   commission or its predecessor agency that are held or acquired by
 263-6   the authority, the impounding and use of the floodwaters of the
 263-7   Colorado River or its tributaries for the generation of
 263-8   hydroelectric power by the authority or anyone who may succeed to
 263-9   the rights and privileges conferred on the authority by this
263-10   chapter are subject to the rights of a person, municipal
263-11   corporation, or body politic that, under legal grant of authority,
263-12   is impounding and putting to beneficial use the waters if the
263-13   person, municipal corporation, or body politic:
263-14               (1)  has received a permit for the use from the
263-15   commission, or its predecessor agency; or
263-16               (2)  is permitted by law to impound water for the
263-17   purposes described by this subsection.
263-18         (c)  Nothing in this chapter shall be construed to require a
263-19   municipal corporation or body politic to surrender to the authority
263-20   any rights described by this section to which it may be legally
263-21   entitled.
263-22         (d)  This chapter shall not be construed to subject to
263-23   condemnation by the authority or any successor, or by anyone who
263-24   may succeed to the rights and privileges conferred on the authority
263-25   by this chapter, any waters:
263-26               (1)  impounded or to be impounded within or outside the
 264-1   authority under any law authorizing water to be impounded or under
 264-2   any permits granted to a municipal corporation or body politic; or
 264-3               (2)  impounded or permitted to be impounded or used
 264-4   outside the authority under permits legally granted to any person.
 264-5         (e)  Nothing in this chapter shall be construed as depriving
 264-6   any person or municipality of the right, legally granted, to
 264-7   impound the waters of the Colorado River or its tributaries for
 264-8   authorized beneficial uses or as repealing any law granting such
 264-9   rights to persons and municipalities.
264-10         (f)  The rights of the authority to impound or use or sell
264-11   the waters of the Colorado River and its tributaries for the
264-12   generation of hydroelectric power are subordinate and inferior to
264-13   the rights of:
264-14               (1)  cities and towns situated within the boundaries of
264-15   the authority to build dams and impound floodwaters solely for
264-16   municipal purposes;
264-17               (2)  cities and towns and bodies politic within the
264-18   watershed of the Colorado River outside the authority to build dams
264-19   or impound floodwaters for municipal purposes; and
264-20               (3)  bodies politic within the watershed of the
264-21   Colorado River to build dams and impound the floodwaters within the
264-22   watershed of the Colorado River and its tributaries for domestic
264-23   purposes inside and outside the boundaries of the authority.
264-24         (g)  The title to any rights, properties, licenses,
264-25   franchises, or permits acquired by the authority shall be subject
264-26   to the limitations imposed by Subsection (f).
 265-1         Sec. 261.006.  BOARD OF DIRECTORS.  (a)  The powers, rights,
 265-2   privileges, and functions of the authority shall be exercised by
 265-3   the board.  The board shall consist of 15 directors and shall
 265-4   include at least one director from each of the counties named in
 265-5   Section 261.003 except Travis County, which shall have two
 265-6   directors.  Three directors  shall be appointed at large by the
 265-7   governor with the advice and consent of the senate from the
 265-8   counties served with electric power, other than the counties
 265-9   included in Section 261.003.
265-10         (b)  A director appointed at large may not serve for a period
265-11   of more than six consecutive years.  A county other than a county
265-12   included in Section 261.003 may not be represented on the board for
265-13   more than six consecutive years.  A county other than Travis County
265-14   may not have two directors for a period greater than six
265-15   consecutive years.
265-16         (c)  All directors shall be appointed by the governor with
265-17   the advice and consent of the senate for staggered terms of six
265-18   years, with five members' terms expiring on February 1 of each
265-19   odd-numbered year.
265-20         (d)  Each director must be a resident and freehold property
265-21   taxpayer of the county from which the director is appointed and
265-22   must have been a resident and taxpayer of that county for not less
265-23   than two years immediately preceding the director's appointment.
265-24   Not more than two directors may be residents of the same county.
265-25         (e)  A person is not eligible for appointment as a director
265-26   if the person has, during the three years immediately preceding the
 266-1   person's appointment, been employed by an electric power and light
 266-2   company, a telephone company, or any other utility company.
 266-3         (f)  At the expiration of the term of a director, a successor
 266-4   shall be appointed by the governor with the advice and consent of
 266-5   the senate.  Each director shall hold office until the expiration
 266-6   of the term for which the director was appointed and until a
 266-7   successor has been appointed and has qualified, unless removed
 266-8   sooner as provided by this section.
 266-9         (g)  A director may be removed by the governor for
266-10   inefficiency, neglect of duty, or misconduct in office after at
266-11   least 30 days written notice of the charges against the director
266-12   and an opportunity to be heard in person or by counsel at a public
266-13   hearing.
266-14         (h)  A vacancy resulting from the death, resignation, or
266-15   removal of a director is filled by the governor for the unexpired
266-16   term.
266-17         (i)  Each director shall qualify by taking the official oath
266-18   of office prescribed by the constitution or general laws of the
266-19   state.
266-20         (j)  Each director is entitled to receive fees of office of
266-21   not more than $100 per day and reimbursement of actual expenses
266-22   incurred in accordance with Chapter 49; provided, however, that no
266-23   director is paid per diem in excess of 150 days in any one calendar
266-24   year.
266-25         (k)  Eight directors constitute a quorum at any meeting and,
266-26   except as otherwise provided by this chapter or in the bylaws, all
 267-1   action may be taken by the affirmative vote of a majority of the
 267-2   directors present at any meeting, except that no bonds, notes, or
 267-3   other evidence of indebtedness and no amendment of the bylaws shall
 267-4   be valid unless authorized or ratified by the affirmative vote of
 267-5   at least eight directors, unless otherwise specifically provided by
 267-6   this chapter.
 267-7         (l)  The board is a state board as contemplated by Section
 267-8   30a, Article XVI, Texas Constitution.
 267-9         Sec. 261.007.  OFFICERS; GENERAL MANAGER; EMPLOYEES.
267-10   (a)  The board shall select a secretary, who shall keep true and
267-11   complete records of all proceedings of the board.  Until the
267-12   appointment of a secretary or in the event of the secretary's
267-13   absence or inability to act, the board shall select a secretary pro
267-14   tempore.
267-15         (b)  The board shall select a general manager.  The general
267-16   manager is the chief executive officer of the authority.
267-17         (c)  The board shall select a treasurer, who may also hold
267-18   the office of secretary.
267-19         (d)  The officers described in Subsections (a)-(c) have the
267-20   powers and duties, hold office for the term, and are subject to
267-21   removal in the manner as may be provided in the bylaws.
267-22         (e)  The board shall set the compensation of the officers.
267-23   The board may appoint the officers described in Subsections
267-24   (a)-(c), agents, and employees, may set their compensation and term
267-25   of office and the method by which they may be removed, and may
267-26   delegate to them the power and duties it determines proper.
 268-1         Sec. 261.008.  DISBURSEMENT OF FUNDS; SURETY BONDS.  (a)  The
 268-2   money of the authority may be disbursed only on checks, drafts,
 268-3   orders, or other instruments signed by the persons authorized by
 268-4   the bylaws or a resolution concurred in by no fewer than eight
 268-5   directors.
 268-6         (b)  The general manager, the treasurer, and all other
 268-7   officers, agents, and employees of the authority charged with the
 268-8   collection, custody, or payment of any funds of the authority must
 268-9   give bond conditioned on the faithful performance of their duties
268-10   and an accounting for all funds and property of the authority
268-11   coming into their hands.
268-12         (c)  The bonds must be in a form, amount, and with a surety
268-13   company authorized to do business in the state, approved by the
268-14   board.
268-15         (d)  The premiums on the bonds shall be paid by the authority
268-16   and charged as an operating expense.
268-17         Sec. 261.009.  OFFICE; RECORDS.  (a)  The domicile of the
268-18   authority is in the City of Austin, Travis County, where the
268-19   authority shall maintain its principal office in the charge of the
268-20   general manager.
268-21         (b)  The authority shall keep complete and accurate accounts
268-22   conforming to approved methods of bookkeeping.
268-23         (c)  The accounts and all contracts, documents, and records
268-24   of the authority shall be kept at the principal office.  The
268-25   accounts and contracts shall be open to public inspection at all
268-26   reasonable times.
 269-1         (d)  The board shall cause to be made and completed, within
 269-2   90 days after the end of each fiscal year, an audit of the books of
 269-3   account and financial records of the authority for that fiscal
 269-4   year.  The audit shall be made by an independent certified public
 269-5   accountant or firm of certified public accountants.
 269-6         (e)  Copies of a written report of the audit certified to by
 269-7   the accountant or accountants must be placed and kept on file with
 269-8   the commission, with the comptroller, and at the principal office
 269-9   of the authority, and be open to public inspection at all
269-10   reasonable times.
269-11         Sec. 261.010.  CONFLICT OF INTEREST.  The provisions of
269-12   Chapter 171, Local Government Code, apply to conflicts of interest
269-13   in the award of authority contracts.
269-14         Sec. 261.011.  RATES AND CHARGES.  (a)  The board shall
269-15   establish and collect rates and other charges for the sale or use
269-16   of water, water connections, power, electric energy, or other
269-17   services sold, furnished, or supplied by the authority.  The fees
269-18   and charges must be reasonable and nondiscriminatory and sufficient
269-19   to produce revenues adequate to:
269-20               (1)  pay all expenses necessary to the operation and
269-21   maintenance of the properties and facilities of the authority;
269-22               (2)  pay the interest on and principal of all bonds
269-23   issued under this chapter as the interest and principal become due
269-24   and payable;
269-25               (3)  pay the principal and interest on any legal debt
269-26   created by the authority;
 270-1               (4)  pay all sinking fund and reserve fund payments
 270-2   agreed to be made with respect to bonds and payable out of such
 270-3   revenues, as the payments become due and payable; and
 270-4               (5)  fulfill the terms of any agreements made with the
 270-5   holders of bonds or with any person in their behalf.
 270-6         (b)  Out of the revenues that may be received in excess of
 270-7   those required for the purposes specified in Subsection (a), the
 270-8   board may:
 270-9               (1)  establish a reasonable depreciation and emergency
270-10   fund;
270-11               (2)  retire, by purchase and cancellation or
270-12   redemption, bonds issued under this chapter; or
270-13               (3)  apply the excess revenues to any corporate
270-14   purpose.
270-15         (c)  The rates and charges of the authority may not be in
270-16   excess of what is necessary to fulfill the obligations imposed on
270-17   the authority by this chapter or other law.  Nothing in this
270-18   chapter shall be construed as depriving the state of its power to
270-19   regulate and control fees or charges to be collected for the use of
270-20   water, water connections, power, electric energy, or other service;
270-21   provided, however, that the state pledges to and agrees with the
270-22   purchasers and successive holders of the bonds and other written
270-23   evidence of indebtedness issued under this chapter that the state
270-24   will not limit or alter the power vested in the authority to
270-25   establish and collect such fees and charges as will produce
270-26   revenues sufficient to pay the items specified in Subsection (a),
 271-1   or in any way impair the rights or remedies of creditors or holders
 271-2   of the bonds, or of any person in their behalf, until the bonds and
 271-3   other written evidence of indebtedness, together with the interest
 271-4   on the bonds or indebtedness and the interest on unpaid
 271-5   installments of interest and all costs and expenses in connection
 271-6   with any action or proceedings by or on behalf of the bondholders
 271-7   and all other obligations of the authority in connection with the
 271-8   bonds are fully met and discharged.
 271-9         Sec. 261.012.  PAYMENT OF DEBTS.  Any indebtedness,
271-10   liability, or obligation of the authority for the payment of money,
271-11   however entered into or incurred and whether arising from contract,
271-12   implied contract, or otherwise, shall be payable solely:
271-13               (1)  out of revenues received by the authority with
271-14   respect to its properties, subject to any prior lien on the
271-15   revenues conferred by any resolution or resolutions adopted as
271-16   provided by this chapter authorizing the issuance of bonds; or
271-17               (2)  if the board so determines, out of the proceeds of
271-18   sale by the authority of bonds payable solely from such revenues.
271-19         Sec. 261.013.  ISSUANCE OF BONDS.  (a)  The authority may
271-20   issue bonds from time to time and for any purpose authorized by
271-21   this chapter or other general law.  If bonds of the authority are
271-22   issued, in addition to complying with other general law the bonds:
271-23               (1)  when sold, shall be sold for cash at public sale
271-24   to the highest and best bidder, as determined by the board, and the
271-25   interest cost of the money received for the bonds, computed to
271-26   maturity in accordance with the method prescribed by the board in
 272-1   connection with the sale of the bonds;
 272-2               (2)  may be issued, on such terms as the board
 272-3   determines, in exchange for property of any kind, real, personal,
 272-4   or mixed, or any interest in such property that the board
 272-5   determines necessary or convenient for any corporate purposes,
 272-6   provided that any property acquired through the exchange of bonds
 272-7   is certified in writing before the exchange as being of a value
 272-8   equal to or in excess of the par value of the bonds by an
 272-9   independent appraisal that is to be kept on file by the authority
272-10   as a public record, with a copy filed with the state auditor;
272-11               (3)  may be issued in exchange for like principal
272-12   amounts of other obligations of the authority, matured or
272-13   unmatured; or
272-14               (4)  may be sold to the state or any agency of the
272-15   state, the United States, or any agency or corporation created or
272-16   designated by the state or the United States in exchange for cash
272-17   equal in amount to the principal amount of the bonds sold and the
272-18   interest cost of the money received for the bonds, computed to
272-19   maturity in accordance with standard bond tables in general use by
272-20   banks and insurance companies, as determined by the board.
272-21         (b)  The proceeds from the sale of the bonds shall be
272-22   deposited in a bank or banks or a trust company or trust companies
272-23   and shall be paid out pursuant to such terms and conditions not in
272-24   conflict with the provisions of this chapter or other general law
272-25   as may be agreed on between the authority and the purchasers of the
272-26   bonds.
 273-1         (c)  The proceeds of the bonds and any net operating revenues
 273-2   derived from the sale of electric power or water which may be
 273-3   available after paying the interest on outstanding bonds and the
 273-4   principal amount of such bonds and after setting aside sufficient
 273-5   funds for working capital, including a reasonable amount for
 273-6   contingencies, and setting aside funds for reserves to secure
 273-7   payment of principal of and interest on outstanding bonds, shall be
 273-8   used, in addition to any provision of general law:
 273-9               (1)  to build and construct dams or other structures
273-10   within the authority, on the Colorado River and its tributaries,
273-11   for the impounding and storage of floodwater and surface water;
273-12               (2)  to purchase and install in the dams on the
273-13   Colorado River hydroelectric generators and other related
273-14   facilities for the generation of hydroelectric power; 
273-15               (3)  for the construction of additional lines and the
273-16   purchase and installation of additional equipment the board
273-17   considers necessary or expedient to enable the authority to
273-18   continue to meet the demand for electric power in the areas within
273-19   the authority directly served by its transmission lines and
273-20   distribution systems on January 1, 1975, and other areas within the
273-21   service area served by the authority on January 1, 1975, that
273-22   cannot receive comparable service from any other power source and
273-23   to provide electric power to the state as provided by Section
273-24   261.004; provided, however, that no steam generating capacity shall
273-25   be installed by the authority, except that the authority may
273-26   acquire, install, construct, enlarge and make additions to, and
 274-1   operate one or more steam generating plants, the sum of whose
 274-2   aggregate capacity shall not be more than 5,000 megawatts, to be
 274-3   located within the boundaries of either one or more of Colorado,
 274-4   Fayette, Bastrop, Travis, Blanco, Burnet, Llano, or San Saba
 274-5   counties and to be utilized for the purpose of serving the area
 274-6   directly served by the authority's transmission lines and
 274-7   distribution systems on January 1, 1975, and to provide electric
 274-8   power to the state as provided by Section 261.004;
 274-9               (4)  to own or acquire an interest in one or more steam
274-10   generating plants at any location within or outside the authority,
274-11   if any such plant or plants are owned in conjunction with one or
274-12   more other utilities, public, private, or municipal, provided that
274-13   any such interest owned or acquired by the authority shall be
274-14   utilized for the sole purpose of serving electric power and energy
274-15   only in the areas within the authority directly served by its
274-16   transmission lines and distribution systems as they existed on
274-17   January 1, 1975;
274-18               (5)  for the purpose of building dams, levees, or such
274-19   other flood control structures between the City of Austin and the
274-20   mouth of the Colorado River as may be considered necessary and
274-21   desirable by the board and for acquiring or installing such
274-22   facilities necessary to supply water for irrigation and other
274-23   useful purposes within the counties composing the authority; and 
274-24               (6)  in aid of any soil conservation or soil
274-25   reclamation projects within the authority that the board determines
274-26   to be in the public interest.
 275-1         (d)  Nothing in this section shall be construed as
 275-2   establishing priorities as to uses of water that are contrary to
 275-3   the general laws of this state with reference to the water uses.
 275-4         (e)  Except as otherwise provided by general law, proceeds of
 275-5   bonds sold by the authority, and any net operating revenues that
 275-6   the board determines are not needed to carry out the projects set
 275-7   out in Subsections (c)(1), (2), and (3), to the extent not required
 275-8   by an outstanding trust indenture to be used to redeem outstanding
 275-9   bonds, shall be placed in a general revenue fund of the authority.
275-10   Dams built on the tributaries of the Colorado River or on the
275-11   Colorado River shall be used for the purpose of impounding and
275-12   storing floodwaters and surface waters.
275-13         (f)  Bonds shall be authorized by resolution of the board
275-14   concurred in by at least 12 of the members.
275-15         (g)  Bonds shall bear such date or dates, mature at such time
275-16   or times, bear interest at such rates, payable annually or
275-17   semiannually, be in such denominations, be in such form, either
275-18   coupon or registered, carry such registration privileges as to
275-19   principal only or as to both principal and interest and as to
275-20   exchange of coupon bonds for registered bonds or vice versa and
275-21   exchange of bonds of one denomination for bonds of other
275-22   denominations, be executed in such manner, and be payable at such
275-23   place or places within or outside the state as the resolution or
275-24   resolutions may provide.
275-25         (h)  A resolution or resolutions authorizing bonds may
275-26   contain provisions, which shall be part of the contract between the
 276-1   authority and the holder of the bonds from time to time:
 276-2               (1)  reserving the right to redeem the bonds at the
 276-3   time or times, in the amounts, and at the prices, not exceeding 105
 276-4   percent of the principal amount of the bonds, plus accrued
 276-5   interest, as may be provided;
 276-6               (2)  providing for the setting aside of interest and
 276-7   sinking funds or reserve funds and the regulation and disposition
 276-8   of those funds;
 276-9               (3)  pledging, to secure the payment of the principal
276-10   of and interest on the bonds and of the sinking fund or reserve
276-11   fund payments agreed to be made with respect to the bonds, all or
276-12   any part of the gross or net revenues received by the authority
276-13   with respect to the property, real, personal, or mixed, acquired or
276-14   constructed or to be acquired or constructed with the bonds or the
276-15   proceeds of the bonds, or all or any part of the gross or net
276-16   revenues previously or thereafter received by the authority from
276-17   any source;
276-18               (4)  prescribing the purposes to which the bonds or any
276-19   bonds issued later are to be applied;
276-20               (5)  agreeing to set and collect rates and charges
276-21   sufficient to produce revenues adequate to pay the items specified
276-22   in Section 261.011(a) and prescribing the use and disposition of
276-23   all revenues;
276-24               (6)  prescribing limitations on the issuance of
276-25   additional bonds and on the agreements that may be made with the
276-26   purchasers and successive holders of the bonds;
 277-1               (7)  relating to the construction, extension,
 277-2   improvement, reconstruction, operation, maintenance, and repair of
 277-3   the properties of the authority and the carrying of insurance on
 277-4   all or any part of the properties covering loss or damage or loss
 277-5   of use and occupancy resulting from specified risks;
 277-6               (8)  setting the procedure, if any, by which, if the
 277-7   authority so desires, the terms of any contract with the holders of
 277-8   the bonds may be amended or abrogated, the amount of bonds whose
 277-9   holders must consent to such amendment or abrogation and the manner
277-10   in which the consent may be given;
277-11               (9)  providing for the execution and delivery by the
277-12   authority, to a bank or trust company authorized by law to accept
277-13   trusts, of indentures and agreements for the benefit of the holders
277-14   of the bonds setting forth all of the agreements authorized by this
277-15   chapter to be made with or for the benefit of the holders of the
277-16   bonds and other provisions as may be customary in such indentures
277-17   or agreements; and
277-18               (10)  making other provisions, not inconsistent with
277-19   the provisions of this chapter or other general law, as the board
277-20   may approve, provided that no agreement, contract, or commitment
277-21   shall ever be made which, under any contingency, could or would
277-22   result in the United States government or any of its agencies or
277-23   bureaus claiming the right or privilege of controlling or managing
277-24   the properties and facilities of the authority or the control or
277-25   disposition of the water of the Colorado River or its tributaries;
277-26   provided, however, that nothing in this chapter shall be construed
 278-1   as limiting or restricting the rights or powers as set out in
 278-2   Section 261.014 in the event of any default on the part of the
 278-3   authority; and provided further that nothing in this chapter is
 278-4   intended to prohibit compliance with existing federal regulations,
 278-5   if compliance with those regulations is done on the advice and
 278-6   approval of the attorney general.
 278-7         Sec. 261.014.  DEFAULT PROCEDURES.  (a)  A resolution
 278-8   authorizing the issuance of bonds and any indenture or agreement
 278-9   entered into pursuant to the resolution may include provisions
278-10   regarding a default on:
278-11               (1)  the payment of the interest on any bonds as the
278-12   interest becomes due and payable;
278-13               (2)  the payment of the principal of any bonds as they
278-14   become due and payable, whether at maturity, by call for
278-15   redemption, or otherwise; or
278-16               (3)  the performance of an agreement made with the
278-17   purchasers or successive holders of any bonds.
278-18         (b)  If a default described by Subsection (a) has occurred
278-19   and has continued for a period, if any, prescribed by the
278-20   resolution authorizing the issuance of the bonds, the trustee under
278-21   the indenture or indentures entered into with respect to the bonds
278-22   authorized by the resolution, or, if there is no indenture, a
278-23   trustee appointed in the manner provided in the resolution by the
278-24   holders of 25 percent in aggregate principal amount of the bonds
278-25   authorized by the resolution or resolutions and then outstanding,
278-26   shall, in the trustee's own name but for the equal and
 279-1   proportionate benefit of the holders of all the bonds, and with or
 279-2   without having possession of the bonds:
 279-3               (1)  by mandamus or other suit, action, or proceeding
 279-4   at law or in equity, enforce all rights of the holders of the
 279-5   bonds, including the requirements of Section 261.011;
 279-6               (2)  bring suit on the bonds or the appurtenant
 279-7   coupons;
 279-8               (3)  by action or suit in equity, require the authority
 279-9   to account as if it were the trustee of an express trust for the
279-10   bondholders;
279-11               (4)  by action or suit in equity, enjoin any acts or
279-12   things which may be unlawful or in violation of the rights of the
279-13   holders of the bonds; or
279-14               (5)  after such notice to the authority as the
279-15   resolution may provide, declare the principal of all of the bonds
279-16   due and payable, and if all defaults have been made good, then with
279-17   the written consent of the holders of 25 percent in aggregate
279-18   principal amount of the bonds then outstanding, annul the
279-19   declaration and its consequences; provided, however, that the
279-20   holders of more than a majority in principal amount of the bonds
279-21   authorized by the resolution and then outstanding shall, by written
279-22   instrument delivered to the trustee, have the right to direct and
279-23   control any and all action taken or to be taken by the trustee
279-24   under this section.
279-25         (c)  A resolution, indenture, or agreement relating to bonds
279-26   may provide that in such suit, action, or proceeding under this
 280-1   section, the trustee, whether or not all of the bonds have been
 280-2   declared due and payable and with or without possession of any of
 280-3   the bonds, shall be entitled as of right to the appointment of a
 280-4   receiver who may enter and take possession of all or any part of
 280-5   the properties of the authority and operate and maintain the
 280-6   properties and set, collect, and receive rates and charges
 280-7   sufficient to provide revenues adequate to pay the items set forth
 280-8   in Section 261.011(a) and the costs and disbursements of the suit,
 280-9   action, or proceeding and apply such revenues in conformity with
280-10   the provisions of this chapter and the resolution or resolutions
280-11   authorizing the bonds.
280-12         (d)  In any suit, action, or proceeding by a trustee under
280-13   this section, the reasonable fees, counsel fees, and expenses of
280-14   the trustee or the receiver or receivers, if any, constitute
280-15   taxable disbursements, and all costs and disbursements allowed by
280-16   the court shall be a first charge on any revenues pledged to secure
280-17   the payment of the bonds.
280-18         (e)  Subject to the provisions of the constitution, the
280-19   courts of Travis County shall have jurisdiction of any suit,
280-20   action, or proceeding under this section by a trustee on behalf of
280-21   the bondholders and of all property involved in the suit, action,
280-22   or proceeding.
280-23         (f)  In addition to the powers specifically provided by this
280-24   section, the trustee shall have and possess all powers necessary or
280-25   appropriate for the exercise of the powers specifically provided or
280-26   incident to the general representation of the bondholders in the
 281-1   enforcement of their rights.
 281-2         Sec. 261.015.  BOND APPROVAL AND REGISTRATION.  (a)  Before
 281-3   any bonds may be sold by the authority, a certified copy of the
 281-4   proceedings for the issuance of the bonds, including the form of
 281-5   the bonds, together with any other information the attorney general
 281-6   may require, shall be submitted to the attorney general, and if the
 281-7   attorney general finds that the bonds have been issued in
 281-8   accordance with law, the attorney general shall approve the bonds
 281-9   and shall execute a certificate to that effect which shall be filed
281-10   in the office of the comptroller and be recorded in a record kept
281-11   for that purpose.  Bonds may not be issued until they have been
281-12   registered by the comptroller, who shall register the bonds if the
281-13   attorney general has filed with the comptroller the certificate
281-14   approving the bonds and the proceedings for the issuance of the
281-15   bonds as provided in this subsection.
281-16         (b)  Bonds approved by the attorney general and registered by
281-17   the comptroller and issued in accordance with the proceedings so
281-18   approved are valid and binding obligations on the revenues of the
281-19   authority and are incontestable for any cause after their
281-20   registration.
281-21         Sec. 261.016.  AUDIT.  The authority shall be subject to the
281-22   audit provisions of Subchapter G, Chapter 49.
281-23         Sec. 261.017.  AUTHORITY AS CONSERVATION AND RECLAMATION
281-24   DISTRICT.  (a)  The authority shall manage and use its facilities,
281-25   the water impounded by its dams on the Colorado River or its
281-26   tributaries, and the net operating revenues which may be available
 282-1   to accomplish, to the extent possible, the purposes included in
 282-2   Section 59(a), Article XVI, Texas Constitution, that are enumerated
 282-3   in the provisions of this chapter or other general law, and the
 282-4   authority shall market such electric power that in the opinion of
 282-5   the board will not be immediately needed by the authority, under
 282-6   contracts and on conditions that will best enable the authority to
 282-7   pay its operating expenses, meet its outstanding financial
 282-8   obligations as they mature, supply the increasing demand for
 282-9   electric power in the area dependent on its systems for electric
282-10   service on April 28, 1975, and assure, to the extent possible, an
282-11   adequate supply of water for irrigation and other useful purposes,
282-12   as it is needed in the various counties comprising the authority.
282-13         (b)  When bonds are to be issued to finance in whole or in
282-14   part water-impounding facilities, before approving the bonds the
282-15   attorney general shall be furnished a resolution from the
282-16   commission or its successor agency certifying that the authority
282-17   possesses the necessary water right authorizing it to impound or
282-18   otherwise appropriate the waters to be utilized by the project.
282-19         Sec. 261.018.  BONDS AS NEGOTIABLE INSTRUMENTS.  Bonds issued
282-20   by the authority pursuant to the provisions of this chapter or
282-21   other general law are negotiable instruments under the laws of this
282-22   state.
282-23         Sec. 261.019.  ADDITIONAL POWERS RELATING TO CONTRACTS,
282-24   RULES, AND REGULATIONS.  The authority may, but without intending
282-25   by this provision to limit any powers of the authority as granted
282-26   to it by this chapter or other general law, enter into and carry
 283-1   out contracts or establish or comply with rules and regulations
 283-2   concerning labor and materials and other related matters in
 283-3   connection with any project or projects as the authority considers
 283-4   desirable or as requested by the United States, the state, or any
 283-5   corporation or agency created, designated, or established by the
 283-6   United States or the state that may assist in the financing of the
 283-7   project or projects.
 283-8         Sec. 261.020.  PURCHASE OF BONDS.  The authority may, out of
 283-9   any funds available for the purpose, purchase any bonds issued by
283-10   it at a price not exceeding the redemption price applicable at the
283-11   time of the purchase, or if the bonds are not redeemable, at a
283-12   price not exceeding the principal amount of the bonds plus accrued
283-13   interest.  All bonds so purchased shall be canceled.
283-14         Sec. 261.021.  DISPOSITION OF PROPERTY.  (a)  Nothing in this
283-15   chapter shall be construed as authorizing the authority, and the
283-16   authority is not  authorized, to mortgage or otherwise encumber any
283-17   of its property of any kind, real, personal, or mixed, or any
283-18   interest in such property, or to acquire any property or interest
283-19   subject to a mortgage or conditional sale, provided that this
283-20   section shall not be construed as preventing the pledging of the
283-21   revenues of the authority as authorized by this chapter.
283-22         (b)  Nothing in this chapter shall be construed as
283-23   authorizing the sale of any property or interest by the authority
283-24   or by any receiver of any of its properties or through any court
283-25   proceeding or otherwise, unless, by the affirmative vote of
283-26   three-fourths of its statutory membership, the board has determined
 284-1   that the property or interest is not necessary or convenient or of
 284-2   beneficial use to the business of the authority and has approved
 284-3   the terms of the sale.  Except by sale as expressly authorized in
 284-4   this section, no such property or interest shall ever come into the
 284-5   ownership or control, directly or indirectly, of any person, firm,
 284-6   or corporation other than a public authority created under the laws
 284-7   of the state or a nonprofit corporation created by the authority
 284-8   under Chapter 152.
 284-9         (c)  The limitations on the sale of properties of the
284-10   authority in this section shall not and are not intended to
284-11   preclude the authority from selling any interest owned or held by
284-12   the authority in any jointly owned electric power and generating
284-13   facilities constructed, or to be constructed, pursuant to the
284-14   provisions of Section 261.004(t), provided that any such sale of an
284-15   ownership interest in a joint project is provided for and in
284-16   conformance with any contract with other owners regarding such
284-17   electric power and energy generating facilities.
284-18         (d)  All property of the authority shall be at all times
284-19   exempted from forced sale, and nothing in this chapter shall be
284-20   construed to authorize the sale of any of the property of the
284-21   authority under any judgment rendered in any suit, and such sales
284-22   are prohibited.
284-23         Sec. 261.022.  PROPERTY AGREEMENTS WITH CITY OF AUSTIN.
284-24   Nothing in this chapter prohibits the authority from owning
284-25   property in conjunction with, acquiring property from, or selling
284-26   property to the City of Austin, on terms and conditions as the
 285-1   authority and the city may agree.  The authority may acquire
 285-2   property from the City of Austin subject to repurchase agreements,
 285-3   or other terms and conditions as may be agreed on between the
 285-4   authority and the city, and may enter into such contractual
 285-5   relations with the city respecting property as the parties may
 285-6   agree on.
 285-7         Sec. 261.023.  PROPERTY USEFUL IN THE PRODUCTION OR
 285-8   UTILIZATION OF ELECTRIC ENERGY.  Nothing in this chapter shall
 285-9   prohibit or restrict the sale, lease, or other disposition, to any
285-10   electric cooperative, municipality, nonprofit corporation created
285-11   by the authority under Chapter 152, or other governmental agency or
285-12   body politic and corporate of the state, of any property acquired
285-13   or constructed by the authority and incidental to or used or useful
285-14   in the generation, production, transmission, distribution, or sale
285-15   of electric energy.  The authority is authorized to pledge the
285-16   proceeds of any such sale or sales to the same extent and in the
285-17   same manner in which it is authorized to pledge its revenues.
285-18         Sec. 261.024.  PUBLIC ACCESS.  (a)  The authority may not
285-19   prevent the public use of its lands for recreation purposes and
285-20   fishing except at such points where, in the opinion of the board,
285-21   the use would interfere with the proper conduct of the business of
285-22   the authority or would interfere with the lawful use of the
285-23   property.  A lease of authority lands, except one expressly
285-24   permitted by Section 261.023, is not lawful unless it provides for
285-25   free public use of the lands for recreational purposes and fishing.
285-26         (b)  All public rights-of-way traversing the areas adjacent
 286-1   to the areas flooded or to be flooded by the impounded waters shall
 286-2   remain open as a way of free public passage to and from the lakes
 286-3   created, and no charge shall ever be made to the public for the
 286-4   right to engage in fishing, boating, or swimming on such lakes.
 286-5         (c)  If any citizen of the state or of the United States
 286-6   advises the attorney general that this section has not been
 286-7   complied with, the attorney general is authorized after
 286-8   investigation of the complaint and notice to the authority to
 286-9   institute the proper legal proceedings, if any are required, to
286-10   require the authority or its successor to comply with this section.
286-11         (d)  If any of the land owned by the authority bordering the
286-12   lakes to be created under the authority of this chapter is sold by
286-13   the authority, the authority shall retain in each tract a strip 20
286-14   feet wide abutting the high-water line of the lake for the purpose
286-15   of passage and use by the public for public sports and amusements;
286-16   provided, however, that this subsection shall not apply to any
286-17   sales of land by the authority to any state or federal agency to be
286-18   used for game or fish sanctuaries, preserves, or for propagation
286-19   purposes.
286-20         Sec. 261.025.  BONDS EXEMPT FROM TAXATION.  All bonds and
286-21   interest on the bonds issued under the provisions of this chapter
286-22   are exempt from taxation, except inheritance taxes, by the state or
286-23   by any municipal corporation, county, or other political
286-24   subdivision or taxing district of the state.
286-25         Sec. 261.026.  SOURCE OF AUTHORITY.  (a)  This chapter,
286-26   without reference to other statutory provisions, constitutes full
 287-1   authority for the authorization and issuance of bonds under this
 287-2   chapter, and no other act or law with regard to the authorization
 287-3   or issuance of obligations or the deposit of the proceeds of
 287-4   obligations, or in any way impeding or restricting the carrying out
 287-5   of the acts authorized by this chapter shall be construed as
 287-6   applying a limitation to any proceedings taken under or acts done
 287-7   pursuant to this chapter.
 287-8         (b)  Nothing in this chapter shall prevent the authority from
 287-9   issuing bonds under any applicable general law of the state,
287-10   provided, however, that no bonds are issued that would be in
287-11   conflict with Section 261.025.
287-12         Sec. 261.027.  BONDS AS INVESTMENTS AND SECURITY FOR
287-13   DEPOSITS.  (a)  All bonds of the authority are legal and authorized
287-14   investments for individuals, partnerships, profit and nonprofit
287-15   corporations, banks, savings banks, trust companies, building and
287-16   loan associations, savings and loan associations, insurance
287-17   companies, fiduciaries, trustees, and guardians and for the sinking
287-18   funds of cities, towns, villages, counties, school districts, or
287-19   other political corporations or subdivisions of the state.
287-20         (b)  The bonds are eligible to secure the deposit of all
287-21   public funds of the state and any public funds of cities, towns,
287-22   villages, counties, school districts, or other political
287-23   corporations or subdivisions of the state and are lawful and
287-24   sufficient security for such deposits to the extent of their par
287-25   value when accompanied by all unmatured coupons.
287-26         Sec. 261.028.  CONSTRUCTION.  (a)  This chapter and all of
 288-1   its terms and provisions shall be liberally construed to carry out
 288-2   the purposes set forth in this chapter.
 288-3         (b)  Nothing in this chapter shall affect the meaning of
 288-4   Section 261.011, formerly Section 9, Chapter 74, Acts of the 64th
 288-5   Legislature, Regular Session, 1975, as it existed prior to the
 288-6   adoption of this chapter, except where specifically amended.
 288-7         Sec. 261.029.  AUTHORITY POWERS IN LAMPASAS COUNTY.
 288-8   Notwithstanding any other provision of this chapter, the authority
 288-9   may exercise all powers within Lampasas County that it may
288-10   otherwise exercise within the 10 counties specified in Section
288-11   261.003, except that the authority may not provide water or
288-12   wastewater services in the portion of Lampasas County outside the
288-13   Colorado River watershed without the consent of the Brazos River
288-14   Authority.
288-15         Sec. 261.030.  ADDITIONAL SPECIFIC POWERS.  (a)
288-16   Notwithstanding any other provision of this chapter, the authority:
288-17               (1)  may purchase, construct, acquire, own, operate,
288-18   repair, improve, or extend any facility necessary or convenient to
288-19   provide water services in Williamson County in cooperation with
288-20   another special district, a municipality, or another governmental
288-21   entity;
288-22               (2)  may not provide water services in the watershed of
288-23   the Brazos River unless the authority obtains in writing the
288-24   consent of the Brazos River Authority before the services are
288-25   provided; and
288-26               (3)  may transfer surface water from the authority to a
 289-1   place in Williamson County that is outside the watershed of the
 289-2   Colorado River only if the transfer is made to:
 289-3                     (A)  a municipality that was a water customer of
 289-4   the authority on May 20, 1997, and located in the watersheds of
 289-5   both the Colorado River and the Brazos River; or
 289-6                     (B)  a person or entity that pays for the surface
 289-7   water in an amount sufficient to pay both the authority's
 289-8   applicable water rate and an additional charge to pay the costs of
 289-9   mitigating any adverse effects of the transfer of surface water to
289-10   Williamson County from the Colorado River watershed, and provided
289-11   the transfer results in no net loss of water to the Colorado River
289-12   watershed as determined by the board.
289-13         (b)  Notwithstanding the amounts of surface water transferred
289-14   by the authority to municipalities in accordance with Subsection
289-15   (a)(3)(A), the volume of surface water authorized for transfer by
289-16   the authority in accordance with Subsection (a)(3)(B) shall not
289-17   exceed 25,000 acre-feet per year, it being the intent of the
289-18   legislature that the authority shall not be the sole provider of
289-19   surface water to Williamson County.
289-20         (c)  The authority shall determine the amount of the
289-21   additional charge under Subsection (a)(3)(B).  The additional
289-22   charge may not be less than 10 percent of the authority's
289-23   applicable rate for surface water to be transferred.  The authority
289-24   shall deposit any money the authority receives from the additional
289-25   charge, and may deposit any other money as the board determines,
289-26   into a separate fund designated as the agricultural water
 290-1   conservation fund.  The authority may use money from the
 290-2   agricultural water conservation fund only for the development of
 290-3   water resources or other water use strategies to replace or offset
 290-4   the amount of surface water to be transferred to Williamson County,
 290-5   including the development and implementation of methods, programs,
 290-6   and strategies relating to groundwater resources, reuse,
 290-7   conservation, and other opportunities to reduce the reliance on
 290-8   surface water for agricultural irrigation, provided that the
 290-9   methods, programs, and strategies take into consideration the
290-10   surface water and groundwater needs of the affected Colorado River
290-11   Basin users.
290-12         (d)  Before its determination of the use of money from the
290-13   agricultural water conservation fund, the authority shall consult
290-14   with an advisory committee representing agricultural irrigation
290-15   interests that is appointed by the county judges of Matagorda,
290-16   Wharton, and Colorado counties.  The board's determination of the
290-17   additional charge is not subject to review or modification by any
290-18   regulatory agency or independent reviewing authority.  Water
290-19   resources developed or conserved through the additional charge may
290-20   be acquired from any source inside or outside the boundaries of the
290-21   authority and shall be used to benefit the water service areas of
290-22   the authority's irrigation operations.
290-23               CHAPTER 262.  LOWER NECHES VALLEY AUTHORITY
290-24         Sec. 262.001.  CREATION.  (a)  A conservation and reclamation
290-25   district to be known as the "Lower Neches Valley Authority" is
290-26   created.  The authority is a governmental agency and a body politic
 291-1   and corporate.
 291-2         (b)  The authority is created under and is essential to
 291-3   accomplish the purposes of Section 59, Article XVI, Texas
 291-4   Constitution.
 291-5         (c)  The authority may exercise the powers granted by Section
 291-6   59, Article XVI, Texas Constitution, to districts created to
 291-7   conserve, store, control, preserve, utilize, and distribute the
 291-8   storm waters, floodwaters, and waters of the rivers and streams of
 291-9   the state, as well as such powers as may be contemplated and
291-10   implied by the purposes of that provision of the constitution and
291-11   as may be conferred by general law and by the provisions of this
291-12   chapter, except that nothing in this chapter shall be construed to
291-13   authorize the authority to levy any taxes or special assessments.
291-14         (d)  The authority may construct, maintain, and operate, in
291-15   the Neches River basin, within or outside the boundaries of the
291-16   authority, any and all works deemed essential to the operation of
291-17   the authority and for its administration in the control, storing,
291-18   preservation, and distribution for all useful purposes of the
291-19   waters of the Neches River and its tributaries, including the storm
291-20   waters and floodwaters.
291-21         (e)  The authority may exercise such authority and power of
291-22   control and regulations over such waters of the Neches River and
291-23   its tributaries as may be exercised by a district under general law
291-24   not in conflict with this chapter, subject to the provisions of the
291-25   constitution and the acts of the legislature.
291-26         Sec. 262.002.  DEFINITIONS.  In this chapter:
 292-1               (1)  "Authority" means the Lower Neches Valley
 292-2   Authority.
 292-3               (2)  "Board" means the board of directors of the
 292-4   authority.
 292-5               (3)  "Director" means a member of the board.
 292-6               (4)  "Neches River basin" means the area within the
 292-7   Neches River basin as defined by the Texas Water Development Board
 292-8   and any area within the boundaries of the authority.
 292-9               (5)  "Neches River and its tributaries" means the
292-10   waters of the rivers, streams, and watercourses within the Neches
292-11   River basin.
292-12         Sec. 262.003.  TERRITORY.  The territory of the authority is
292-13   as follows:  All of Jefferson, Hardin and Tyler Counties, a strip
292-14   of land ten (10) miles in width off the Eastern end of Liberty
292-15   County (the West line of said strip being parallel to and ten (10)
292-16   miles West of the extreme Eastern boundary line of Liberty County,
292-17   and a strip of land fifteen (15) miles in width off the East side
292-18   of Chambers County.  (the West line of such strip being parallel to
292-19   and fifteen (15) miles West of the Eastern boundary line of
292-20   Chambers County).
292-21         Sec. 262.004.  BOARD OF DIRECTORS.  (a)  The management and
292-22   control of all the affairs of the authority shall be vested in a
292-23   board consisting of nine directors.
292-24         (b)  A director must be a freehold property taxpayer and a
292-25   legal voter of the state.
292-26         (c)  The governor shall appoint the directors with the advice
 293-1   and consent of the senate.  The board shall include five residents
 293-2   of Jefferson County, two of Hardin County, and two of Tyler County.
 293-3         (d)  Directors serve for staggered terms of six years.
 293-4   Directors hold office after their appointment and qualification
 293-5   until their successors are appointed and have qualified, unless
 293-6   sooner removed by the governor.
 293-7         (e)  If a vacancy occurs on the board, the vacancy is filled
 293-8   for the unexpired term in the manner provided in appointments for a
 293-9   full term.
293-10         (f)  As soon as practical after a director is appointed, that
293-11   director shall qualify by making the sworn statement prescribed by
293-12   law for public office, taking the official oath prescribed by the
293-13   constitution for public office and filing with the secretary of
293-14   state a bond payable to the authority, all in accordance with
293-15   Section 49.055.
293-16         Sec. 262.005.  ADMINISTRATIVE PROVISIONS.  The authority
293-17   shall operate pursuant to the applicable provisions of Subchapter
293-18   C, Chapter 49.
293-19         Sec. 262.006.  ACCOUNT RECORDS; AUDIT.  The authority shall
293-20   keep a complete book of accounts and prepare an annual audit,
293-21   subject to the applicable provisions of Subchapter G, Chapter 49.
293-22         Sec. 262.007.  CONTROL AND EMPLOYMENT OF WATERS; POWERS AND
293-23   DUTIES.  (a)  The authority may exercise, in addition to all the
293-24   powers otherwise provided by this chapter for the conservation and
293-25   beneficial utilization of waters, the power of control and
293-26   employment of the waters of the Neches River basin, including the
 294-1   storm waters and floodwaters, in the manner and for the following
 294-2   purposes:
 294-3               (1)  to provide through practical and legal means for
 294-4   the control and coordination of the regulation of the waters of the
 294-5   Neches River basin;
 294-6               (2)  to provide by adequate organization and
 294-7   administration for the preservation of the equitable rights of the
 294-8   people of the different sections of the watershed area in the
 294-9   beneficial use of the waters of the Neches River basin;
294-10               (3)  to provide for storage, control, and conservation
294-11   of the waters of the Neches River basin within or outside the
294-12   authority in order to prevent the escape of any of the waters
294-13   without the maximum of public service and to provide for the
294-14   prevention of the devastation of lands from recurrent overflows and
294-15   the protection of life and property in the authority from
294-16   uncontrolled floodwaters;
294-17               (4)  to provide for the conservation of the waters of
294-18   the Neches River basin essential for domestic and municipal uses;
294-19               (5)  to provide for the irrigation of all lands in the
294-20   authority, lands outside the authority but within the Neches River
294-21   basin, where irrigation is required for agricultural purposes, or
294-22   may be deemed helpful to more profitable agricultural production,
294-23   to provide for the treatment of water and wastewater and solid
294-24   waste, and to provide for the equitable distribution of water to
294-25   the regional potential requirements for all uses, domestic,
294-26   industrial, and irrigation;
 295-1               (6)  to provide for encouragement and development of
 295-2   drainage systems and provisions for drainage of lands in the Neches
 295-3   River basin needing drainage for profitable agricultural production
 295-4   and for drainage of other lands in the Neches River basin requiring
 295-5   drainage for the most advantageous use;
 295-6               (7)  to provide for the conservation of all soils
 295-7   against destructive erosion and to prevent the increased flood
 295-8   dangers caused by destructive soil erosion;
 295-9               (8)  to control and make storm waters and floodwaters
295-10   available for employment in the development of industrial uses in
295-11   all sections of the Neches River basin;
295-12               (9)  to provide for the control, storage, and
295-13   employment of storm waters and floodwaters in the development and
295-14   distribution of hydroelectric power, where this use may be
295-15   economically coordinated with other and superior uses and
295-16   subordinated to the uses declared by law to be superior;
295-17               (10)  to provide for all purposes for which floodwaters
295-18   and storm waters, when controlled and conserved, may be used in the
295-19   performance of a useful service as contemplated and authorized by
295-20   the provisions of the Texas Constitution and the public policy it
295-21   declares; and
295-22               (11)  to provide water for beneficial uses pursuant to
295-23   an interlocal agreement for economic development programs.
295-24         (b)  The authority may purchase or construct all works
295-25   necessary or convenient for the exercise of the powers and to
295-26   accomplish the purposes specified in this chapter and to purchase
 296-1   or otherwise acquire all lands or other property necessary or
 296-2   convenient for carrying out those purposes.
 296-3         (c)  Plans and works provided by the authority and works
 296-4   provided under authorization of the authority must give primary
 296-5   consideration to the necessary and potential needs for water by or
 296-6   within the Neches River basin.
 296-7         (d)  The authority may exercise any applicable power or duty
 296-8   provided by Subchapter H, Chapter 49, or any other applicable
 296-9   general law of the state.
296-10         Sec. 262.008.  FEES AND CHARGES.  (a)  The board shall
296-11   prescribe fees and charges to be collected for the use of water,
296-12   water connections, or other service.  The fees and charges must be
296-13   reasonable and equitable and fully sufficient to produce revenues
296-14   adequate to pay, and from which the board shall pay:
296-15               (1)  all expenses necessary to the operation and
296-16   maintenance of the improvements and facilities of the authority,
296-17   including the cost of the acquisition of properties and materials
296-18   necessary to maintain the improvements and facilities in good
296-19   condition and to operate them efficiently, necessary wages and
296-20   salaries of the authority, and such other expenses as may be
296-21   reasonably necessary to the efficient operation of the improvements
296-22   and facilities;
296-23               (2)  the annual or semiannual interest on any
296-24   obligations issued under this chapter that are payable out of the
296-25   revenues of the improvements and facilities; and
296-26               (3)  the amount required to be paid annually into the
 297-1   sinking fund for the payment of any obligations issued under this
 297-2   chapter that are payable out of the revenues of the improvements
 297-3   and facilities.
 297-4         (b)  No charges other than those authorized by Subsection (a)
 297-5   may be made on the revenues derived from the improvements and
 297-6   facilities of the authority if any obligations issued under this
 297-7   chapter remain outstanding and unpaid as to principal or interest;
 297-8   provided, however, that out of revenues that may be received in
 297-9   excess of those required for the purposes listed in Subsection (a)
297-10   the board may pay the cost of improvements and replacements not
297-11   covered by Subsection (a)(1) and may establish a reasonable
297-12   depreciation and emergency fund.
297-13         (c)  The fees and charges of the authority may not be in
297-14   excess of what may be reasonably necessary to fulfill the
297-15   obligations imposed on the authority by this chapter.
297-16         Sec. 262.009.  CONTRACTS, LEASES, AND AGREEMENTS.  (a)  The
297-17   authority, in addition to the powers otherwise provided by this
297-18   chapter, may enter into all contracts, leases, and agreements
297-19   necessary or convenient to carry out any of the powers granted by
297-20   this chapter.  The contracts, leases, and agreements may be entered
297-21   into with any person, real or artificial, any corporation,
297-22   municipal, public, or private, or any government or governmental
297-23   agency, including the United States government and the state.
297-24         (b)  The authority may convey or cause to be conveyed any of
297-25   its properties, rights, lands, tenements, easements, improvements,
297-26   reservoirs, dams, canals, plants, laterals, works, and facilities
 298-1   to the United States government or any agency of the United States
 298-2   and may enter into a lease with the United States government or any
 298-3   agency of the United States relative to such properties and
 298-4   obligate itself to pay rent for such properties out of the income
 298-5   and revenues of the properties, with or without the privilege of
 298-6   purchase.
 298-7         (c)  Nothing in this section shall be construed to authorize
 298-8   the assumption by the authority of any obligation requiring payment
 298-9   out of taxes.
298-10         (d)  Contracts, leases, and agreements authorized by this
298-11   section shall be approved by resolution of the board and shall be
298-12   executed by the president and attested by the secretary.
298-13         Sec. 262.010.  RIGHT TO SUE.  The authority may sue and be
298-14   sued.
298-15         Sec. 262.011.  APPROVAL OF PLANS AND SPECIFICATIONS.  Before
298-16   the authority may establish a diversion point or construct a canal,
298-17   a pumping plant, or other works provided for in this chapter, the
298-18   authority shall present to the commission plans and specifications
298-19   of the canal, plant, or other works and obtain the approval of the
298-20   commission.
298-21         Sec. 262.012.  ACQUISITION OF LAND FOR PUBLIC PARKS.
298-22   (a)  The authority may acquire and own lands within the authority
298-23   by purchase for the purpose of operating and maintaining public
298-24   parks for public recreation and may construct and operate
298-25   improvements and facilities on such lands to accomplish that
298-26   purpose.
 299-1         (b)  Funds derived from taxation may not be expended in
 299-2   purchasing lands or constructing and maintaining improvements and
 299-3   facilities under this section.
 299-4         Sec. 262.013.  ECONOMIC DEVELOPMENT PROGRAMS.  (a)  The
 299-5   authority may sponsor and participate in an economic development
 299-6   program within the areas served by the authority to strengthen the
 299-7   economic base and further the economic development of the state.
 299-8   The program may not be outside the areas served by the authority
 299-9   unless the authority has entered into an interlocal agreement with
299-10   an entity under Subsection (c).
299-11         (b)  Each program must be established by formal action of the
299-12   board.  The board shall:
299-13               (1)  establish the goals of the program;
299-14               (2)  impose requirements on persons participating in
299-15   and receiving the benefits of the program; and
299-16               (3)  provide restrictions, procedures, and budget
299-17   limits that the board determines are necessary to ensure that the
299-18   governmental purposes of this section and the program are achieved.
299-19         (c)  A program under this section may involve grants or loans
299-20   of money, services, or equipment to a person engaged in an economic
299-21   development activity, including a public fire-fighting
299-22   organization, governmental body, nonprofit corporation, local or
299-23   regional development council, or other nonprofit or noncommercial
299-24   organization.  The authority may provide assistance to a for-profit
299-25   entity if the assistance is necessary or appropriate to carry out
299-26   an economic development program consistent with the purposes of
 300-1   this section.
 300-2         (d)  The authority may employ staff and expend its resources
 300-3   to further an economic development program under this section,
 300-4   except that the authority may not use money received from an ad
 300-5   valorem tax or a general appropriation to further a program.  The
 300-6   authority may apply for and receive money, grants, or other
 300-7   assistance from any source to carry out an economic development
 300-8   program under this section.
 300-9         (e)  The authority and any other public or private person may
300-10   enter into an agreement with respect to an economic development
300-11   program.
300-12         (f)  If the authority provides scholarships, grants, loans,
300-13   or financial assistance to a public fire-fighting organization, the
300-14   authority shall adopt guidelines to determine:
300-15               (1)  eligibility for the assistance;
300-16               (2)  the amount of loans, grants, or other assistance
300-17   the authority may make available to a fire-fighting organization;
300-18   and
300-19               (3)  the type of equipment, education, or training for
300-20   which the assistance may be used.
300-21         (g)  A determination by the board that a program is intended
300-22   and expected to carry out the program's stated purposes is
300-23   conclusive with respect to whether the purposes of this section are
300-24   satisfied.
300-25         (h)  In this section, an economic development program
300-26   includes a community assistance program, privatization program, or
 301-1   any other program designed to:
 301-2               (1)  encourage economic diversification;
 301-3               (2)  maintain or expand employment;
 301-4               (3)  train persons;
 301-5               (4)  eliminate conditions detrimental to the public
 301-6   health, safety, or welfare;
 301-7               (5)  improve the quality or quantity of services
 301-8   essential for the development of viable communities and economic
 301-9   growth, including services related to:
301-10                     (A)  education;
301-11                     (B)  transportation;
301-12                     (C)  public safety;
301-13                     (D)  recreation;
301-14                     (E)  health care;
301-15                     (F)  water and wastewater treatment; or
301-16                     (G)  rural water and sewer development; or
301-17               (6)  contribute to the health and development of a
301-18   community to improve the attractiveness of the community to public
301-19   and private enterprises.
301-20         Sec. 262.014.  COMMISSION SUPERVISION.  In the exercise of
301-21   the powers and duties provided by this chapter, the authority is
301-22   subject to the continuing rights of supervision of the commission.
301-23   The commission may approve or refuse to approve the adequacy of any
301-24   plan or plans for flood control or conservation improvement
301-25   purposes devised by the authority for the achievement of the plans
301-26   and purposes intended in the creation of the authority which
 302-1   contemplate improvements supervised by the commission under the
 302-2   provisions of general law.
 302-3         Sec. 262.015.  ADDITIONAL POWERS.  (a)  The authority has and
 302-4   may exercise the functions, powers, authority, rights, and duties
 302-5   necessary to accomplish the purposes for which the authority is
 302-6   created, including investigating and planning, acquiring,
 302-7   constructing, maintaining, and operating all necessary properties,
 302-8   lands, rights, tenements, easements, improvements, reservoirs,
 302-9   dams, canals, laterals, plants, works, and facilities, including
302-10   the acquisition within or outside the authority of lands,
302-11   rights-of-way, water rights, and all other properties, tenements,
302-12   and easements and other rights incident to, helpful to, or in aid
302-13   of carrying out the purposes of the authority as provided by this
302-14   chapter.
302-15         (b)  This chapter shall be liberally construed to effectuate
302-16   the purposes provided by this chapter.
302-17         Sec. 262.016.  LOANS.  The authority may borrow money for any
302-18   corporate purpose from any department or agency of the United
302-19   States or from any other source, and in evidence of any such debt
302-20   may issue notes, warrants, bonds, certificates of indebtedness, or
302-21   other forms of obligations of the authority, payable solely out of
302-22   the revenues to be derived from the improvements and facilities and
302-23   the operations and services of the improvements and facilities.
302-24         Sec. 262.017.  EXISTING WATER RIGHTS.  Nothing in this
302-25   chapter affects any rights existing at the time of the formation of
302-26   the authority or existing priorities in the rights to water from
 303-1   the source of supply, and neither the formation of the authority or
 303-2   a contract for the purchase of water with the authority may ever be
 303-3   held to be an abandonment or waiver of those rights or priorities
 303-4   or an abandonment of the original point of diversion from the
 303-5   source of supply, and all such rights existing at the time of
 303-6   formation of the authority shall be preserved.
 303-7         Sec. 262.018.  EMINENT DOMAIN.  (a)  The right of eminent
 303-8   domain is expressly conferred on the authority to enable it to
 303-9   acquire the fee simple title to, or easement or right-of-way over
303-10   and through, all lands, water, or lands under water, private or
303-11   public, within or outside the Neches River basin, necessary or
303-12   convenient to carry out any of the purposes and powers conferred on
303-13   the authority by this chapter.
303-14         (b)  Condemnation proceedings shall be under the direction of
303-15   the board and in the name of the authority. The assessment of
303-16   damages and all procedures with regard to condemnation, appeal, and
303-17   payment shall be in conformity with Chapter 21, Property Code.
303-18            CHAPTER 263.  MACKENZIE MUNICIPAL WATER AUTHORITY
303-19         Sec. 263.001.  CREATION.  (a)  A conservation and reclamation
303-20   district to be known as the "Mackenzie Municipal Water Authority"
303-21   is created.  The authority is a governmental agency and a body
303-22   politic and corporate.
303-23         (b)  The authority is created under and is essential to
303-24   accomplish the purposes of Section 59, Article XVI, Texas
303-25   Constitution.
303-26         Sec. 263.002.  DEFINITIONS.  In this chapter:
 304-1               (1)  "Authority" means the Mackenzie Municipal Water
 304-2   Authority.
 304-3               (2)  "Board" means the board of directors of the
 304-4   authority.
 304-5               (3)  "Director" means a member of the board.
 304-6         Sec. 263.003.  TERRITORY.  The authority contains all of the
 304-7   territory within the boundaries of the city of Tulia in Swisher
 304-8   County, the city of Silverton in Briscoe County, and the cities of
 304-9   Lockney and Floydada in Floyd County, as the boundaries of each
304-10   city existed on February 1, 1965.  An invalidity in the fixing of
304-11   the boundaries of those cities does not affect the boundaries of
304-12   the territory contained in the authority.  It is found and
304-13   determined that all of the territory and taxable property contained
304-14   within the boundaries of those cities will benefit from the works
304-15   and improvements of the authority.
304-16         Sec. 263.004.  BOARD OF DIRECTORS.  (a)  All powers of the
304-17   authority shall be exercised by a board of directors.  The
304-18   directors serve staggered two-year terms.  The governing body of
304-19   each city contained in the authority shall appoint two directors,
304-20   with the term of one director expiring on April 30 of each
304-21   even-numbered year and the term of one director expiring on April
304-22   30 of each odd-numbered year.
304-23         (b)  In April of each year the governing body of each city
304-24   contained in the authority shall appoint a director to succeed the
304-25   director from that city whose term is about to expire.  A vacancy
304-26   shall be filled for the unexpired term by the governing body of the
 305-1   appropriate city.
 305-2         (c)  Each director serves for a term of office as provided by
 305-3   this section and until a successor is appointed and has qualified.
 305-4         (d)  A director must reside in and own taxable property in
 305-5   the city from which the director is appointed.  A member of a
 305-6   governing body or an employee of a city is not eligible to serve as
 305-7   a director.
 305-8         (e)  Each director shall subscribe the constitutional oath of
 305-9   office and shall give bond for the faithful performance of the
305-10   person's duties as director in the amount of $5,000.  The cost of
305-11   the bond shall be paid by the authority.
305-12         (f)  A majority of the members of the board constitutes a
305-13   quorum.
305-14         (g)  If a director moves from the city from which the
305-15   director is appointed or otherwise ceases to be a director, the
305-16   governing body of the city shall appoint a successor for the
305-17   unexpired term.
305-18         Sec. 263.005.  DIRECTOR FEES.  (a)  Each director may receive
305-19   a fee determined by the board, not to exceed $20, for attending
305-20   each meeting of the board, provided that no more than $40 shall be
305-21   paid to any director for meetings held in any one calendar month.
305-22         (b)  Each director is entitled to receive a fee not to exceed
305-23   $20 per day for each day devoted to the business of the authority
305-24   and to reimbursement for actual expenses incurred in attending to
305-25   authority business provided that the service and expense have
305-26   received prior approval by the board.
 306-1         Sec. 263.006.  OFFICERS; EMPLOYEES; SEAL.  (a)  The board
 306-2   shall elect from among its members a president and a vice president
 306-3   of the authority and other officers as the board determines
 306-4   necessary.
 306-5         (b)  The president is the chief executive officer of the
 306-6   authority and the presiding officer of the board and has the same
 306-7   right to vote as any other director.
 306-8         (c)  The vice president shall perform all duties and exercise
 306-9   all powers conferred by this chapter on the president when the
306-10   president is absent or fails or declines to act, except the
306-11   president's right to vote.
306-12         (d)  The board shall appoint a secretary and a treasurer, who
306-13   may or may not be members of the board, and it may combine those
306-14   offices.  The treasurer shall give bond in an amount determined by
306-15   the board.  The bond shall be conditioned on the treasurer
306-16   faithfully accounting for all money that comes into the treasurer's
306-17   custody as treasurer of the authority.
306-18         (e)  The board shall appoint necessary engineers, attorneys,
306-19   and other employees and employ a general manager.  The power to
306-20   employ and discharge employees may be conferred on the general
306-21   manager.
306-22         (f)  The board shall adopt a seal for the authority.
306-23         Sec. 263.007.  GENERAL PROCEDURE FOR ANNEXATION OF TERRITORY.
306-24   (a)  Other territory, whether incorporated or unincorporated, may
306-25   be annexed to the authority as provided by this section.
306-26         (b)  A petition praying for annexation must:
 307-1               (1)  be signed by 50 or a majority, whichever number is
 307-2   less, of the qualified voters residing in the territory to be
 307-3   annexed who own taxable property in the territory;
 307-4               (2)  be filed with the board; and
 307-5               (3)  describe the territory to be annexed by metes and
 307-6   bounds, or otherwise, unless the territory is the same as that
 307-7   contained in a city or town, in which event it will be sufficient
 307-8   to state that the territory to be annexed is that contained within
 307-9   the boundaries of the city or town.
307-10         (c)  If the board finds that the petition complies with, and
307-11   is signed by the number of qualified persons required by,
307-12   Subsection (b), that the annexation would be to the best interest
307-13   of the territory to be annexed and the authority, and that the
307-14   authority will be able to supply water or cause water to be
307-15   supplied to the territory or render sewer service or cause sewer
307-16   service to be rendered to the territory, the board shall adopt a
307-17   resolution stating the conditions, if any, under which the
307-18   territory may be annexed to the authority and shall set a time and
307-19   place for a hearing to be held by the board on the question of
307-20   whether the territory to be annexed will benefit from the
307-21   improvements, works, and facilities then owned or operated or
307-22   contemplated to be owned or operated by the authority or by the
307-23   other functions of the authority.  Railroad right-of-way that is
307-24   not situated within the defined limits of an incorporated city or
307-25   town will not benefit from the improvements, works, and facilities
307-26   that the authority is authorized to construct.  Railroad
 308-1   right-of-way may not be annexed to the authority unless the
 308-2   right-of-way is contained within the limit of an incorporated city
 308-3   or town that has been annexed to the authority.
 308-4         (d)  Notice of the adoption of the resolution stating the
 308-5   time and place of the hearing shall be published one time in a
 308-6   newspaper designated by the board at least 10 days before the date
 308-7   of the hearing.  The notice must describe the territory to be
 308-8   annexed in the same manner in which it is required or permitted by
 308-9   this chapter to be described in the petition.
308-10         (e)  All interested persons may appear at the hearing and
308-11   offer evidence for or against the proposed annexation.  The hearing
308-12   may proceed in the order and under the rules as may be prescribed
308-13   by the board and may be recessed from time to time.  If, at the
308-14   conclusion of the hearing, the board finds that lands in the
308-15   territory to be annexed will benefit from present or contemplated
308-16   improvements, works, or facilities of the authority, the board
308-17   shall adopt a resolution making a finding of such benefit, calling
308-18   an election in the territory to be annexed stating the date and the
308-19   place or places for holding the election and the proposition to be
308-20   voted on, and appointing a presiding judge for each voting place,
308-21   who shall appoint the necessary assistant judges and clerks to
308-22   assist in holding the election.
308-23         (f)  Notice of the election shall be given by publishing a
308-24   substantial copy of the resolution calling the election one time in
308-25   a newspaper of general circulation in the territory to be annexed
308-26   to the authority at least 10 days before the date set for the
 309-1   election.
 309-2         (g)  Only constitutionally qualified electors who reside in
 309-3   the territory to be annexed shall be qualified to vote in the
 309-4   election.  Returns of the result of the election shall be made to
 309-5   the board.
 309-6         (h)  The board shall canvass the returns of the election and
 309-7   adopt an order declaring the results.  If the order shows that a
 309-8   majority of the votes cast are in favor of annexation, the board
 309-9   shall by resolution annex the territory to the authority, and the
309-10   annexation shall be incontestable except in the manner and within
309-11   the time for contesting elections under the Election Code.
309-12         (i)  In calling an election on the proposition of the
309-13   annexation of territory, the board may include as a part of the
309-14   same proposition, or as a separate proposition, the question of the
309-15   assumption of that territory's part of the tax-supported bonds of
309-16   the authority then outstanding and those voted but not yet sold and
309-17   the levy of an ad valorem tax on taxable property in the territory
309-18   along with the tax in the rest of the authority for the payment of
309-19   the bonds.  The voting on the proposition or propositions shall be
309-20   restricted to constitutionally qualified electors.  The territory
309-21   may be annexed only if both propositions receive a majority vote.
309-22         Sec. 263.008.  ANNEXATION OF CERTAIN MUNICIPAL TERRITORY.
309-23   (a)  Territory annexed to a city that is initially contained in the
309-24   authority or that is added to the authority may be annexed to the
309-25   authority as provided by this section.
309-26         (b)  At any time after final passage of an ordinance or
 310-1   resolution annexing territory to a city, the board may issue a
 310-2   notice of a hearing on the question of annexing the territory or
 310-3   any part of the territory.  The notice is sufficient if it states
 310-4   the date and place of the hearing and:
 310-5               (1)  describes the area proposed to be annexed; or
 310-6               (2)  makes reference to the annexation ordinance or
 310-7   resolution of the city.
 310-8         (c)  The notice must be published one time in a newspaper
 310-9   having general circulation in the city that made the annexation.
310-10   The publication must be at least 10 days before the date set for
310-11   the hearing.
310-12         (d)  If, at the hearing, the board finds that the territory
310-13   proposed to be annexed will benefit from present or contemplated
310-14   improvements, works, or facilities of the authority, the board
310-15   shall adopt a resolution annexing the territory to the authority.
310-16         Sec. 263.009.  ASSUMPTION OF BONDS.  After territory is added
310-17   to the authority, the board may call an election over the entire
310-18   authority to determine whether the entire authority as enlarged
310-19   shall assume the tax-supported bonds then outstanding and those
310-20   voted but not yet sold and whether an ad valorem tax shall be
310-21   levied on all taxable property within the authority as enlarged for
310-22   the payment of the bonds, unless the proposition had previously
310-23   been voted at an election held within the annexed territory and
310-24   became lawfully binding on the annexed territory.  The election
310-25   shall be called and held and notice of the election given in the
310-26   same manner as elections for the issuance of bonds as provided in
 311-1   this chapter.
 311-2         Sec. 263.010.  APPOINTMENT OF DIRECTORS IN ANNEXED
 311-3   TERRITORIES.  If the territory of a city is annexed to the
 311-4   authority, the governing body of the city shall appoint two
 311-5   directors.  The term of one appointee shall expire on the following
 311-6   April 30 and the term of the other appointee shall expire on April
 311-7   30 a year later.  Thereafter the directors shall be appointed as
 311-8   provided in Section 263.004.
 311-9         Sec. 263.011.  WATER APPROPRIATION PERMITS.  The authority
311-10   may obtain appropriation permits from the commission through
311-11   appropriate hearings as provided by Chapter 11.
311-12         Sec. 263.012.  DAMS AND OTHER FACILITIES FOR DIVERTING,
311-13   IMPOUNDING, STORING, TREATING, AND TRANSPORTING WATER.  The
311-14   authority may acquire or construct within or outside the boundaries
311-15   of the authority dams and all works, plants, and other facilities,
311-16   including underground water storage facilities, necessary for the
311-17   purpose of diverting, impounding, storing, treating, and
311-18   transporting water to cities and others for municipal, domestic,
311-19   industrial, and mining purposes.  A dam or other facility for
311-20   impounding water may not be constructed unless the plan for the
311-21   facility is approved by the commission.
311-22         Sec. 263.013.  ACQUISITION AND SALE OF PROPERTY; CONSTRUCTION
311-23   OF FACILITIES; WATER RIGHTS.  (a)  The authority may acquire land
311-24   within and outside the boundaries of the authority and may
311-25   construct, lease, or otherwise acquire all works, plants, and other
311-26   facilities necessary for the purpose of diverting, further
 312-1   impounding, or storing water, treating the water, and transporting
 312-2   it to cities and others for municipal, domestic, industrial, and
 312-3   mining purposes.
 312-4         (b)  The authority may sell water within and outside the
 312-5   boundaries of the authority and may acquire by purchase or
 312-6   contract, in any county in which a part of the authority is
 312-7   located, lands in fee simple title or water rights without surface
 312-8   title and may develop and beneficially use such groundwater;
 312-9   provided, however, that the authority shall be limited to a
312-10   quantity of groundwater as may be reasonably necessary, and the
312-11   withdrawal may not exceed two acre-feet of water per year for each
312-12   acre of surface area purchased or water rights otherwise acquired
312-13   by the authority overlying the groundwater reservoir.
312-14         (c)  Subject to the terms of any deed of trust issued by the
312-15   authority, the authority may sell, trade, or otherwise dispose of
312-16   any real or personal property determined by the board not to be
312-17   needed for authority purposes.
312-18         (d)  As a necessary aid to the conservation, control,
312-19   preservation, and distribution of water for beneficial use, the
312-20   authority may construct, own, and operate sewage gathering,
312-21   transmission, and disposal facilities, may charge for such service,
312-22   and may make contracts in reference to such facilities and services
312-23   with municipalities and others.
312-24         Sec. 263.014.  EMINENT DOMAIN.  (a)  For the purpose of
312-25   carrying out a power or authority conferred by this chapter, except
312-26   the acquisition of groundwater rights, the authority may acquire,
 313-1   within or outside the boundaries of the authority, the fee simple
 313-2   title to land and other property and easements, including land
 313-3   needed for a reservoir and dam and flood easements above the
 313-4   probable high-water line around the reservoir, by condemnation in
 313-5   the manner and with the same power as conferred on counties of the
 313-6   state by Chapter 21, Property Code.  The authority is a municipal
 313-7   corporation within the meaning of Section 21.021(c), Property
 313-8   Code.
 313-9         (b)  The authority may not condemn any property that is owned
313-10   by any persons, firms, private corporations, or receivers, or their
313-11   trustees, who have the power of eminent domain, except that the
313-12   authority may condemn an easement.  The amount and character of
313-13   interest in land, other property, and easements to be acquired
313-14   through condemnation shall be determined by the board.  The
313-15   authority has the powers provided by Section 49.221 with reference
313-16   to making surveys and attending to other business of the authority.
313-17         (c)  If the authority, in the exercise of its power of
313-18   eminent domain or police power or any other power, requires the
313-19   relocation, raising, lowering, rerouting, change in grade, or
313-20   alteration in construction of any road or highway; railroad;
313-21   electric transmission, telegraph, or telephone lines, conduits,
313-22   poles, properties, or facilities; or pipelines, all such
313-23   relocation, raising, lowering, rerouting, change in grade, or
313-24   alteration of construction shall be accomplished at the sole
313-25   expense of the authority.  In this section, "sole expense" means
313-26   the actual cost of such lowering, rerouting, change in grade, or
 314-1   alteration of construction in providing comparable replacement
 314-2   without enhancement of the facilities, after deducting the net
 314-3   salvage value derived from the old facility.
 314-4         Sec. 263.015.  CONTRACTS; BIDDING.  A construction contract
 314-5   requiring an expenditure of more than $15,000 may only be made
 314-6   after publication of a notice to bidders once each week for two
 314-7   weeks before the contract is awarded.  The notice is sufficient if
 314-8   it states the time and location the bids will be opened, states the
 314-9   general nature of the work to be done or the material, equipment,
314-10   or supplies to be purchased, and states where and the terms on
314-11   which copies of the plans and specifications may be obtained.  The
314-12   publication must be in a newspaper published in each county in
314-13   which a portion of the authority is located, and such newspapers
314-14   shall be designated or approved by the board.
314-15         Sec. 263.016.  ISSUANCE OF BONDS.  (a)  For the purpose of
314-16   carrying out any power or authority conferred by this chapter, the
314-17   authority may issue negotiable bonds to be payable from such
314-18   revenues or taxes or both revenues and taxes of the authority as
314-19   are pledged by resolution of the board.
314-20         (b)  Bonds must be authorized by resolution of the board.
314-21   The bonds must be issued in the name of the authority, signed by
314-22   the president or vice president, and attested by the secretary and
314-23   must bear the seal of the authority.  The signatures of the
314-24   president or vice president, of the secretary, or of both may be
314-25   printed or lithographed on the bonds if authorized by the board,
314-26   and the seal of the authority may be impressed on the bonds or may
 315-1   be printed or lithographed on the bonds.
 315-2         (c)  Bonds must mature serially or otherwise in not to exceed
 315-3   40 years from their date and may be sold at a price and under terms
 315-4   determined by the board to be the most advantageous reasonably
 315-5   obtainable, provided that the interest cost to the authority,
 315-6   including the discount, if any, does not exceed six percent per
 315-7   year.  Within the discretion of the board, bonds may be made
 315-8   callable prior to maturity at such times and prices as may be
 315-9   prescribed in the resolution authorizing the bonds and may be made
315-10   registrable as to principal or as to both principal and interest.
315-11         (d)  Bonds may be issued in more than one series and from
315-12   time to time as required for carrying out the purposes of this
315-13   chapter.
315-14         (e)  Bonds may be secured by a pledge of all or part of the
315-15   net revenues of the authority, of the net revenues of one or more
315-16   contracts made before or after the bonds are issued, or of other
315-17   revenues or income specified by resolution of the board or in the
315-18   trust indenture.  A pledge may reserve the right, under conditions
315-19   in the pledge specified, to issue additional bonds that will be on
315-20   a parity with or subordinate to the bonds being issued.
315-21         (f)  The authority may issue bonds payable from ad valorem
315-22   taxes to be levied on all taxable property in the authority or may
315-23   issue bonds secured by and payable from both those taxes and the
315-24   revenues of the authority.  If bonds are issued payable wholly or
315-25   partially from ad valorem taxes, the board shall levy a tax
315-26   sufficient to pay the bonds and the interest on the bonds as the
 316-1   bonds and interest become due.  The rate of the tax for any year
 316-2   may be set after giving consideration to the money received from
 316-3   the pledged revenues available for payment of principal and
 316-4   interest to the extent and in the manner permitted by the
 316-5   resolution authorizing the issuance of the bonds.
 316-6         (g)  If bonds payable wholly from revenues are issued, the
 316-7   board shall set, and from time to time revise, rates of
 316-8   compensation for water sold and services rendered by the authority
 316-9   sufficient to pay the expense of operating and maintaining the
316-10   facilities of the authority, to pay the bonds as they mature and
316-11   the interest as it accrues, and to maintain the reserve and other
316-12   funds as provided in the resolution authorizing the bonds.  If
316-13   bonds payable partially from revenues are issued, the board shall
316-14   set, and from time to time revise, rates of compensation for water
316-15   sold and services rendered by the authority sufficient to assure
316-16   compliance with the resolution authorizing the bonds or the trust
316-17   indenture securing the bonds.
316-18         (h)  From the proceeds of the sale of the bonds, the
316-19   authority may set aside an amount for the payment of interest
316-20   expected to accrue during construction and for a reserve interest
316-21   and sinking fund and such other funds as may be provided in the
316-22   resolution authorizing the bonds or in the trust indenture.
316-23   Proceeds from the sale of the bonds may also be used for the
316-24   payment of all expenses necessarily incurred in accomplishing the
316-25   purpose for which this authority is created, including expenses of
316-26   issuing and selling the bonds.  The proceeds from the sale of the
 317-1   bonds and other funds may be invested in such securities as are
 317-2   specified in the bond resolution or trust indenture.
 317-3         (i)  In the event of a default or a threatened default in the
 317-4   payment of principal of or interest on bonds payable wholly or
 317-5   partially from revenues, any court of competent jurisdiction may,
 317-6   on petition of the holders of outstanding bonds, appoint a receiver
 317-7   with authority to collect and receive all income of the authority
 317-8   except taxes, employ and discharge agents and employees of the
 317-9   authority, take charge of the authority's funds on hand (except
317-10   funds received from taxes, unless commingled), and manage the
317-11   proprietary affairs of the authority without consent or hindrance
317-12   by the board.  The receiver may also be authorized to sell or make
317-13   contracts for the sale of water or renew the contracts with the
317-14   approval of the court appointing the receiver.  The court may vest
317-15   the receiver with other powers and duties the court finds necessary
317-16   for the protection of the holders of the bonds.  The resolution
317-17   authorizing the issuance of the bonds or the trust indenture
317-18   securing them may limit or qualify the rights of the holders of
317-19   less than all of the outstanding bonds payable from the same source
317-20   to institute or prosecute litigation affecting the authority's
317-21   property or income.
317-22         Sec. 263.017.  REFUNDING BONDS.  (a)  The authority may issue
317-23   refunding bonds for the purpose of refunding outstanding bonds
317-24   authorized by this chapter and interest on the bonds.  Refunding
317-25   bonds may be issued to refund more than one series of outstanding
317-26   bonds and may combine the pledges for the outstanding bonds for the
 318-1   security of the refunding bonds, and the refunding bonds may be
 318-2   secured by other or additional revenues and mortgage liens.
 318-3         (b)  The provisions of this chapter regarding the issuance of
 318-4   other bonds by the authority, their security, their approval by the
 318-5   attorney general, and the remedies of the holders shall be
 318-6   applicable to refunding bonds.  Refunding bonds shall be registered
 318-7   by the comptroller on surrender and cancellation of the bonds to be
 318-8   refunded, but in lieu of that procedure, the resolution authorizing
 318-9   the issuance of the refunding bonds may provide that the refunding
318-10   bonds shall be sold and the proceeds of the sale deposited in the
318-11   bank where the original bonds are payable, in which case the
318-12   refunding bonds may be issued in an amount sufficient to pay the
318-13   principal of and the interest on the original bonds to their option
318-14   date or maturity date, and the comptroller shall register the
318-15   refunding bonds without concurrent surrender and cancellation of
318-16   the original bonds.  Refunding bonds may be issued without an
318-17   election.
318-18         Sec. 263.018.  TRUST INDENTURE; DEED OF TRUST OR MORTGAGE
318-19   LIEN.  (a)  Bonds, including refunding bonds, authorized by this
318-20   chapter that are not payable wholly from ad valorem taxes may be
318-21   additionally secured by a trust indenture under which the trustee
318-22   may be a bank with trust powers located either within or outside
318-23   the state.  The bonds may, within the discretion of the board, be
318-24   additionally secured by a deed of trust or mortgage lien on
318-25   physical properties of the authority and all franchises, easements,
318-26   water rights and appropriation permits, leases and contracts, and
 319-1   all rights appurtenant to the properties, vesting in the trustee
 319-2   power to sell the properties for the payment of indebtedness, power
 319-3   to operate the properties, and all other powers and authority for
 319-4   the further security of the bonds.
 319-5         (b)  The trust indenture, regardless of the existence of a
 319-6   deed of trust or mortgage lien on the properties, may:
 319-7               (1)  contain provisions prescribed by the board for the
 319-8   security of the bonds and the preservation of the trust estate;
 319-9               (2)  make provision for amendment or modification of
319-10   the trust indenture and the issuance of bonds to replace lost or
319-11   mutilated bonds;
319-12               (3)  condition the right to expend authority money or
319-13   sell authority property on approval of a registered professional
319-14   engineer selected as provided in the trust indenture; and
319-15               (4)  make provision for the investment of funds of the
319-16   authority.
319-17         (c)  A purchaser under a sale under a deed of trust lien,
319-18   where one is given, shall be the absolute owner of the properties,
319-19   facilities, and rights purchased and shall have the right to
319-20   maintain and operate the properties, facilities, and rights.
319-21         Sec. 263.019.  BONDS PAYABLE FROM AD VALOREM TAXES; ELECTION.
319-22   (a)  Bonds payable wholly or partially from ad valorem taxes,
319-23   except refunding bonds, may not be issued unless authorized by an
319-24   election at which only the constitutionally qualified electors who
319-25   reside in the authority are allowed to vote and a majority of the
319-26   votes cast in each city contained in the authority are in favor of
 320-1   the issuance of the bonds.  If a majority of the votes cast in any
 320-2   city contained in the authority are against the issuance of the
 320-3   bonds, the board may, in its discretion, adopt a resolution
 320-4   detaching the territory of that city from the authority; provided,
 320-5   however, that after bonds payable from taxes have been issued by
 320-6   the authority and while any such bonds are outstanding, no
 320-7   territory shall be detached from the authority.  Bonds not payable
 320-8   wholly or partially from ad valorem taxes may be issued without an
 320-9   election.
320-10         (b)  An election for the authorization of bonds may be called
320-11   by the board without a petition.  The resolution calling the
320-12   election shall specify the time and locations of holding the
320-13   election, the purpose for which the bonds are to be issued, the
320-14   maximum amount of the bonds, the maximum maturity of the bonds, the
320-15   form of the ballot, and the presiding judge for each voting place.
320-16   The presiding judge serving at each voting place shall appoint one
320-17   assistant judge and at least two clerks to assist in holding the
320-18   election.  Notice of the election shall be given by publishing a
320-19   substantial copy of the notice in a newspaper published in each
320-20   city contained in the authority for two consecutive weeks.  The
320-21   first publication must be at least 21 days before the date of the
320-22   election.  In a city in which no newspaper is published, notice
320-23   shall be given by posting a copy of the resolution in three public
320-24   places in the city at least 21 days before the date of the
320-25   election.
320-26         (c)  The returns of the election shall be made to and
 321-1   canvassed by the board.
 321-2         (d)  Elections held under this section shall be governed by
 321-3   the Election Code except as otherwise provided by this chapter.
 321-4         Sec. 263.020.  BOND APPROVAL AND REGISTRATION.  After bonds,
 321-5   including refunding bonds, are authorized by the authority, the
 321-6   bonds and the record relating to their issuance shall be submitted
 321-7   to the attorney general for examination as to the validity of the
 321-8   bonds.  If the bonds recite that they are secured by a pledge of
 321-9   the proceeds of a contract previously made between the authority
321-10   and a city or other governmental agency, authority, or district, a
321-11   copy of the contract and the proceedings of the city or other
321-12   governmental agency, authority, or district authorizing the
321-13   contract shall also be submitted to the attorney general.  If the
321-14   attorney general finds that the bonds have been authorized and that
321-15   the contract has been made in accordance with the constitution and
321-16   laws of the state, the attorney general shall approve the bonds and
321-17   the contract, and the bonds shall then be registered by the
321-18   comptroller.  After their approval and registration, the bonds and
321-19   the contract, if any, are valid and binding and are incontestable
321-20   for any cause.
321-21         Sec. 263.021.  CONTRACTS WITH CITIES AND OTHERS.  (a)  The
321-22   authority may enter into contracts with cities and others for
321-23   supplying water to them.  The authority may also contract with a
321-24   city for the rental or leasing of, or for the operation of, the
321-25   water production, water supply, and water filtration or
321-26   purification and water supply facilities of the city for such
 322-1   consideration as the authority and the city may agree.  The
 322-2   contract may be on the terms and for the time as the parties may
 322-3   agree, and the contract may provide that it shall continue in
 322-4   effect until bonds specified in the contract and refunding bonds
 322-5   issued in lieu of those bonds are paid.
 322-6         (b)  If an election is held in any city then contained in the
 322-7   authority on the question of whether the governing body of the city
 322-8   shall be authorized to make a water supply contract with the
 322-9   authority and the result of the election is that the governing body
322-10   shall not be authorized to make such a contract with the authority,
322-11   the board may, in its discretion, adopt a resolution detaching that
322-12   city from the authority; provided, however, that after bonds
322-13   payable from taxes have been issued by the authority and while any
322-14   such bonds are outstanding, no territory shall be detached from the
322-15   authority.
322-16         (c)  In addition to selling its bonds to the Texas Water
322-17   Development Board and securing loans from that board, the authority
322-18   may enter into a contract or contracts with the board under which
322-19   the board or the state will own a portion of the water storage
322-20   facilities, as provided in Chapter 16, in a reservoir or reservoirs
322-21   to be constructed by the authority.  The authority may include in
322-22   the contract or contracts the obligation to purchase such storage
322-23   facilities from the state and a provision to accumulate a fund for
322-24   that purpose by setting and maintaining adequate rates and charges
322-25   to be paid by cities previously and subsequently contracting to buy
322-26   water from the authority.
 323-1         Sec. 263.022.  AUTHORITY DEPOSITORY.  (a)  The board shall
 323-2   designate one or more banks within the authority to serve as
 323-3   depository for the funds of the authority.  All funds of the
 323-4   authority shall be deposited in the depository bank or banks,
 323-5   except that bond proceeds and funds pledged to pay bonds may, to
 323-6   the extent provided in the indenture, be deposited with the trustee
 323-7   bank named in the trust indenture and except that funds shall be
 323-8   remitted to the bank of payment for the payment of principal of and
 323-9   interest on bonds.  To the extent that funds in the depository
323-10   banks and the trustee bank are not insured by the Federal Deposit
323-11   Insurance Corporation, the funds shall be secured in the manner
323-12   provided by law for the security of county funds.
323-13         (b)  Before designating a depository bank or banks, the board
323-14   shall issue a notice stating the time and the location the board
323-15   will meet to designate the depository or depositories and inviting
323-16   the banks in the authority to submit applications to be designated
323-17   depositories.  The notice must be mailed to each bank in the
323-18   authority.
323-19         (c)  At the time stated in the notice, the board shall
323-20   consider the applications and the management and condition of the
323-21   banks filing them and shall designate as the depository or
323-22   depositories the bank or banks that offer the most favorable terms
323-23   and conditions for the handling of the funds of the authority and
323-24   which the board finds have proper management and are in condition
323-25   to warrant the handling of authority funds.  Membership on the
323-26   board of an officer or director of a bank shall not disqualify that
 324-1   bank from being designated as a depository.
 324-2         (d)  If no applications are received by the time stated in
 324-3   the notice, the board shall designate a bank or banks within or
 324-4   outside the authority on the terms and conditions the board
 324-5   determines are advantageous to the authority.
 324-6         (e)  The term of service for depositories shall be prescribed
 324-7   by the board.
 324-8         Sec. 263.023.  WATER APPROPRIATION PERMITS; ACQUISITION OF
 324-9   STORAGE CAPACITY AND OF WATER.  The authority may acquire water
324-10   appropriation permits from owners of permits.  The authority may
324-11   lease or acquire rights in and to storage and storage capacity in
324-12   any reservoir constructed or to be constructed by any person, firm,
324-13   corporation, or public agency or from the United States government
324-14   or any of its agencies.
324-15         Sec. 263.024.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
324-16   DEPOSITS.  (a)  Bonds of the authority are legal and authorized
324-17   investments for banks, savings banks, trust companies, building and
324-18   loan associations, savings and loan associations, insurance
324-19   companies, fiduciaries, trustees, and guardians and for the sinking
324-20   fund of cities, towns, villages, counties, school districts, or
324-21   other political corporations or subdivisions of the state.
324-22         (b)  The bonds are eligible to secure the deposit of all
324-23   public funds of the state and all public funds of cities, towns,
324-24   villages, counties, school districts, or other political
324-25   corporations or subdivisions of the state.  The bonds are lawful
324-26   and sufficient security for the deposits to the extent of their
 325-1   value when accompanied by all unmatured coupons appurtenant to the
 325-2   bonds.
 325-3         Sec. 263.025.  BONDS EXEMPT FROM TAXATION.  The
 325-4   accomplishment of the purposes stated in this chapter is for the
 325-5   benefit of the people of the state and for the improvement of their
 325-6   properties and industries, and the authority, in carrying out the
 325-7   purposes of this chapter, will be performing an essential public
 325-8   function under Section 59, Article XVI, Texas Constitution.  The
 325-9   authority may not be required to pay any tax or assessment on the
325-10   project or any part of the project, and the bonds issued under this
325-11   chapter and the transfer of and income from the bonds, including
325-12   the profits made on the sale of the bonds, shall at all times be
325-13   free from taxation within the state.
325-14         Sec. 263.026.  TAX ROLLS.  (a)  The tax rolls of the cities
325-15   located within the authority and within annexed territory
325-16   constitute the tax rolls of the authority until assessment and tax
325-17   rolls are made by the authority.
325-18         (b)  Before the sale and delivery of authority bonds that are
325-19   payable wholly or partially from ad valorem taxes, the board shall
325-20   appoint a tax assessor and collector and a board of equalization
325-21   and shall cause taxes to be assessed, valuations to be equalized,
325-22   and tax rolls to be prepared.  General laws applicable to water
325-23   control and improvement districts with reference to tax assessors
325-24   and collectors, boards of equalization, tax rolls, tax liens, and
325-25   the levy and collection of taxes and delinquent taxes shall be
325-26   applicable to the authority, except that the board of equalization,
 326-1   to be appointed each year by the board, shall consist of one member
 326-2   residing in each city contained in the authority.
 326-3         (c)  The board may make contracts with one or more cities in
 326-4   the authority for the collection of authority taxes.
 326-5         (d)  Taxes levied by the authority shall be ad valorem.
 326-6         Sec. 263.027.  ADOPTION OF RULES AND REGULATIONS.  (a)  The
 326-7   board may adopt and promulgate all reasonable rules and regulations
 326-8   to secure, maintain, and preserve the potable and sanitary
 326-9   condition of all water in and to flow into any reservoir owned by
326-10   the authority to prevent the waste or unauthorized use of water, to
326-11   regulate residence, hunting, fishing, boating, and camping, and all
326-12   recreational and business privileges, along, around, or on any
326-13   reservoir or any body of land or easement owned by the authority.
326-14         (b)  The authority may prescribe a reasonable penalty for the
326-15   breach of a rule or regulation of the authority, not to exceed a
326-16   fine of $200 or imprisonment for 30 days, or both such fine and
326-17   imprisonment.  The penalty shall be in addition to any other
326-18   penalties provided by the laws of the state and may be enforced by
326-19   complaints filed in the appropriate court of jurisdiction;
326-20   provided, however, that no rule or regulation that provides a
326-21   penalty for a violation of the rule or regulation shall be in
326-22   effect, as to enforcement of the penalty, until five days after the
326-23   authority has caused a substantive statement of the rule or
326-24   regulation and the penalty for the violation to be published once a
326-25   week for two consecutive weeks in the county or counties in which
326-26   the reservoir is located.  The substantive statement to be
 327-1   published shall be as condensed as is possible to afford sufficient
 327-2   notice as to the act forbidden by the rule or regulation.  A single
 327-3   notice may embrace any number of rules or regulations.  The notice
 327-4   must provide the information that breach of the rule or regulation
 327-5   will subject the violator to the imposition of a penalty.  The
 327-6   notice must also state that the full text of the rule or regulation
 327-7   is on file in the principal office of the authority and may be read
 327-8   by any interested person.  Five days after the second publication
 327-9   of the notice required by this section, the advertised rule or
327-10   regulation shall be in effect, and ignorance of the rule or
327-11   regulation shall not constitute a defense to prosecution for the
327-12   enforcement of a penalty.  After the required publication, the
327-13   rules and regulations authorized by this section shall judicially
327-14   be known to the courts and shall be considered similar in nature to
327-15   a valid penal ordinance of a city.
327-16         (c)  A duly constituted peace officer may make arrests when
327-17   necessary to prevent or stop the commission of any offense against
327-18   the rules or regulations of the authority or against the laws of
327-19   the state, when the offense or threatened offense occurs on or in
327-20   any land, water, or easement owned or controlled by the authority,
327-21   or may make an arrest at any place in the case of an offense
327-22   involving injury or detriment to any property owned or controlled
327-23   by the authority.
327-24         Sec. 263.028.  PARKS AND RECREATION FACILITIES.  The
327-25   authority may establish or otherwise provide for public parks and
327-26   recreation facilities and may acquire land for such purposes within
 328-1   or outside the authority; provided, however, that no money received
 328-2   from taxation or from bonds payable wholly or partially from
 328-3   taxation shall be used to provide for the parks or recreation
 328-4   facilities.
 328-5         Sec. 263.029.  AUTHORITY OF PEACE OFFICERS.  The authority
 328-6   may employ and constitute its own peace officers, and any such
 328-7   officer or any other duly constituted peace officer may make an
 328-8   arrest when necessary to prevent or stop the commission of any
 328-9   offense against the regulations of the authority or against the
328-10   laws of the state, when any such offense or threatened offense
328-11   occurs on or in any land, water, or easement owned or controlled by
328-12   the authority, or may make an arrest at any place in the case of an
328-13   offense involving injury or detriment to any property owned or
328-14   controlled by the authority.
328-15         Sec. 263.030.  EFFECT ON PRIORITY OF WATER USE.  Nothing in
328-16   this chapter shall be interpreted as amending or repealing Section
328-17   11.024, which provides for priorities of the use of water.
328-18       CHAPTER 264.  NORTH CENTRAL TEXAS MUNICIPAL WATER AUTHORITY
328-19         Sec. 264.001.  CREATION.  (a)  A conservation and reclamation
328-20   district to be known as the "North Central Texas Municipal Water
328-21   Authority" is created.  The authority is a governmental agency and
328-22   a body politic and corporate.
328-23         (b)  The authority is created under and is essential to
328-24   accomplish the purposes of Section 59, Article XVI, Texas
328-25   Constitution.
328-26         Sec. 264.002.  DEFINITIONS.  In this chapter:
 329-1               (1)  "Authority" means the North Central Texas
 329-2   Municipal Water Authority.
 329-3               (2)  "Board" means the board of directors of the
 329-4   authority.
 329-5               (3)  "Director" means a member of the board.
 329-6         Sec. 264.003.  TERRITORY.  The authority contains all of the
 329-7   territory contained in the boundaries of the cities of Goree, Knox
 329-8   City, and Munday in Knox County and the city of Haskell in Haskell
 329-9   County, as the boundaries of each city are set forth in ordinances
329-10   or resolutions passed or adopted before April 19, 1957.  No
329-11   invalidity of any of those ordinances or resolutions or the fixing
329-12   of the boundaries as set out in those ordinances shall affect the
329-13   boundaries of the territory contained in the authority.  The
329-14   legislature finds and determines that all of the territory and
329-15   taxable property contained within the boundaries set forth in the
329-16   ordinances or resolutions will benefit from the works and
329-17   improvements of the authority and that the territory described in
329-18   the ordinances or resolutions shall be contained within the
329-19   authority whether lawfully contained within any of the cities or
329-20   not.
329-21         Sec. 264.004.  BOARD OF DIRECTORS.  (a)  All powers of the
329-22   authority shall be exercised by a board of directors.  Each
329-23   director is appointed by a majority vote of the governing body of
329-24   the city in which the director resides.
329-25         (b)  Two directors are appointed from each city in the
329-26   authority.
 330-1         (c)  Directors serve staggered two-year terms.  In May of
 330-2   each year the governing body of each city shall appoint a director
 330-3   for the two-year term beginning June 1 of that year.
 330-4         (d)  Each director serves for a term of office as provided by
 330-5   this section and until a successor is appointed and has qualified.
 330-6         (e)  A director must reside in and own taxable property in
 330-7   the city from which the director is appointed.  A member of a
 330-8   governing body of a city or an employee of a city is not eligible
 330-9   to serve as a director.
330-10         (f)  A director shall subscribe the constitutional oath of
330-11   office and shall give bond for the faithful performance of the
330-12   director's duties in the amount of $5,000, the cost of which shall
330-13   be paid by the authority.
330-14         (g)  A majority of the members of the board constitute a
330-15   quorum.
330-16         (h)  If a director moves from the city from which the
330-17   director is appointed or otherwise ceases to be a director, the
330-18   governing body of the city shall appoint a successor director for
330-19   the unexpired term.
330-20         Sec. 264.005.  DIRECTOR FEES.  (a)  Each director is entitled
330-21   to receive a fee not to exceed $20 for attending each meeting of
330-22   the board; provided, however, that no more than $40 may be paid to
330-23   a director for meetings held in any one calendar month.
330-24         (b)  Each director is entitled to receive a fee not to exceed
330-25   $20 per day for each day devoted to the business of the authority
330-26   and reimbursement for actual expenses incurred in attending to
 331-1   authority business provided that such service and expense are
 331-2   expressly approved by the board.
 331-3         Sec. 264.006.  OFFICERS; EMPLOYEES; SEAL.  (a)  The board
 331-4   shall elect from among its members a president and a vice president
 331-5   of the authority and other officers as in the judgment of the board
 331-6   are necessary.
 331-7         (b)  The president is the chief executive officer of the
 331-8   authority and the presiding officer of the board and has the same
 331-9   right to vote as any other director.
331-10         (c)  The vice president shall perform all duties and exercise
331-11   all powers conferred by this chapter on the president when the
331-12   president is absent or fails or declines to act, except the
331-13   president's right to vote.
331-14         (d)  The board shall appoint a secretary and a treasurer, who
331-15   may or may not be members of the board, and it may combine those
331-16   offices.  The treasurer shall give bond in an amount required by
331-17   the board.  The bond must be conditioned on the treasurer
331-18   faithfully accounting for all funds that come into the person's
331-19   custody as treasurer of the authority.
331-20         (e)  The board shall appoint necessary engineers, attorneys,
331-21   and other employees and shall employ a general manager.  The power
331-22   to employ and discharge employees may be conferred upon the general
331-23   manager.
331-24         (f)  The board shall adopt a seal for the authority.
331-25         Sec. 264.007.  ANNEXATION OF TERRITORY IN CERTAIN COUNTIES.
331-26   (a)  Other territory situated within Baylor, Haskell, and Knox
 332-1   counties may be annexed to the authority as provided by this
 332-2   section.
 332-3         (b)  A petition for annexation must:
 332-4               (1)  be signed by 50 or a majority, whichever number is
 332-5   less, of the qualified voters of the territory to be annexed who
 332-6   own taxable property in the territory being annexed and who have
 332-7   duly rendered the property to the city, if situated within a city
 332-8   or town, or county for taxation;
 332-9               (2)  be filed with the board; and
332-10               (3)  describe the territory to be annexed by metes and
332-11   bounds or otherwise unless the territory is the same as that
332-12   contained in a city or town, in which event it is sufficient to
332-13   state that the territory to be annexed is that contained within the
332-14   city or town.
332-15         (c)  If the board finds that the petition complies with and
332-16   is signed by the number of qualified persons required under
332-17   Subsection (b), that the annexation would be in the interest of the
332-18   territory to be annexed and the authority, and that the authority
332-19   will be able to supply water to the territory to be annexed or
332-20   cause water to be supplied to the territory to be annexed, the
332-21   board shall adopt a resolution stating the conditions, if any,
332-22   under which the territory may be annexed to the authority and
332-23   requesting the commission to annex the territory to the authority.
332-24   The resolution shall be conclusive of the legal sufficiency of the
332-25   petition and the qualifications of the signers.  A certified copy
332-26   of the resolution and the petition shall be filed with the
 333-1   commission.
 333-2         (d)  The commission shall adopt a resolution declaring its
 333-3   intention to call an election in the territory to be annexed for
 333-4   the purpose of submitting the proposition of whether the territory
 333-5   shall be annexed to the authority.  The commission shall set a time
 333-6   and place for a hearing to be held by the commission on the
 333-7   question of whether the territory to be annexed will benefit from
 333-8   the improvements, works, and facilities then owned or operated or
 333-9   contemplated to be owned or operated by the authority or will
333-10   benefit from the other functions of the authority.  Railroad
333-11   right-of-way that is not situated within the defined limits of an
333-12   incorporated city or town will not benefit from the improvements,
333-13   works, and facilities that the authority is authorized to
333-14   construct.  Railroad right-of-way may not be annexed to the
333-15   authority unless the right-of-way is contained within the limits of
333-16   an incorporated city or town that has been annexed to the
333-17   authority.
333-18         (e)  Notice of the adoption of the resolution stating the
333-19   time and place of the hearing addressed to the citizens and owners
333-20   of property in the territory to be annexed shall be published one
333-21   time in a newspaper designated by the commission at least 10 days
333-22   before the date of the hearing.  The notice must describe the
333-23   territory to be annexed in the same manner in which it is required
333-24   or permitted by this chapter to be described in the petition.
333-25         (f)  All interested persons may appear at the hearing and
333-26   offer evidence for or against the intended annexation.  The hearing
 334-1   may proceed in the order and under the rules as may be prescribed
 334-2   by the commission and may be recessed from time to time.  If, at
 334-3   the conclusion of the hearing, the commission finds that all of the
 334-4   lands in the territory to be annexed will benefit from the present
 334-5   or contemplated improvements, works, or facilities of the
 334-6   authority, the commission shall adopt a resolution calling an
 334-7   election in the territory to be annexed stating the date of the
 334-8   election and the place or places for holding and appointing a
 334-9   presiding judge for each voting place, who shall appoint the
334-10   necessary assistant judges and clerks to assist in holding the
334-11   election.
334-12         (g)  Notice of the election, stating the date and places for
334-13   holding the election, the proposition to be voted on, and the
334-14   conditions under which the territory may be annexed, or making
334-15   reference to the resolution of the board for that purpose, shall be
334-16   published one time in a newspaper designated by the commission at
334-17   least 10 days before the date set for the election.
334-18         (h)  Only qualified electors who reside in the territory to
334-19   be annexed may vote in the election.  Returns of the election shall
334-20   be made to the commission.
334-21         (i)  The commission shall canvass the returns of the election
334-22   and adopt an order declaring the results.  If the order shows that
334-23   a majority of the votes cast are in favor of annexation, the
334-24   commission shall annex the territory to the authority, and the
334-25   annexation is incontestable except in the manner and within the
334-26   time for contesting elections under the general election law.  A
 335-1   certified copy of the order shall be recorded in the deed records
 335-2   of the county in which the territory is situated.
 335-3         (j)  In calling the election on the proposition for the
 335-4   annexation of territory, the commission may include, as a part of
 335-5   the same proposition, a proposition for:
 335-6               (1)  the assumption of the territory's part of the
 335-7   tax-supported bonds of the authority then outstanding and those
 335-8   previously voted but not yet sold; and
 335-9               (2)  the levy of an ad valorem tax on taxable property
335-10   in the territory to be annexed along with the tax in the rest of
335-11   the authority for the payment of the bonds.
335-12         (k)  After territory is added to the authority, the board may
335-13   call an election over the entire authority for the purpose of
335-14   determining whether the entire authority as enlarged shall assume
335-15   the tax-supported bonds then outstanding and those voted but not
335-16   yet sold and whether an ad valorem tax shall be levied on all
335-17   taxable property within the authority as enlarged for the payment
335-18   of the bonds, unless the proposition has been voted along with the
335-19   annexation election and becomes lawfully binding on the territory
335-20   annexed.  The election shall be called and held in the same manner
335-21   as elections for the issuance of bonds as provided in this chapter.
335-22         (l)  If no newspaper is published in the territory to be
335-23   annexed, the notices required by this section shall be posted at
335-24   three public places in the territory.
335-25         Sec. 264.008.  APPOINTMENT OF DIRECTORS IN ANNEXED TERRITORY.
335-26   If the territory of a city is annexed to the authority, the
 336-1   governing body of the city shall appoint two directors.  The term
 336-2   of one appointee expires on the following May 31 and the term of
 336-3   the other appointee expires on May 31 a year later.  Thereafter,
 336-4   the directors are appointed as provided in Section 264.004.
 336-5         Sec. 264.009.  WATER APPROPRIATION PERMITS.  The authority
 336-6   may obtain appropriation permits from the commission through
 336-7   appropriate hearings as provided by Chapter 11.  Thereafter the
 336-8   permit, either on application of the authority or on the initiative
 336-9   of the commission, may be modified by the commission, after an
336-10   appropriate hearing, to increase or decrease the amount of water
336-11   that may be appropriated, and after considering the amount of water
336-12   that may be stored by the authority to meet fluctuating demands,
336-13   either on application by the authority or by its own action, the
336-14   commission shall redetermine the maximum amount of water that the
336-15   authority may store in its reservoir.  In making this
336-16   determination, the commission shall consider the needs of the
336-17   cities and others that purchase water from the authority.
336-18         Sec. 264.010.  AUTHORITY TO IMPOUND AND TRANSPORT WATER;
336-19   COMMISSION APPROVAL. (a) The authority may acquire or construct,
336-20   within the boundaries of Baylor, Haskell, Knox, and Throckmorton
336-21   counties, dams and all works, plants, and other facilities
336-22   necessary or useful for the purpose of impounding, processing, and
336-23   transporting water to cities and others for municipal, domestic,
336-24   industrial, and mining purposes.
336-25         (b)  The size of a dam and reservoir shall be determined by
336-26   the board, taking into consideration probable future increases in
 337-1   water requirements.
 337-2         (c)  The size of a dam shall not be limited by the amount of
 337-3   water initially authorized by the commission or a predecessor
 337-4   agency of the commission to be impounded in the reservoir.
 337-5         (d)  A dam or other facility for impounding water may not be
 337-6   constructed until the plan for the project is approved by the
 337-7   commission.
 337-8         Sec. 264.011.  ACQUISITION AND DISPOSITION OF PROPERTY.
 337-9   (a)  The authority may acquire land and construct, lease, or
337-10   otherwise acquire all works, plants, and other facilities necessary
337-11   or useful for the purpose of diverting, further impounding or
337-12   storing, processing, and transporting water to cities and others
337-13   for municipal, domestic, industrial, and mining purposes.
337-14         (b)  Subject to the terms of any deed of trust issued by the
337-15   authority, the authority may sell, trade, or otherwise dispose of
337-16   any real or personal property determined by the board not to be
337-17   needed for authority purposes.
337-18         (c)  The authority may not develop or otherwise acquire
337-19   underground sources of water.
337-20         (d)  The authority may not exercise powers of eminent domain
337-21   outside the boundaries of Baylor, Knox, Haskell, and Throckmorton
337-22   counties.
337-23         Sec. 264.012.  EMINENT DOMAIN.  (a)  For the purpose of
337-24   carrying out any power or authority conferred by this chapter, the
337-25   authority may acquire by condemnation in the manner provided by
337-26   Chapter 21, Property Code, the fee simple title to land and other
 338-1   property and easements in Baylor, Knox, Haskell, and Throckmorton
 338-2   counties for the reservoir and dam and flood easements above the
 338-3   probable high-water line around any such reservoir and easements
 338-4   for pipelines.
 338-5         (b)  The authority is a municipal corporation within the
 338-6   meaning of Section 21.021(c), Property Code, except that the
 338-7   authority may not condemn property owned by any other political
 338-8   subdivision, city, or town.
 338-9         (c)  As against persons, firms, and corporations, or their
338-10   receivers or trustees, who have the power of eminent domain, the
338-11   fee title may not be condemned, and the authority may condemn only
338-12   an easement.
338-13         (d)  In accordance with the provisions of this section, the
338-14   amount and character of interest in land, other property, and
338-15   easements to be acquired shall be determined by the board.
338-16         (e)  The authority has the power conferred on water control
338-17   and improvement districts by Section 49.221 with reference to
338-18   making surveys and attending to other business of the authority.
338-19         (f)  If the authority, in the exercise of the power of
338-20   eminent domain or the power of relocation or any other power
338-21   granted under this chapter, makes necessary the relocation,
338-22   raising, rerouting, changing the grade, or altering the
338-23   construction of any highway, railroad, electric transmission line,
338-24   telephone or telegraph properties and facilities, or pipeline, all
338-25   such necessary relocation, raising, rerouting, changing of grade,
338-26   or alteration of construction shall be accomplished at the sole
 339-1   expense of the authority.
 339-2         Sec. 264.013.  CONTRACTS; BIDS.  A construction contract
 339-3   requiring an expenditure of more than $10,000 may be made only
 339-4   after publication of a notice to bidders once each week for two
 339-5   weeks for sealed bids before the contract is awarded.  The bids
 339-6   shall be opened publicly.  The notice is sufficient if it states
 339-7   the time and place when and where the bids will be opened, states
 339-8   the general nature of the work to be done or the material,
 339-9   equipment, or supplies to be purchased, and states where and on
339-10   what terms copies of the plans and specifications may be obtained.
339-11   The publication must be in a newspaper published in the authority
339-12   and designated or approved by the board.
339-13         Sec. 264.014.  ISSUANCE OF BONDS.  (a)  For the purpose of
339-14   providing a source of water supply for cities and other users for
339-15   municipal, domestic, industrial, mining, and oil flooding purposes
339-16   as authorized by this chapter and for the purpose of carrying out
339-17   any other power or authority conferred by this chapter, the
339-18   authority may issue negotiable bonds to be payable from such
339-19   revenues or taxes, or both revenues and taxes, of the authority as
339-20   are pledged by resolution of the board.  Pending the issuance of
339-21   definitive bonds, the board may authorize the delivery of
339-22   negotiable interim bonds or notes that are eligible for exchange or
339-23   substitution by the definitive bonds.
339-24         (b)  Bonds must be authorized by resolution of the board.
339-25   The bonds must be issued in the name of the authority, signed by
339-26   the president or vice president, and attested by the secretary and
 340-1   must bear the seal of the authority.  The signatures of the
 340-2   president or of the secretary or of both may be printed or
 340-3   lithographed on the bonds if authorized by the board, and the seal
 340-4   of the authority may be impressed, printed, or lithographed on the
 340-5   bonds.  The bonds must mature, serially or otherwise, in not to
 340-6   exceed 40 years and may be sold at a price and under terms
 340-7   determined by the board to be the most advantageous reasonably
 340-8   obtainable, provided that the interest cost to the authority,
 340-9   including the discount, if any, calculated by use of standard bond
340-10   interest tables currently in use by insurance companies and
340-11   investment houses does not exceed six percent per year.  Within the
340-12   discretion of the board, bonds may be made callable prior to
340-13   maturity at such times and prices as may be prescribed in the
340-14   resolution authorizing the bonds and may be made registrable as to
340-15   principal or as to both principal and interest.
340-16         (c)  Bonds may be issued in more than one series and from
340-17   time to time as required for carrying out the purposes of this
340-18   chapter.
340-19         (d)  Bonds may be secured by a pledge of all or part of the
340-20   net revenues of the authority, of the net revenues of one or more
340-21   contracts made before or after the bonds are issued, or of other
340-22   revenues or income specified by resolution of the board or in the
340-23   trust indenture.  Any such pledge may reserve the right, under
340-24   conditions specified in the pledge, to issue additional bonds that
340-25   will be on a parity with or subordinate to the bonds being issued.
340-26   In this section, "net revenues" means the gross revenues and income
 341-1   of the authority from all sources less the amount necessary to pay
 341-2   the cost of maintaining and operating the authority and its
 341-3   properties.
 341-4         (e)  The authority may issue bonds payable from ad valorem
 341-5   taxes to be levied on all taxable property in the authority and may
 341-6   issue bonds secured by and payable from both such taxes and the
 341-7   revenues of the authority.  If bonds are issued payable wholly or
 341-8   partially from ad valorem taxes, the board shall levy a tax
 341-9   sufficient to pay the bonds and the interest on the bonds as the
341-10   bonds and interest become due, but the rate of the tax for any year
341-11   may be set after giving consideration to the money received from
341-12   the pledged revenues that may be available for payment of principal
341-13   and interest to the extent and in the manner permitted by the
341-14   resolution authorizing the issuance of the bonds.
341-15         (f)  If bonds payable wholly from revenues are issued, the
341-16   board shall set, and from time to time revise, rates of
341-17   compensation for water sold and services rendered by the authority
341-18   that will be sufficient to pay the expense of operating and
341-19   maintaining the facilities of the authority and to pay bonds as
341-20   they mature and the interest as it accrues and to maintain the
341-21   reserve and other funds as provided in the resolution authorizing
341-22   the bonds.  If bonds payable partially from revenues are issued,
341-23   the board shall set, and from time to time revise, rates of
341-24   compensation for water sold and services rendered by the authority
341-25   that will be sufficient to assure compliance with the resolution
341-26   authorizing the bonds.
 342-1         (g)  The authority may set aside from the proceeds of the
 342-2   sale of the bonds an amount for the payment of interest expected to
 342-3   accrue during construction and for a reserve interest and sinking
 342-4   fund, and such provision may be made in the resolution authorizing
 342-5   the bonds.  Proceeds from the sale of the bonds may also be used
 342-6   for the payment of all expenses necessarily incurred in
 342-7   accomplishing the purposes for which the authority is created,
 342-8   including the expenses of issuing and selling the bonds.  The
 342-9   proceeds from the sale of the bonds may be temporarily invested in
342-10   direct obligations of the United States government maturing not
342-11   more than one year from the date of investment.
342-12         (h)  In the event of a default or a threatened default in the
342-13   payment of principal of or interest on bonds payable wholly or
342-14   partially from revenues of the authority, any court of competent
342-15   jurisdiction may, on petition of the holders of outstanding bonds,
342-16   appoint a receiver with authority to collect and receive all income
342-17   of the authority except taxes, employ and discharge agents and
342-18   employees of the authority, take charge of the authority's funds on
342-19   hand (except funds received from taxes, unless commingled), and
342-20   manage the proprietary affairs of the authority without consent or
342-21   hindrance by the board.  The receiver may also be authorized to
342-22   sell or make contracts for the sale of water or renew such
342-23   contracts with the approval of the court appointing the receiver.
342-24   The court may vest the receiver with other powers and duties the
342-25   court finds necessary for the protection of the holders of the
342-26   bonds.  The resolution authorizing the issuance of the bonds or the
 343-1   trust indenture securing them may limit or qualify the rights of
 343-2   less than all of the outstanding bonds payable from the same source
 343-3   to institute or prosecute any litigation affecting the authority's
 343-4   property or income.
 343-5         Sec. 264.015.  REFUNDING BONDS.  (a)  The authority may issue
 343-6   refunding bonds for the purpose of refunding any outstanding bonds
 343-7   authorized by this chapter and interest on the bonds.  Refunding
 343-8   bonds may be issued to refund more than one series of outstanding
 343-9   bonds and combine the pledges for the outstanding bonds for the
343-10   security of the refunding bonds, and refunding bonds may be secured
343-11   by other or additional revenues and mortgage liens.
343-12         (b)  The provisions of this chapter with reference to the
343-13   issuance by the authority of other bonds, their security, their
343-14   approval by the attorney general, and the remedies of the holders
343-15   shall be applicable to refunding bonds.  Refunding bonds shall be
343-16   registered by the comptroller on surrender and cancellation of the
343-17   bonds to be refunded, but in lieu of the process, the resolution
343-18   authorizing the issuance of the refunding bonds may provide that
343-19   the refunding bonds shall be sold and the proceeds of the sale
343-20   deposited in the bank where the original bonds are payable, in
343-21   which case the refunding bonds may be issued in an amount
343-22   sufficient to pay the principal of and the interest on the original
343-23   bonds to their option date or maturity date, and the comptroller
343-24   shall register the refunding bonds without concurrent surrender and
343-25   cancellation of the original bonds.
343-26         Sec. 264.016.  TRUST INDENTURE; DEED OF TRUST OR MORTGAGE
 344-1   LIEN.  (a)  Bonds, including refunding bonds, authorized by this
 344-2   chapter that are not payable wholly from ad valorem taxes may be
 344-3   additionally secured by a trust indenture under which the trustee
 344-4   may be a bank with trust powers located either within or outside
 344-5   the state.  Such bonds may, within the discretion of the board, be
 344-6   additionally secured by a deed of trust or mortgage lien on
 344-7   physical properties of the authority and all franchises, easements,
 344-8   water rights and appropriation permits, leases and contracts, and
 344-9   rights appurtenant to the properties, vesting in the trustee power
344-10   to sell the properties for payment of the indebtedness, power to
344-11   operate the properties, and all other powers and authority for the
344-12   further security of the bonds.
344-13         (b)  The trust indenture, regardless of the existence of a
344-14   deed of trust or mortgage lien on the properties, may contain any
344-15   provisions prescribed by the board for the security of the bonds
344-16   and the preservation of the trust estate, may make provision for
344-17   amendment or modification thereof and the issuance of bonds to
344-18   replace lost or mutilated bonds, may condition the right to expend
344-19   authority funds or sell authority property upon approval of a
344-20   registered professional engineer selected as provided in the trust
344-21   indenture, and may make provision for the investment of funds of
344-22   the authority.  A purchaser under a sale under a deed of trust
344-23   lien, where one is given, shall be the absolute owner of the
344-24   properties, facilities, and rights purchased and shall have the
344-25   right to maintain and operate the properties, facilities, and
344-26   rights.
 345-1         Sec. 264.017.  BONDS PAYABLE FROM AD VALOREM TAXES; ELECTION.
 345-2   (a)  Bonds payable wholly or partially from ad valorem taxes,
 345-3   except refunding bonds, may not be issued unless authorized by an
 345-4   election held after January 1, 1969, at which only the qualified
 345-5   voters who reside in the authority may vote and a majority of the
 345-6   votes cast in each city contained in the authority are in favor of
 345-7   the issuance of the bonds.  If a majority of the votes cast in any
 345-8   city contained in the authority are against the issuance of the
 345-9   bonds, the board may adopt a resolution detaching the territory of
345-10   that city from the authority if the board finds that it is to the
345-11   best interest of the authority to issue bonds payable wholly or
345-12   partially from taxes, but no territory may be detached from the
345-13   authority while any bonds that are payable from revenues or taxes
345-14   or both are outstanding.  Bonds not payable wholly or partially
345-15   from ad valorem taxes may be issued without an election.
345-16         (b)  An election for the authorization of bonds may be called
345-17   by the board without a petition.  The resolution calling the
345-18   election must specify the time and places of holding the election,
345-19   the purpose for which the bonds are to be issued, the maximum
345-20   amount of the bonds, the maximum maturity of the bonds, the form of
345-21   the ballot, and the presiding judge for each voting place.  The
345-22   presiding judge serving at each voting place shall appoint one
345-23   assistant judge and at least two clerks to assist in holding the
345-24   election.  Notice of the election shall be given by publishing a
345-25   substantial copy of the notice in a newspaper published in each
345-26   city contained in the authority for two consecutive weeks.  The
 346-1   first publication must be at least 21 days before the date of the
 346-2   election.  In a city in which no newspaper is published, notice
 346-3   shall be given by posting a copy of the resolution in three public
 346-4   places.
 346-5         (c)  The returns of the election shall be made to and
 346-6   canvassed by the board.
 346-7         (d)  Elections held under this section shall be governed by
 346-8   the Election Code except as otherwise provided by this chapter.
 346-9         Sec. 264.018.  BOND APPROVAL AND REGISTRATION.  After bonds,
346-10   including refunding bonds, are authorized by the authority, the
346-11   bonds and the record relating to their issuance shall be submitted
346-12   to the attorney general for examination as to the validity of the
346-13   bonds.  If the bonds recite that they are secured by a pledge of
346-14   the proceeds of a contract previously made between the authority
346-15   and a city or other governmental agency, authority, or district, a
346-16   copy of the contract and the proceedings of the city or other
346-17   governmental agency, authority, or district authorizing the
346-18   contract shall also be submitted to the attorney general.  If the
346-19   bonds have been authorized and if such contract has been made in
346-20   accordance with the constitution and laws of the state, the
346-21   attorney general shall approve the bonds and the contract, and the
346-22   bonds then shall be registered by the comptroller.  After this
346-23   approval, the bonds and the contract, if any, are valid and binding
346-24   and are incontestable for any cause.
346-25         Sec. 264.019.  CONTRACTS WITH CITIES AND OTHERS.  The
346-26   authority may enter into contracts with cities and others for
 347-1   supplying water to them.  The authority may also contract with a
 347-2   city for the rental or leasing of, or for the operation of, the
 347-3   water production, water supply, and water filtration or
 347-4   purification and water supply facilities of the city for such
 347-5   consideration as the authority and the city may agree.  The
 347-6   contract may be on such terms and for such time as the parties may
 347-7   agree, and the contract may provide that it shall continue in
 347-8   effect until bonds specified in the contract and refunding bonds
 347-9   issued in lieu of such bonds are paid.
347-10         Sec. 264.020.  AUTHORITY DEPOSITORY.  (a)  The board shall
347-11   designate one or more banks within the authority to serve as
347-12   depository for the funds of the authority.  All funds of the
347-13   authority shall be deposited in the depository bank or banks,
347-14   except that funds pledged to pay bonds may be deposited with the
347-15   trustee bank named in the trust agreement and except that funds
347-16   shall be remitted to the bank of payment for the payment of the
347-17   principal of and interest on bonds.  To the extent that funds in
347-18   the depository banks and the trustee bank are not insured by the
347-19   Federal Deposit Insurance Corporation, the funds shall be secured
347-20   in the manner provided by law for the security of county funds.
347-21         (b)  Before designating a depository bank or banks, the board
347-22   shall issue a notice stating the time and place when and where the
347-23   board will meet for such purpose and inviting the banks in the
347-24   authority to submit applications to be designated depositories.
347-25   The notice must be published one time in a newspaper or newspapers
347-26   published in the authority and specified by the board.
 348-1         (c)  At the time stated in the notice, the board shall
 348-2   consider the applications and the management and condition of the
 348-3   banks filing them and shall designate as depositories the bank or
 348-4   banks that offer the most favorable terms and conditions for the
 348-5   handling of the funds of the authority and that the board finds
 348-6   have proper management and are in condition to warrant the handling
 348-7   of authority funds.  Membership on the board by an officer or
 348-8   director of a bank shall not disqualify that bank from being
 348-9   designated as a depository.
348-10         (d)  If no applications are received by the time stated in
348-11   the notice, the board shall designate a bank or banks within or
348-12   outside the authority on such terms and conditions as the board
348-13   determines advantageous to the authority.
348-14         (e)  The term of service for depositories shall be prescribed
348-15   by the board.
348-16         Sec. 264.021.  WATER APPROPRIATION PERMITS; ACQUISITION OF
348-17   STORAGE CAPACITY AND WATER.  The authority may acquire water
348-18   appropriation permits from owners of permits.  The authority may
348-19   lease or acquire rights in and to storage and storage capacity in
348-20   any reservoir constructed or to be constructed by any person, firm,
348-21   corporation, or public agency or from the United States government
348-22   or any of its agencies.  The authority may also purchase or make
348-23   contracts for the purchase of water or a water supply from any
348-24   person, firm, corporation, or public agency or from the United
348-25   States government or any of its agencies.
348-26         Sec. 264.022.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
 349-1   DEPOSITS.  All bonds of the authority are legal and authorized
 349-2   investments for banks, savings banks, trust companies, building and
 349-3   loan associations, savings and loan associations, insurance
 349-4   companies, fiduciaries, trustees, and guardians and for the sinking
 349-5   funds of cities, towns, villages, counties, school districts, or
 349-6   other political corporations or subdivisions of the state.  The
 349-7   bonds are eligible to secure the deposit of all public funds of the
 349-8   state and all public funds of cities, towns, villages, counties,
 349-9   school districts, or other political corporations or subdivisions
349-10   of the state, and the bonds are lawful and sufficient security for
349-11   the deposits to the extent of their value when accompanied by all
349-12   unmatured coupons.
349-13         Sec. 264.023.  BONDS EXEMPT FROM TAXATION.  The
349-14   accomplishment of the purposes stated in this chapter is for the
349-15   benefit of the people of this state and for the improvement of
349-16   their properties and industries, and the authority, in carrying out
349-17   the purposes of this chapter will be performing an essential public
349-18   function under Section 59, Article XVI, Texas Constitution.  The
349-19   authority shall not be required to pay any tax or assessment on the
349-20   project or any part of the project, and the bonds issued under this
349-21   chapter and the transfer of and income from the bonds, including
349-22   profits made on the sale of the bonds, shall at all times be free
349-23   from taxation within the state.
349-24         Sec. 264.024.  TAXATION.  (a)  The tax rolls of the cities
349-25   situated within the authority as created and within annexed
349-26   territory shall constitute the tax rolls of the authority until
 350-1   assessments and tax rolls are made by the authority.
 350-2         (b)  Before the sale and delivery of authority bonds that are
 350-3   payable wholly or partially from ad valorem taxes, the board shall
 350-4   appoint a tax assessor and collector and a board of equalization
 350-5   and shall cause taxes to be assessed, valuations to be equalized,
 350-6   and tax rolls to be prepared.  General laws applicable to water
 350-7   control and improvement districts with reference to tax assessors
 350-8   and collectors, boards of equalization, tax rolls, and the levy and
 350-9   collection of taxes and delinquent taxes shall be applicable to the
350-10   authority, except that the board of equalization, to be appointed
350-11   each year by the board, shall consist of one member residing in
350-12   each city then contained in the authority.
350-13         Sec. 264.025.  ADOPTION OF RULES OR REGULATIONS; PENALTIES;
350-14   ENFORCEMENT.  (a)  The board may adopt and promulgate all
350-15   reasonable rules or regulations to secure, maintain, and preserve
350-16   the sanitary condition of all water in and to flow into any
350-17   reservoir owned by the authority, to prevent the waste or
350-18   unauthorized use of water, and to regulate residence, hunting,
350-19   fishing, boating, and camping and all recreational and business
350-20   privileges along or around any reservoir or any body of land or
350-21   easement owned by the authority.
350-22         (b)  The authority may prescribe a reasonable penalty for the
350-23   breach of a rule or regulation of the authority, not to exceed a
350-24   fine of $200 or imprisonment for 30 days, or both the fine and
350-25   imprisonment.  The penalty shall be in addition to any other
350-26   penalties provided by the laws of the state and may be enforced by
 351-1   complaints filed in the appropriate court of jurisdiction;
 351-2   provided, however, that no rule or regulation that provides a
 351-3   penalty for a violation of the rule or regulation shall be in
 351-4   effect, as to enforcement of the penalty, until five days after the
 351-5   authority has caused a substantive statement of the rule or
 351-6   regulation and the penalty for the violation to be published once a
 351-7   week for two consecutive weeks in the county in which the reservoir
 351-8   is situated or in any county in which it is partly situated.  The
 351-9   substantive statement to be published must be as condensed as is
351-10   possible to afford sufficient notice as to the act prohibited by
351-11   the rule or regulation.  A single notice may embrace any number of
351-12   rules or regulations.  The notice must provide the information that
351-13   breach of the rule or regulation will subject the violator to the
351-14   imposition of a penalty.  The notice must also state that the full
351-15   text of the rule or regulation is on file in the principal office
351-16   of the authority, where it may be read by any interested person.
351-17   Five days after the second publication of the required notice, the
351-18   advertised rule or regulation shall be in effect and ignorance of
351-19   the rule or regulation is not a defense to prosecution for the
351-20   enforcement of a penalty.  After the required publication, the
351-21   rules and regulations authorized by this section shall judicially
351-22   be known to the courts and shall be considered similar in nature to
351-23   a valid penal ordinance of a city of the state.
351-24         (c)  A duly constituted peace officer may make arrests when
351-25   necessary to prevent or stop the commission of any offense against
351-26   the rules or regulations of the authority, or against the laws of
 352-1   the state, when the offense or threatened offense occurs on any
 352-2   land, water, or easement owned or controlled by the authority or
 352-3   may make an arrest at any place in the case of an offense involving
 352-4   injury or detriment to any property owned or controlled by the
 352-5   authority.
 352-6         Sec. 264.026.  PARKS AND RECREATION.  The authority may
 352-7   establish or otherwise provide for public parks and recreation
 352-8   facilities and may acquire land for those purposes.
 352-9         Sec. 264.027.  EFFECT ON PRIORITY OF WATER USE.  Nothing in
352-10   this chapter shall be interpreted as amending or repealing Section
352-11   11.024, which provides for priorities of the use of water.
352-12       CHAPTER 265.  NORTH HARRIS COUNTY REGIONAL WATER AUTHORITY
352-13         Sec. 265.001.  CREATION.  (a)  A regional water authority to
352-14   be known as the "North Harris County Regional Water Authority" is
352-15   created.  The authority is a governmental agency and a body politic
352-16   and corporate.
352-17         (b)  The authority is created under and is essential to
352-18   accomplish the purposes of Section 59, Article XVI, Texas
352-19   Constitution.
352-20         Sec. 265.002.  DEFINITIONS.  In this chapter:
352-21               (1)  "Agricultural crop" means food or fiber
352-22   commodities grown for resale or commercial purposes that provide
352-23   food, clothing, or animal feed.
352-24               (2)  "Authority" means the North Harris County Regional
352-25   Water Authority.
352-26               (3)  "Board" means the board of directors of the
 353-1   authority.
 353-2               (4)  "Director" means a member of the board.
 353-3               (5)  "Local government" means a municipality, county,
 353-4   special district, or other political subdivision of the state or a
 353-5   combination of two or more of those entities.
 353-6               (6)  "Person" has the meaning assigned by Section
 353-7   311.005, Government Code.
 353-8               (7)  "Subsidence" means the lowering in elevation of
 353-9   the surface of land by the withdrawal of groundwater.
353-10               (8)  "Subsidence district" means the Harris-Galveston
353-11   Coastal Subsidence District.
353-12               (9)  "System" means a network of pipelines, conduits,
353-13   canals, pumping stations, force mains, treatment plants, and any
353-14   other construction, device, or related appurtenance used to treat
353-15   or transport water.
353-16               (10)  "Water" includes:
353-17                     (A)  groundwater, percolating or otherwise;
353-18                     (B)  any surface water, natural or artificial,
353-19   navigable or nonnavigable; and
353-20                     (C)  industrial and municipal wastewater.
353-21         Sec. 265.003.  BOUNDARIES.  (a)  Except as provided by this
353-22   section, the authority includes the territory that is contained in
353-23   the following area, regardless of whether the territory contains
353-24   noncontiguous parcels of land or whether the territory is located
353-25   within the boundaries of any other governmental entity or political
353-26   subdivision of the state, but only if also contained in one or more
 354-1   of the state representative districts described by this section:
 354-2         BEGINNING at the intersection of the Harris and Waller County
 354-3   line with the north right-of-way line of U.S. Highway 290 (current
 354-4   alignment);
 354-5         THENCE northwest along the Harris and Waller County line to
 354-6   the intersection with Spring Creek;
 354-7         THENCE continuing southeasterly along said Harris and Waller
 354-8   County line, with the meanders of Spring Creek to the intersection
 354-9   of the Waller and Montgomery County line;
354-10         THENCE southeasterly along the Harris and Montgomery County
354-11   line continuing with the meanders of said Spring Creek; to the
354-12   intersection with the City of Houston, corporate limits;
354-13         THENCE along said City of Houston corporate limits, the
354-14   following:  south approximately one half mile; east approximately
354-15   one half mile to the City of Humble corporate limits; north along
354-16   said City of Humble corporate limits approximately one half mile to
354-17   aforementioned Spring Creek; east along Spring Creek to its
354-18   confluence with the San Jacinto River to the intersection of U.S.
354-19   Highway 59; easterly and southerly along the take line for Lake
354-20   Houston to the intersection with the southeasterly right-of-way of
354-21   the Union Pacific Railroad; southwesterly along said Union Pacific
354-22   Railroad for approximately two miles; south to the north end of
354-23   Duessen Parkway; southeast along the east side of Duessen Parkway
354-24   and along the north side of the access road to the intersection
354-25   with North Lake Houston Parkway;
354-26         THENCE departing said City of Houston corporate limits, west
 355-1   along the north side of said North Lake Houston Parkway to the
 355-2   beginning of Mount Houston Road, and continuing west on Mount
 355-3   Houston Road to the 6900 block to the intersection of Suburban;
 355-4         THENCE south along Suburban to the City of Houston corporate
 355-5   limits;
 355-6         THENCE along said City of Houston corporate limits, the
 355-7   following:  west to Hirsch Road; south along the west side of
 355-8   Hirsch Road to Langely; west along the south side of Langley to the
 355-9   southbound feeder road of US Highway 59; northeast along the west
355-10   side of the feeder road of US Highway 59 to Little York; west along
355-11   the south side of Little York to Bentley; north along the east side
355-12   of Bentley to Sagebrush; west along the north side of Sagebrush to
355-13   Halls Bayou; south along Halls Bayou to Little York; west along the
355-14   south side of Little York to Aldine Westfield Road; north along the
355-15   east sides of Aldine Westfield Road to its intersection with the
355-16   easterly extension of the City of Houston corporate limits; west to
355-17   the Hardy Toll Road; north along the Hardy Toll Road approximately
355-18   0.25 miles; east approximately 0.35 mile; north approximately 0.15
355-19   mile; west approximately 0.35 mile; northwest along the Hardy Toll
355-20   Road approximately 1 mile; southwesterly along an irregular path
355-21   generally west to Carby; west along Carby to Airline Drive; south
355-22   along Airline Drive to Canino; west along Canino to Sweetwater;
355-23   north along Sweetwater to West Road; west to Interstate 45/US 75;
355-24   south along Interstate 45/US 75 to south of Bluebell Road;
355-25   southerly along an irregular path generally south and west to West
355-26   Mount Houston Road; west along Mount Houston Road to a line east of
 356-1   Ella Boulevard; south along a line generally parallel to Ella
 356-2   Boulevard to south of West Gulf Bank; west along the south side of
 356-3   West Gulf Bank to Tomball Parkway; northwest along Tomball Parkway
 356-4   approximately 1.5 mile; west along an irregular path to North
 356-5   Houston-Rosslyn Road; north along North Houston-Rosslyn Road to
 356-6   Vogel Creek; west along Vogel Creek to the FWD CRIP RR; south along
 356-7   the FWD CRIP RR to Logview; west along Logview to Hollister; south
 356-8   along Hollister to White Oak Bayou; east along White Oak Bayou to
 356-9   Twisting Vine; south along Twisting Vine to West Little York; west
356-10   along West Little York to Fairbanks North Houston; south along
356-11   Fairbanks North Houston to Cole Creek; west along Cole Creek to
356-12   Hempstead Road; northwest along Hempstead Road to Brittmore Road,
356-13   also being the intersection with U.S. Highway 290, Northwest
356-14   Freeway;
356-15         THENCE departing said City of Houston corporate limits and
356-16   continuing northwest along U.S. Highway 290, Northwest Freeway, at
356-17   Spencer Road;
356-18         THENCE northwest along U.S. Highway 290, Northwest Freeway
356-19   (current alignment), to the intersection of the Harris and Waller
356-20   County line, the POINT OF BEGINNING.
356-21         (b)  The authority includes only that territory described by
356-22   Subsection (a) that is also in the following state representative
356-23   districts as described by Article II, Chapter 2, Acts of the 72nd
356-24   Legislature, 3rd Called Session, 1992 (Article II, Article 195a-11,
356-25   Vernon's Texas Civil Statutes), as the districts existed on
356-26   June 18, 1999:
 357-1               (1)  District 127;
 357-2               (2)  District 126;
 357-3               (3)  District 130;
 357-4               (4)  District 135; and
 357-5               (5)  District 150.
 357-6         (c)  Notwithstanding Subsections (a) and (b), the authority
 357-7   does not include any area that, on June 18, 1999, was inside the
 357-8   municipal limits of the city of Houston or inside the municipal
 357-9   limits of the city of Humble.
357-10         (d)  On a municipality's annexation of any of the authority's
357-11   territory, the annexed territory is excluded from the authority's
357-12   territory.  The authority shall continue to provide services to the
357-13   annexed territory in accordance with contracts in effect at the
357-14   time of the annexation unless a written agreement between the board
357-15   and the governing body of the municipality provides otherwise.
357-16         Sec. 265.004.  EXCLUSION OF CERTAIN TERRITORY.  (a)  A
357-17   district organized under Section 52, Article III, or Section 59,
357-18   Article XVI, Texas Constitution, that is located in the portion of
357-19   the territory described by Section 265.003(a) that is south of
357-20   Beltway 8 or east of U.S. Highway 59 may petition for exclusion of
357-21   its territory from the authority's territory.  Before the 61st day
357-22   after the date the authority receives the petition, the board
357-23   shall:
357-24               (1)  grant the petition and order the territory
357-25   excluded if the petition:
357-26                     (A)  includes an accurate legal description of
 358-1   the boundaries of the territory to be excluded; and
 358-2                     (B)  is filed with the authority before March 1,
 358-3   2001; and
 358-4               (2)  if the board grants the petition, file for
 358-5   recording in the office of the county clerk of Harris County a copy
 358-6   of the order and a description of the authority's boundaries as
 358-7   they exist after the exclusion of the territory.
 358-8         (b)  The order excluding the territory is effective
 358-9   immediately after the order and description are recorded.
358-10         Sec. 265.005.  APPLICABILITY OF OTHER LAW.  (a)  Except as
358-11   provided by Subsection (b), this chapter prevails over any
358-12   provision of general law that is inconsistent with this chapter.
358-13         (b)  This chapter does not prevail over or preempt a
358-14   provision of Chapter 36 or 151 that is being implemented by the
358-15   subsidence district.
358-16         Sec. 265.006.  FINDING OF BENEFIT.  All the land and other
358-17   property included within the boundaries of the authority will
358-18   benefit from the works and projects that are to be accomplished by
358-19   the authority under powers conveyed by this chapter.  The authority
358-20   is created to serve a public use and benefit.
358-21         Sec. 265.007.  BOARD OF DIRECTORS.  (a)  The authority is
358-22   governed by a board of five directors.
358-23         (b)  The board shall appoint a person to fill a vacancy in
358-24   the office of director until the next election of directors.  If
358-25   the position is not scheduled to be filled at the election, the
358-26   person elected to fill the position serves only for the remainder
 359-1   of the unexpired term.
 359-2         (c)  To be eligible to serve as director, a person must be a
 359-3   qualified voter in the voting district from which the person is
 359-4   elected or appointed.
 359-5         Sec. 265.008.  METHOD OF ELECTION OF DIRECTORS.  (a)  One
 359-6   director shall be elected from each of the five single-member
 359-7   voting districts by the qualified voters of the voting district.
 359-8         (b)  A person shall indicate on the person's application for
 359-9   a place on the ballot the voting district that the person seeks to
359-10   represent.
359-11         (c)  In the manner described by Section 49.103(d), the board
359-12   shall redraw the single-member voting districts as soon as
359-13   practicable after:
359-14               (1)  each federal census; and
359-15               (2)  any change in the boundaries of the authority.
359-16         (d)  At the first election after each time the voting
359-17   districts are redrawn:
359-18               (1)  five new directors shall be elected to represent
359-19   the single-member voting districts; and
359-20               (2)  the directors elected shall draw lots to determine
359-21   their terms so that:
359-22                     (A)  two directors serve two-year terms; and
359-23                     (B)  three directors serve four-year terms.
359-24         (e)  Subchapter C, Chapter 146, Election Code, applies to the
359-25   consideration of votes for a write-in candidate for director as if
359-26   the authority were a municipality.
 360-1         Sec. 265.009.  SERVICE OF DIRECTORS.  (a)  The terms of the
 360-2   initial permanent directors are determined by lot, with two
 360-3   directors serving two-year terms and three directors serving
 360-4   four-year terms.
 360-5         (b)  The initial permanent directors serve until permanent
 360-6   directors are elected under Section 265.010.
 360-7         (c)  Permanent directors serve staggered four-year terms.
 360-8         (d)  A director serves until the director's successor has
 360-9   qualified.
360-10         Sec. 265.010.  ELECTION DATES.  On the first uniform election
360-11   date of the calendar year in each even-numbered year, the
360-12   appropriate number of directors shall be elected to the board.
360-13         Sec. 265.011.  MEETINGS AND ACTIONS OF BOARD.  The board
360-14   shall meet at least four times each year and may meet at any other
360-15   time the board considers appropriate.
360-16         Sec. 265.012.  GENERAL MANAGER.  (a)  The board shall employ
360-17   a general manager as the chief administrative officer of the
360-18   authority.  The board may delegate to the general manager full
360-19   authority to manage and operate the affairs of the authority
360-20   subject only to the orders of the board.
360-21         (b)  The duties of the general manager include:
360-22               (1)  the administration of the orders of the board;
360-23               (2)  coordination with state, federal, and local
360-24   agencies;
360-25               (3)  the oversight of development of authority plans
360-26   and programs; and
 361-1               (4)  other duties assigned by the board.
 361-2         (c)  The board shall determine the terms of office and
 361-3   employment of and the compensation to be paid to the general
 361-4   manager.  The general manager may be discharged by majority vote of
 361-5   the board.
 361-6         Sec. 265.013.  EMPLOYEES; BONDS.  (a)  The general manager of
 361-7   the authority shall employ all persons necessary for the proper
 361-8   handling of the business and operations of the authority and may
 361-9   employ attorneys, bookkeepers, engineers, and other expert and
361-10   specialized personnel the board considers necessary.  The general
361-11   manager shall determine compensation to be paid by the authority.
361-12         (b)  The general manager may discharge employees of the
361-13   authority.
361-14         (c)  The general manager of the authority and each employee
361-15   or contractor of the authority who is charged with the collection,
361-16   custody, or payment of any money of the authority shall execute a
361-17   fidelity bond in an amount determined by the board and in a form
361-18   and with a surety approved by the board.  The authority shall pay
361-19   for the bond.
361-20         Sec. 265.014.  GENERAL POWERS AND DUTIES.  (a)  The authority
361-21   has all of the rights, powers, privileges, authority, functions,
361-22   and duties necessary and convenient to accomplish the purposes of
361-23   this chapter, including those provided by Chapter 49.
361-24         (b)  The authority may:
361-25               (1)  provide for the conservation, preservation,
361-26   protection, recharge, and prevention of waste of groundwater, and
 362-1   for the reduction of groundwater withdrawals, in a manner
 362-2   consistent with the purposes of Section 59, Article XVI, Texas
 362-3   Constitution;
 362-4               (2)  for the purposes of reducing groundwater
 362-5   withdrawals and subsidence, acquire or develop surface water and
 362-6   groundwater supplies from sources inside or outside the boundaries
 362-7   of the authority and may conserve, store, transport, treat, purify,
 362-8   distribute, sell, and deliver water to persons, corporations,
 362-9   municipal corporations, political subdivisions of the state, and
362-10   others, inside and outside the boundaries of the authority;
362-11               (3)  enter into contracts with persons, including
362-12   political subdivisions of the state, on terms and conditions the
362-13   board considers desirable, fair, and advantageous for the
362-14   performance of the authority's rights, powers, and authority under
362-15   this chapter;
362-16               (4)  coordinate water services provided inside,
362-17   outside, or into the authority; and
362-18               (5)  administer and enforce the provisions of this
362-19   chapter.
362-20         (c)  The authority's rights, powers, privileges, authority,
362-21   functions, and duties are subject to the continuing right of
362-22   supervision of the state, to be exercised by and through the
362-23   commission.
362-24         (d)  The authority shall exercise its rights, powers,
362-25   privileges, and authority in a manner that will promote
362-26   regionalization of water treatment and distribution.
 363-1         Sec. 265.015.  AUTHORITY RULES.  (a)  The authority shall
 363-2   adopt and enforce rules reasonably required to implement this
 363-3   chapter, including rules governing procedures before the board.
 363-4         (b)  The board shall compile its rules in a book and make
 363-5   them available for use and inspection at the authority's principal
 363-6   office.
 363-7         Sec. 265.016.  FEES AND CHARGES.  (a)  The authority may
 363-8   establish fees and charges as necessary to enable the authority to
 363-9   fulfill the authority's regulatory obligations as provided by this
363-10   chapter.
363-11         (b)  The authority may charge against the owner of a well
363-12   located in the authority's boundaries a fee on the amount of water
363-13   pumped from the well.  The board shall set the rate of a fee under
363-14   this subsection only after a special meeting on the fee.  The board
363-15   by rule may exempt classes of wells from the fee under this
363-16   subsection.  The board may not apply the fee to a well that:
363-17               (1)  has a casing diameter of less than five inches and
363-18   serves a single-family dwelling;
363-19               (2)  is regulated under Chapter 27;
363-20               (3)  is used for irrigation of agricultural crops;
363-21               (4)  produces 10 million gallons or less annually; or
363-22               (5)  is used solely for electric generation.
363-23         (c)  Fees set by the board must be sufficient to:
363-24               (1)  achieve water conservation, prevent waste of
363-25   water, serve as a disincentive to pumping groundwater, and
363-26   accomplish the purposes of this chapter, including making available
 364-1   alternative water supplies; and
 364-2               (2)  enable the authority to meet operation and
 364-3   maintenance expenses and pay the principal of and interest on debt
 364-4   issued in connection with the exercise of the authority's general
 364-5   powers and duties.
 364-6         (d)  The temporary board may set fees to pay for the initial
 364-7   operation of the authority and the election of the initial
 364-8   permanent board until the permanent board has been elected.
 364-9         Sec. 265.017.  CIVIL PENALTY; INJUNCTION.  (a)  A person who
364-10   violates a rule or order of the authority is subject to a civil
364-11   penalty of not less than $50 and not more than $5,000 for each
364-12   violation or each day of a continuing violation.
364-13         (b)  The authority may bring an action to recover the penalty
364-14   in a district court in the county where the violation occurred.
364-15   The penalty shall be paid to the authority.
364-16         (c)  The authority may bring an action for injunctive relief
364-17   in a district court in the county where a violation of an authority
364-18   rule or order occurs or is threatened to occur.  The court may
364-19   grant to the authority, without bond or other undertaking, a
364-20   prohibitory or mandatory injunction that the facts warrant,
364-21   including a temporary restraining order, temporary injunction, or
364-22   permanent injunction.
364-23         (d)  The authority may bring an action for a civil penalty
364-24   and injunctive relief in the same proceeding.
364-25         Sec. 265.018.  WATER SUPPLY PLANS.  The authority by rule
364-26   shall, as needed but not less frequently than every five years,
 365-1   develop, prepare, revise, and adopt comprehensive water supply and
 365-2   drought contingency plans for various areas of the authority.  The
 365-3   plans must:
 365-4               (1)  be consistent with regional planning; and
 365-5               (2)  include 10-year, 20-year, and 50-year projections
 365-6   of water needs within the authority.
 365-7         Sec. 265.019.  ACQUISITION, CONSTRUCTION, AND OPERATION OF
 365-8   SYSTEMS.  (a)  The authority may:
 365-9               (1)  acquire and provide by purchase, gift, or lease a
365-10   water treatment or water supply system inside or outside the
365-11   authority's boundaries;
365-12               (2)  design, finance, or construct a water treatment or
365-13   water supply system and provide water services inside or outside
365-14   the authority's boundaries;
365-15               (3)  operate, lease, or sell a water treatment or water
365-16   supply system the authority constructs or acquires; and
365-17               (4)  contract with any person to operate or maintain a
365-18   water treatment or water supply system the person owns.
365-19         (b)  The authority shall give persons outside the authority's
365-20   boundaries, including the City of Houston, the option to contract
365-21   for available excess capacity of the authority's water treatment or
365-22   water supply system or, before construction of a water treatment or
365-23   water supply system begins, for additional capacity of the system.
365-24   The authority must offer a contract that would enable the person to
365-25   pay for the excess capacity or additional capacity in accordance
365-26   with the person's pro rata share of the capital investment and
 366-1   operational and maintenance costs for providing the excess capacity
 366-2   or additional capacity.
 366-3         Sec. 265.020.  SALE OR REUSE OF WATER OR BY-PRODUCT.  The
 366-4   authority may store, sell, or reuse:
 366-5               (1)  water; or
 366-6               (2)  any by-product from the authority's operations.
 366-7         Sec. 265.021.  EMINENT DOMAIN.  The authority may exercise
 366-8   the power of eminent domain in the manner provided by Chapter 21,
 366-9   Property Code, to acquire property of any kind to further
366-10   authorized purposes of the authority.  The authority may not
366-11   exercise the power of eminent domain outside the boundaries of the
366-12   authority.
366-13         Sec. 265.022.  CONTRACTS.  (a)  The authority may enter into
366-14   a contract with any person or legal entity regarding the
366-15   performance of any purpose or function of the authority, including
366-16   a contract to jointly construct, finance, own, or operate works,
366-17   improvements, facilities, plants, equipment, or appliances
366-18   necessary to accomplish a purpose or function of the authority.  A
366-19   contract may be of unlimited duration.
366-20         (b)  The authority may purchase an interest in a project used
366-21   for a purpose or function of the authority.
366-22         (c)  The authority may contract for:
366-23               (1)  the purchase or sale of water or water rights;
366-24               (2)  the performance of activities within the powers of
366-25   the authority to promote the continuing and orderly development of
366-26   land and property in the authority through the purchase,
 367-1   construction, or installation of works, improvements, facilities,
 367-2   plants, equipment, or appliances so that, to the greatest extent
 367-3   possible consistent with sound engineering practices and economic
 367-4   feasibility, all the land and property in the authority may receive
 367-5   services of the works, improvements, facilities, plants, equipment,
 367-6   or appliances of the authority; or
 367-7               (3)  the construction, ownership, maintenance, or
 367-8   operation of any works, improvements, facilities, plants,
 367-9   equipment, or appliances of the authority or another person or
367-10   legal entity.
367-11         (d)  The authority may purchase surplus property from the
367-12   state, the United States, or another public entity through a
367-13   negotiated contract without bids.
367-14         (e)  An officer, agent, or employee of the authority who has
367-15   a financial interest in the contract of the type described by
367-16   Subsection (d) shall disclose the interest to the board before the
367-17   board votes on the acceptance of the contract.
367-18         Sec. 265.023.  COOPERATION WITH AND ASSISTANCE OF OTHER
367-19   GOVERNMENTAL ENTITIES.  (a)  In implementing this chapter, the
367-20   board may cooperate with and request the assistance of the Texas
367-21   Water Development Board, the commission, the United States
367-22   Geological Survey, the subsidence district, other local
367-23   governments, and other agencies of the United States and the state.
367-24         (b)  The subsidence district may enter into an interlocal
367-25   contract with the authority to carry out the authority's purposes
367-26   and may carry out the governmental functions and services specified
 368-1   in the interlocal contract.
 368-2         (c)  The board shall coordinate with the City of Houston to
 368-3   develop an interregional plan for a system to distribute treated
 368-4   surface water in an economical and efficient manner.
 368-5         Sec. 265.024.  GIFTS AND GRANTS.  The authority is authorized
 368-6   to accept a gift or grant from money collected by the subsidence
 368-7   district under Chapter 151 to fund a water treatment or water
 368-8   supply system.  The authorization provided by this section is in
 368-9   addition to the authorization provided by Section 49.229.
368-10         Sec. 265.025.  EXPENDITURES.  (a)  The authority's money may
368-11   be disbursed only by check, draft, order, or other instrument.
368-12         (b)  Disbursements of the authority must be signed by at
368-13   least two directors, except that the board by resolution may allow
368-14   the general manager, treasurer, or bookkeeper or another employee
368-15   of the authority to sign disbursements.
368-16         (c)  The board by resolution may allow disbursements to be
368-17   transferred by federal reserve wire system to accounts in the name
368-18   of the authority.
368-19         Sec. 265.026.  TAXATION.  The authority may not impose an ad
368-20   valorem tax.
368-21         Sec. 265.027.  REVENUE NOTES.  (a)  The board, without an
368-22   election, may borrow money on negotiable notes of the authority to
368-23   be paid solely from the revenue derived from any legal source,
368-24   including:
368-25               (1)  tolls, charges, and fees the authority imposes;
368-26               (2)  the sale of water, water or sewer services, or any
 369-1   other service or product of the authority;
 369-2               (3)  grants or gifts;
 369-3               (4)  the ownership and operation of all or a designated
 369-4   part of the authority's works, improvements, facilities, plants, or
 369-5   equipment; and
 369-6               (5)  contracts between the authority and any person,
 369-7   including a local government.
 369-8         (b)  The notes may be first or subordinate lien notes at the
 369-9   board's discretion.  An obligation may not be a charge on the
369-10   property of the authority.  An obligation may only be a charge on
369-11   revenue pledged for the payment of the obligation.
369-12         Sec. 265.028.  BONDS.  (a)  To carry out a power or authority
369-13   conferred by this chapter, the authority may issue bonds secured by
369-14   all or part of the revenue derived from any source, including any
369-15   source described by Section 265.027(a).
369-16         (b)  In issuing or securing a bond or note of the authority,
369-17   the authority may exercise any power of an issuer under Chapter
369-18   1371, Government Code.
369-19         (c)  The authority may conduct a public, private, or
369-20   negotiated sale of the bonds.
369-21         (d)  The authority's bonds must:
369-22               (1)  be authorized by board resolution;
369-23               (2)  be issued in the authority's name;
369-24               (3)  be signed by the president or vice president of
369-25   the board, which may be accomplished by facsimile signature;
369-26               (4)  be attested by the secretary of the board, which
 370-1   may be accomplished by facsimile signature; and
 370-2               (5)  bear the authority's seal or facsimile seal.
 370-3         (e)  An authority bond may be secured by a trust indenture
 370-4   with a corporate trustee.
 370-5         (f)  The authority may issue bonds in more than one series as
 370-6   required for carrying out the purposes of this chapter.  In issuing
 370-7   bonds secured by revenue of the authority, the authority may
 370-8   reserve the right to issue additional bonds secured by the
 370-9   authority's revenue that are on a parity with or are senior or
370-10   subordinate to the bonds issued earlier.
370-11         (g)  The resolution authorizing the bonds or the trust
370-12   indenture securing the bonds may specify additional provisions that
370-13   constitute a contract between the authority and its bondholders.
370-14   The board may provide:
370-15               (1)  for additional bond provisions; and
370-16               (2)  for a corporate trustee or receiver to take
370-17   possession of the authority's facilities if the authority defaults.
370-18         (h)  Section 49.181 does not apply to bonds or notes issued
370-19   by the authority.
370-20         Sec. 265.029.  REFUNDING BONDS.  The provisions of this
370-21   chapter that apply to the authority's issuance of other bonds,
370-22   their security, and the remedies of the holders apply to refunding
370-23   bonds.
370-24         Sec. 265.030.  APPROVAL AND REGISTRATION OF BONDS.  After the
370-25   authority authorizes bonds, the authority shall submit the bonds
370-26   and the record relating to their issuance to the attorney general
 371-1   for approval.  If the bonds are secured by a pledge of the proceeds
 371-2   of a contract between the authority and a municipality or other
 371-3   governmental agency, authority, or district, the authority shall
 371-4   submit to the attorney general a copy of the contract and the
 371-5   proceedings of the municipality or other governmental agency,
 371-6   authority, or district authorizing the contract.  If the attorney
 371-7   general finds that the bonds have been authorized and each contract
 371-8   has been made in accordance with the constitution and laws of the
 371-9   state, the attorney general shall approve the bonds and contracts.
371-10   On approval, the bonds shall be registered by the comptroller.
371-11         Sec. 265.031.  FUNDING BY OTHER DISTRICTS.  (a)  The
371-12   authority shall develop a procedure for cooperatively funding a
371-13   project of the authority with money from other districts inside the
371-14   authority's boundaries if the authority project fulfills a
371-15   governmental purpose of both the authority and the other districts.
371-16         (b)  Not later than the 90th day before the date the
371-17   authority issues bonds, other than refunding bonds, to finance a
371-18   project, the authority shall provide written notice of the
371-19   authority's intention to issue the bonds to each district inside
371-20   the authority's boundaries that may benefit from or be affected by
371-21   the project.  The notice must include the value of the bonds to be
371-22   issued, a description of the project the bonds would finance, and a
371-23   schedule of the portion of the project costs financed by the bonds
371-24   that may be allocated to each district benefited or affected.  The
371-25   schedule must be prepared by means of a formula certified by the
371-26   authority's engineer.
 372-1         (c)  A district may enter into a contract with the authority
 372-2   for the district to finance a portion of the proposed project with
 372-3   the district's resources instead of using proceeds from bonds of
 372-4   the authority for that purpose.  The contract must be executed
 372-5   before the authority issues the bonds.  As provided in the
 372-6   contract, the authority must:
 372-7               (1)  reduce the value of the bond issuance to the
 372-8   degree that the district provides project funding; and
 372-9               (2)  credit the district for its contribution to the
372-10   project financing and adjust the allocation of revenue pledged to
372-11   the payment of the bonds so that the authority avoids using, to a
372-12   degree commensurate with the contribution, revenue from the
372-13   district to service the authority's bond debt or interest.
372-14           CHAPTER 266.  NORTH TEXAS MUNICIPAL WATER DISTRICT
372-15         Sec. 266.001.  CREATION.  (a)  A conservation and reclamation
372-16   district to be known as the "North Texas Municipal Water District"
372-17   is created.  The district is a governmental agency and a body
372-18   politic and corporate.
372-19         (b)  The district is created under and is essential to
372-20   accomplish the purposes of Section 59, Article XVI, Texas
372-21   Constitution.
372-22         Sec. 266.002.  DEFINITIONS.  In this chapter:
372-23               (1)  "Basic service area" means the geographic area
372-24   contained within the corporate limits of the member cities and
372-25   areas that are being served at the time of the creation of the
372-26   district or that may later be served by the member cities' primary
 373-1   water system.
 373-2               (2)  "Board" means the board of directors of the
 373-3   district.
 373-4               (3)  "Customer" means users of district water other
 373-5   than member cities.
 373-6               (4)  "Director" means a member of the board.
 373-7               (5)  "District" means the North Texas Municipal Water
 373-8   District and any other public body that succeeds to the property
 373-9   and principal rights, powers, and obligations of the North Texas
373-10   Municipal Water District.
373-11               (6)  "Enlarged Lavon water" means the water that the
373-12   district holds on May 5, 1969, or secures in the future, under or
373-13   through a permit from the commission to store and divert from Lavon
373-14   Lake on the East Fork of the Trinity River, as modified.
373-15               (7)  "Interim basis" means only until such time as the
373-16   district needs the water for the use and benefit of its service
373-17   area, not permanently, but only during such times as a surplus of
373-18   dependable safe yield is present in each classification of water.
373-19               (8)  "Member cities" means the cities of Garland,
373-20   Princeton, Plano, Mesquite, Wylie, Rockwall, Farmersville,
373-21   McKinney, Forney, Royse City, Allen, and Richardson and any other
373-22   city that may legally become a part of the district.
373-23               (9)  "Original Lavon water" means the water for which
373-24   the district holds a permit from the commission to store and divert
373-25   from Lavon Lake on the East Fork of the Trinity River, as
373-26   originally constructed.
 374-1               (10)  "Other service area" means the geographic area in
 374-2   the state that is outside the service area described by Subdivision
 374-3   (14).
 374-4               (11)  "Other water" means any water that the district
 374-5   secures under or through a permit from the commission or its
 374-6   predecessor agency to store and divert, other than Lavon water or
 374-7   enlarged Lavon water.
 374-8               (12)  "Primary right" means the superior right to
 374-9   permanent water and to the quantity, quality, and price of the
374-10   water.
374-11               (13)  "Prospective customer" means any person, firm,
374-12   corporation, company, partnership, association, or body corporate
374-13   or politic that evidences an interest in securing water from the
374-14   district.
374-15               (14)  "Service area" means the geographic area
374-16   contained within the watershed of the East Fork of the Trinity
374-17   River, any area contained within the corporate limits of the member
374-18   cities, and the areas served by the member cities' water system.
374-19         Sec. 266.003.  TERRITORY.  (a)  The district comprises all
374-20   the territory that was contained within the cities of Garland,
374-21   Princeton, Plano, Mesquite, Wylie, Rockwall, Farmersville,
374-22   McKinney, Forney, and Royse City on March 1, 1951, and any
374-23   territory annexed after that date.  A defect in the definition of
374-24   the boundaries of any of those cities or in any past or future
374-25   proceedings for the annexation of territory to any of those cities
374-26   does not affect the validity of the district or any of its powers
 375-1   or duties.
 375-2         (b)  The legislature finds and determines that all the land
 375-3   included in the district will benefit from the improvements to be
 375-4   acquired and constructed by the district.
 375-5         Sec. 266.004.  BOARD OF DIRECTORS.  (a)  All powers of the
 375-6   district shall be exercised by a board of directors.  The directors
 375-7   shall be appointed by majority vote of the governing body of each
 375-8   of the member cities contained in the district.
 375-9         (b)  In May of each year, the governing body of each member
375-10   city in the district with a population of 5,000 or more shall
375-11   appoint one director for a two-year term beginning June 1 of that
375-12   year.
375-13         (c)  In May of each even-numbered year, the governing body of
375-14   each member city in the district with a population of less than
375-15   5,000 shall appoint one director for a two-year term beginning
375-16   June 1 of that year.
375-17         (d)  Each director serves for a term of office as provided by
375-18   this section and until a successor is appointed and has qualified.
375-19         (e)  A director must reside in and own taxable property in
375-20   the city from which the director is appointed.  A member of a
375-21   governing body of a city or an employee of a city is not eligible
375-22   to serve as a director.
375-23         (f)  A director shall subscribe the constitutional oath of
375-24   office and shall give bond for the faithful performance of the
375-25   director's duties in the amount of $5,000, the cost of which shall
375-26   be paid by the district.
 376-1         (g)  A majority of the members of the board constitutes a
 376-2   quorum.
 376-3         Sec. 266.005.  DIRECTOR FEES.  (a)  Each director is entitled
 376-4   to receive a fee of $50 for attending each meeting of the board and
 376-5   $20 per day for each day devoted to the business of the district
 376-6   other than attending board meetings, but not more than $1,200 shall
 376-7   be paid to any director in one calendar year.
 376-8         (b)  Each director is entitled to reimbursement for actual
 376-9   expenses incurred in attending to district business if the service
376-10   and expense are expressly approved by the board.
376-11         Sec. 266.006.  OFFICERS; EMPLOYEES; SEAL.  (a)  The board
376-12   shall elect from among its members a president and a vice president
376-13   of the district and other officers as the board considers
376-14   necessary.
376-15         (b)  The president is the chief executive officer of the
376-16   district and the presiding officer of the board and has the same
376-17   right to vote as any other director.
376-18         (c)  The vice president shall perform all duties and exercise
376-19   all powers conferred by this chapter on the president when the
376-20   president is absent or fails or declines to act.
376-21         (d)  The board shall appoint a secretary and a treasurer, who
376-22   may or may not be members of the board, and may combine those
376-23   offices.  The treasurer shall give bond in an amount required by
376-24   the board but not less than $100,000.  The bond shall be
376-25   conditioned on the treasurer faithfully accounting for all money
376-26   that comes into the treasurer's custody as treasurer of the
 377-1   district.
 377-2         (e)  The board shall be responsible for the management of all
 377-3   the affairs of the district.  The district shall employ or contract
 377-4   with all persons or entities, public or private, deemed necessary
 377-5   by the board for the conduct of the affairs of the district,
 377-6   including, but not limited to, engineers, attorneys, financial
 377-7   advisors, operators, bookkeepers, tax assessors and collectors,
 377-8   auditors, and other employees.  The board may delegate to a general
 377-9   manager or executive director full authority to manage and operate
377-10   the affairs of the district, including the authority granted in
377-11   this subsection.  The board shall appoint all necessary engineers,
377-12   attorneys, and other employees.
377-13         (f)  The board shall adopt a seal for the district.
377-14         Sec. 266.007.  ANNEXATION OF TERRITORY.  (a)  Other territory
377-15   may be annexed to the district as provided by this section.
377-16         (b)  A petition for annexation must:
377-17               (1)  be signed by 50 or a majority of the qualified
377-18   voters of the territory to be annexed who own taxable property in
377-19   the territory;
377-20               (2)  be filed with the board; and
377-21               (3)  describe the territory to be annexed by metes and
377-22   bounds or otherwise unless the territory is the same as that
377-23   contained in a city or town, in which case it will be sufficient to
377-24   state that the territory to be annexed is that contained within the
377-25   city or town.
377-26         (c)  If the board finds that the petition complies with and
 378-1   is signed by the number of qualified persons required under
 378-2   Subsection (b), that the annexation would be in the interest of the
 378-3   territory to be annexed and the district, and that the district
 378-4   will be able to supply water to the territory to be annexed, the
 378-5   board shall adopt a resolution stating the conditions, if any,
 378-6   under which the territory may be annexed and requesting the
 378-7   commission or its successor agency to annex the territory to the
 378-8   district.  A certified copy of the resolution and the petition
 378-9   shall be filed with the commission.
378-10         (d)  The commission shall adopt a resolution declaring its
378-11   intention to call an election in the territory to be annexed for
378-12   the purpose of submitting the proposition of whether the territory
378-13   shall be annexed to the district.  The commission shall set a time
378-14   and place for a hearing to be held by the commission on the
378-15   question of whether the territory to be annexed will benefit from
378-16   the improvements, works, and facilities then owned or operated or
378-17   contemplated to be owned or operated by the district.  Railroad
378-18   right-of-way or transmission lines and other property of electric
378-19   and gas utilities that are not situated within the defined limits
378-20   of an incorporated city or town will not benefit from the
378-21   improvements, works, and facilities that the district is authorized
378-22   to construct.  Railroad right-of-way or transmission lines and
378-23   other property of electric and gas utilities may not be annexed to
378-24   the district unless the right-of-way and transmission lines and
378-25   other property of electric and gas utilities are contained within
378-26   the limits of an incorporated city or town that has been annexed to
 379-1   the district.
 379-2         (e)  Notice of the adoption of the resolution stating the
 379-3   time and place of the hearing addressed to the citizens and owners
 379-4   of property in the territory to be annexed shall be published one
 379-5   time in a newspaper designated by the commission at least 10 days
 379-6   before the date of the hearing.  The notice shall describe the
 379-7   territory in the same manner as required or permitted by the
 379-8   petition.
 379-9         (f)  All interested persons may appear at the hearing and
379-10   offer evidence for or against the intended annexation.  The hearing
379-11   may proceed in the order and under the rules prescribed by the
379-12   commission and may be recessed from time to time.  If, at the
379-13   conclusion of the hearing, the commission finds that all the lands
379-14   in the territory to be annexed will benefit from the present or
379-15   contemplated improvements, works, or facilities of the district,
379-16   the commission shall adopt a resolution calling an election in the
379-17   territory to be annexed, stating the date and the place or places
379-18   for holding the election, and appointing a presiding judge for each
379-19   voting place, who shall appoint the necessary assistant judges and
379-20   clerks to assist in holding the election.
379-21         (g)  Notice of the election, stating the date and places for
379-22   holding the election, the proposition to be voted on, and the
379-23   conditions under which the territory may be annexed, or making
379-24   reference to the resolution of the board for that purpose, shall be
379-25   published one time in a newspaper designated by the commission at
379-26   least 10 days before the date set for the election.
 380-1         (h)  Only qualified electors who reside in the territory to
 380-2   be annexed are qualified to vote in the election.  Returns of the
 380-3   election shall be made to the commission.
 380-4         (i)  The commission shall canvass the returns of the election
 380-5   and adopt a resolution declaring the results.  If the resolution
 380-6   shows that a majority of the votes cast are in favor of annexation,
 380-7   the commission shall enter an order annexing the territory to the
 380-8   district, and the annexation shall be incontestable except in the
 380-9   manner and within the time for contesting elections under the
380-10   Election Code.  A certified copy of the order shall be recorded in
380-11   the deed records of the county in which the territory is situated.
380-12         (j)  In calling the election on the proposition for the
380-13   annexation of territory, the commission may include as a part of
380-14   the same proposition a proposition for the assumption of that
380-15   territory's part of the tax-supported bonds of the district then
380-16   outstanding and those voted but not yet sold and for the levy of an
380-17   ad valorem tax on taxable property in the territory to be annexed
380-18   along with the tax in the rest of the district for the payment of
380-19   the bonds.
380-20         (k)  After territory is added to the district, the board may
380-21   call an election over the entire district for the purpose of
380-22   determining whether the entire district as enlarged shall assume
380-23   the tax-supported bonds then outstanding and those voted but not
380-24   yet sold and whether an ad valorem tax shall be levied on all
380-25   taxable property within the district as enlarged for the payment of
380-26   the bonds, unless the proposition is voted along with the
 381-1   annexation election and becomes lawfully binding on the territory
 381-2   annexed.  The election shall be called and held in the same manner
 381-3   as elections for the issuance of bonds as provided by this chapter.
 381-4         (l)  If no newspaper is published in the territory to be
 381-5   annexed, notices required by this section shall be posted in three
 381-6   public places in the territory.
 381-7         Sec. 266.008.  APPOINTMENT OF DIRECTORS IN ANNEXED
 381-8   TERRITORIES.  (a)  If the territory of a city with a population of
 381-9   5,000 or more is annexed to the district, the governing body of the
381-10   city shall appoint one director for a term ending the following May
381-11   31 and one director for a term ending one year after the following
381-12   May 31.  In May of each year, the governing body of the city shall
381-13   appoint one director for a two-year term as provided by this
381-14   chapter for cities originally included in the district.
381-15         (b)  If a city whose territory is annexed to the district has
381-16   a population of less than 5,000, the governing body of the city
381-17   shall appoint one director whose term shall expire the following
381-18   May 31 and in May of each second year thereafter shall appoint one
381-19   director for a two-year term.  If the city later attains a
381-20   population of 5,000 or more, it shall be entitled to two directors
381-21   to be appointed as provided by this section.
381-22         Sec. 266.009.  USE OF CERTAIN WATERS AND FACILITIES.
381-23   (a)  The district may acquire any and all rights in and to storage
381-24   and storage capacity in Lavon Lake as constructed at the time of
381-25   the creation of the district or later modified, and in any other
381-26   reservoir or from any other source, and the right to take water
 382-1   from the reservoirs or other sources after obtaining a permit from
 382-2   the commission, by complying with the provisions of this code that
 382-3   are applicable to such rights and pursuant to any contract or
 382-4   contracts the district may make with the United States government,
 382-5   any of its agencies, or any other agency in reference to those
 382-6   rights, and the district may develop or otherwise acquire, with the
 382-7   consent of owners of the surface, underground sources of water.
 382-8         (b)  The district may construct or otherwise acquire all
 382-9   works, plants, and other facilities necessary or useful for the
382-10   purpose of storing, impounding, retaining, diverting, or processing
382-11   the water described by Subsection (a) and transporting it to cities
382-12   and other areas for municipal, domestic, and industrial purposes.
382-13         (c)  To the extent permissible under a contract with the
382-14   United States government, any of its agencies, and any other
382-15   agency, the district may dispose of surplus water under its control
382-16   by contract with the commission or any other state or local agency
382-17   for irrigation or beneficial purposes.
382-18         (d)  Any works for the diversion of water from the impounding
382-19   dams may not be constructed until the plans for the works are
382-20   approved by the commission.  The district shall apply to and obtain
382-21   authority from the commission to appropriate the waters.
382-22         (e)  The district may not be compelled to supply water for
382-23   use outside its service area except by order of the commission in
382-24   accordance with Section 11.041.
382-25         (f)  The basic service area has the primary right to water in
382-26   each classification that the district secures under permit from the
 383-1   commission.
 383-2         (g)  This chapter does not compel any customer or prospective
 383-3   customer to secure water from the district except pursuant to
 383-4   contracts voluntarily executed.
 383-5         (h)  This chapter does not alter any outstanding permit,
 383-6   contract, or other obligation.
 383-7         Sec. 266.010.  EMINENT DOMAIN.  (a)  For the purpose of
 383-8   carrying out any power or authority conferred by this chapter, the
 383-9   district may acquire land and easements within and outside the
383-10   district, including land above the probable high-water line around
383-11   reservoirs, by condemnation in the manner provided by Chapter 21,
383-12   Property Code.
383-13         (b)  The district is a municipal corporation within the
383-14   meaning of Section 21.021(c), Property Code.
383-15         (c)  The amount and character of interest in land and
383-16   easements acquired under this section shall be determined by the
383-17   board.
383-18         (d)  If the district, in the exercise of the power of eminent
383-19   domain or police power or any other power granted under this
383-20   chapter makes necessary the relocation, raising, lowering,
383-21   rerouting, changing the grade, or altering the construction of any
383-22   railroad, electric transmission, telegraph or telephone lines,
383-23   properties, and facilities, or pipeline, all such relocation,
383-24   raising, lowering, rerouting, changing of grade, or alteration of
383-25   construction shall be accomplished at the sole expense of the
383-26   district.  In this subsection, "sole expense" means the actual cost
 384-1   of the relocation, raising, lowering, rerouting, change in grade,
 384-2   or alteration of construction in providing comparable replacement
 384-3   without enhancement of the facilities, after deducting from the
 384-4   cost the net salvage value of the old facility.
 384-5         Sec. 266.011.  NOTICE REQUIRED FOR CERTAIN CONTRACTS.  (a)  A
 384-6   construction contract requiring an expenditure of more than $25,000
 384-7   shall be made only after publication of a notice to bidders once
 384-8   each week for two weeks before the awarding of the contract.
 384-9         (b)  The notice required under this section is sufficient if
384-10   it states the time and place at which the bids will be opened, the
384-11   general nature of the work to be done or the material, equipment,
384-12   or supplies to be purchased and states where and under what terms
384-13   copies of the plans and specifications may be obtained.
384-14         (c)  The publication shall be in a newspaper published in the
384-15   district and designated by the board.
384-16         Sec. 266.012.  BONDS.  (a)  For the purpose of providing a
384-17   source of water supply for cities and other users for municipal,
384-18   domestic, and industrial purposes as authorized by this chapter and
384-19   for the purpose of carrying out any other power or authority
384-20   conferred by this chapter, the district may issue negotiable bonds
384-21   payable from the revenues or taxes, or both revenues and taxes, of
384-22   the district as pledged by resolution of the board.  Pending the
384-23   issuance of definitive bonds, the board may authorize the delivery
384-24   of negotiable interim bonds or notes that are eligible for exchange
384-25   or substitution by the definitive bonds.
384-26         (b)  Bonds must be authorized by resolution of the board and
 385-1   shall be issued in the name of the district, signed by the
 385-2   president or vice president, and attested by the secretary and
 385-3   shall bear the seal of the district.
 385-4         (c)  Bonds must mature serially or otherwise in not to exceed
 385-5   40 years and may be sold at a price and under terms determined by
 385-6   the board to be the most advantageous reasonably obtainable,
 385-7   provided that the interest cost to the district, calculated by the
 385-8   use of standard bond interest tables currently in use by insurance
 385-9   companies and investment houses, does not exceed six percent per
385-10   year.  Within the discretion of the board, bonds may be made
385-11   callable prior to maturity at times and prices prescribed in the
385-12   resolution authorizing the bonds and may be made registrable as to
385-13   principal or as to both principal and interest.
385-14         (d)  Bonds may be issued in more than one series and from
385-15   time to time as required for carrying out the purposes of this
385-16   chapter.
385-17         (e)  Bonds may be secured by a pledge of all or part of the
385-18   net revenues of the district, of the net revenues of one or more
385-19   contracts made before or after the bonds are issued, or of other
385-20   revenues specified by resolution of the board.  A pledge may
385-21   reserve the right, under conditions specified in the pledge, to
385-22   issue additional bonds that will be on a parity with or subordinate
385-23   to the bonds being issued.  In this subsection, "net revenues"
385-24   means the gross revenues of the district less the amount necessary
385-25   to pay the cost of maintaining and operating the district and its
385-26   properties.
 386-1         (f)  For the purposes stated in Subsection (a), the district
 386-2   may issue bonds payable from ad valorem taxes to be levied on all
 386-3   taxable property in the district or may issue bonds secured by and
 386-4   payable from both the taxes and the revenues of the district,
 386-5   subject to the conditions prescribed in Sections 266.015(a), (b),
 386-6   and (c).  The board shall levy a tax sufficient to pay bonds issued
 386-7   payable wholly or partially from ad valorem taxes and the interest
 386-8   on the bonds as the bonds and interest become due.  The rate of the
 386-9   tax for any year may be set after giving consideration to the money
386-10   received from the pledged revenues available for payment of
386-11   principal and interest to the extent and in the manner permitted by
386-12   the resolution authorizing the issuance of the bonds.
386-13         (g)  If bonds payable wholly from revenues are issued, the
386-14   board shall set, and from time to time revise, rates of
386-15   compensation for water sold and services rendered by the district
386-16   that will be sufficient to pay the expense of operating and
386-17   maintaining the facilities of the district and to pay bonds as they
386-18   mature and the interest as it accrues and to maintain the reserve
386-19   and other funds as provided in the resolution authorizing the
386-20   bonds.  If bonds payable partially from revenues are issued, the
386-21   board shall set, and from time to time revise, rates of
386-22   compensation for water sold and services rendered by the district
386-23   that will be sufficient to assure compliance with the resolution
386-24   authorizing the bonds.
386-25         (h)  From the proceeds of the sale of the bonds, the district
386-26   may set aside an amount for the payment of interest expected to
 387-1   accrue during construction and for a reserve interest and sinking
 387-2   fund, and the set-aside provision may be made in the resolution
 387-3   authorizing the bonds.  Proceeds from the sale of the bonds may
 387-4   also be used for the payment of all expenses necessarily incurred
 387-5   in accomplishing the purposes for which the district is created,
 387-6   including expenses of issuing and selling the bonds.
 387-7         (i)  In the event of a default or a threatened default in the
 387-8   payment of principal of or interest on bonds payable wholly or
 387-9   partially from revenues of the district, any court of competent
387-10   jurisdiction may, on petition of the holders of 25 percent of the
387-11   outstanding bonds of the issue in default or threatened with
387-12   default, appoint a receiver with authority to collect and receive
387-13   all income of the district except taxes, employ and discharge
387-14   agents and employees of the district, take charge of the district's
387-15   funds on hand (except funds received from taxes, unless
387-16   commingled), and manage the proprietary affairs of the district
387-17   without consent or hindrance by the directors.  The receiver may
387-18   also be authorized to sell or make contracts for the sale of water
387-19   or renew the contracts with the approval of the court appointing
387-20   the receiver.  The court may vest the receiver with other powers
387-21   and duties that the court finds necessary for the protection of the
387-22   holders of the bonds.
387-23         Sec. 266.013.  REFUNDING BONDS.  (a)  The district may issue
387-24   refunding bonds for the purpose of refunding any outstanding bonds
387-25   authorized by this chapter and interest on the bonds.  Refunding
387-26   bonds may be issued to refund more than one series of outstanding
 388-1   bonds and may combine the pledges for the outstanding bonds for the
 388-2   security of the refunding bonds, and the refunding bonds may be
 388-3   secured by other or additional revenues.
 388-4         (b)  The provisions of this chapter regarding the issuance by
 388-5   the district of other bonds, their approval by the attorney
 388-6   general, and the remedies of the holders are applicable to
 388-7   refunding bonds.  Refunding bonds shall be registered by the
 388-8   comptroller on surrender and cancellation of the bonds to be
 388-9   refunded, but in lieu of that process, the resolution authorizing
388-10   the issuance of the refunding bonds may provide that the refunding
388-11   bonds shall be sold and the proceeds of the sale deposited in the
388-12   bank where the original bonds are payable, in which case the
388-13   refunding bonds may be issued in an amount sufficient to pay the
388-14   interest on the original bonds to their option date or maturity
388-15   date, and the comptroller shall register the refunding bonds
388-16   without concurrent surrender and cancellation of the original
388-17   bonds.
388-18         Sec. 266.014.  TRUST INDENTURE; DEED OF TRUST.  (a)  Bonds,
388-19   including refunding bonds, authorized by this chapter that are not
388-20   payable wholly from ad valorem taxes may be additionally secured by
388-21   a trust indenture under which the trustee may be a bank having
388-22   trust powers situated either within or outside the state.  Bonds
388-23   may, in the discretion of the board, be additionally secured by a
388-24   deed of trust lien on physical properties of the district and all
388-25   franchises, easements, and water rights and appropriation permits,
388-26   leases, and contracts and all rights appurtenant to the properties,
 389-1   vesting in the trustee power to sell the properties for payment of
 389-2   the indebtedness, power to operate the properties, and all other
 389-3   powers and authority for the further security of the bonds.
 389-4         (b)  The trust indenture, regardless of the existence of a
 389-5   deed of trust lien, may contain any provisions prescribed by the
 389-6   board for the security of the bonds and the preservation of the
 389-7   trust estate and may make provision for amendment or modification
 389-8   thereof and the issuance of bonds to replace lost or mutilated
 389-9   bonds.  A purchaser under a sale under the deed of trust lien,
389-10   where one is given, shall be the owner of the properties,
389-11   facilities, and rights purchased and shall have the right to
389-12   maintain and operate the properties, facilities, and rights.
389-13         Sec. 266.015.  ELECTION FOR TAX-FUNDED BONDS.  (a)  Bonds
389-14   payable wholly or partially from ad valorem taxes, except refunding
389-15   bonds, shall not be issued unless authorized by an election at
389-16   which only the qualified voters who reside in the district shall be
389-17   qualified to vote and unless a majority of the votes cast is in
389-18   favor of the issuance of the bonds.
389-19         (b)  Before calling an election for the issuance of bonds
389-20   secured either wholly or partially by a pledge of ad valorem taxes,
389-21   the board shall publish, in the manner prescribed by this section,
389-22   a summary of the improvements to be financed with the proceeds of
389-23   the bonds to be issued.  If the district has not provided
389-24   facilities for delivering water to a city within the district and
389-25   if the summary of improvements does not include provision for
389-26   delivering water to the city, the district shall publish in the
 390-1   city notice of its intention, on a date specified in the notice, to
 390-2   adopt a resolution ordering an election on the issuance of bonds
 390-3   wholly or partly secured by a pledge of ad valorem taxes and
 390-4   containing the summary of the proposed improvements.  The notice
 390-5   shall be published at least once in a newspaper published in or
 390-6   having general circulation in the city.  The date of publication
 390-7   shall be at least 14 days before the date on which the district
 390-8   intends to adopt a resolution ordering the election.  The district
 390-9   shall also mail a copy of the notice to the mayor of the city at
390-10   least 14 days before the date designated for ordering the election.
390-11   Before the date designated for ordering the election, the governing
390-12   body of the notified city may adopt a resolution stating that the
390-13   district has not provided facilities for delivering water to the
390-14   city and does not propose to provide the necessary facilities with
390-15   the proceeds from the proposed tax-supported bonds and on a
390-16   reasonable cost basis; stating that it is in the best interests of
390-17   the people of the city that the city be eliminated from the
390-18   district for all purposes; and seeking withdrawal from the
390-19   district.  If, before the date designated for ordering the
390-20   election, a certified copy of the resolution is delivered to the
390-21   district and to the commission, the district shall not proceed with
390-22   the election until the commission has acted finally on the request
390-23   for withdrawal from the district.
390-24         (c)  On receipt of the certified copy of the resolution from
390-25   a city requesting withdrawal from the district the commission shall
390-26   set a date for a hearing on the request, giving written notice of
 391-1   the hearing to both the city and the district.  If at the hearing
 391-2   the commission finds that no facilities have been provided to the
 391-3   city and that none will be provided from the proceeds of the
 391-4   proposed tax-supported bonds for the delivery of water to the city
 391-5   on a reasonable cost basis, the commission shall enter an order
 391-6   eliminating the city from the district.  In lieu of a hearing the
 391-7   district may file with the commission a consent to the elimination
 391-8   of the territory.  However, if the commission finds that facilities
 391-9   are available or will be provided from the proceeds of the proposed
391-10   bonds on a reasonable cost basis, the commission shall enter an
391-11   order denying the request for withdrawal.  After the commission
391-12   enters the order, the district may order an election with the city
391-13   either eliminated or retained in the boundaries of the district as
391-14   prescribed in the order.  Bonds not payable wholly or partially
391-15   from ad valorem taxes may be issued without an election.
391-16         (d)  An election for the issuance of bonds payable wholly or
391-17   partially from ad valorem taxes may be called by the board without
391-18   a petition.  The resolution calling the election shall specify the
391-19   time and places for holding the election, the purpose for which the
391-20   bonds are to be issued, the maximum amount of the bonds, the
391-21   maximum maturity of the bonds, the form of the ballot, and the
391-22   presiding judge for each voting place.  The presiding judge serving
391-23   at each voting place shall appoint one assistant judge and at least
391-24   two clerks to assist in holding the election.  Notice of the
391-25   election shall be given by publishing a substantial copy of the
391-26   resolution in one newspaper published in each city contained in the
 392-1   district for two consecutive weeks.  The first publication shall be
 392-2   at least 21 days before the date of the election.  If a newspaper
 392-3   is not published in a city, notice shall be given by posting a copy
 392-4   of the resolution in three public places.
 392-5         (e)  The returns of the election shall be made to and
 392-6   canvassed by the board.
 392-7         (f)  The Election Code is applicable to elections held under
 392-8   this section except as otherwise provided by this chapter.
 392-9         Sec. 266.016.  EXAMINATION BY ATTORNEY GENERAL.  After any
392-10   bonds, including refunding bonds, are authorized by the district,
392-11   the bonds and the record relating to their issuance shall be
392-12   submitted to the attorney general for examination as to the
392-13   validity of the bonds.  If the bonds recite that they are secured
392-14   by a pledge of the proceeds of a contract previously made between
392-15   the district and any city or other governmental agency or district,
392-16   a copy of the contract and the proceedings of the city or other
392-17   governmental agency or district authorizing the contract shall also
392-18   be submitted to the attorney general.  If the bonds have been
392-19   authorized and the contracts have been made in accordance with the
392-20   constitution and laws of the state, the attorney general shall
392-21   approve the bonds and the contracts, and the bonds then shall be
392-22   registered by the comptroller.  After approval and registration,
392-23   the bonds and the contracts, if any, are valid and binding and are
392-24   incontestable for any cause.
392-25         Sec. 266.017.  CONTRACTS WITH CITIES AND OTHERS.  The
392-26   district may enter into contracts with cities and others for
 393-1   supplying water to them.  The district may also contract with a
 393-2   city for the rental or leasing of, or for the operation of, the
 393-3   water production, water supply, and water filtration or
 393-4   purification and water supply facilities of the city for such
 393-5   consideration as the district and the city may agree.  The contract
 393-6   may be on such terms and for such period as the parties may agree
 393-7   and may provide that it shall continue in effect until bonds
 393-8   specified in the contract and refunding bonds issued in lieu of
 393-9   such bonds are paid.
393-10         Sec. 266.018.  DISTRICT DEPOSITORY.  (a)  The board shall
393-11   designate one or more banks within the district to serve as
393-12   depository for the funds of the district.  All funds of the
393-13   district shall be deposited in the depository bank or banks, except
393-14   that funds pledged to pay bonds may be deposited with the trustee
393-15   bank named in the trust agreement and except that funds shall be
393-16   remitted to the bank of payment for the payment of principal of and
393-17   interest on bonds.  To the extent that funds in the depository
393-18   banks and the trustee bank are not insured by the Federal Deposit
393-19   Insurance Corporation the funds shall be secured in the manner
393-20   provided by law for the security of county funds.
393-21         (b)  Before designating a depository bank or banks, the board
393-22   shall issue a notice stating the time and place when and where the
393-23   board will meet to designate the depository or depositories and
393-24   inviting the banks in the district to submit applications to be
393-25   designated depositories.  The notice shall be published one time in
393-26   a newspaper or newspapers published in the district and specified
 394-1   by the board.  The term of service for depositories shall be
 394-2   prescribed by the board.
 394-3         (c)  At the time stated in the notice, the board shall
 394-4   consider the applications and the management and condition of the
 394-5   banks filing them and shall designate as depositories the bank or
 394-6   banks which offer the most favorable terms and conditions for the
 394-7   handling of the funds of the district and which the board finds
 394-8   have proper management and are in condition to warrant handling of
 394-9   district funds.  Membership on the board of an officer or director
394-10   of a bank shall not disqualify the bank from being designated as a
394-11   depository.
394-12         (d)  If no applications are received by the time stated in
394-13   the notice, the board shall designate a bank or banks within or
394-14   outside the district on terms and conditions it determines
394-15   advantageous to the district.
394-16         Sec. 266.019.  WATER APPROPRIATION PERMITS; ACQUISITION OF
394-17   WATER.  The district may acquire water appropriation permits
394-18   directly from the commission or from owners of permits.  The
394-19   district may purchase water or a water supply from any person,
394-20   firm, corporation, or public agency or from the United States
394-21   government or any of its agencies.
394-22         Sec. 266.020.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
394-23   DEPOSITS.  All bonds of the district are legal and authorized
394-24   investments for banks, savings banks, trust companies, building and
394-25   loan associations, savings and loan associations, and insurance
394-26   companies.  The bonds are eligible to secure the deposit of all
 395-1   public funds of the state and all public funds of cities, towns,
 395-2   villages, counties, school districts, or other political
 395-3   corporations or subdivisions of the state.  The bonds are lawful
 395-4   and sufficient security for such deposits to the extent of their
 395-5   value when accompanied by all unmatured coupons.
 395-6         Sec. 266.021.  BONDS EXEMPT FROM TAXATION.  The
 395-7   accomplishment of the purposes stated in this chapter is for the
 395-8   benefit of the people of this state and for the improvement of
 395-9   their properties and industries, and the district, in carrying out
395-10   the purposes of this chapter, will be performing an essential
395-11   public function under Section 59, Article XVI, Texas Constitution.
395-12   The district shall not be required to pay any tax or assessment on
395-13   a project or any part of a project under this chapter, and the
395-14   bonds issued under this chapter and the transfer of and income from
395-15   the bonds, including profits made on the sale of the bonds, shall
395-16   at all times be free from taxation within the state.
395-17         Sec. 266.022.  TAX ROLLS.  (a)  The tax rolls of the cities
395-18   situated within the district as created and within annexed
395-19   territory shall constitute the tax rolls of the district until
395-20   assessments and tax rolls are made by the district.
395-21         (b)  Before the sale and delivery of district bonds that are
395-22   payable wholly or partially from ad valorem taxes, the board shall
395-23   appoint a tax assessor and collector and a board of equalization
395-24   and shall cause taxes to be assessed, valuations to be equalized,
395-25   and tax rolls to be prepared.  General laws applicable to water
395-26   control and improvement districts with reference to tax assessors
 396-1   and collectors, boards of equalization, tax rolls, and the levy and
 396-2   collection of taxes and delinquent taxes shall be applicable to the
 396-3   district, except that the board of equalization, which is to be
 396-4   appointed each year by the board, shall consist of one member
 396-5   residing in each city contained in the district.
 396-6         Sec. 266.023.  ADOPTION OF RULES AND REGULATIONS.  (a)  The
 396-7   board may adopt and promulgate all reasonable rules and regulations
 396-8   to secure, maintain, and preserve the sanitary condition of all
 396-9   water in and to flow into any reservoir owned by the district, or
396-10   which it may control by contract or otherwise, to prevent the waste
396-11   or unauthorized use of water, and to regulate residence, hunting,
396-12   fishing, boating, and camping, and all recreational and business
396-13   privileges, along or around any reservoir or any body of land or
396-14   easement owned or controlled by the district.
396-15         (b)  The district may prescribe a reasonable penalty for the
396-16   breach of a rule or regulation of the district, which penalty shall
396-17   not exceed a fine of more than $200 or imprisonment for not more
396-18   than 30 days, or both a fine and imprisonment.  The penalty is in
396-19   addition to any other penalties provided by the laws of this state
396-20   and may be enforced by a complaint filed in the appropriate court
396-21   of jurisdiction.  A rule or regulation that provides a penalty for
396-22   a violation of the rule or regulation is not effective or
396-23   enforceable unless the district has published a substantive
396-24   statement of the rule or regulation and the penalty for its
396-25   violation once a week for two consecutive weeks in the county in
396-26   which the reservoir is situated or in any county in which it is
 397-1   partly situated.  The substantive statement must be as condensed as
 397-2   possible to afford sufficient notice of the act forbidden by the
 397-3   rule or regulation.  A single notice may embrace a number of rules
 397-4   or regulations.  The notice must state that breach of the rule or
 397-5   regulation will subject the violator to the imposition of a
 397-6   penalty.  The notice must also state that the full text of the rule
 397-7   or regulation is on file in the principal office of the district
 397-8   and may be read by any interested person.  Five days after the
 397-9   second publication of the required notice, the rule or regulation
397-10   shall be in effect, and ignorance of the rule or regulation shall
397-11   not constitute a defense to a prosecution for the enforcement of a
397-12   penalty.  After the required publication, the rules and regulations
397-13   authorized by this subsection shall judicially be known to the
397-14   courts and shall be considered similar in nature to a valid penal
397-15   ordinance of a city of the state.
397-16         (c)  The district may employ and constitute its own peace
397-17   officers, and any such officer or any county peace officer may make
397-18   arrests when necessary to prevent or stop the commission of any
397-19   offense against the rules or regulations of the district or against
397-20   the laws of the state, when the offense or threatened offense
397-21   occurs on any land, water, or easement owned or controlled by the
397-22   district, or may make an arrest at any place in the case of an
397-23   offense involving injury or detriment to any property owned or
397-24   controlled by the district.
397-25         Sec. 266.024.  PARKS AND RECREATION.  The district may
397-26   establish or otherwise provide for public parks and recreation
 398-1   facilities and may acquire land adjacent to any reservoir in which
 398-2   the district owns water storage rights for such purposes; provided,
 398-3   however, that no money received from taxation or from bonds payable
 398-4   wholly or partially from taxation shall be used for such purpose.
 398-5         Sec. 266.025.  ADDITIONAL SPECIFIC POWERS.  (a)  In addition
 398-6   to all other powers and for the conservation and development of the
 398-7   natural resources of the state within the meaning of Section 59,
 398-8   Article XVI, Texas Constitution, the district is authorized to
 398-9   purchase, construct, acquire, own, operate, maintain, repair,
398-10   improve, or extend at any location inside and outside its
398-11   boundaries, in the sole discretion of the district, any and all
398-12   works, improvements, facilities, plants, equipment, and appliances
398-13   incident, helpful, or necessary to:
398-14               (1)  provide, under the provisions of Chapters 11 and
398-15   12, for the control, storage, preservation, transmission,
398-16   treatment, and distribution and use of storm water and floodwater,
398-17   the water of rivers and streams, and groundwater for irrigation,
398-18   power, hydroelectric, and all other useful purposes and to supply
398-19   water for municipal, domestic, power, hydroelectric, industrial,
398-20   oil flooding, mining, and commercial uses and purposes and all
398-21   other beneficial uses and purposes; or
398-22               (2)  collect, transport, process, treat, dispose of,
398-23   and control all municipal, domestic, industrial, or communal waste,
398-24   whether in fluid, solid, or composite state, including the control,
398-25   abatement, or reduction of all types of pollution.
398-26         (b)  The district may adopt, enforce, and collect all
 399-1   necessary charges, fees, or rentals for providing any district
 399-2   facilities or service and may require a deposit for any service or
 399-3   facilities furnished, and the district may or may not provide that
 399-4   the deposit will bear interest.  The district may discontinue a
 399-5   facility or service to prevent an abuse or enforce payment of an
 399-6   unpaid charge, fee, or rental due the district.
 399-7         (c)  Facilities acquired or constructed under this section
 399-8   shall be separate and apart from, and shall not constitute a part
 399-9   of, the district's water system established under the trust
399-10   indenture securing North Texas Municipal Water District Water
399-11   Revenue Bonds, Series 1954, dated September 1, 1954, and all
399-12   additional bonds issued under that trust indenture, as
399-13   supplemented.  Bonds issued under this section shall not be issued
399-14   as additional bonds under that trust indenture, but shall be issued
399-15   strictly under this section.
399-16         Sec. 266.026.  APPLICATION OF REGIONAL WASTE DISPOSAL ACT.
399-17   (a)  The district is a "district" under Chapter 30, and all
399-18   provisions of that chapter apply to the district except to the
399-19   extent of any conflict with this chapter, in which case the
399-20   provisions of this chapter shall prevail.
399-21         (b)  A city, public agency, or other political subdivision
399-22   may contract with the district in any manner authorized by Chapter
399-23   30, provided that any city is authorized to contract with the
399-24   district in the manner authorized by Section 30.030(c).
399-25         (c)  The district and all cities, public agencies, and other
399-26   political subdivisions shall have all the rights, powers, and
 400-1   authority with respect to the control, storage, preservation,
 400-2   transmission, treatment, and disposition of storm water and
 400-3   floodwater, the water of rivers and streams, and groundwater that
 400-4   are granted, permitted, and authorized by Chapter 30 with respect
 400-5   to waste, waste disposal systems, and treatment facilities.
 400-6   Contracts made under this subsection are subject to the provisions
 400-7   of Subsection (b).
 400-8         (d)  All cities, public agencies, and other political
 400-9   subdivisions may set, charge, and collect fees, rates, charges,
400-10   rentals, and other amounts for any service or facilities provided
400-11   under or in connection with any contract with the district and to
400-12   pledge amounts sufficient to make all payments required under the
400-13   contract.
400-14         Sec. 266.027.  BOND ISSUANCE FOR SPECIFIC PURPOSES.  (a)  For
400-15   the purpose of providing funds to acquire, purchase, construct,
400-16   improve, enlarge, and equip any property, buildings, structures, or
400-17   other facilities for any purpose or power authorized by Section
400-18   266.025 or 266.026, the board may issue revenue bonds from time to
400-19   time and in one or more issues or series.  The bonds may be payable
400-20   from and secured by liens on and pledges of all or any part of the
400-21   revenues, income, or receipts derived by the district from its
400-22   ownership, operation, lease, or sale of the property, buildings,
400-23   structures, or facilities, including the proceeds or revenues from
400-24   contracts with any person, firm, corporation, city, public agency,
400-25   or other political subdivision.  The bonds may be issued to mature
400-26   serially or otherwise within 50 years from their date, and
 401-1   provision may be made for the subsequent issuance of additional
 401-2   parity bonds or subordinate lien bonds under any terms or
 401-3   conditions that may be set forth in the resolution authorizing the
 401-4   issuance of the bonds.
 401-5         (b)  The bonds, and any interest coupons pertaining to the
 401-6   bonds, are negotiable instruments within the meaning and for all
 401-7   purposes of the Business & Commerce Code, provided that the bonds
 401-8   may be issued registrable as to principal alone or as to both
 401-9   principal and interest.
401-10         (c)  The bonds must be executed and may be made redeemable
401-11   before maturity and may be issued in the form, denominations, and
401-12   manner and under the terms, conditions, and details, may be sold in
401-13   the manner, at the price, and under the terms, and must bear
401-14   interest at the rates determined and provided in the resolution
401-15   authorizing the issuance of the bonds.  If the bond resolution so
401-16   provides, the proceeds from the sale of the bonds may be used for
401-17   paying interest on the bonds during the period of the acquisition
401-18   or construction of facilities to be provided through the issuance
401-19   of the bonds, for paying expenses of operation and maintenance of
401-20   facilities, for creating a reserve fund for the payment of the
401-21   principal of and interest on the bonds, and for creating any other
401-22   funds, and the proceeds may be placed on time deposit or invested
401-23   until needed, to the extent and in the manner provided in the bond
401-24   resolution.
401-25         (d)  The district may pledge all or part of its revenues,
401-26   income, or receipts from fees, rentals, rates, charges, and
 402-1   contract proceeds or payments to the payment of the bonds,
 402-2   including the payment of principal, interest, and any other amounts
 402-3   required or permitted in connection with the bonds.  The pledged
 402-4   fees, rentals, rates, charges, proceeds, or payments shall be set
 402-5   and collected in amounts that will be at a minimum sufficient,
 402-6   together with other pledged resources, to provide for all payments
 402-7   of principal, interest, and other amounts required in connection
 402-8   with the bonds and, to the extent required by the resolution
 402-9   authorizing the issuance of the bonds, to provide for the payment
402-10   of expenses in connection with the bonds and for the operation,
402-11   maintenance, and other expenses in connection with the facilities.
402-12         (e)  The bonds may be additionally secured by mortgages or
402-13   deeds of trust on real property owned or to be acquired by the
402-14   district and by chattel mortgages or liens on personal property
402-15   appurtenant to the real property, and the board may authorize the
402-16   execution of trust indentures, mortgages, deeds of trust, or other
402-17   forms of encumbrances to evidence same.  The district may pledge to
402-18   the payment of the bonds all or any part of any grant, donation,
402-19   revenues, or income received from the United States government or
402-20   any other public or private source, whether under an agreement or
402-21   otherwise.
402-22         (f)  Bonds issued under this section may be refunded or
402-23   otherwise refinanced by the issuance of refunding bonds for that
402-24   purpose, under the terms, conditions, and details determined by
402-25   resolution of the board.  All pertinent and appropriate provisions
402-26   of this section apply to the refunding bonds, and they shall be
 403-1   issued in the manner provided in this section for other bonds
 403-2   authorized under this section.  The refunding bonds may be sold and
 403-3   delivered in amounts necessary to pay the principal, interest, and
 403-4   redemption premium, if any, of bonds to be refunded, at maturity or
 403-5   on any redemption date.  The refunding bonds may be issued to be
 403-6   exchanged for the bonds being refunded.  In the latter case, the
 403-7   comptroller shall register the refunding bonds and deliver the
 403-8   bonds to the holder or holders of the bonds being refunded, in
 403-9   accordance with the provisions of the resolution authorizing the
403-10   refunding bonds.  The exchange may be made in one delivery or in
403-11   several installment deliveries.  Bonds issued at any time by the
403-12   district may also be refunded in the manner provided by any other
403-13   applicable law.
403-14         Sec. 266.028.  BOND APPROVAL AND REGISTRATION.  Bonds issued
403-15   under Section 266.027 and the appropriate proceedings authorizing
403-16   their issuance shall be submitted to the attorney general for
403-17   examination.  When the bonds are to be issued to finance in whole
403-18   or in part water-using facilities, except treatment or distribution
403-19   facilities, the attorney general, before granting approval, shall
403-20   be furnished a resolution from the commission certifying that the
403-21   district possesses the necessary water right authorizing it to
403-22   impound and appropriate the water to be used by the project.  If
403-23   the bonds recite that they are secured by a pledge of revenues of a
403-24   contract, a copy of the contract and the proceedings relating to
403-25   the contract shall be submitted to the attorney general.  If the
403-26   attorney general finds that the bonds have been authorized and the
 404-1   contract has been made in accordance with law, the attorney general
 404-2   shall approve the bonds and the contract and then the bonds shall
 404-3   be registered by the comptroller.
 404-4         (b)  After the approval and registration, the bonds and the
 404-5   contract, if any, are incontestable in any court or other forum for
 404-6   any reason and are valid and binding obligations in accordance with
 404-7   their terms for all purposes.
 404-8         Sec. 266.029.  ADDITIONAL PROVISIONS REGARDING BONDS ELIGIBLE
 404-9   FOR INVESTMENT AND TO SECURE DEPOSITS.  Bonds issued under Section
404-10   266.027 are legal and authorized investments for banks, trust
404-11   companies, building and loan associations, savings and loan
404-12   associations, insurance companies of all kinds and types, and
404-13   trustees and for all interest and sinking funds and other public
404-14   funds of the state and all agencies, subdivisions, and
404-15   instrumentalities of the state, including counties, cities, towns,
404-16   villages, school districts, and all other kinds and types of
404-17   districts, public agencies, and bodies politic.  The bonds are
404-18   eligible and lawful security for all deposits of public funds of
404-19   the state and all agencies, subdivisions, and instrumentalities of
404-20   the state, including counties, cities, towns, villages, school
404-21   districts, and all other kinds and types of districts, public
404-22   agencies, and bodies politic, to the extent of the market value of
404-23   the bonds when accompanied by any unmatured interest coupons.
404-24         Sec. 266.030.  SUFFICIENT SOURCE OF AUTHORITY.  (a)  The
404-25   provisions of Sections 266.025-266.029 are wholly sufficient
404-26   authority for the issuance of bonds, the execution of contracts,
 405-1   and the performance by the district and all cities, public
 405-2   agencies, and other political subdivisions of other acts and
 405-3   procedures authorized by those provisions, without reference to any
 405-4   other law or any restrictions or limitations contained in that law,
 405-5   except as specifically provided in this chapter.  To the extent of
 405-6   any conflict or inconsistency between provisions of this section
 405-7   and any other provision of law, this section and Sections
 405-8   266.025-266.029 shall prevail and control; provided, however, that
 405-9   the district and all cities, public agencies, and other political
405-10   subdivisions may use the provisions of any other laws not in
405-11   conflict with this section to the extent convenient or necessary to
405-12   carry out any power or authority, express or implied, granted by
405-13   those sections.
405-14         (b)  This chapter does not compel any city, customer, or
405-15   prospective customer to secure water, sewer service, or any other
405-16   service from the district except under contracts voluntarily
405-17   executed.
405-18         Sec. 266.031.  COMPLIANCE REQUIRED.  Nothing in this chapter
405-19   shall relieve the district from compliance with the provisions of
405-20   Chapters 11, 12, and 49.
405-21         CHAPTER 267.  NORTHEAST TEXAS MUNICIPAL WATER DISTRICT
405-22         Sec. 267.001.  CREATION.  (a)  A conservation and reclamation
405-23   district to be known as the "Northeast Texas Municipal Water
405-24   District" is created.  The district is a governmental agency and a
405-25   body politic and corporate.
405-26         (b)  The district is created under and is essential to
 406-1   accomplish the purposes of Section 59, Article XVI, Texas
 406-2   Constitution.
 406-3         (c)  Unless specifically provided otherwise, the provisions
 406-4   of this chapter are intended to supplement and expand rather than
 406-5   to limit the powers and authority of the district arising from
 406-6   other laws, including Chapters 49, 50, and 51.
 406-7         Sec. 267.002.  DEFINITIONS.  In this chapter:
 406-8               (1)  "Board" means the board of directors for the
 406-9   district.
406-10               (2)  "Director" means a member of the board.
406-11               (3)  "District" means the Northeast Texas Municipal
406-12   Water District.
406-13         Sec. 267.003.  BOUNDARIES.  (a)  The district comprises all
406-14   the territory that was contained within the cities of Jefferson,
406-15   Avinger, Hughes Springs, Lone Star, Ore City, Pittsburg, and
406-16   Daingerfield on March 1, 1953.  A defect in the definition of the
406-17   boundaries of any of those cities or in any past or future
406-18   proceedings for the annexation of territory to any of those cities
406-19   does not affect the validity of the district or any of its powers
406-20   or duties.
406-21         (b)  The legislature finds that all the land included in the
406-22   district will benefit from the improvements to be acquired and
406-23   constructed by the district.
406-24         Sec. 267.004.  BOARD OF DIRECTORS.  (a)  All powers of the
406-25   district shall be exercised by a board of directors.  The directors
406-26   shall be appointed by a majority vote of the governing body of each
 407-1   of the cities contained in the district.
 407-2         (b)  In appointing the first directors for a city with a
 407-3   population of 5,000 or more, the governing body of the city shall
 407-4   appoint one director for a term ending the following May 31 and one
 407-5   director for a term ending one year after the following May 31.  In
 407-6   appointing subsequent directors, the governing body of each city
 407-7   shall appoint in May of each year one director for a two-year term
 407-8   beginning on June 1 of that year.
 407-9         (c)  In appointing the first director for a city with a
407-10   population of less than 5,000, the governing body of the city shall
407-11   appoint one director for a term ending the next May 31 of an
407-12   even-numbered year.  In appointing subsequent directors, the
407-13   governing body shall appoint in May of each even-numbered year one
407-14   director for a two-year term beginning on June 1 of that year.
407-15         (d)  Each director serves for a term of office as provided by
407-16   this section and until a successor is appointed and has qualified.
407-17         (e)  A director must reside in and own taxable property in
407-18   the city from which the director is appointed.  A member of a
407-19   governing body of a city or an employee of a city is not eligible
407-20   to serve as a director.
407-21         (f)  A director shall subscribe the constitutional oath of
407-22   office and shall give bond for the faithful performance of the
407-23   director's duties in the amount of $5,000, the cost of which shall
407-24   be paid by the district.
407-25         (g)  A majority of the members of the board constitutes a
407-26   quorum.
 408-1         Sec. 267.005.  DIRECTOR FEES.  (a)  Each director is entitled
 408-2   to receive a fee of $100 for attending each meeting of the board,
 408-3   provided, however, that not more than $200 shall be paid to any
 408-4   director for meetings held in any one calendar month.
 408-5         (b)  A director is entitled to receive a fee of $100 per day
 408-6   for each day devoted to the business of the district and to
 408-7   reimbursement for actual expenses incurred in attending to district
 408-8   business if such service and expense are expressly approved by the
 408-9   board.
408-10         Sec. 267.006.  OFFICERS; EMPLOYEES; SEAL.  (a)  The board
408-11   shall elect from among its members a president and a vice president
408-12   of the district and other officers the board considers necessary.
408-13         (b)  The president is the chief executive officer of the
408-14   district and the presiding officer of the board and has the same
408-15   right to vote as any other director.
408-16         (c)  The vice president shall perform all duties and exercise
408-17   all powers conferred by this chapter on the president when the
408-18   president is absent or fails or declines to act.
408-19         (d)  The board shall appoint a secretary and a treasurer, who
408-20   may or may not be members of the board, and may combine those
408-21   offices.  The treasurer shall give bond in an amount required by
408-22   the board, but in no event less than $100,000.  The bond must be
408-23   conditioned on the treasurer's accounting for all money that comes
408-24   into the treasurer's custody as treasurer of the district.  Until
408-25   the district authorizes the issuance of bonds, the amount of the
408-26   official bond of the treasurer may be fixed by the board in any
 409-1   amount not less than $5,000.
 409-2         (e)  The board shall appoint all necessary engineers,
 409-3   attorneys, and other employees.
 409-4         (f)  The board shall adopt a seal for the district.
 409-5         Sec. 267.007.  ANNEXATION OF TERRITORY IN CERTAIN COUNTIES.
 409-6   (a)  Other territory in Titus, Marion, Cass, Morris, Harrison,
 409-7   Upshur, and Camp counties may be annexed to the district as
 409-8   provided by this section.
 409-9         (b)  A petition for annexation must:
409-10               (1)  be signed by 50 or a majority of the qualified
409-11   voters of the territory to be annexed who own taxable property in
409-12   the territory and who have duly rendered the property to the city,
409-13   if situated within a city or town, or county for taxation;
409-14               (2)  be filed with the board; and
409-15               (3)  describe the territory to be annexed by metes and
409-16   bounds or otherwise unless the territory is the same as that
409-17   contained in a city or town, in which event it shall be sufficient
409-18   to state that the territory to be annexed is that which is
409-19   contained within the city or town.
409-20         (c)  If the board finds that the petition complies with and
409-21   is signed by the number of qualified persons required under
409-22   Subsection (b), that the annexation would be in the interest of the
409-23   territory to be annexed and the district, and that the district
409-24   will be able to supply water to the territory to be annexed, the
409-25   board shall adopt a resolution stating the conditions, if any,
409-26   under which territory may be annexed to the district and requesting
 410-1   the commission to annex the territory to the district.  A certified
 410-2   copy of the resolution and of the petition shall be filed with the
 410-3   commission.
 410-4         (d)  The commission shall adopt a resolution declaring its
 410-5   intention to call an election in the territory to be annexed for
 410-6   the purpose of submitting the proposition of whether or not the
 410-7   territory shall be annexed to the district.  The commission shall
 410-8   set a time and place for a hearing to be held by the commission on
 410-9   the question of whether the territory to be annexed will benefit
410-10   from the improvements, works, and facilities then owned or operated
410-11   or contemplated to be owned or operated by the district.  A
410-12   railroad right-of-way that is not situated within the defined
410-13   limits of an incorporated city or town will not benefit from the
410-14   improvements, works, and facilities that the district is authorized
410-15   to construct.  A railroad right-of-way may not be annexed to the
410-16   district unless the right-of-way is contained within the limits of
410-17   an incorporated city or town that has been annexed to the district.
410-18         (e)  Notice of the adoption of the resolution stating the
410-19   time and place of the hearing and addressed to the citizens and
410-20   owners of property in the territory to be annexed shall be
410-21   published one time in a newspaper published within or having
410-22   general circulation within the territory to be annexed, as
410-23   designated by the commission, at least 10 days before the date of
410-24   the hearing.  The notice must describe the territory to be annexed
410-25   in the same manner as required or permitted by the petition.
410-26         (f)  All interested persons may appear at the hearing and
 411-1   offer evidence for or against the intended annexation.  The hearing
 411-2   may proceed in the order and under the rules prescribed by the
 411-3   commission and may be recessed from time to time.  If, at the
 411-4   conclusion of the hearing, the commission finds that all of the
 411-5   lands in the territory to be annexed will benefit from the present
 411-6   or contemplated improvements, works, or facilities of the district,
 411-7   the commission shall adopt a resolution calling an election in the
 411-8   territory to be annexed, stating the date and place or places for
 411-9   holding the election and appointing a presiding judge for each
411-10   voting place who shall appoint the necessary assistant judges and
411-11   clerks to assist in holding the election.
411-12         (g)  Notice of the election, stating the date of and places
411-13   for holding the election, the proposition to be voted on, and the
411-14   conditions under which the territory may be annexed, or making
411-15   reference to the resolution of the board for that purpose, shall be
411-16   published one time in a newspaper designated by the commission at
411-17   least 10 days before the date set for the election.  If the
411-18   newspaper carrying the notice is not published within the territory
411-19   to be annexed, additional notice shall be given for the required
411-20   period by posting copies of the notice of the election at three
411-21   public places in the territory.
411-22         (h)  Only qualified electors who reside in the territory to
411-23   be annexed may vote in the election.  Returns of the election shall
411-24   be made to the commission.
411-25         (i)  The commission shall canvass the returns of the election
411-26   and adopt a resolution declaring the results.  If the resolution
 412-1   shows that a majority of the votes cast are in favor of annexation,
 412-2   the commission shall enter an order annexing the territory to the
 412-3   district, and the annexation is incontestable except in the manner
 412-4   and within the time for contesting elections under the Election
 412-5   Code.  A certified copy of the order shall be recorded in the deed
 412-6   records of the county in which the territory is situated.
 412-7         (j)  The commission, in calling the election on the
 412-8   proposition for annexation of territory, may include as a part of
 412-9   the same proposition a proposition for the assumption of the
412-10   territory's part of the tax-supported bonds of the district then
412-11   outstanding and those voted but not yet sold and for the levy of an
412-12   ad valorem tax on taxable property in the territory to be annexed
412-13   along with the tax in the rest of the district for the payment of
412-14   the bonds.
412-15         (k)  After territory is added to the district, the board may
412-16   call an election over the entire district for the purpose of
412-17   determining whether the district as enlarged shall assume the
412-18   tax-supported bonds, if any, then outstanding and those voted but
412-19   not yet sold and whether an ad valorem tax shall be levied on all
412-20   taxable property within the district as enlarged for the payment of
412-21   the bonds, unless the proposition is voted along with the
412-22   annexation election and becomes lawfully binding on the territory
412-23   annexed.  The election shall be called and held in the same manner
412-24   as elections for the issuance of bonds as provided by this chapter.
412-25         (l)  If no newspaper is published in the territory to be
412-26   annexed, the notices required by this section shall be posted in
 413-1   three public places in the territory.
 413-2         Sec. 267.008.  APPOINTMENT OF DIRECTORS IN ANNEXED
 413-3   TERRITORIES.  (a)  When any city, the territory of which is annexed
 413-4   to the district, has a population of 5,000 or more, the governing
 413-5   body of the city shall appoint one director for a term ending the
 413-6   following May 31 and one director for a term ending one year after
 413-7   the following May 31.  In May of each year the governing body of
 413-8   the city shall appoint one director for a two-year term as provided
 413-9   by this chapter for cities originally included in the district.
413-10         (b)  If a city, the territory of which is annexed to the
413-11   district, has a population of less than 5,000, the governing body
413-12   of the city shall appoint one director whose term shall expire the
413-13   following May 31 and in May of each second year thereafter shall
413-14   appoint one director for a two-year term.
413-15         (c)  If a city initially subject to Subsection (b) later has
413-16   a population of 5,000 or more, it shall be entitled to two
413-17   directors to be appointed as provided by Subsection (a).
413-18         Sec. 267.009.  USE OF CERTAIN WATERS AND FACILITIES.
413-19   (a)  The district may acquire:
413-20               (1)  any and all rights to storage and storage capacity
413-21   in the reservoir formed by Ferrell's Bridge Dam; and
413-22               (2)  the right to take water from the reservoirs in
413-23   which the dam will impound certain storm waters and floodwaters and
413-24   the unappropriated flow of Cypress Creek and its tributaries by
413-25   complying with the applicable provisions of this code and pursuant
413-26   to any contracts that the district may make with the United States
 414-1   government in reference to those rights.
 414-2         (b)  The district may construct or otherwise acquire all
 414-3   works, plants, and other facilities necessary or useful for the
 414-4   purpose of diverting, further impounding, or storing the water
 414-5   described by Subsection (a), processing the water, and transporting
 414-6   it to cities and others for municipal, domestic, and industrial
 414-7   purposes.
 414-8         (c)  To the extent permissible under the contract with the
 414-9   United States government and its agencies, the district may dispose
414-10   of surplus waters under its control for irrigation purposes.
414-11         (d)  Any works for the diverting of water from the impounding
414-12   dam may not be constructed until the plans for the works are
414-13   approved by the commission.
414-14         (e)  None of the powers granted by this section extend
414-15   outside of Titus, Marion, Cass, Morris, Harrison, Upshur, and Camp
414-16   counties.
414-17         Sec. 267.010.  SEWAGE FACILITIES.  As a proper aid to the
414-18   conservation, control, preservation, and distribution of the water
414-19   described by Section 267.009 for beneficial uses, the district may
414-20   construct, own, and operate sewage gathering, transmission,
414-21   treatment, and disposal facilities within the counties designated
414-22   in Section 267.009, charge for services rendered by the facilities,
414-23   and make contracts in reference to the facilities with
414-24   municipalities and others.
414-25         Sec. 267.011.  DAMS AND RESERVOIRS.  (a)  The district may
414-26   construct and operate one or more impounding dams and reservoirs
 415-1   within Titus, Marion, Cass, Morris, Harrison, Upshur, and Camp
 415-2   counties.
 415-3         (b)  A dam or reservoir may not be constructed until a permit
 415-4   is procured from and the plans are approved by the commission.
 415-5         (c)  The district may enter into contracts with individuals
 415-6   and public or private corporations for supplying water from such
 415-7   source, either at the reservoir or delivered to the purchasers.
 415-8         (d)  The district may use and pledge the net revenues from a
 415-9   contract described by this section in connection with the issuance
415-10   of its bonds in accordance with Section 267.015.
415-11         Sec. 267.012.  APPLICATION OF CERTAIN PROVISIONS.  The
415-12   provisions of Section 267.013(e), under which the district is
415-13   required to accomplish at its sole expense the relocation, raising,
415-14   rerouting, changing the grade, or altering the construction of any
415-15   highway, railroad, electric transmission line, or pipeline, are
415-16   applicable to any work done by the district under authority of this
415-17   chapter.
415-18         Sec. 267.013.  EMINENT DOMAIN.  (a)  For the purpose of
415-19   carrying out any power or authority conferred by this chapter the
415-20   district may acquire land and easements within and outside the
415-21   district in Titus, Marion, Cass, Morris, Harrison, Upshur, and Camp
415-22   counties, including land above the probable high-water line around
415-23   any impounding or diversion reservoir, by condemnation in the
415-24   manner provided by Chapter 21, Property Code.
415-25         (b)  The district is a municipal corporation within the
415-26   meaning of Section 21.021(c), Property Code.
 416-1         (c)  Except as provided by Subsection (d), the amount of and
 416-2   character of interest in land and easements acquired under this
 416-3   section shall be determined by the board.
 416-4         (d)  The district may condemn only an easement against
 416-5   persons, firms, and corporations, or their receivers or trustees,
 416-6   who have the power of eminent domain, and the fee title may not be
 416-7   condemned.
 416-8         (e)  If the district, in the exercise of the power of eminent
 416-9   domain or power of relocation or any other power granted under this
416-10   chapter, makes necessary the relocation, raising, rerouting,
416-11   changing the grade, or altering the construction of any highway,
416-12   railroad, electric transmission line, or pipeline, all such
416-13   necessary relocation, raising, rerouting, changing the grade, or
416-14   alteration of construction shall be accomplished at the sole
416-15   expense of the district.
416-16         Sec. 267.014.  NOTICE REQUIRED FOR CERTAIN CONTRACTS.  (a)  A
416-17   construction contract requiring an expenditure of more than $25,000
416-18   may be made only after publication of a notice to bidders once each
416-19   week for two weeks before the awarding of the contract.
416-20         (b)  The notice required under this section is sufficient if
416-21   it states the time and place at which the bids will be opened and
416-22   the general nature of the work to be done or the material,
416-23   equipment, or supplies to be purchased and states where and under
416-24   what terms copies of the plans and specifications may be obtained.
416-25         (c)  The publication shall be in a newspaper published in the
416-26   district and designated by the board.
 417-1         Sec. 267.015.  BONDS.  (a)  For the purpose of providing a
 417-2   source of water supply for cities and other users for municipal,
 417-3   domestic, and industrial purposes as authorized by this chapter and
 417-4   for the purpose of carrying out any other power or authority
 417-5   conferred by this chapter, the district may issue negotiable bonds
 417-6   payable from the revenues or taxes, or both revenues and taxes, of
 417-7   the district as pledged by resolution of the board.  Pending the
 417-8   issuance of definitive bonds, the board may authorize the delivery
 417-9   of negotiable interim bonds or notes that are eligible for exchange
417-10   or substitution by the definitive bonds.
417-11         (b)  Bonds must be authorized by resolution of the board and
417-12   must be issued in the name of the district, signed by the president
417-13   or vice president, and attested by the secretary and have the seal
417-14   of the district impressed on the bonds.
417-15         (c)  Bonds must mature serially or otherwise in not to exceed
417-16   40 years and may be sold at a price and under terms determined by
417-17   the board to be the most advantageous reasonably obtainable,
417-18   provided that the interest cost to the district, calculated by use
417-19   of standard bond interest tables currently in use by insurance
417-20   companies and investment houses, does not exceed six percent per
417-21   year.  Within the discretion of the board, bonds may be made
417-22   callable prior to maturity at times and prices prescribed in the
417-23   resolution authorizing the bonds and may be made registrable as to
417-24   principal or as to both principal and interest.
417-25         (d)  Bonds may be issued in more than one series and from
417-26   time to time as required for carrying out the purposes of this
 418-1   chapter.
 418-2         (e)  Bonds may be secured by a pledge of all or part of the
 418-3   net revenues of the district, of the net revenues of one or more
 418-4   contracts made before or after the bonds are issued, or of other
 418-5   revenues specified by resolution of the board.  A pledge may
 418-6   reserve the right, under conditions specified in the pledge, to
 418-7   issue additional bonds which will be on a parity with or
 418-8   subordinate to the bonds being issued.  In this subsection, "net
 418-9   revenues" means the gross revenues of the district less the amount
418-10   necessary to pay the cost of maintaining and operating the district
418-11   and its properties.
418-12         (f)  For the purposes stated in Subsection (a), the district
418-13   may issue bonds payable from ad valorem taxes to be levied on all
418-14   taxable property in the district or may issue bonds secured by and
418-15   payable from both the taxes and the revenues of the district,
418-16   subject to the conditions prescribed in Section 267.018(a).  The
418-17   board shall levy a tax sufficient to pay bonds issued payable
418-18   wholly or partially from ad valorem taxes and the interest on the
418-19   bonds as the bonds and interest become due.  The rate of the tax
418-20   for any year may be set after giving consideration to the money
418-21   received from the pledged revenues available for payment of
418-22   principal and interest to the extent and in the manner permitted by
418-23   the resolution authorizing the issuance of the bonds.
418-24         (g)  If bonds payable wholly from revenues are issued, the
418-25   board shall set and from time to time revise rates of compensation
418-26   for water sold and services rendered by the district that will be
 419-1   sufficient to pay the expense of operating and maintaining the
 419-2   facilities of the district, to pay bonds as they mature and the
 419-3   interest as it accrues, and to maintain the reserve and other funds
 419-4   as provided in the resolution authorizing the bonds.  If bonds
 419-5   payable partially from revenues are issued, the board shall set and
 419-6   from time to time revise rates of compensation for water sold and
 419-7   services rendered by the district that will be sufficient to assure
 419-8   compliance with the resolution authorizing the bonds.
 419-9         (h)  From the proceeds of the sale of the bonds, the district
419-10   may set aside an amount for the payment of interest expected to
419-11   accrue during construction and for a reserve interest and sinking
419-12   fund, and the set-aside provision may be made in the resolution
419-13   authorizing the bonds.  Proceeds from the sale of the bonds may
419-14   also be used for the payment of all expenses necessarily incurred
419-15   in accomplishing the purposes for which the district is created,
419-16   including expenses of issuing and selling the bonds and the expense
419-17   of creating and organizing the district.
419-18         (i)  The district may invest all or any part of the proceeds
419-19   of the bonds before and during the period of construction in
419-20   obligations of or in obligations unconditionally guaranteed by the
419-21   United States government.
419-22         (j)  In the event of a default or a threatened default in the
419-23   payment of principal of or interest on bonds payable wholly or
419-24   partially from revenues of the district, any court of competent
419-25   jurisdiction may, on petition of the holders of 25 percent of the
419-26   outstanding bonds of the issue in default or threatened with
 420-1   default, appoint a receiver with authority to collect and receive
 420-2   all income of the district except income from taxes, employ and
 420-3   discharge agents and employees of the district, take charge of the
 420-4   district's funds on hand (except funds received from taxes, unless
 420-5   commingled), and manage the proprietary affairs of the district
 420-6   without consent or hindrance by the board.  The receiver may also
 420-7   be authorized to sell or make contracts for the sale of water or
 420-8   renew the contracts with the approval of the court appointing the
 420-9   receiver.  The court may vest the receiver with other powers and
420-10   duties the court finds necessary for the protection of the holders
420-11   of the bonds.
420-12         Sec. 267.016.  REFUNDING BONDS.  (a)  The district may issue
420-13   refunding bonds for the purpose of refunding any outstanding bonds
420-14   authorized by this chapter and interest on the bonds.  The
420-15   refunding bonds may be issued to refund more than one series of
420-16   outstanding bonds and may combine the pledges for the outstanding
420-17   bonds for the security of the refunding bonds, and the refunding
420-18   bonds may be secured by other or additional revenues.
420-19         (b)  The provisions of this chapter with reference to the
420-20   issuance by the district of other bonds, the approval of the bonds
420-21   by the attorney general, and the remedies of the holders of the
420-22   bonds are applicable to refunding bonds.  Refunding bonds shall be
420-23   registered by the comptroller on surrender and cancellation of the
420-24   bonds to be refunded, but in lieu of that process, the resolution
420-25   authorizing the issuance of the refunding bonds may provide that
420-26   the refunding bonds shall be sold and the proceeds of the sale
 421-1   deposited in the bank where the original bonds are payable, in
 421-2   which case the refunding bonds may be issued in an amount
 421-3   sufficient to pay the interest on the original bonds to their
 421-4   option date or maturity date, and the comptroller shall register
 421-5   the refunding bonds without concurrent surrender and cancellation
 421-6   of the original bonds.
 421-7         Sec. 267.017.  TRUST INDENTURE FOR BONDS.  (a)  Any bonds,
 421-8   including refunding bonds, authorized by this chapter that are not
 421-9   payable wholly from ad valorem taxes may be additionally secured by
421-10   a trust indenture under which the trustee may be a bank having
421-11   trust powers located either within or outside the state.  The bonds
421-12   may, in the discretion of the board, be additionally secured by a
421-13   deed of trust lien on physical properties of the district and all
421-14   franchises, easements, water rights and appropriation permits,
421-15   leases, and contracts and all rights pertaining to the properties,
421-16   vesting in the trustee power to sell the properties for payment of
421-17   the indebtedness, power to operate the properties, and all other
421-18   powers and authority for the further security of the bonds.
421-19         (b)  The trust indenture, regardless of the existence of the
421-20   deed of trust lien, may contain any provisions prescribed by the
421-21   board for the security of the bonds and the preservation of the
421-22   trust estate and may make provision for amendment or modification
421-23   of the trust indenture and the issuance of bonds to replace lost or
421-24   mutilated bonds.
421-25         (c)  A purchaser under a sale under a deed of trust lien,
421-26   where one is given, shall be the owner of the properties,
 422-1   facilities, and rights purchased and shall have the right to
 422-2   maintain and operate the properties, facilities, and rights.
 422-3         Sec. 267.018.  BOND ELECTIONS.  (a)  Bonds payable wholly or
 422-4   partially from ad valorem taxes, except refunding bonds, may not be
 422-5   issued unless authorized by an election at which only the qualified
 422-6   voters who reside in the district shall participate and a majority
 422-7   of the votes cast at the election is in favor of the issuance of
 422-8   the bonds.
 422-9         (b)  Before calling an election for the issuance of bonds
422-10   secured either wholly or partially by a pledge of ad valorem taxes,
422-11   the board shall publish, in the manner prescribed by this section,
422-12   a summary of the improvements to be financed with the proceeds of
422-13   the bonds to be issued.  If the district has not provided
422-14   facilities for delivering water to a city within the district and
422-15   the summary of improvements does not include provision for
422-16   delivering water to the city, the district shall publish in the
422-17   city notice of its intention, on a date specified in the notice, to
422-18   adopt a resolution ordering an election involving the issuance of
422-19   the bonds and containing the summary of the proposed improvements.
422-20   The notice shall be published at least once in a newspaper
422-21   published in or having general circulation in the city.  The date
422-22   of publication shall be at least 14 days before the date on which
422-23   the district intends to adopt a resolution ordering the election.
422-24   If no newspaper is published in the city, notice shall be given by
422-25   posting a copy of the notice of intention at three public places in
422-26   the city for at least 14 days before the date designated for
 423-1   ordering the election.  The district shall also mail a copy of the
 423-2   election notice to the mayor of the city at least 14 days before
 423-3   the date designated for ordering the election.  Before the date
 423-4   designated for ordering the election, the governing body of the
 423-5   city notified may adopt a resolution stating that the district has
 423-6   not provided facilities for delivering water to the city and does
 423-7   not propose to provide the facilities necessary for that purpose
 423-8   with the proceeds from the proposed tax-supported bonds on a
 423-9   reasonable cost basis; stating that eliminating the city from the
423-10   district for all purposes is in the best interests of the people of
423-11   the city; and seeking withdrawal from the district.  If, before the
423-12   date designated for ordering the election, a certified copy of the
423-13   resolution is delivered to the district and to the commission, the
423-14   district shall not proceed with the election until the commission
423-15   has acted finally on the request for withdrawal from the district.
423-16         (c)  On receipt of a certified copy of a resolution from a
423-17   city requesting withdrawal from a district the commission shall set
423-18   a date for a hearing on the request, giving written notice of the
423-19   hearing to the city and to the district.  If at the hearing the
423-20   commission finds that no facilities have been provided to the city
423-21   and that none will be provided from the proceeds of the proposed
423-22   tax-supported bonds for the delivery of water to the city on a
423-23   reasonable cost basis, the commission shall enter an order
423-24   eliminating the city from the district.  In lieu of a hearing the
423-25   district may file with the commission a consent to the elimination
423-26   of the territory.  However, if the commission finds that the
 424-1   facilities are available or will be provided from the proceeds of
 424-2   the proposed bonds on a reasonable cost basis, the commission shall
 424-3   enter an order denying the request for withdrawal.  After the
 424-4   commission enters the order, the district may order an election
 424-5   with the city either eliminated or retained in the boundaries of
 424-6   the district as prescribed in the order.
 424-7         (d)  An election for the issuance of bonds payable wholly or
 424-8   partially by ad valorem taxes may be called by the board without a
 424-9   petition.  The resolution calling the election shall specify the
424-10   time and location of the election, the purpose for which the bonds
424-11   are to be issued, the maximum amount of the bonds, the maximum
424-12   maturity of the bonds, the form of the ballot, and the presiding
424-13   judge for each voting place.  The presiding judge serving at each
424-14   voting place shall appoint one assistant judge and at least two
424-15   clerks to assist in holding the election.  Notice of the election
424-16   shall be given by publishing a substantial copy of the resolution
424-17   calling the election in one newspaper published in each city
424-18   contained in the district for two consecutive weeks.  The notice
424-19   must first be published at least 21 days prior to the date of the
424-20   election.  If no newspaper is published in a city, notice shall be
424-21   given by posting a copy of the resolution in three public places.
424-22         (e)  The returns of the election shall be made to and
424-23   canvassed by the board.
424-24         (f)  The Election Code is applicable to elections held under
424-25   this section except as otherwise provided by this chapter.
424-26         (g)  Bonds not payable wholly or partially from ad valorem
 425-1   taxes may be issued without an election.
 425-2         Sec. 267.019.  APPROVAL AND REGISTRATION OF BONDS.  After any
 425-3   bonds, including refunding bonds, are authorized by the district,
 425-4   the bonds and the record relating to their issuance shall be
 425-5   submitted to the attorney general for examination as to the
 425-6   validity of the bonds.  If the bonds recite that they are secured
 425-7   by a pledge of the proceeds of a contract previously made between
 425-8   the district and a city or other governmental agency or district, a
 425-9   copy of the contract and the proceedings of the city or other
425-10   governmental agency or district authorizing the contract shall also
425-11   be submitted to the attorney general.  If the bonds have been
425-12   authorized and the contracts have been made in accordance with the
425-13   constitution and laws of the state, the attorney general shall
425-14   approve the bonds and contracts and the bonds shall then be
425-15   registered by the comptroller.  After the approval and
425-16   registration, the bonds and the contracts, if any, are valid and
425-17   binding and are incontestable for any cause.
425-18         Sec. 267.020.  WATER SUPPLY CONTRACTS.  The district may
425-19   contract with cities and others for the purpose of supplying water
425-20   to them.  The district may also contract with a city for the rental
425-21   or leasing of, or for the operation of, the water production, water
425-22   supply, or water filtration or purification and water supply
425-23   facilities of the city for such consideration as the district and
425-24   the city may agree.  The contract may be on the terms and for the
425-25   time the parties may agree, and the contract may provide that it
425-26   shall continue in effect until bonds specified in the contract and
 426-1   refunding bonds issued in lieu of the bonds are paid.
 426-2         Sec. 267.021.  DISTRICT DEPOSITORY.  (a)  The board shall
 426-3   designate one or more banks within the district to serve as
 426-4   depository or depositories for the funds of the district.  All
 426-5   funds of the district shall be deposited in the depository bank or
 426-6   banks, except that funds pledged to pay bonds may be deposited with
 426-7   the trustee bank named in the trust agreement and except that funds
 426-8   shall be remitted to the bank of payment for the payment of
 426-9   principal of and interest on bonds.  To the extent that funds in
426-10   the depository banks and the trustee bank are not insured by the
426-11   Federal Deposit Insurance Corporation, the funds shall be secured
426-12   in the manner provided by law for the security of county funds; or
426-13   the resolution or trust agreement, or both, securing the bonds may
426-14   require that any or all of the funds be secured by obligations of
426-15   or obligations unconditionally guaranteed by the United States
426-16   government.
426-17         (b)  Before designating a depository bank or banks, the board
426-18   shall issue a notice stating the time and place when and where the
426-19   board will meet to designate the depository bank or banks and
426-20   inviting the banks in the district to submit applications to be
426-21   designated depositories.  The notice must be published one time in
426-22   a newspaper or newspapers published in the district and specified
426-23   by the board.  The term of service for depositories shall be
426-24   prescribed by the board.
426-25         (c)  At the time stated in the notice of the meeting, the
426-26   board shall consider the applications and the management and
 427-1   condition of the banks filing the applications and shall designate
 427-2   as depositories the bank or banks which offer the most favorable
 427-3   terms and conditions for the handling of the funds of the district
 427-4   and which the board finds have proper management and are in
 427-5   condition to warrant handling of district funds.  Membership on the
 427-6   board of an officer or director of a bank shall not disqualify the
 427-7   bank from being designated as depository.
 427-8         (d)  If no applications are received by the time stated in
 427-9   the notice of the meeting, the board shall designate a bank or
427-10   banks within or outside of the district based on the terms and
427-11   conditions the board finds advantageous to the district.
427-12         Sec. 267.022.  WATER APPROPRIATION PERMITS; WATER SUPPLY
427-13   CONTRACTS.  The district may acquire water appropriation permits
427-14   directly from the commission or from owners of permits.  The
427-15   district may also purchase water or a water supply from any person,
427-16   firm, corporation, or public agency or from the United States
427-17   government or any of its agencies.  The district may, within the
427-18   discretion of the board, contract with one or more large users of
427-19   water to acquire a water supply on an agreed allocation of storage
427-20   space as between the district and the user, or the district may
427-21   contract independently for the district's water supply.
427-22         Sec. 267.023.  BONDS ELIGIBLE FOR INVESTMENT AND SECURITY OF
427-23   DEPOSITS.  (a)  All bonds of the district are legal and authorized
427-24   investments for banks, savings banks, trust companies, building and
427-25   loan associations, savings and loan associations, insurance
427-26   companies, fiduciaries, trustees, and guardians and for the sinking
 428-1   funds of cities, towns, villages, counties, school districts, or
 428-2   other political corporations or subdivisions of the state.
 428-3         (b)  District bonds are eligible to secure the deposit of
 428-4   public funds of the state and of cities, towns, villages, counties,
 428-5   school districts, or other political corporations or subdivisions
 428-6   of the state.  The bonds are lawful and sufficient security for the
 428-7   deposits to the extent of the value of the bonds when accompanied
 428-8   by all unmatured coupons.
 428-9         Sec. 267.024.  EXEMPTION FROM TAXATION.  The accomplishment
428-10   of the purposes stated in this chapter being for the benefit of the
428-11   people of this state and for the improvement of the properties and
428-12   industries of the state, the district in carrying out the purposes
428-13   of this chapter will be performing an essential public function
428-14   under the constitution and shall not be required to pay any tax or
428-15   assessment on a project or any part of a project under this
428-16   chapter.  The bonds issued as provided by this chapter and the
428-17   transfer of and income from the bonds, including the profits made
428-18   on the sale of the bonds, are free from taxation within the state.
428-19         Sec. 267.025.  ASSESSMENT, EQUALIZATION, LEVYING, AND
428-20   COLLECTION OF TAXES.  (a)  The tax rolls of the cities situated
428-21   within the district and within territory later annexed are adopted
428-22   and shall constitute the tax rolls of the district until
428-23   assessments and tax rolls are made by the district.
428-24         (b)  Before the sale and delivery of district bonds payable
428-25   wholly or partially from ad valorem taxes, the board shall appoint
428-26   a tax assessor and collector and a board of equalization.  The
 429-1   board shall assess taxes, equalize valuations, and prepare tax
 429-2   rolls.  General laws applicable to water control and improvement
 429-3   districts with reference to tax assessors and collectors, boards of
 429-4   equalization, tax rolls, and the levy and collection of taxes and
 429-5   delinquent taxes are applicable to the district, except that the
 429-6   board of equalization which is to be appointed each year by the
 429-7   board, shall consist of one member residing in each city contained
 429-8   in the district.
 429-9         Sec. 267.026.  DISTRICT RULES AND REGULATIONS.  (a)  The
429-10   board may adopt and promulgate all reasonable rules or regulations
429-11   to secure, maintain, and preserve the sanitary condition of all
429-12   water in and to flow into a reservoir owned by the district, or
429-13   which the district may control by contract or otherwise, to prevent
429-14   the waste or unauthorized use of the water, and to regulate
429-15   residence, hunting, fishing, boating, camping, and all recreational
429-16   and business privileges, along or around the reservoir or any body
429-17   of land or easement owned or controlled by the district.
429-18         Sec. 267.027.  RECREATIONAL FACILITIES.  The district may
429-19   establish or otherwise provide for and operate public parks and
429-20   recreational facilities adjacent to or in the immediate vicinity of
429-21   Ferrell's Bridge Dam Reservoir, known as Lake of the Pines, and may
429-22   acquire, by purchase, lease, or otherwise, land for the parks or
429-23   facilities.  However, no money received from taxation or from bonds
429-24   payable wholly or partially from taxation shall be used to provide
429-25   for the parks or facilities, and no land for the parks or
429-26   facilities shall be acquired through condemnation proceedings.  The
 430-1   district may make contracts, including lease and operating
 430-2   agreements, in reference to the establishment of public parks and
 430-3   recreational facilities with the United States government.  The
 430-4   district has the power and authority to prescribe and enforce rules
 430-5   and regulations applicable to the parks and recreational facilities
 430-6   as are granted, under the general law, to water control and
 430-7   improvement districts.
 430-8         Sec. 267.028.  BOUNDARY MAP.  The board shall file a map and
 430-9   plat of the district, clearly showing the boundaries and limits,
430-10   with each of the following offices:  two copies with the
430-11   commission, one copy with the secretary of state, and one copy with
430-12   the county clerk of each county in which any portion of the
430-13   district is located.
430-14                  CHAPTER 268.  NUECES RIVER AUTHORITY
430-15         Sec. 268.001.  CREATION.  (a)  A conservation and reclamation
430-16   district to be known as the "Nueces River Authority" is created.
430-17   The authority is a governmental agency, a body politic and
430-18   corporate, and a municipality with the authority to exercise the
430-19   powers, rights, privileges, and functions in this chapter.  The
430-20   authority is created under and is essential to accomplish the
430-21   purposes of Section 59, Article XVI, Texas Constitution.
430-22         (b)  The rights, privileges, authority, and functions granted
430-23   in this chapter to the authority and the authority itself are
430-24   expressly subject to Sections 17.183-17.188, Sections
430-25   17.271-17.277, and Chapters 11, 12, and 26.
430-26         Sec. 268.002.  DEFINITIONS.  In this chapter:
 431-1               (1)  "Authority" means the Nueces River Authority.
 431-2               (2)  "Board" means the board of directors of the
 431-3   authority.
 431-4               (3)  "Director" means a member of the board.
 431-5               (4)  "Person" includes an individual, corporation,
 431-6   organization, government or governmental subdivision or agency,
 431-7   business trust, estate, trust, partnership, association, and any
 431-8   other legal entity.
 431-9               (5)  "State" means the State of Texas or any of its
431-10   agencies, departments, boards, political subdivisions, or other
431-11   entities.
431-12               (6)  "United States" includes a department, bureau, and
431-13   any other agency of the United States of America.
431-14               (7)  "Waste" means sewage, industrial waste, municipal
431-15   waste, recreational waste, agricultural waste, waste heat, solid
431-16   waste, or any other waste.
431-17         Sec. 268.003.  BOUNDARIES.  (a)  The authority includes all
431-18   counties that lie wholly within the Nueces River Basin, all of San
431-19   Patricio, Nueces, and Jim Wells counties, and generally the
431-20   in-basin parts of other counties, except Webb County, that lie
431-21   partially within the basin.  The actual boundaries of the area
431-22   within the authority may be described by metes and bounds as
431-23   follows:  Beginning at a point in the boundary of the State of
431-24   Texas offshore of the City of Port Aransas at the Northeast corner
431-25   of Nueces County and the most southerly Southeast corner of Aransas
431-26   County; thence along the common line between Nueces County and
 432-1   Aransas County in a westerly and then northerly direction to a
 432-2   point in the center of the Intracoastal Canal cutoff between
 432-3   Rockport and Aransas Pass, Texas; thence southerly along the
 432-4   centerline of the said Intracoastal Canal to its point of
 432-5   intersection with an extension of the boundary line between Aransas
 432-6   County and San Patricio County for the northernmost Southeast
 432-7   corner of San Patricio County and the Southwest corner of Aransas
 432-8   County for an angle point; thence along the common line between San
 432-9   Patricio County and Aransas County in a northwesterly direction
432-10   approximately 14 miles to a point on the Aransas River on the South
432-11   line of Refugio County for the Northeast corner of San Patricio
432-12   County and the West corner of Aransas County; thence along the
432-13   Aransas River and the common line between Refugio County and San
432-14   Patricio County in a west-northwesterly direction approximately 19
432-15   miles to a point on the Southeast line of Bee County for the
432-16   Southwest corner of Refugio County; thence along the common line
432-17   between Bee County and San Patricio County in a southwesterly
432-18   direction approximately 3 miles to a point for the Southeast corner
432-19   of Bee County; thence along the common line between Bee County and
432-20   San Patricio County in a west-northwesterly direction approximately
432-21   16 miles to the common corner of Live Oak, Bee, and San Patricio
432-22   Counties; thence in a northwesterly direction with the line between
432-23   Live Oak and Bee Counties approximately 14 miles; thence N.
432-24   approximately 25 miles to the most northern corner of Bee County;
432-25   thence N. 40  W. at approximately 19 1/2 miles the Karnes-Wilson
432-26   Counties line, at about 31 miles a point in the S.W. line of Bexar
 433-1   County; thence approximately North 77 1/2  W. approximately 28
 433-2   miles, to the S.W. corner of Bexar County; thence N.W. along the
 433-3   northwest extension of the common boundary between Bexar and
 433-4   Atascosa Counties 3 1/2 miles to a point; thence N. 30  W.
 433-5   approximately 28 miles to a point in the North line of Medina
 433-6   County; then North 64  W. approximately 34 miles to a point in the
 433-7   west line of Bandera County; thence North approximately 3 miles to
 433-8   the northwest corner of Bandera County; thence West with the line
 433-9   of Real and Kerr Counties approximately 5 miles to S.W. corner of
433-10   Kerr County; thence North with the line between Kerr and Real
433-11   Counties approximately 13 miles to the N.E. corner of Real County;
433-12   thence West, North and West, with the north line of Real County,
433-13   approximately 18 miles to the Northwest corner of Real County;
433-14   thence South 75  west approximately 15 miles to the Court House in
433-15   Rock Springs in Edwards County; thence N. 68  W. approximately 15
433-16   miles to a point; thence S. 34  W. approximately 19 miles to a
433-17   point; thence S. 35  E. at 21 miles pass a point in the South line
433-18   of Edwards County, 34 miles to a point; thence S. 23 1/2  W.
433-19   approximately 14 miles to a point; thence S. approximately 8 miles
433-20   to Spofford Junction; thence South with the Eagle Pass branch of
433-21   G. H. & S. A. R. R. at 15 miles a point; thence South 12 miles to a
433-22   point; thence S. 41 1/2  E. 42 miles to the village of Dentonia in
433-23   Dimmit County; thence S. 27 1/2 d. E. approximately 10 miles to the
433-24   Dimmit and Webb Counties line; thence E. with said Dimmit-Webb
433-25   County line approximately 25 miles to the west line of La Salle
433-26   County; thence South with west line of La Salle County
 434-1   approximately 5 miles to the S.W. corner of La Salle County, a
 434-2   common corner with Webb County; thence E. with the Webb-La Salle
 434-3   County line approximately 30 miles to the N.E. corner of Webb
 434-4   County, the common corner of Webb, La Salle, McMullen and Duval
 434-5   Counties; thence S. with the Webb-Duval County line approximately
 434-6   27 miles to a point in the E. line of Webb County; thence N. 35 d.
 434-7   E. 33 miles to a point on the 28 d. North Parallel; thence East
 434-8   along the 28 degrees North Parallel approximately 17 miles to a
 434-9   point on the East line of Duval County and the West line of Jim
434-10   Wells County for an interior corner; thence along the common line
434-11   between Duval County and Jim Wells County, South approximately 55
434-12   miles to a point on the North line of Brooks County for the
434-13   Southwest corner of Jim Wells County and the Southeast corner of
434-14   Duval County; thence along the common line between Jim Wells County
434-15   and Brooks County, East approximately 11 miles to a point for the
434-16   northernmost Southwest corner of Kleberg County and the
434-17   southernmost Southeast corner of Jim Wells County; thence along the
434-18   common line between Jim Wells County and Kleberg County, North
434-19   approximately 25.5 miles to the Northwest corner of Kleberg County
434-20   and an interior corner of Jim Wells County; thence along the common
434-21   line between Jim Wells County and Kleberg County, East
434-22   approximately 7.25 miles to a point in the center of San Fernando
434-23   Creek for the northernmost Southeast corner of Jim Wells County and
434-24   the northernmost Southwest corner of Nueces County; thence along
434-25   the centerline of San Fernando Creek and along the common line
434-26   between Kleberg County and Nueces County in a southeasterly
 435-1   direction approximately 9 miles to a point for the southernmost
 435-2   Southwest corner of Nueces County; thence along the common line
 435-3   between Kleberg County and Nueces County, East approximately 32
 435-4   miles to a point on the shoreline of Laguna Madre for an angle
 435-5   point; thence along the common line between Kleberg County and
 435-6   Nueces County in an east-northeasterly direction across Laguna
 435-7   Madre approximately 5.25 miles to a point on the Northwest line of
 435-8   Padre Island for an angle point; thence along the common line
 435-9   between Kleberg County and Nueces County in a southeasterly
435-10   direction to a point on the boundary of the State of Texas in the
435-11   Gulf of Mexico off North Padre Island at the Northeast corner of
435-12   Kleberg County and the Southeast corner of Nueces County; thence
435-13   along the boundary of the State of Texas in the Gulf of Mexico and
435-14   along the Southeast line of Nueces County in a northeasterly
435-15   direction to the point of beginning; being all of Live Oak County,
435-16   1116 square miles, McMullen County 1302 square miles, La Salle
435-17   County 1561 square miles, Frio County 1124 square miles, Zavala
435-18   County 1348 square miles, Atascosa County, 1358 square miles, Real
435-19   County 619 square miles, Uvalde County 1589 square miles, San
435-20   Patricio County 680 square miles, Nueces County 838 square miles,
435-21   and Jim Wells County 846 square miles, and parts of the following
435-22   Counties with the number of square miles included in the authority:
435-23   Duval                                      378 square miles.
435-24   Dimmit                                    1200 square miles.
435-25   Maverick                                   574 square miles.
435-26   Kinney                                     602 square miles.
 436-1   Medina                                    1113 square miles.
 436-2   Bandera                                    224 square miles.
 436-3   Edwards                                    922 square miles.
 436-4   Bexar                                       84 square miles.
 436-5   Wilson                                      98 square miles.
 436-6   Karnes                                      85 square miles.
 436-7   Bee                                        135 square miles.
 436-8         (b)  The boundaries and field notes of the authority form a
 436-9   closure.  If a mistake is made in copying the field notes in the
436-10   legislative process or a mistake is otherwise made in the field
436-11   notes, it shall in no way affect the organization, existence, and
436-12   validity of the authority, the right of the authority to issue any
436-13   type of bonds or refunding bonds for the purpose for which the
436-14   authority is created or to pay the principal of or interest on the
436-15   bonds, the right to assess, levy, and collect taxes, or in any
436-16   other manner affect the legality or operation of the authority or
436-17   the governing body of the authority.
436-18         (c)  The written description of the boundaries in Subsection
436-19   (a) shall be recorded by the board in the minutes of the authority.
436-20         (d)  If the board finds any land included in the field notes,
436-21   other than land in San Patricio, Nueces, and Jim Wells counties,
436-22   that is not actually included in the watershed, the board shall
436-23   exclude the land from the authority and file a certificate of
436-24   exclusion with the county clerk of the county in which the land is
436-25   located.  The certificate of exclusion shall describe the
436-26   boundaries of the land excluded so that the land remaining in the
 437-1   authority may be adequately identified.
 437-2         Sec. 268.004.  PURPOSE.  The purpose of this chapter is to
 437-3   provide by the means and in the manner authorized by this chapter,
 437-4   for the conservation and development of the state's natural
 437-5   resources within the Nueces River Basin, including:
 437-6               (1)  the control, storage, preservation, and
 437-7   distribution of the state's water for domestic and municipal uses,
 437-8   industrial uses, irrigation, mining and recovery of minerals, stock
 437-9   raising, underground water recharge, electric power generation,
437-10   navigation, recreation and pleasure, and other beneficial uses and
437-11   purposes;
437-12               (2)  the reclamation and irrigation of arid, semiarid,
437-13   and other land needing irrigation;
437-14               (3)  the reclamation and drainage of overflowed land
437-15   and other land needing drainage;
437-16               (4)  the maintenance and enhancement of the quality of
437-17   the water in the Nueces River Basin;
437-18               (5)  the conservation and development of the forests,
437-19   water, and hydroelectric power;
437-20               (6)  the navigation of inland and coastal water;
437-21               (7)  the provision of systems, facilities, and
437-22   procedures for the collection, transportation, handling, treatment,
437-23   and disposal of waste of all types; and
437-24               (8)  protection of the beds and banks of the
437-25   state-owned rivers and watercourses in the Nueces River Basin.
437-26         Sec. 268.005.  CONSTRUCTION OF CHAPTER.  This chapter shall
 438-1   be liberally construed to achieve its purposes, and any particular
 438-2   grant of power contained in this chapter shall be held to specify
 438-3   but not to limit general powers.  This chapter is sufficient
 438-4   authority for the performance of all acts and procedures authorized
 438-5   by this chapter, without reference to any other law or any
 438-6   restrictions or limitations included in any other law.  The
 438-7   authority may use the provisions of any other law not in conflict
 438-8   with an express provision of this chapter to the extent necessary
 438-9   or convenient to carry out any power, express or implied, granted
438-10   by this chapter or by any other law that by its terms is applicable
438-11   to the authority.
438-12         Sec. 268.006.  BOARD OF DIRECTORS.  (a)  The authority shall
438-13   be governed by a board of directors composed of 21 members, who
438-14   shall be appointed by the governor with the advice and consent of
438-15   the senate.  Each member must be a qualified elector and a resident
438-16   of a county that lies wholly or partly within the authority as
438-17   described in Section 268.003(a).
438-18         (b)  The board shall include four members who are residents
438-19   of Nueces County, two members who are residents of San Patricio
438-20   County, and two members who are residents of Jim Wells County.  Not
438-21   more than four persons who reside in Nueces County and not more
438-22   than two persons who reside in any other county that lies wholly or
438-23   partly within the authority may be appointed to or serve on the
438-24   board at the same time.
438-25         (c)  Each member of the board serves for a term of six years
438-26   and until a successor is appointed and has qualified.  Members of
 439-1   the board serve staggered terms, with one-third of the members
 439-2   taking office on February 1 of each odd-numbered year.
 439-3         (d)  Each member of the board shall qualify by taking the
 439-4   constitutional oath of office and by executing a bond in an amount
 439-5   determined by the board conditioned on the faithful performance of
 439-6   the member's duties.
 439-7         (e)  All vacancies on the board shall be filled in the manner
 439-8   provided by this section for making the original appointment.
 439-9         (f)  The governor may remove a director from office for
439-10   inefficiency, neglect of duty, misconduct in office, or absence
439-11   from three consecutive regular meetings of the board.  Before a
439-12   director is removed from office, the board shall conduct a hearing
439-13   on the charges against the director.  The director is entitled to
439-14   appear at the hearing and present evidence to show why the director
439-15   should not be removed from office.  Not later than the 30th day
439-16   before the date of the hearing, the board shall give the director
439-17   notice of the charges against the director and the time and place
439-18   for the hearing.  An affirmative vote of not less than 11 of the
439-19   directors is required to approve a recommendation for removal.  A
439-20   recommendation for removal shall be forwarded to the governor for
439-21   the governor's consideration and action in accordance with the
439-22   provisions of this subsection.
439-23         (g)  Eleven members of the board constitute a quorum for the
439-24   transaction of business.
439-25         (h)  The board shall adopt and may amend necessary bylaws for
439-26   the conduct of the authority's business.
 440-1         (i)  The board shall elect a president, one or more vice
 440-2   presidents, a secretary, a treasurer, and other officers as the
 440-3   board considers necessary.  The president, vice presidents,
 440-4   secretary, and treasurer must be members of the board, but other
 440-5   officers are not required to be members of the board.  The offices
 440-6   of secretary and treasurer may be combined, and the offices of
 440-7   assistant secretary and assistant treasurer may be combined.
 440-8         Sec. 268.007.  INTEREST IN CONTRACT.  A director who has a
 440-9   financial interest in a contract to be executed by the authority
440-10   for the purchase, sale, lease, rental, or supply of property,
440-11   including supplies, materials, and equipment, or the construction
440-12   of facilities shall disclose that fact to the other directors and
440-13   may not vote on or participate in discussions during board meetings
440-14   on the acceptance of the contract.  A financial interest of a
440-15   director does not affect the validity of a contract if the
440-16   disclosure is made and the director with the financial interest
440-17   does not vote on the question of entering into the contract.
440-18         Sec. 268.008.  DIRECTOR COMPENSATION.  (a)  A director is
440-19   entitled to receive an allowance in an amount not exceeding that
440-20   provided under the general law of the state and reimbursement for
440-21   actual and necessary expenses incurred:
440-22               (1)  for each day the director spends attending
440-23   meetings of the board; and
440-24               (2)  for each day the director spends attending to the
440-25   business of the authority that is authorized by the board.
440-26         (b)  A director is not entitled to receive a per diem
 441-1   allowance for more than 50 days in any one calendar year.
 441-2         Sec. 268.009.  COMMITTEES.  The board may appoint or
 441-3   establish an executive committee and appoint or provide for the
 441-4   appointment of other committees as necessary or desirable to assist
 441-5   in conducting the business of the authority.  Subject to the
 441-6   applicable rules of law on delegation of powers, the board may
 441-7   assign, delegate, or provide for the assignment or delegation of
 441-8   any powers, duties, and functions to its committees as the board
 441-9   may prescribe.  If a committee member is not a director, the
441-10   committee member may not vote on matters coming before the
441-11   committee unless specifically authorized by the board.
441-12         Sec. 268.010.  EXECUTIVE DIRECTOR.  (a)  The board may employ
441-13   an executive director and set the salary and other compensation of
441-14   the executive director by a majority vote of the board.
441-15         (b)  The executive director is the chief executive officer of
441-16   the authority.  Under policies determined by the board and the
441-17   executive committee, if such a committee is established under
441-18   Section 268.009, the executive director is responsible to the board
441-19   and the executive committee, if established, for:
441-20               (1)  administering the directives of the board and the
441-21   executive committee;
441-22               (2)  keeping the authority's records, including minutes
441-23   of meetings of the board and the executive committee;
441-24               (3)  coordinating with state, federal, and local
441-25   agencies;
441-26               (4)  developing plans and programs for the approval of
 442-1   the board or the executive committee;
 442-2               (5)  hiring, supervising, training, and discharging the
 442-3   authority's employees, as authorized by the board or the executive
 442-4   committee;
 442-5               (6)  contracting for or retaining technical,
 442-6   scientific, legal, fiscal, and other professional services, as
 442-7   authorized by the board or the executive committee; and
 442-8               (7)  performing any other duties assigned to the
 442-9   executive director by the board or the executive committee.
442-10         (c)  The board may discharge the executive director on a
442-11   majority vote of the board.
442-12         Sec. 268.011.  DIRECTOR AND EMPLOYEE BONDS.  (a)  The
442-13   executive director, the treasurer, and other officers, agents, and
442-14   employees of the authority charged with the collection, custody, or
442-15   payment of any money of the authority shall execute a fidelity
442-16   bond.  The board shall approve the form, amount, and surety of the
442-17   bond.
442-18         (b)  The authority shall pay the premiums on the bonds
442-19   required under this section and the director bonds required under
442-20   Section 268.006(d).
442-21         Sec. 268.012.  PRINCIPAL OFFICE.  The authority shall
442-22   maintain its principal office within its boundaries.
442-23         Sec. 268.013.  RECORDS.  (a)  The authority shall keep
442-24   complete and accurate accounts of its business transactions in
442-25   accordance with generally accepted methods of accounting.
442-26         (b)  The authority shall keep complete and accurate minutes
 443-1   of its meetings.
 443-2         (c)  The authority shall keep its accounts, contracts,
 443-3   documents, minutes, and other records at its principal office.
 443-4         (d)  Except as otherwise required by law, the authority shall
 443-5   not disclose any records that it has relating to trade secrets or
 443-6   economics of operation of any business or industry.
 443-7         (e)  Except as provided in Subsection (d), the authority
 443-8   shall permit reasonable public inspection of its records during
 443-9   regular business hours.
443-10         Sec. 268.014.  SEAL.  The authority shall adopt a seal, the
443-11   form of which it may alter from time to time.
443-12         Sec. 268.015.  SUIT.  The authority may sue and be sued in
443-13   its corporate name.
443-14         Sec. 268.016.  GENERAL POWERS AND DUTIES.  (a)  The authority
443-15   shall administer this chapter and shall use its facilities and
443-16   powers to accomplish the purposes of this chapter.
443-17         (b)  The authority shall have and may exercise all powers,
443-18   rights, and privileges necessary or convenient for accomplishing
443-19   the purposes of this chapter.
443-20         (c)  The powers granted to the authority by this chapter are
443-21   cumulative of all powers granted by other laws that are by their
443-22   terms applicable to the authority.
443-23         Sec. 268.017.  CONTROL AND EMPLOYMENT OF WATERS.
443-24   (a)  Subject to the constitution and other laws of the state and
443-25   the continuing right of supervision of the state through the
443-26   commission, the authority has and may exercise authority and power
 444-1   over the storm water and floodwater of the Nueces River Basin,
 444-2   subject to the applicable provisions of Chapters 11 and 12.
 444-3         (b)  Subject to Chapters 11 and 12, the authority may
 444-4   exercise the powers of control and employment of the state's water
 444-5   in the following manner and for the following purposes:
 444-6               (1)  to provide for the control and coordination of
 444-7   water use in the Nueces River Basin as a unit;
 444-8               (2)  to provide by adequate organization and
 444-9   administration for the preservation of the rights of the people of
444-10   the different sections of the Nueces River Basin in the beneficial
444-11   use of water;
444-12               (3)  to provide for conserving storm water, floodwater,
444-13   and unappropriated flow water of the Nueces River Basin, including
444-14   storing, controlling, transporting, treating, and distributing the
444-15   water, for preventing the escape of the water without the maximum
444-16   of public service, preventing the devastation of land from
444-17   recurrent overflows, and protecting life and property in the river
444-18   basin from uncontrolled floodwater;
444-19               (4)  to provide for the conservation of water essential
444-20   for domestic and other water uses of the people of the Nueces River
444-21   Basin, including all necessary water supplies for cities, towns,
444-22   and industrial districts;
444-23               (5)  to provide for the irrigation of land in the
444-24   Nueces River Basin where irrigation is required for agricultural
444-25   purposes or may be deemed helpful to more profitable agricultural
444-26   production and to provide for the equitable distribution of storm
 445-1   water, floodwater, and unappropriated flow water to the regional
 445-2   potential requirements for all uses;
 445-3               (6)  to provide for the encouragement and development
 445-4   of drainage systems and provisions for drainage of land in the
 445-5   valleys of the Nueces River and its tributaries needing drainage
 445-6   for profitable agricultural and livestock production and industrial
 445-7   activities and drainage of other land in the watershed area of the
 445-8   authority requiring drainage for the most advantageous use;
 445-9               (7)  to provide for the conservation of all soils
445-10   against destructive erosion, thereby preventing the increased flood
445-11   dangers caused by destructive erosion;
445-12               (8)  to control and make available for employment
445-13   floodwater, storm water, and unappropriated flow water, as
445-14   authorized by the commission, in the development of commercial and
445-15   industrial enterprises in all sections of the watershed area of the
445-16   authority;
445-17               (9)  to provide, as set forth by Chapters 11 and 12,
445-18   for the control, storage, and employment of floodwater, storm
445-19   water, and unappropriated flow water in the development and
445-20   distribution of hydroelectric power where this use may be
445-21   economically coordinated with other and superior uses and
445-22   subordinated to the uses declared by law to be superior; and
445-23               (10)  to provide, in the manner set forth in Chapters
445-24   11 and 12, for each purpose and use for which floodwater, storm
445-25   water, and unappropriated flow water when controlled and conserved
445-26   may be used in the performance of a useful service as contemplated
 446-1   and authorized by the provisions of the constitution and other
 446-2   laws.
 446-3         (c)  Subject to Chapters 11 and 12, the authority may
 446-4   control, store, and preserve the water of the Nueces River and its
 446-5   tributaries within the boundaries of the authority for any useful
 446-6   purpose, may use, distribute, and sell the water for any beneficial
 446-7   purpose inside and outside the authority, and may acquire water and
 446-8   water rights inside and outside the authority.
 446-9         (d)  Plans and works provided by the authority and works
446-10   provided under authorization of the authority should give primary
446-11   consideration to the necessary and potential needs for water by or
446-12   within the respective areas constituting the watershed of the
446-13   Nueces River and its tributary streams.
446-14         Sec. 268.018.  FORESTATION AND REFORESTATION.  The authority
446-15   may forest, reforest, and aid in the foresting and reforesting of
446-16   the watershed area of the Nueces River and its tributaries.
446-17         Sec. 268.019.  GROUNDWATER.  (a)  The authority may conduct
446-18   surveys and studies of the groundwater supplies in the authority
446-19   for the purpose of determining the location and quantity of
446-20   groundwater available for irrigation and other purposes and to
446-21   develop and ascertain other data and information that in the
446-22   judgment of the authority may be necessary to fully develop
446-23   irrigation and other water uses from the groundwater in the
446-24   authority.
446-25         (b)  Subject to the requirements of applicable laws and with
446-26   the approval and under the supervision of the commission, the
 447-1   authority may appropriate storm water and floodwater to recharge
 447-2   underground freshwater-bearing sand and aquifers in the Nueces
 447-3   River Basin.
 447-4         (c)  The authority shall cooperate with the Edwards Aquifer
 447-5   Authority, or its lawful successor, and any other groundwater
 447-6   district within the boundaries of the authority in groundwater
 447-7   recharge projects in areas where a groundwater district has
 447-8   jurisdiction.
 447-9         Sec. 268.020.  WATER QUALITY CONTROL.  (a)  The authority has
447-10   and may exercise all the powers granted to river authorities under
447-11   Subchapters E and F, Chapter 17, and Chapters 26 and 30.
447-12         (b)  The authority may serve as the entity to provide
447-13   regional or areawide waste collection, treatment, and disposal
447-14   services, as provided by Subchapter C, Chapter 26.
447-15         Sec. 268.021.  SOLID WASTE.  The authority may purchase,
447-16   acquire, construct, maintain, and provide facilities, equipment,
447-17   and disposal sites to furnish solid waste collection,
447-18   transportation, treatment, and disposal services inside the
447-19   authority, may charge for the services, and may enter into
447-20   contracts for the services with any person.
447-21         Sec. 268.022.  PARKS AND RECREATIONAL FACILITIES.  The
447-22   authority may acquire land adjacent to or in the vicinity of the
447-23   Nueces River or any of its tributaries for park and recreational
447-24   purposes and may acquire, construct, and maintain park and
447-25   recreational facilities on that land.
447-26         Sec. 268.023.  PERMITS AND LICENSES.  (a)  In the manner
 448-1   provided by Chapters 11 and 12, the authority shall apply for any
 448-2   permits, licenses, franchises, and other grants of authority it may
 448-3   require from the commission.
 448-4         (b)  The authority may apply for any permits, licenses,
 448-5   franchises, and other grants of authority it may require from the
 448-6   Texas Water Development Board or any other federal, state, or local
 448-7   governmental agency to exercise its powers and accomplish the
 448-8   purposes under this chapter.
 448-9         Sec. 268.024.  SERVICE CONTRACTS AND CHARGES.  (a)  The
448-10   authority may enter into service contracts and may adopt
448-11   resolutions and orders establishing rates and providing for the
448-12   collection of fees and charges for the sale or use of water, the
448-13   services of water transmission, treatment, and storage facilities,
448-14   solid and liquid waste collection, treatment, and disposal
448-15   facilities and services, the use of park and recreational
448-16   facilities, the sale of power and electric energy, and any other
448-17   services or facilities sold, furnished, or supplied by the
448-18   authority.
448-19         (b)  The fees and charges shall be sufficient to produce
448-20   revenue adequate to pay:
448-21               (1)  expenses necessary for the operation and
448-22   maintenance of the properties and facilities of the authority;
448-23               (2)  the interest on or the principal of any bonds or
448-24   other obligations issued by the authority when due and payable and
448-25   to fulfill any reserve or other fund obligations of the authority
448-26   in connection with the bonds or other obligations; and
 449-1               (3)  any other expenses the board may consider
 449-2   necessary and proper for the operations of the authority.
 449-3         Sec. 268.025.  EMINENT DOMAIN.  The authority may acquire
 449-4   property of any kind, within or outside the authority, appropriate
 449-5   for the exercise of its functions, through the exercise of the
 449-6   power of eminent domain under Chapter 21, Property Code.
 449-7         Sec. 268.026.  ACQUISITION AND DISPOSITION OF PROPERTY.
 449-8   (a)  The authority may purchase, lease, acquire by gift, maintain,
 449-9   use, and operate property of any kind, inside or outside the
449-10   authority, appropriate for the exercise of its functions.
449-11         (b)  The authority may sell any property or interest in any
449-12   property owned by the authority by installments or otherwise,
449-13   including sales in a manner prescribed or authorized by Section
449-14   402.014, Local Government Code, Chapter 383, Health and Safety
449-15   Code, and Chapter 30.  The authority may lease, exchange, or
449-16   otherwise dispose of any property or interest in any property.
449-17         Sec. 268.027.  FACILITIES.  The authority may acquire,
449-18   construct, extend, improve, maintain, reconstruct, use, and operate
449-19   any facilities inside or outside the authority necessary or
449-20   convenient to the exercise of its powers, rights, duties, and
449-21   functions.
449-22         Sec. 268.028.  USE OF PUBLIC EASEMENTS.  The authority may
449-23   use any public roadways, streets, alleys, or public easements
449-24   inside or outside the boundaries of the authority in the
449-25   accomplishment of its purposes without the necessity of securing a
449-26   franchise.
 450-1         Sec. 268.029.  RELOCATION OF FACILITIES.  (a)  If the
 450-2   authority, in the exercise of the power of eminent domain, power of
 450-3   relocation, or any other power, necessitates the relocation,
 450-4   raising, rerouting, change in grade, or alteration of the
 450-5   construction of any highway, railroad, electric transmission line,
 450-6   telephone or telegraph properties and facilities, or pipelines, all
 450-7   necessary relocation, raising, rerouting, change in grade, or
 450-8   alteration of construction shall be accomplished at the sole
 450-9   expense of the authority.
450-10         (b)  In this section, "sole expense" means the actual cost of
450-11   the relocation, raising, rerouting, change in grade, or alteration
450-12   of grade or construction in providing a comparable replacement
450-13   without any enhancement of the facilities, after deducting the net
450-14   salvage value derived from the old facility.
450-15         Sec. 268.030.  CONTRACTS GENERALLY.  (a)  The authority may
450-16   enter into contracts and execute instruments that are necessary or
450-17   convenient to the exercise of its powers, rights, duties, and
450-18   functions.
450-19         (b)  A construction, maintenance, operation, or repair
450-20   contract, a contract for the purchase of material, equipment, or
450-21   supplies, or a contract for services, other than technical,
450-22   scientific, legal, fiscal, or other professional services, that
450-23   will require an estimated expenditure of more than $10,000 or is
450-24   for a term of six months or more shall be awarded to the lowest and
450-25   best bidder.  A notice to bidders shall be published once each week
450-26   for three consecutive weeks before the date set for awarding the
 451-1   contract.  In the event of a catastrophe or calamity of any kind,
 451-2   the authority may award contracts necessary to protect and preserve
 451-3   the public health and welfare or the properties of the authority
 451-4   without using the bidding procedures.
 451-5         (c)  The notice of bids is sufficient if it states the time
 451-6   and place the bids will be opened, the general nature of the work
 451-7   to be done, the material, equipment, or supplies to be purchased,
 451-8   or the nonprofessional services to be rendered and states the terms
 451-9   on which copies of the plans, specifications, or other pertinent
451-10   information may be obtained.
451-11         (d)  Notice shall be published in a newspaper with general
451-12   circulation in the county or counties in which the contract is to
451-13   be performed and may also be published in any other appropriate
451-14   publication.
451-15         (e)  A person who desires to bid on the construction of any
451-16   work that is advertised shall, on written application to the
451-17   authority, be furnished a copy of the plans and specifications or
451-18   other engineering and architectural documents showing the work to
451-19   be done and all the details of the work to be done.  The authority
451-20   may charge a fee to cover the cost of making the copy.  Bids must
451-21   be in writing, sealed, and delivered to the authority and must be
451-22   accompanied by a certified check on a responsible bank in the state
451-23   or, at the discretion of the authority, a bid bond from a company
451-24   approved by the authority, for at least one percent of the total
451-25   amount bid.  The check or bond is forfeited to the authority if the
451-26   successful bidder fails or refuses to enter into a proper contract
 452-1   or fails or refuses to furnish bond as required by law.  Bids may
 452-2   be rejected by the authority, and the authority may waive any
 452-3   informality in the bids.
 452-4         (f)  Bids shall be opened at the place specified in the
 452-5   published notice and shall be announced by the authority.  The
 452-6   place where the bids are opened and announced shall always be open
 452-7   to the public.  The award of the contract shall be made by the
 452-8   board or by the executive committee if authorized by the board.
 452-9         (g)  The contract price of all construction contracts of the
452-10   authority may be paid in partial payments as the work progresses,
452-11   but the payments shall not exceed 90 percent of the amount due at
452-12   the time of the payment as shown by the report of the engineer of
452-13   the authority.  At all times during the progress of the work, the
452-14   executive director shall inspect the construction or have the
452-15   construction inspected by the authority's engineer or the
452-16   engineer's assistants.  On certification of the executive director
452-17   and the authority's engineer of the completion of the contract in
452-18   accordance with its terms, and in the case of any construction
452-19   contract for which notice to bidders is required by Subsection (b),
452-20   on approval of the board, the authority shall draw a warrant on its
452-21   depository to pay the balance due on the contract.
452-22         (h)  The person, firm, or corporation to whom the contract is
452-23   awarded shall provide the performance and payment bonds required by
452-24   law.
452-25         (i)  This section does not prohibit the authority from
452-26   purchasing or acquiring land or interests in land from any person,
 453-1   from acquiring, constructing, or improving pollution control or
 453-2   waste collection and disposal facilities as provided by Chapter
 453-3   383, Health and Safety Code, Chapter 30, or other applicable laws,
 453-4   or from purchasing or acquiring surplus property from a
 453-5   governmental entity by negotiated contract and without necessity
 453-6   for advertising bids.
 453-7         (j)  An officer, agent, or employee of the authority who is
 453-8   financially interested in a contract described in Subsection (b)
 453-9   shall disclose that fact to the board before the board votes on the
453-10   acceptance of the contract.
453-11         Sec. 268.031.  AUTHORITY RULES.  (a)  The authority may adopt
453-12   and enforce rules reasonably required to effectuate the provisions
453-13   of this chapter.
453-14         (b)  In adopting rules, the board shall comply, as
453-15   appropriate, with the requirements of Chapter 2001, Government
453-16   Code.
453-17         (c)  The board shall print its rules and furnish copies to
453-18   any person on written request.
453-19         Sec. 268.032.  PENALTIES.  (a)  A person who violates a rule
453-20   or order of the authority is subject to a civil penalty of not less
453-21   than $50 and not more than $1,000 for each day of violation.  The
453-22   authority may sue to recover the penalty in a district court in the
453-23   county where the violation occurred.  Penalties shall be paid to
453-24   the authority.
453-25         (b)  The authority may sue for injunctive relief in a
453-26   district court in the county where a violation of a rule or order
 454-1   occurred or is threatened.
 454-2         (c)  The authority may sue for injunctive relief and
 454-3   penalties in the same proceeding.
 454-4         Sec. 268.033.  JUDICIAL REVIEW.  (a)  A person who is
 454-5   adversely affected by a rule or order of the authority may sue the
 454-6   authority in a district court to set aside the rule or order before
 454-7   the 31st day after the date on which the rule or order took effect.
 454-8         (b)  Venue for suits under Subsection (a) is in any county
 454-9   located wholly or partially in the authority where the plaintiff
454-10   resides or in the county in which the authority maintains its
454-11   principal office.
454-12         Sec. 268.034.  SURVEYS AND ENGINEERING INVESTIGATIONS.  The
454-13   authority shall make surveys and engineering investigations to
454-14   develop information for its use, and the board may make and
454-15   determine plans necessary to accomplish the purposes for which the
454-16   authority is created and do all things useful and helpful in
454-17   carrying out the plans and accomplishing the purposes of the
454-18   authority.
454-19         Sec. 268.035.  ACCESS.  (a)  To provide for the safety and
454-20   welfare of persons and their property or for the protection and
454-21   security of the property and facilities of the authority, the board
454-22   may adopt rules with respect to the properties of the authority and
454-23   any water reservoir or dam, the construction, operation, or
454-24   management of which is participated in by the authority, to control
454-25   and regulate ingress, egress, and use and the operation of land and
454-26   water vehicles.
 455-1         (b)  All public roads, streets, and state highways crossing
 455-2   the areas adjacent to the areas to be covered by any impounded
 455-3   water shall remain open to allow public access to and from the
 455-4   lakes created, unless a change is made by lawful authority.
 455-5         Sec. 268.036.  USE OF BED AND BANKS OF NUECES RIVER AND
 455-6   TRIBUTARIES.  Subject to the approval of the commission, the
 455-7   authority may use the bed and banks of the Nueces River and its
 455-8   tributaries for any purpose necessary to accomplish the plans of
 455-9   the authority for storing, controlling, conserving, transporting,
455-10   and distributing storm waters, floodwaters, and appropriated flow
455-11   waters for useful purposes.
455-12         Sec. 268.037.  PROTECTION OF NATURAL CONDITION OF BEDS AND
455-13   BANKS OF STATE-OWNED WATERCOURSES.  (a)  The authority may adopt
455-14   and enforce rules to protect the natural condition of the
455-15   state-owned beds and banks of the watercourses within the
455-16   authority's boundaries against disturbance of their beds and banks
455-17   by limiting or prohibiting vehicular access and the use of
455-18   vehicles, except by owners of the adjacent uplands and the owners'
455-19   agents, employees, representatives, and lessees for reasonable
455-20   purposes related to usual and customary agricultural operations
455-21   conducted only in those reaches of the watercourse adjacent to the
455-22   owner's property.  The authority in its rules may also prohibit
455-23   within the state-owned beds and banks of the watercourses
455-24   littering, destruction of aquatic habitat, pollution, and
455-25   activities endangering the public safety.  In adopting rules, the
455-26   board shall comply, as appropriate, with the requirements of
 456-1   Chapter 2001, Government Code.
 456-2         (b)  Nothing in this section is intended to or shall affect
 456-3   such use of the beds and banks of the watercourses for emergency or
 456-4   rescue operations or for activities specifically authorized by the
 456-5   state or its political subdivisions acting pursuant to state law.
 456-6         (c)  A violation of the rules adopted pursuant to this
 456-7   section is a Class B misdemeanor.  Actions for violations of the
 456-8   rules may be brought under this section or under Section
 456-9   268.032(a).  The authority may also seek injunctive relief as
456-10   provided in Section 268.032 for enforcement of rules.
456-11         (d)  The authority may contract for, employ, or appoint peace
456-12   officers in the manner provided in Section 49.216 to enforce the
456-13   rules within the state-owned beds and banks of the watercourses
456-14   within the authority's boundaries.
456-15         Sec. 268.038.  MASTER PLAN.  (a)  The authority shall prepare
456-16   and file with the commission a master plan for the maximum
456-17   development of the soil and water resources of the entire Nueces
456-18   River watershed, including plans for the complete utilization, for
456-19   all economically beneficial purposes, of the water resources of the
456-20   watershed.  The authority may amend the master plan as appropriate
456-21   to accomplish the purposes of this section.
456-22         (b)  After the master plan or any amendments to the plan have
456-23   been filed with the commission, notice of the application of a
456-24   person who desires to acquire the right to use state water in the
456-25   Nueces River watershed shall be furnished to the authority.  After
456-26   public hearing as provided by law, the commission may grant or deny
 457-1   the proposed application in the manner required by law,
 457-2   notwithstanding any provisions of the master plan or any amendments
 457-3   to the plan to the contrary.
 457-4         (c)  Works constructed by the authority shall be constructed
 457-5   and operated in a manner conforming to the master plan and any
 457-6   amendments to the plan to the greatest degree practicable.
 457-7         (d)  None of the provisions of this section shall be
 457-8   construed to interfere with any improvement of the Nueces River or
 457-9   its tributaries or with grants or loans in aid of any improvement
457-10   made by the United States or the state.
457-11         Sec. 268.039.  CONSERVATION PROGRAM.  The board shall adopt
457-12   and implement a program of water conservation that incorporates
457-13   practices, techniques, and technologies that will reduce the
457-14   consumption of water, reduce the loss or waste of water, improve
457-15   the efficiency in the use of water, or increase the recycling and
457-16   reuse of water so that a water supply is made available for future
457-17   or alternative uses.  The commission determines whether a program
457-18   will meet reasonably anticipated local needs and conditions.
457-19         Sec. 268.040.  WORK WITH TEXAS WATER DEVELOPMENT BOARD.  The
457-20   authority has all the powers vested in political subdivisions under
457-21   Chapters 16 and 17, including the powers necessary to enable the
457-22   authority to participate in the programs administered by the Texas
457-23   Water Development Board for the acquisition and development of
457-24   facilities, the sale or lease of facilities, financial assistance
457-25   to political subdivisions, and other authorized programs.
457-26         Sec. 268.041.  GENERAL PROVISIONS.  (a)  The board may
 458-1   provide for any expenditures it considers essential or useful in
 458-2   the maintenance, operation, and administration of the authority.
 458-3         (b)  The authority may perform any other acts necessary or
 458-4   convenient to the exercise of the powers, rights, privileges, or
 458-5   functions conferred by this chapter or other laws.
 458-6         Sec. 268.042.  LIMITATIONS ON AUTHORITY AND SUPERVISION BY
 458-7   COMMISSION.  (a)  The powers and duties granted and prescribed by
 458-8   this chapter are subject to all legislative declarations of public
 458-9   policy in the maximum use of the storm water, floodwater, and
458-10   unappropriated flow water of the Nueces River Basin for the
458-11   purposes for which the authority is created and are subject to the
458-12   continuing right of supervision of the state through the
458-13   commission.
458-14         (b)  The commission is charged with the authority and duty to
458-15   approve or refuse to approve the adequacy of a plan for flood
458-16   control or conservation improvement purposes that is devised by the
458-17   authority for the achievement of the plans and purposes intended in
458-18   the creation of the authority and that contemplates improvements
458-19   supervised by the commission under the provisions of the general
458-20   law.
458-21         Sec. 268.043.  CLEAN AIR FINANCING POWERS.  In addition to
458-22   the powers and functions vested in the authority by this chapter,
458-23   the authority has and may exercise all the powers and functions
458-24   vested in river authorities under Chapter 383, Health and Safety
458-25   Code.
458-26         Sec. 268.044.  DISBURSEMENT OF FUNDS.  The authority may
 459-1   disburse money only by check, draft, order, or other instrument,
 459-2   signed by the person or persons authorized in the bylaws of the
 459-3   board or by resolution of the board.
 459-4         Sec. 268.045.  FEES AND CHARGES.  The authority shall
 459-5   establish fees and charges that may not be higher than necessary to
 459-6   fulfill the obligations imposed on the authority by this chapter.
 459-7         Sec. 268.046.  LOANS AND GRANTS.  (a)  The authority may
 459-8   borrow money and accept grants and donations for corporate purposes
 459-9   from private sources, the United States, the state, local
459-10   governments, or any other person.  The authority may enter into any
459-11   agreement in connection with the loan, grant, or donation that is
459-12   not in conflict with the constitution and laws of this state.
459-13         (b)  The source of any funds accepted by the authority,
459-14   including the amount and any restrictions placed by the donor on
459-15   the expenditure of the funds, shall be public information.
459-16         Sec. 268.047.  FUNDS FOR SURVEYS AND DATA COLLECTION.  The
459-17   authority may apply to the state, the United States, or any other
459-18   person for funds necessary to secure engineering surveys and the
459-19   compilation and collection of data relating to regional and general
459-20   conditions entering into and influencing the character and the
459-21   extent of the improvements necessary to accomplish the storage,
459-22   control, transportation, treatment, conservation, and equitable
459-23   distribution to the greatest public advantage of the floodwater,
459-24   normal flow, and storm water that are stored and controlled and to
459-25   accomplish or carry out any of the other purposes of this chapter.
459-26   The authority shall request an amount of funds the authority
 460-1   considers sufficient for its purposes and may make the necessary
 460-2   agreements with the party providing the funds and may appropriate
 460-3   the amount of the estimated equitable contribution of the costs of
 460-4   developing essential engineering data.
 460-5         Sec. 268.048.  TRUST FUND.  Money collected by or donated,
 460-6   granted, loaned, or advanced to the authority is declared to be
 460-7   trust fund money for the purposes provided in this chapter.
 460-8         Sec. 268.049.  USE OF REVENUE AND PROPERTY.  (a)  All revenue
 460-9   accruing to the authority shall be used by the authority pursuant
460-10   to this chapter and any other law relating to the authority.
460-11         (b)  The use of any money or property of the authority for
460-12   any purpose not provided in this chapter is prohibited.
460-13         Sec. 268.050.  INVESTMENT OF FUNDS.  (a)  Funds in the
460-14   treasury of the authority that are not required for current payment
460-15   of obligations of the authority or for sinking funds and that the
460-16   board considers available for investment may be invested or
460-17   reinvested by the authority in:
460-18               (1)  direct obligations of or obligations the principal
460-19   and interest of which are guaranteed by the United States;
460-20               (2)  direct obligations of or participation
460-21   certificates guaranteed by the Federal Intermediate Credit Banks,
460-22   Federal Land Banks, Federal National Mortgage Association, Federal
460-23   Home Loan Banks, Banks for Cooperatives, or the successor or
460-24   successors to any of those entities and in certificates of deposit
460-25   of any bank or trust company the deposits of which are fully
460-26   secured by a pledge of securities of any of the kind specified in
 461-1   this subdivision;
 461-2               (3)  any other securities made eligible for such
 461-3   investment by other laws and constitutional provisions; or
 461-4               (4)  any combination of the obligations, certificates,
 461-5   or securities specified in this subsection.
 461-6         (b)  The type and maturity of investments made under this
 461-7   section shall be determined by the board, which, in the case of
 461-8   funds established in connection with the authorization of bonds,
 461-9   shall provide appropriate recitals with regard to the issuance of
461-10   the bonds in the resolutions relating to the issuance of the bonds.
461-11   Income and profits on the investments shall be applied as directed
461-12   by the board.
461-13         Sec. 268.051.  AUDIT.  (a)  The fiscal year of the authority
461-14   ends on August 31 of each year.
461-15         (b)  On or before January 1 following the close of each
461-16   fiscal year, the state auditor shall audit the books and accounts
461-17   of the authority for the preceding fiscal year.  The audit shall
461-18   show the amount of money received by the authority under this
461-19   chapter during the preceding fiscal year and shall show how, to
461-20   whom, and for what purpose the money was spent.
461-21         (c)  A copy of the audit report shall be filed with the
461-22   authority, the governor, the lieutenant governor, the speaker of
461-23   the house of representatives, the attorney general, the commission,
461-24   and the comptroller.
461-25         (d)  After completing the audit report, the state auditor
461-26   shall prepare a statement showing the actual cost of the audit and
 462-1   shall certify the statement to the governor for approval.  When the
 462-2   statement is approved by the governor, it shall be delivered to the
 462-3   authority.  The authority shall pay the cost of the audit by
 462-4   depositing the money with the state treasurer, who shall place the
 462-5   money in the general revenue fund.
 462-6         (e)  Nothing in this section shall prohibit the authority
 462-7   from employing the professional services of accountants for any
 462-8   purpose.
 462-9         Sec. 268.052.  DEPOSITORY BANKS.  (a)  The board shall
462-10   designate one or more banks inside or outside the authority to
462-11   serve as depository for the funds of the authority.  All money of
462-12   the authority shall be deposited in the depository bank or banks
462-13   except that bond proceeds, money pledged to pay bonds, money placed
462-14   in special funds, and money remitted to a bank of payment for the
462-15   payment of principal of and interest on bonds may be handled as
462-16   provided in a trust indenture or bond resolution.  To the extent
462-17   that funds in the depository banks or a trustee bank are not
462-18   invested or insured by the Federal Deposit Insurance Corporation,
462-19   the funds shall be secured in the manner provided by law for the
462-20   security of county funds.
462-21         (b)  Before designating a depository bank or banks, the board
462-22   shall issue a notice stating the time and place the board will meet
462-23   for that purpose and inviting the banks in the authority to submit
462-24   applications to be designated depositories.  The term of service
462-25   for depositories shall be prescribed by the board.  The notice
462-26   shall be published one time in a newspaper or newspapers of general
 463-1   circulation in the authority specified by the board.  In lieu of
 463-2   the publication in a newspaper, a copy of the notice may be mailed
 463-3   to each bank in the authority.
 463-4         (c)  At the time mentioned in the notice, the board shall
 463-5   consider the applications and the management and condition of the
 463-6   banks filing them and shall designate as depositories the bank or
 463-7   banks that offer the most favorable terms and conditions for the
 463-8   handling of the funds of the authority, that the board finds have
 463-9   proper management, and that are in condition to warrant handling of
463-10   authority funds.  Membership on the board of an officer or director
463-11   of a bank shall not disqualify the bank from being designated a
463-12   depository.
463-13         (d)  If no applications are received by the time stated in
463-14   the notice, the board shall designate a bank or banks inside or
463-15   outside the authority on terms and conditions the authority finds
463-16   advantageous.
463-17         Sec. 268.053.  BONDS.  (a)  For the purpose of carrying out
463-18   any power or authority conferred by this chapter, including the
463-19   expense of preparing the master plan and the payment of engineering
463-20   and other expenses in connection with the master plan, the
463-21   authority may issue bonds in three general classes:
463-22               (1)  bonds secured by ad valorem taxes;
463-23               (2)  bonds secured by a pledge of all or part of the
463-24   revenues accruing to the authority, including revenues received
463-25   from the sale of water or other products, rendition of service,
463-26   tolls, charges, and all other sources other than ad valorem taxes;
 464-1   or
 464-2               (3)  bonds secured by a combination pledge of all or
 464-3   part of the revenues described in Subdivision (2) and taxes.
 464-4         (b)  The bonds must be authorized by resolution of the board
 464-5   and shall be issued in the name of the authority, signed by the
 464-6   president or vice president, and attested by the secretary and
 464-7   shall bear the seal of the authority.  If authorized by the board,
 464-8   the signatures of the president or vice president and the secretary
 464-9   or of both may be printed or lithographed on the bonds, and the
464-10   seal of the authority may be impressed on the bonds or may be
464-11   printed or lithographed on the bonds.  The bonds must be in the
464-12   form prescribed by the board, must be in any denomination or
464-13   denominations, must mature serially or otherwise in not to exceed
464-14   50 years from their date, shall bear any interest, and may be sold
464-15   at a price and under terms determined by the board to be the most
464-16   advantageous reasonably obtainable.  Within the discretion of the
464-17   board, the bonds may be made callable prior to maturity at the
464-18   times and prices prescribed in the bonds and may be made
464-19   registrable as to principal or as to both principal and interest.
464-20   The bonds may be further secured by an indenture of trust with a
464-21   corporate trustee.
464-22         (c)  Bonds may be issued in more than one series, and from
464-23   time to time, as required for carrying out the purposes of this
464-24   chapter.  A pledge of revenue may reserve the right, under
464-25   conditions specified in the pledge, to issue additional bonds which
464-26   will be on a parity with or subordinate to the bonds then being
 465-1   issued.
 465-2         (d)  The resolution authorizing the bonds or the trust
 465-3   indenture further securing the bonds may specify additional
 465-4   provisions that shall constitute a contract between the authority
 465-5   and its bondholders.  The board shall have full discretion to
 465-6   provide additional provisions to the resolution, including the
 465-7   authority to provide for a corporate trustee or receiver to take
 465-8   possession of facilities of the authority in the event of default
 465-9   on the part of the authority in fulfilling the covenants made in
465-10   the resolution.
465-11         Sec. 268.054.  REFUNDING BONDS.  (a)  The authority may issue
465-12   refunding bonds for the purpose of refunding any outstanding bonds
465-13   authorized by this chapter and interest on the bonds.  The
465-14   refunding bonds may be issued to refund one or more series of
465-15   outstanding bonds and may combine the pledges for the outstanding
465-16   bonds for the security of the refunding bonds, and the refunding
465-17   bonds may be secured by other or additional revenue.
465-18         (b)  The provisions of this chapter with reference to the
465-19   issuance by the authority of other bonds, their security, their
465-20   approval by the attorney general, and the remedies of the holders
465-21   shall be applicable to refunding bonds.  Refunding bonds shall be
465-22   registered by the comptroller on surrender and cancellation of the
465-23   bonds to be refunded, but in lieu of such surrender and
465-24   cancellation, the resolution authorizing the issuance of the
465-25   refunding bonds may provide that the bonds shall be sold and the
465-26   proceeds deposited in the bank where the original bonds are
 466-1   payable, in which case the refunding bonds may be issued in an
 466-2   amount sufficient to pay the principal of and the interest on the
 466-3   original bonds to their option date or maturity date, and the
 466-4   comptroller shall register the refunding bonds without concurrent
 466-5   surrender and cancellation of the original bonds.
 466-6         Sec. 268.055.  APPROVAL AND REGISTRATION OF BONDS.  After any
 466-7   bonds, including refunding bonds, are authorized by the authority,
 466-8   the bonds and the record relating to their issuance shall be
 466-9   submitted to the attorney general for examination as to the
466-10   validity of the bonds.  If bonds are to be issued to finance in
466-11   whole or in part water-using facilities, the attorney general
466-12   before giving approval shall be furnished a resolution from the
466-13   commission certifying that the authority possesses the necessary
466-14   water right authorizing the authority to impound and appropriate
466-15   the water to be utilized by the project.  If the bonds recite that
466-16   they are secured by a pledge of the proceeds of a contract
466-17   previously made between the authority and a city or other
466-18   governmental agency, authority, or district, a copy of the contract
466-19   and the proceedings of the city or other governmental agency,
466-20   authority, or district authorizing the contract shall also be
466-21   submitted to the attorney general.  If the attorney general finds
466-22   that the bonds have been authorized and the contracts have been
466-23   made in accordance with the constitution and laws of the state, the
466-24   attorney general shall approve the bonds and the contracts and the
466-25   bonds then shall be registered by the comptroller.  After approval
466-26   and registration the bonds, and the contracts, if any, are valid
 467-1   and binding and are incontestable for any cause.
 467-2         Sec. 268.056.  BOND ELECTION REQUIREMENTS.  (a)  Bonds
 467-3   payable wholly or partially from ad valorem taxes, except refunding
 467-4   bonds, may not be issued unless authorized by an election at which
 467-5   the resident electors cast a majority of the votes in favor of the
 467-6   issuance of the bonds.  The election shall be held in accordance
 467-7   with the provisions of Section 268.058 governing ad valorem tax
 467-8   elections.
 467-9         (b)  Bonds not payable wholly or partially from ad valorem
467-10   taxes may be issued without an election.
467-11         Sec. 268.057.  ADMINISTRATION AND MAINTENANCE TAX.  (a)  The
467-12   board may levy and collect ad valorem taxes for the maintenance and
467-13   improvements of the authority, for administrative expenses of the
467-14   authority, or for both purposes in the amounts voted in accordance
467-15   with the election procedure in Section 268.058.
467-16         (b)  The maintenance tax and administration tax shall not
467-17   exceed the maximum rate voted, and the rate shall remain in effect
467-18   unless changed by subsequent vote.  The tax rate may not exceed the
467-19   limit specified in Section 268.060.
467-20         Sec. 268.058.  ELECTION.  An ad valorem tax may not be levied
467-21   or collected for any purpose authorized in this chapter and bonds
467-22   payable wholly or partially from ad valorem taxes, except refunding
467-23   bonds, may not be issued, unless an election is held in the
467-24   authority and the taxes or bonds are duly and favorably voted by a
467-25   majority of the resident electors of the authority voting at the
467-26   election.  Each election shall be called by resolution of the
 468-1   board.  The election resolution shall set forth the date of the
 468-2   election, the proposition to be submitted and voted on, the polling
 468-3   places, and any other matters considered advisable by the board.
 468-4   There shall be at least two polling places in each county that lies
 468-5   wholly inside the authority, one of which shall be at the county
 468-6   seat.  There shall be at least one polling place in the part of
 468-7   each county that lies partly inside the authority.  Notice of the
 468-8   election shall be given by publishing a substantial copy of the
 468-9   resolution calling the election in a newspaper or newspapers of
468-10   general circulation in the authority not less than twice in each
468-11   newspaper, with the interval between the publications to be at
468-12   least one week and with the first of each of the publications to be
468-13   at least 14 days prior to the date set for the election.  To the
468-14   extent consistent with this section, the election shall be held in
468-15   accordance with the provisions of the Election Code.
468-16         Sec. 268.059.  RENDITION, ASSESSMENT, EQUALIZATION, LEVYING,
468-17   AND COLLECTION OF TAXES.  (a)  The rendition and assessment of
468-18   property for taxation, the equalization of values, and the
468-19   collection of taxes for the benefit of the authority shall be in
468-20   accordance with the law applicable to counties, to the extent that
468-21   the law can be made applicable and except as specifically provided
468-22   in this section.
468-23         (b)  The board may act as the board of equalization for the
468-24   authority in all counties that lie wholly or partly in the
468-25   authority or, to the extent authorized or not prohibited by the
468-26   constitution, may delegate the equalization functions for one or
 469-1   more of those counties to the county board of equalization for each
 469-2   county.  In either case, the board of equalization shall have the
 469-3   powers, functions, and duties of the commissioners courts in
 469-4   counties to equalize the property values in accordance with the law
 469-5   applicable to counties, to the extent that the laws can be made
 469-6   applicable.  If the board delegates the equalization functions to
 469-7   one or more county boards of equalization as authorized in this
 469-8   subsection, the board shall review the assessments of each county
 469-9   board of equalization and shall adjust the assessments as necessary
469-10   to equalize values throughout the authority.  Regardless of the
469-11   method used by the authority to accomplish the equalization
469-12   functions, renditions shall be made to the county tax
469-13   assessor-collector of the county in which property contained in the
469-14   authority is located, and the tax assessor-collector of the county
469-15   shall act as the tax assessor-collector for the authority for
469-16   property in the authority located in the county.
469-17         (c)  It shall be the duty of the tax assessor-collector in
469-18   each county to place on the county tax rolls the additional column
469-19   or columns needed to show the taxes levied by the authority and the
469-20   amount of the taxes, based on the value of the property as approved
469-21   and equalized by the board.  The fee of each county tax
469-22   assessor-collector for assessing and collecting the taxes levied by
469-23   the authority shall be one percent of the taxes collected, to be
469-24   paid over and disbursed in each county as are other fees of office.
469-25         (d)  All the laws for the enforcement of state and county
469-26   taxes shall be available to the authority.  The authority shall
 470-1   have the right to cause the officers of each county to enforce and
 470-2   collect the taxes due the authority in that county, as provided in
 470-3   the law for the enforcement of state and county taxes.
 470-4         (e)  Taxes assessed and levied for the benefit of the
 470-5   authority shall be payable and shall become delinquent at the same
 470-6   time, in the same manner, and subject to the same discount for
 470-7   advance payment as taxes levied by and for the benefit of the
 470-8   county in which the property is taxable.  The fee for collecting
 470-9   delinquent taxes through prosecution of suit shall be 15 percent of
470-10   the taxes collected by the suit, to be paid over and disbursed in
470-11   each county as are other fees of office.
470-12         (f)  Concurrently with the levy of county taxes by the
470-13   commissioners courts, the board shall levy the tax on all taxable
470-14   property in the authority that is subject to taxation and shall
470-15   immediately certify the tax rate to the tax assessor-collectors of
470-16   the counties that lie wholly or partly inside the authority.
470-17         Sec. 268.060.  TAX LIMIT.  The maximum rate of tax that may
470-18   be levied for any year for all purposes is 15 cents on each $100 of
470-19   taxable property, based on the assessed valuation of the property.
470-20         Sec. 268.061.  TAXATION IN DEFINED AREA.  The authority has
470-21   and may exercise, but is not required to exercise, the powers
470-22   specified in Sections 51.510-51.530 relating to improvements
470-23   peculiar to defined areas inside the authority.  The tax rate limit
470-24   specified in Section 268.060 does not apply to improvements
470-25   constructed in the exercise of the powers authorized by this
470-26   section.  The taxing powers in this section are cumulative of the
 471-1   other taxing powers in this chapter.
 471-2         Sec. 268.062.  BONDS AS LEGAL INVESTMENTS AND SECURITY FOR
 471-3   DEPOSITS.  Bonds and refunding bonds of the authority are legal,
 471-4   eligible, and authorized investments for banks; savings and loan
 471-5   associations; insurance companies; fiduciaries; trustees; the
 471-6   sinking funds of cities, towns, villages, counties, school
 471-7   districts, or any other political corporations or subdivisions of
 471-8   the state; and all public funds of the state or its agencies,
 471-9   including the state permanent school fund.  Bonds and refunding
471-10   bonds are eligible to secure the deposit of all public funds of the
471-11   state, cities, towns, villages, counties, school districts, or
471-12   other political corporations or subdivisions of the state, and the
471-13   bonds are lawful and sufficient security for the deposits to the
471-14   extent of the face value of the bonds, when accompanied by all
471-15   unmatured coupons.
471-16               CHAPTER 269.  RED RIVER AUTHORITY OF TEXAS
471-17         Sec. 269.001.  CREATION.  (a)  A conservation and reclamation
471-18   district to be known as the "Red River Authority of Texas" is
471-19   created.  The authority is a governmental agency and a body politic
471-20   and corporate.
471-21         (b)  The authority is created under and is essential to
471-22   accomplish the purposes of Section 59, Article XVI, Texas
471-23   Constitution.
471-24         Sec. 269.002.  DEFINITIONS.  In this chapter:
471-25               (1)  "Authority" means the Red River Authority of
471-26   Texas.
 472-1               (2)  "Board" means the board of directors of the
 472-2   authority.
 472-3               (3)  "Director" means a member of the board.
 472-4         Sec. 269.003.  TERRITORY.  (a)  The area of the authority
 472-5   comprises the whole of all counties in Texas lying wholly or partly
 472-6   within the watershed of the Red River and its Texas tributaries
 472-7   whose confluences with the Red River are upstream from the
 472-8   northeast corner of Bowie County, Texas, according to contour maps
 472-9   on file in the office of the Texas Water Development Board.
472-10         (b)  In addition to the counties lying wholly or partly
472-11   within the watershed, the area of the authority shall also comprise
472-12   the whole of the following Texas counties:  Hutchinson, Hartley,
472-13   Lamar, Lipscomb, and Red River.
472-14         (c)  For the limited purpose stated in Section 269.019, the
472-15   authority shall include Bowie County.  Except as provided by
472-16   Section 269.019, none of the provisions of this chapter apply to
472-17   the following counties:  Delta, Hopkins, Franklin, Titus, Morris,
472-18   Cass, Marion, and Bowie.
472-19         (d)  No defect or irregularity in the boundary of the
472-20   authority, or overlap or conflict of the boundary with other
472-21   authorities or districts, shall in any manner affect the validity
472-22   of the authority.  The legislature finds and determines that all of
472-23   the territory comprising the authority will benefit from the
472-24   exercise of the powers, rights, privileges, and functions conferred
472-25   by this chapter.
472-26         Sec. 269.004.  OVERLAPPING TERRITORY.  (a)  Any overlapping
 473-1   of territory of the authority with the territories or watershed of
 473-2   any other district or authority shall not interfere with or affect
 473-3   the powers, affairs, duties, or functions of the Canadian River
 473-4   Municipal Water Authority or any other district or authority.
 473-5         (b)  Additional districts or authorities of a local nature
 473-6   and peculiar to a defined area may be created either entirely or
 473-7   partly within the authority.
 473-8         (c)  In the prosecution of its proposed improvements, the
 473-9   authority shall cooperate in every practical manner with the
473-10   sponsors of existing or proposed districts or authorities.
473-11         Sec. 269.005.  BOARD OF DIRECTORS.  (a)  All powers of the
473-12   authority shall be exercised by a board consisting of nine
473-13   directors.
473-14         (b)  A director must be a freehold property taxpayer, a legal
473-15   voter of the state, and a resident of the director district that
473-16   the director is appointed to represent.
473-17         (c)  The authority is divided into three districts for the
473-18   appointment and representation of directors as follows:
473-19               (1)  Director District No. 1 includes Roberts,
473-20   Hemphill, Oldham, Potter, Carson, Gray, Wheeler, Deaf Smith,
473-21   Randall, Armstrong, Donley, Collingsworth, Parmer, and Castro
473-22   counties;
473-23               (2)  Director District No. 2 includes Swisher, Briscoe,
473-24   Hall, Childress, Hale, Floyd, Motley, Cottle, Hardeman, Foard,
473-25   Wilbarger, Wichita, Crosby, Dickens, King, Knox, Baylor, Archer,
473-26   and Clay counties; and
 474-1               (3)  Director District No. 3 includes Montague, Cooke,
 474-2   Grayson, Fannin, Lamar, Red River, and Bowie counties.
 474-3         (d)  Three directors shall be appointed from each of the
 474-4   director districts.
 474-5         (e)  Each director is appointed by the governor with the
 474-6   advice and consent of the senate.
 474-7         (f)  Directors serve for staggered six-year terms, holding
 474-8   office after their appointment and qualification until their
 474-9   successors are appointed and have qualified.  If a vacancy occurs
474-10   on the board, the vacancy is filled by the governor in the manner
474-11   provided by this section for the unexpired term.
474-12         (g)  Within 15 days after appointment, each director shall
474-13   qualify by taking the official oath and filing with the secretary
474-14   of state, and obtaining the secretary of state's approval of, a
474-15   good and sufficient bond in the amount of $5,000, payable to the
474-16   authority and conditioned on the faithful performance of the
474-17   director's duties.
474-18         Sec. 269.006.  OFFICERS; VOTING REQUIREMENTS; WARRANTS.  The
474-19   board shall elect a president, vice president, secretary, and
474-20   treasurer.  Five directors constitute a quorum at any meeting, and
474-21   a concurrence of a majority of those present is sufficient in all
474-22   matters pertaining to the business of the authority, except that
474-23   the letting of construction contracts, and the authorization of the
474-24   issuance of warrants paying such contracts, require the concurrence
474-25   of seven directors.  Warrants for the payment of money may be drawn
474-26   and signed by two officers or employees designated by standing
 475-1   order entered in the minutes of the authority when such accounts
 475-2   have been contracted and ordered paid by the board.
 475-3         Sec. 269.007.  DIRECTOR AND EMPLOYEE BONDS.  The board shall
 475-4   require an officer or employee who collects, pays, or handles any
 475-5   funds of the authority to furnish good and sufficient bond, payable
 475-6   to the authority, in an amount determined by the board to be
 475-7   sufficient to safeguard the authority.  The bond shall be
 475-8   conditioned on the faithful performance of the person's duties and
 475-9   on the person's accounting for all funds and property of the
475-10   authority.
475-11         Sec. 269.008.  DUTIES OF OFFICERS.  The president is the
475-12   chief executive officer of the authority and presides at board
475-13   meetings.  The vice president acts as president in case of the
475-14   absence or disability of the president.  The secretary is
475-15   responsible for keeping a record of all proceedings and all orders
475-16   of the board.  The treasurer shall receive and receipt for all
475-17   funds received and expended.  In case of the absence of the
475-18   secretary or the inability of the secretary to act, a secretary pro
475-19   tempore shall be selected by the board.
475-20         Sec. 269.009.  RECORDS; AUTHORITY OFFICE.  Records of the
475-21   authority shall be kept in a secure manner.  The records are the
475-22   property of the authority and are subject to public inspection
475-23   during regular office hours.  An office shall be established and
475-24   maintained within the authority, at a place determined by the
475-25   board, for the conduct of the authority's business.
475-26         Sec. 269.010.  ACCOUNT RECORDS; AUDIT.  (a)  The authority
 476-1   shall keep a complete book of accounts, and the account books and
 476-2   records of the authority and of the depository of the authority
 476-3   shall be audited by a certified public accountant annually as soon
 476-4   as practicable after the end of the authority's fiscal year.
 476-5         (b)  The audit required by this section shall cover a fiscal
 476-6   year ending September 30 of each year and a report on the audit
 476-7   shall be submitted at the first regular meeting of the board after
 476-8   the end of the fiscal year.  A copy shall be filed in the office of
 476-9   the authority, the depository of the authority, the office of the
476-10   auditor, and the commission and shall be open to public inspection.
476-11         Sec. 269.011.  DIRECTOR FEES.  (a)  A director is entitled to
476-12   receive a fee not to exceed $25 per day for each day of service
476-13   necessary to the discharge of the director's duties, in addition to
476-14   all traveling expenses, provided the service is authorized by the
476-15   board.
476-16         (b)  The directors shall file with the secretary on the last
476-17   day of each month, or as soon after that date as practicable, a
476-18   verified statement showing the actual amount of the fees due, and
476-19   warrants shall be issued for those amounts.
476-20         Sec. 269.012.  GENERAL MANAGER AND EMPLOYEES.  (a)  The board
476-21   may employ a general manager for the authority and may delegate to
476-22   the general manager full authority to manage and operate the
476-23   affairs of the authority subject only to orders of the board.  The
476-24   general manager's term of office and compensation shall be
476-25   determined by the board.
476-26         (b)  The terms of employment and compensation of all
 477-1   authority employees shall be determined by the board.
 477-2         (c)  A director may be employed as general manager of the
 477-3   authority, but the compensation of a general manager who also
 477-4   serves as a director shall be determined by a majority of the other
 477-5   directors.  A director who is employed as the general manager of
 477-6   the authority shall continue to perform the duties of a director
 477-7   but may not receive compensation as a director.
 477-8         Sec. 269.013.  SURETY BONDS.  All bonds required to be given
 477-9   by directors, officers, and employees of the authority shall be
477-10   executed by a surety company authorized to do business in this
477-11   state.  The premiums on such bonds shall be paid by the authority.
477-12         Sec. 269.014.  CONFLICT OF INTEREST; PENALTY.  A director,
477-13   engineer, or employee of the authority may not be interested,
477-14   directly or indirectly, either for themselves or as agents for
477-15   anyone else, in any contract for the purchase of materials or the
477-16   construction of work by the authority.  If a director, engineer, or
477-17   employee becomes interested, directly or indirectly, in such a
477-18   contract, the person shall be guilty of a misdemeanor and on
477-19   conviction shall be punished by a fine not to exceed $1,000, by
477-20   confinement in the county jail for not less than six months or more
477-21   than one year, or by both fine and imprisonment.
477-22         Sec. 269.015.  GENERAL POWERS AND DUTIES.  (a)  The authority
477-23   shall have all the powers of the state under Section 59, Article
477-24   XVI, Texas Constitution, to effectuate flood control and the
477-25   conservation and use, for all beneficial purposes, of the storm
477-26   waters, floodwaters, and unappropriated waters of the Red River
 478-1   watershed and its Texas tributaries, subject only to:
 478-2               (1)  declarations of policy by the legislature as to
 478-3   use of water;
 478-4               (2)  continuing supervision and control by the
 478-5   commission or any successor agency;
 478-6               (3)  the provisions of Section 11.024 prescribing the
 478-7   priorities of uses of water; and
 478-8               (4)  water rights legally acquired at any time by
 478-9   municipalities and other users.
478-10         (b)  The authority shall exercise the powers described by
478-11   this section, to the greatest practicable extent, for the
478-12   conservation and beneficial utilization of the storm waters,
478-13   floodwaters, and unappropriated waters of the Red River watershed
478-14   and its Texas tributaries in the manner and for the purposes
478-15   specified in this section and in this chapter, including the power
478-16   to:
478-17               (1)  provide for the study, correcting, and control of
478-18   both artificial and natural pollution of the Red River and its
478-19   tributaries;
478-20               (2)  provide, through all practical and legal means,
478-21   for the control, conservation, and orderly development of the
478-22   watershed and water of the Red River and its Texas tributaries;
478-23               (3)  provide for the preservation of the equitable
478-24   rights and beneficial use of the waters of the Red River and its
478-25   Texas tributaries for the people of the different sections of the
478-26   authority;
 479-1               (4)  provide for storing, controlling, and conserving
 479-2   the waters of the Red River and its Texas tributaries in order to
 479-3   prevent the escape of any of such waters without the maximum of
 479-4   public service, prevent the devastation of lands from recurrent
 479-5   overflows, and protect life and property in the watershed areas
 479-6   from uncontrolled floodwaters;
 479-7               (5)  provide for the conservation of storm waters,
 479-8   floodwaters, and unappropriated waters of the Red River watershed
 479-9   and its Texas tributaries essential for the beneficial uses of the
479-10   people of the watersheds of the Red River and its Texas
479-11   tributaries;
479-12               (6)  provide for the encouragement and development of
479-13   drainage systems and for drainage of lands needing drainage for
479-14   profitable agricultural production;
479-15               (7)  provide for the conservation of all soils against
479-16   destructive erosion and prevent the increased risk of flood caused
479-17   by destructive soil erosion; and
479-18               (8)  in all sections of the authority, control and make
479-19   storm waters, floodwaters, and unappropriated waters of the Red
479-20   River watershed available for employment in the development of
479-21   commercial, industrial, and agricultural enterprises and for all
479-22   purposes for which such waters, when controlled and conserved, may
479-23   be utilized in the performance of a useful service as contemplated
479-24   and authorized by the provisions of the constitution and the public
479-25   policy it declares.
479-26         (c)  The authority may sue and be sued in its own name.
 480-1         (d)  The authority shall prepare a master plan for the
 480-2   maximum development of the soil and water resources of the entire
 480-3   Red River watershed within the authority, including plans for the
 480-4   complete utilization, for all economically beneficial purposes, of
 480-5   the water resources of the watershed.  That portion of the master
 480-6   plan and any amendments to the plan relating to soil conservation
 480-7   and upstream flood prevention and watershed protection works in
 480-8   furtherance of those purposes shall be prepared by the soil
 480-9   conservation districts on the Red River watershed, subject to
480-10   approval by the State Soil and Water Conservation Board.  The
480-11   master plan shall be filed with and approved by the commission.
480-12         (e)  For the purpose of pollution control as provided by
480-13   Subsection (b)(1), the authority may promulgate rules and
480-14   regulations with regard to pollution, both artificial and natural,
480-15   and possesses police power to enforce its rules and regulations.
480-16   The authority may provide for a penalty for a violation of its
480-17   pollution rules consisting of a fine not to exceed $1,000 or
480-18   confinement in the county jail for not more than 30 days or both
480-19   such fine and confinement.  For the purposes of this subsection,
480-20   the provisions of the general law pertaining to water control and
480-21   improvement districts shall govern, except as expressly provided by
480-22   this chapter.
480-23         Sec. 269.016.  POWERS RELATING TO NAVIGATION, RECREATIONAL
480-24   FACILITIES, AND WATER TREATMENT.  (a)  In addition to other
480-25   purposes authorized by law, the authority is vested with all the
480-26   powers of the state under Section 59, Article XVI, Texas
 481-1   Constitution, and with all the powers, rights, privileges, and
 481-2   functions conferred upon navigation districts by general law.
 481-3         (b)  The authority may:
 481-4               (1)  promote, construct, maintain, and operate or aid
 481-5   and encourage the construction, maintenance, and operation of
 481-6   navigable canals or waterways, and all navigational systems or
 481-7   facilities auxiliary to the canals or waterways, using the natural
 481-8   bed and banks of the Red River, where practicable, and traversing
 481-9   the route found by the authority to be the most feasible and
481-10   practicable to connect the Red River in Texas with any new
481-11   navigation canals to be constructed in the lower reaches of the Red
481-12   River or to connect the Red River with the Intracoastal Waterway,
481-13   and to construct or cause to be constructed a system of artificial
481-14   waterways and canals together with all locks and other works,
481-15   structures, and artificial facilities necessary and convenient for
481-16   the construction, maintenance, and operation of navigation canals
481-17   or waterways and all navigational systems and facilities auxiliary
481-18   to the canals or waterways;
481-19               (2)  acquire, purchase, improve, extend, take over,
481-20   construct, maintain, repair, operate, develop, and regulate ports,
481-21   levees, wharves, docks, locks, warehouses, grain elevators, dumping
481-22   facilities, belt railways, lands, and all other facilities or aids
481-23   to navigation or aids necessary to the operation or development of
481-24   ports or waterways within the Red River Basin in Texas; provided,
481-25   however, that the powers conferred on the authority under the
481-26   provisions of this subdivision extend to a facility or aid
 482-1   authorized under this subdivision only if the facility or aid is
 482-2   situated in a county or counties included as part of the authority;
 482-3               (3)  acquire by gift or purchase properties of any
 482-4   kind, including lighters, tugs, barges, and other floating
 482-5   equipment of any nature, whether the property is real, personal, or
 482-6   mixed, or any interest in property, within or outside the
 482-7   boundaries of the authority necessary to the exercise of the
 482-8   powers, rights, privileges, and functions conferred on the
 482-9   authority by this chapter and may acquire property by condemnation
482-10   in the manner provided by Section 269.025; provided, however, that
482-11   the authority shall not be required to give bond for appeal or bond
482-12   for costs in any judicial proceedings;
482-13               (4)  control, develop, store, and use the natural flow
482-14   and floodwaters of the Red River and its Texas tributaries for the
482-15   purpose of operating and maintaining the navigable canals or
482-16   waterways and all navigational systems or facilities auxiliary to
482-17   the canals or waterways; provided, however, that the navigational
482-18   use shall be subordinate to the consumptive use of water, and
482-19   navigation shall be incidental to the consumptive use of water; and
482-20               (5)  effectuate the construction, maintenance, and
482-21   operation of bank stabilization facilities or channel rectification
482-22   or alignment to prevent and aid in preventing the devastation of
482-23   lands from recurrent overflows and to protect life and property in
482-24   the watershed of the Red River in Texas or any tributaries of the
482-25   river within the authority from uncontrolled floodwaters and may
482-26   store and conserve to the greatest beneficial use the storm waters,
 483-1   floodwaters, and unappropriated waters of the Red River in Texas or
 483-2   any tributaries of the river within the authority so as to prevent
 483-3   the escape of any water without maximum beneficial use either
 483-4   within or outside the boundaries of the authority.
 483-5         (c)  If the construction or maintenance and operation of
 483-6   navigable canals or waterways, and all navigational systems or
 483-7   facilities auxiliary to the canals or waterways, on the Red River
 483-8   in Texas is taken over or performed by the federal government or
 483-9   any agency of the federal government, the authority may make and
483-10   enter into any contracts lawfully required by the federal
483-11   government, including assignments and transfers of property and
483-12   rights of property and easements and privileges and any and all
483-13   other lawful things and acts necessary and required in order to
483-14   meet the requirements of the federal government or any agency of
483-15   the federal government in taking over the construction or
483-16   maintenance and operation of the navigable canals or waterways and
483-17   all navigational systems or facilities auxiliary to the canals or
483-18   waterways.
483-19         (d)  The authority may acquire additional land adjacent to
483-20   any permanent improvement constructed within the authority,
483-21   regardless of when it was constructed, for the purpose of
483-22   developing public parks and recreational facilities and may acquire
483-23   necessary right-of-way for public ingress and egress to such areas.
483-24         (e)  The authority may provide recreational facilities and
483-25   services and may enter into contracts and agreements with the
483-26   federal government or any agency of the federal government, the
 484-1   Parks and Wildlife Department, or any county, municipality,
 484-2   municipal corporation, person, firm, or nonprofit organization for
 484-3   the construction, operation, and maintenance of the park or
 484-4   recreational facility.  The authority shall coordinate the
 484-5   development of any public parks and recreational facilities with
 484-6   the Parks and Wildlife Department for conformity with the State
 484-7   Comprehensive Outdoor Recreation Plan.  The authority may perform
 484-8   all functions necessary to qualify for state or federal
 484-9   recreational grants and loans.
484-10         (f)  In addition to other purposes previously authorized by
484-11   law and as a necessary aid to the conservation, control,
484-12   preservation, and distribution of water for beneficial use, the
484-13   authority is authorized to purchase, construct, improve, repair,
484-14   operate, and maintain works and facilities necessary for the
484-15   collection, transportation, treatment, and disposal of sewage and
484-16   industrial waste and effluent and to issue negotiable bonds for
484-17   those purposes.  The authority may make contracts with cities and
484-18   others under which the authority will collect, transport, treat,
484-19   and dispose of sewage from the cities or other entities.  The
484-20   authority may also make contracts with any city for the use of any
484-21   collection, transportation, treatment, or disposal facilities owned
484-22   by the city or by the authority.
484-23         (g)  Bonds issued under this section are payable from
484-24   revenues under any contract or contracts described in this chapter
484-25   or from other income of the authority.  The bonds shall be in the
484-26   form and shall be issued in the manner prescribed by law for other
 485-1   revenue bonds and as provided by Sections 269.033, 269.034,
 485-2   269.035, and 269.036.
 485-3         Sec. 269.017.  ADDITIONAL PROVISIONS REGARDING CONTRACTS,
 485-4   BONDS, FEES, AND MANAGEMENT OF AUTHORITY PROPERTY.  (a)  In this
 485-5   section:
 485-6               (1)  "Person" means:
 485-7                     (A)  an individual, partnership, corporation, or
 485-8   other private entity; and
 485-9                     (B)  a public agency.
485-10               (2)  "Public agency" means an authority, district,
485-11   city, town, other political subdivision, joint board, or other
485-12   public agency created and operating under the laws of this state.
485-13         (b)  The authority and all persons may contract, on terms and
485-14   conditions to which the parties may agree, with respect to any
485-15   power, function, or duty of the authority and may execute all
485-16   appropriate documents and instruments in connection with the
485-17   contract.  The authority may issue bonds with respect to any of its
485-18   powers in the manner provided by Section 269.033, including the
485-19   powers granted in this section for the purpose of providing funds:
485-20               (1)  to pay for the costs of engineering design and
485-21   studies, surveys, title research, appraisals, options on real or
485-22   personal property, and other related matters and activities in
485-23   connection with planning and implementing proposed projects or
485-24   improvements; and
485-25               (2)  to operate and maintain any facilities.
485-26         (c)  The authority may invest its funds, including bond
 486-1   proceeds, in any manner or in any securities determined by the
 486-2   board.
 486-3         (d)  Notwithstanding any provisions of this chapter and in
 486-4   addition to all other powers granted by this chapter or by any
 486-5   other law, the authority may undertake and carry out any
 486-6   activities; enter into loan agreements, leases, or installment sale
 486-7   agreements; and acquire, purchase, construct, own, operate,
 486-8   maintain, repair, improve, or extend and may loan, lease, sell, or
 486-9   otherwise dispose of, on terms and conditions including rentals,
486-10   sale price, or installment sale payments as the parties may agree,
486-11   at any place or location within the boundaries of the authority,
486-12   any and all money or bond proceeds, works, improvements,
486-13   facilities, plants, buildings, structures, equipment, and
486-14   appliances, and all property or any interest in property, that are
486-15   incident, helpful, or necessary to the accomplishment of the
486-16   purposes of this chapter.
486-17         (e)  The authority may exercise the powers listed in
486-18   Subsection (d) to:
486-19               (1)  provide for the control, storage, preservation,
486-20   transmission, treatment, distribution, and use of water, including
486-21   storm water, floodwater, and the water of rivers and streams, for
486-22   irrigation, electric energy or power, flood control, municipal,
486-23   domestic, industrial, agricultural, and commercial uses and
486-24   purposes and for all other beneficial purposes;
486-25               (2)  supply water for municipal, domestic, electric
486-26   energy or power, industrial, irrigation, oil flooding, mining,
 487-1   agricultural, and commercial uses and purposes and for all other
 487-2   beneficial uses and purposes;
 487-3               (3)  generate, produce, distribute, and sell electric
 487-4   energy or power; and
 487-5               (4)  facilitate the carrying out of any power, duty, or
 487-6   function of the authority.
 487-7         (f)  It is found and determined by the legislature that all
 487-8   of the purposes stated in Subsection (e) are for the conservation
 487-9   and development of the natural resources of this state within the
487-10   meaning of Section 59, Article XVI, Texas Constitution.
487-11         (g)  Each public agency may set, charge, and collect fees,
487-12   rates, charges, rentals, and other amounts for any services or
487-13   facilities provided by a utility operated by it or provided
487-14   pursuant to or in connection with any contract with the authority.
487-15   The fees, rates, charges, rentals, and other amounts may be charged
487-16   to and collected from inhabitants or from any users or
487-17   beneficiaries of that utility, service, or facility.  Such fees,
487-18   rates, charges, rentals, and other amounts may include water
487-19   charges, sewage charges, solid waste disposal system fees and
487-20   charges, including garbage collection or handling fees, and other
487-21   fees or charges.
487-22         (h)  The fees, rates, charges, rentals, and other amounts
487-23   authorized by this section may be used or pledged to make payments
487-24   to the authority required under the contract and may be pledged in
487-25   amounts sufficient to make all or any part of those payments to the
487-26   authority when due.  The payments, if the parties agree in the
 488-1   contract, constitute an expense of operation of any facilities or
 488-2   utility operated by the public agency; provided, however, that an
 488-3   agreement may not be made that would violate the United States or
 488-4   Texas constitutions.
 488-5         (i)  This section is wholly sufficient authority for the
 488-6   issuance of bonds, the execution of contracts, and the performance
 488-7   of the other acts and procedures authorized in this chapter by the
 488-8   authority and other persons, including public agencies, without
 488-9   reference to any other law or any restrictions or limitations
488-10   included in any other law.  To the extent of any conflict or
488-11   inconsistency between this subsection and any other law including a
488-12   home-rule city charter, this section prevails and controls;
488-13   provided, however, that the authority and other persons, including
488-14   public agencies, may use any other law not in conflict with this
488-15   subsection to the extent convenient or necessary to carry out any
488-16   power or authority granted by this section.
488-17         (j)  This section does not compel any person, including a
488-18   public agency, to secure water, sewer service, or any other service
488-19   from the authority, except under voluntarily executed contracts.
488-20         Sec. 269.018.  GASOHOL AND INDUSTRIAL ALCOHOL.  (a)  On
488-21   acquisition of any necessary authorization as provided by law, the
488-22   authority may engage in the manufacture and production of gasohol
488-23   only for use in operating equipment of the authority in an
488-24   emergency as determined by the general manager of the authority.
488-25         (b)  The authority is eligible for a local industrial alcohol
488-26   manufacturer's permit under Chapter 47, Alcoholic Beverage Code, as
 489-1   if it were an eligible Texas corporation, but its authority under
 489-2   the permit is limited as provided by Subsection (a).
 489-3         Sec. 269.019.  LIMITED USE OF BOWIE COUNTY TERRITORY.
 489-4   (a)  Bowie County is added to the authority for the limited purpose
 489-5   of participating in the United States Army Corps of Engineers Red
 489-6   River Bank Stabilization and Navigation Project from Index,
 489-7   Arkansas, to Denison Dam, and this chapter shall apply to Bowie
 489-8   County to the extent necessary to accomplish that project.
 489-9         (b)  Bowie County is liable only for debt incurred by the
489-10   authority directly in connection with the Red River Bank
489-11   Stabilization and Navigation Project, and the board may exercise
489-12   the duties and powers, including the power of eminent domain, under
489-13   this chapter with relation to Bowie County only to the extent
489-14   necessary to accomplish that project.
489-15         Sec. 269.020.  LIMITATION OF AUTHORITY; COMMISSION
489-16   SUPERVISION.  The powers and duties granted to the authority by
489-17   this chapter are subject to all legislative declarations of public
489-18   policy for the maximum use of the waters of the authority's
489-19   watersheds for the purposes for which the authority is created.  In
489-20   the exercise of its powers and duties the authority shall be
489-21   subject to continuing supervision by the state.  The supervision
489-22   shall be exercised through the commission or its successor agency,
489-23   and the commission is charged with the authority and duty to
489-24   approve or to refuse to approve the adequacy and feasibility of any
489-25   plan or plans for flood control or conservation devised for the
489-26   achievement of the purposes intended in the creation of the
 490-1   authority.
 490-2         Sec. 269.021.  CONTRACTS WITH PUBLIC ENTITIES.  The authority
 490-3   may execute contracts and enter into agreements necessary to
 490-4   accomplish the purposes for which it is created.  The authority is
 490-5   authorized to enter into contracts with cities, corporations,
 490-6   districts, the United States and its agencies, the state and its
 490-7   agencies, or the states of Oklahoma, Arkansas, and Louisiana, the
 490-8   confines of which are contiguous or adjacent to the Red River.
 490-9         Sec. 269.022.  CONTRACTS FOR WATER SYSTEMS; ACQUISITION OF
490-10   WATER RIGHTS.  The authority is expressly authorized to contract
490-11   with cities, towns, or villages located within its boundaries for
490-12   the purchase, lease, use, management, control, or operation of
490-13   water distribution plants or systems owned by the cities, towns, or
490-14   villages, in accordance with such terms and conditions as may be
490-15   mutually agreed upon by the governing bodies of the authority and
490-16   the cities, towns, or villages.  The authority may acquire by any
490-17   such contract surface water or groundwater rights belonging to a
490-18   city, town, or village; provided, however, that the authority shall
490-19   devote any water rights so acquired only to the uses the city,
490-20   town, or village from which the water rights were acquired would be
490-21   authorized to make of them.  The authority shall use any water
490-22   rights acquired as provided by this section only for the purposes
490-23   of the water distribution plant or system of the city, town, or
490-24   village from which the water rights were acquired.
490-25         Sec. 269.023.  WATER DELIVERY TO ELDORADO, OKLAHOMA.  The
490-26   authority may enter into any contracts necessary to provide for the
 491-1   sale and delivery of water to the City of Eldorado, Oklahoma.
 491-2         Sec. 269.024.  LOANS AND GRANTS.  For the purpose of
 491-3   providing funds requisite to secure the necessary studies,
 491-4   engineering, and other services which may be necessary and to the
 491-5   collection and computation of data respecting regional and general
 491-6   conditions influencing the character and extent of the improvements
 491-7   necessary to effect the purposes of the creation of the authority
 491-8   to the greatest public advantage, the authority may solicit, seek
 491-9   and accept contributions to its funds from any other district,
491-10   authority, or municipality, the federal government, the state, or
491-11   any other source.  All grants and gratuities shall be strictly
491-12   accounted for and shall be subject to the same rules, regulations,
491-13   and orders as are other funds handled or disbursed by the
491-14   authority.
491-15         Sec. 269.025.  EMINENT DOMAIN.  The authority is vested with
491-16   the right of eminent domain in the manner provided by general law
491-17   pertaining to water control and improvement districts.  If the
491-18   authority, in the exercise of the power of eminent domain or power
491-19   of relocation or any other power granted under this chapter, makes
491-20   necessary the relocation, raising, rerouting, changing the grade,
491-21   or altering the construction of any highway, railroad, electric
491-22   transmission line, telephone or telegraph properties and
491-23   facilities, or pipeline, all such necessary relocation, raising,
491-24   rerouting, changing of grade, or alteration of construction shall
491-25   be accomplished at the sole expense of the authority.
491-26         Sec. 269.026.  ADDITIONAL POWERS.  (a)  Except as provided by
 492-1   Subsection (b), the authority has and may exercise the functions,
 492-2   powers, authority, rights, and duties necessary to accomplish the
 492-3   purposes for which the authority is created, including
 492-4   investigating and planning, acquiring, constructing, maintaining,
 492-5   and operating all necessary properties, lands, rights, tenements,
 492-6   easements, improvements, reservoirs, dams, canals, laterals,
 492-7   plants, works, and facilities, including the acquisition within or
 492-8   outside the authority of lands, rights-of-way, water rights, and
 492-9   all other properties, tenements, easements, and other rights
492-10   incident, helpful to, or in aid of carrying out the purposes of the
492-11   authority as provided in this chapter.
492-12         (b)  The authority may not engage in the generation or
492-13   distribution of electric power except as provided by Section
492-14   269.017.  The right of eminent domain shall not be exercised and
492-15   shall not extend beyond the boundaries of the authority.
492-16         Sec. 269.027.  FEES AND CHARGES.  (a)  The authority shall
492-17   establish and collect rates and other charges for the sale or use
492-18   of water or for its services sold, furnished, or supplied.  The
492-19   fees and charges shall be reasonable and nondiscriminatory but
492-20   sufficient to produce revenues adequate to pay the expenses of the
492-21   authority in carrying out the functions for which it is created and
492-22   to fulfill the terms of any agreements made with the holders of any
492-23   of its obligations.
492-24         (b)  The rates and charges for the sale or use of water
492-25   provided by this section shall be subject to review by the
492-26   commission as provided by general law.
 493-1         Sec. 269.028.  APPROVAL OF BONDS AND WARRANTS PRIOR TO
 493-2   ISSUANCE.  While the authority is expressly given the power to
 493-3   issue its obligations or warrants for furnishing funds, before the
 493-4   obligations or warrants may be issued, they shall bear the approval
 493-5   of the state, acting through the attorney general.
 493-6         Sec. 269.029.  AUTHORITY PROCEDURES; SEAL.  The authority
 493-7   shall make bylaws for the management and regulation of its affairs,
 493-8   including:
 493-9               (1)  adopting and using a corporate seal;
493-10               (2)  appointing officers, attorneys, agents, and
493-11   employees and prescribing their duties and setting their
493-12   compensation;
493-13               (3)  making contracts and executing instruments
493-14   necessary or convenient to the exercise of the powers, rights,
493-15   privileges, and functions conferred on the authority by this
493-16   chapter and the general laws of the state pertaining to water
493-17   control and improvement districts;
493-18               (4)  borrowing money for its corporate purposes;
493-19               (5)  borrowing money and accepting grants from the
493-20   United States, the state, or any other source; and
493-21               (6)  in connection with any loan or grant, entering
493-22   into such agreements and assuming such obligations as may be
493-23   required.
493-24         Sec. 269.030.  AUTHORITY DEPOSITORY.  The board shall
493-25   designate one or more banks within the authority to serve as
493-26   depository for the funds of the authority.  All funds of the
 494-1   authority shall be deposited in the depository bank or banks,
 494-2   except that funds pledged to pay bonds may be deposited with the
 494-3   trustee bank named in the trust agreement and except that funds
 494-4   shall be remitted to the bank of payment for the payment of
 494-5   principal of and interest on bonds.  To the extent that funds in
 494-6   the depository banks and the trustee bank are not insured by the
 494-7   Federal Deposit Insurance Corporation, the funds shall be secured
 494-8   in the manner provided by law for the security of county funds.
 494-9         Sec. 269.031.  TAXES.  Nothing in this chapter shall be
494-10   construed as authorizing the authority to levy or collect any form
494-11   of tax within the authority.
494-12         Sec. 269.032.  GROUNDWATER.  Nothing in this chapter shall be
494-13   construed as authorizing the authority to acquire, regulate, or
494-14   control in any way groundwater or groundwater rights by
494-15   condemnation, purchase, or otherwise or to develop, regulate, or
494-16   control the use of groundwater resources in any manner.  This
494-17   chapter is intended to govern and shall be construed to govern and
494-18   apply to surface water only.
494-19         Sec. 269.033.  BOND ISSUANCE.  (a)  For the purpose of
494-20   providing funds for any purpose authorized by this chapter, the
494-21   authority may issue bonds as authorized by this chapter.  The
494-22   authority may, without the necessity of an election, issue bonds to
494-23   be payable from the revenues of the authority as pledged by
494-24   resolution of the board.
494-25         (b)  Bonds must be authorized by resolution of the board and
494-26   shall be issued in the name of the authority, signed by the
 495-1   president or vice president, attested by the secretary, and have
 495-2   the seal of the authority impressed on the bonds.
 495-3         (c)  Bonds must mature serially or otherwise in not to exceed
 495-4   50 years and may be sold at a price and under terms determined by
 495-5   the board to be the most advantageous reasonably obtainable;
 495-6   provided, however, that the interest rate on the bonds may not
 495-7   exceed the maximum net effective interest rate, as that term is
 495-8   defined by Chapter 1204, Government Code, that is legally
 495-9   authorized at the time the bonds are issued.  Within the discretion
495-10   of the board, bonds may be made callable prior to maturity at such
495-11   times and prices as may be prescribed in the resolution authorizing
495-12   the bonds and may be made registrable as to principal or as to both
495-13   principal and interest.
495-14         (d)  Bonds may be issued in more than one series and from
495-15   time to time as required for carrying out the purposes of this
495-16   chapter.
495-17         (e)  Bonds may be secured by a pledge of all or part of the
495-18   net revenues of the authority, of the net revenues of one or more
495-19   contracts made before or after the bonds are issued, or of other
495-20   revenues specified by resolution of the board.  A pledge may
495-21   reserve the right, under conditions specified in the pledge, to
495-22   issue additional bonds which will be on a parity with or
495-23   subordinate to the bonds being issued.  In this section, "net
495-24   revenues" means the gross revenues of the authority less the amount
495-25   necessary to pay the cost of maintaining and operating the
495-26   authority and its properties.
 496-1         (f)  The board shall set, and from time to time revise, rates
 496-2   of compensation for water sold and services rendered by the
 496-3   authority that will be sufficient to pay the expense of operating
 496-4   and maintaining the facilities of the authority and to pay bonds as
 496-5   they mature and the interest as it accrues and to maintain the
 496-6   reserve and other funds as provided in the resolution authorizing
 496-7   the bonds.
 496-8         (g)  From the proceeds of the sale of the bonds, the
 496-9   authority may set aside an amount for the payment of interest
496-10   expected to accrue during construction and for a reserve interest
496-11   and sinking fund, and such provision may be made in the resolution
496-12   authorizing the bonds.  Proceeds from the sale of the bonds may
496-13   also be used for the payment of all expenses necessarily incurred
496-14   in accomplishing the purposes for which the authority is created.
496-15         (h)  In the event of a default or a threatened default in the
496-16   payment of principal of or interest on any of the bonds of the
496-17   authority any court of competent jurisdiction may, on petition of
496-18   the holders of 25 percent of the outstanding bonds of the issue in
496-19   default or threatened with default, appoint a receiver with
496-20   authority to collect and receive all income of the authority,
496-21   employ and discharge agents and employees of the authority, take
496-22   charge of the authority's funds on hand, and manage the proprietary
496-23   affairs of the authority without consent or hindrance by the board.
496-24   The receiver may also be authorized to sell or make contracts for
496-25   the sale of water or to renew such contracts with the approval of
496-26   the court appointing the receiver.  The court may vest the receiver
 497-1   with other powers and duties the court finds necessary for the
 497-2   protection of the holders of the bonds.
 497-3         Sec. 269.034.  REFUNDING BONDS.  (a)  The authority may issue
 497-4   refunding bonds for the purpose of refunding any outstanding bonds
 497-5   authorized by this chapter and interest on the bonds.  Refunding
 497-6   bonds may be issued to refund more than one series of outstanding
 497-7   bonds and may combine the pledges for the outstanding bonds for the
 497-8   security of the refunding bonds, and refunding bonds may be secured
 497-9   by other or additional revenues.
497-10         (b)  The provisions of this chapter with reference to the
497-11   issuance of other bonds and their approval by the attorney general
497-12   and the remedies of the holders shall be applicable to refunding
497-13   bonds.  Refunding bonds shall be registered by the comptroller on
497-14   surrender and cancellation of the bonds to be refunded, but in lieu
497-15   of that procedure, the resolution authorizing the issuance of the
497-16   refunding bonds may provide that the refunding bonds be sold and
497-17   the proceeds of the sale deposited in the bank where the original
497-18   bonds are payable, in which case the refunding bonds may be issued
497-19   in an amount sufficient to pay the interest on the original bonds
497-20   to their option date or maturity date, and the comptroller shall
497-21   register the refunding bonds without concurrent surrender and
497-22   cancellation of the original bonds.
497-23         Sec. 269.035.  DEED OF TRUST LIEN.  (a)  Any bonds, including
497-24   refunding bonds, authorized by this chapter may be additionally
497-25   secured by a deed of trust lien on physical properties of the
497-26   authority and all franchises, easements, water rights and
 498-1   appropriation permits, leases, and contracts and all rights
 498-2   appurtenant to such properties, vesting in the trustee power to
 498-3   sell the properties for payment of the indebtedness, power to
 498-4   operate the properties, and all other powers and authority for the
 498-5   further security of the bonds.
 498-6         (b)  The deed of trust may contain any provisions prescribed
 498-7   by the board for the security of the bonds and the preservation of
 498-8   the trust estate and may make provision for amendment or
 498-9   modification of the deed of trust and the issuance of bonds to
498-10   replace lost or mutilated bonds.  A purchaser under a sale under
498-11   the deed of trust shall be the owner of the dam or dams and the
498-12   other properties and facilities purchased and shall have the right
498-13   to maintain and operate them in the event of a forfeiture or
498-14   default on the part of the authority.
498-15         Sec. 269.036.  APPROVAL AND REGISTRATION OF BONDS.  After any
498-16   bonds are authorized by the authority, the bonds and the record
498-17   relating to their issuance shall be submitted to the attorney
498-18   general for examination as to the validity of the bonds and the
498-19   record.  If the bonds recite that they are secured by a pledge of
498-20   the proceeds of a contract previously made between the authority
498-21   and any city or other governmental agency or district, a copy of
498-22   the contract and the proceedings of the city or other governmental
498-23   agency or district authorizing the contract shall also be submitted
498-24   to the attorney general.  If the bonds have been authorized and the
498-25   contract has been made in accordance with the constitution and laws
498-26   of the state the attorney general shall approve the bonds and the
 499-1   contract, and the bonds then shall be registered by the
 499-2   comptroller.  After their approval and registration, the bonds and
 499-3   the contracts, if any, are valid and binding and are incontestable
 499-4   for any cause.
 499-5         Sec. 269.037.  LEGISLATIVE DECLARATION; CONSTRUCTION.  The
 499-6   legislature hereby declares that the enactment of this chapter is
 499-7   in fulfillment of a duty conferred on it by Section 59, Article
 499-8   XVI, Texas Constitution, empowering the legislature to pass laws
 499-9   for the preservation and conservation of the natural resources of
499-10   the state; that the authority created by this chapter is essential
499-11   to the accomplishment of the purposes of that constitutional
499-12   provision; and that this chapter operates on a subject in which the
499-13   state at large is interested.  The legislature finds and determines
499-14   that all of the lands and other property included within the
499-15   boundaries of the authority will be benefited and that the
499-16   authority is created to serve a public use and benefit.  All the
499-17   terms and provisions of this chapter are to be liberally construed
499-18   to effectuate its purposes.
499-19         Sec. 269.038.  POWERS OF WATER CONTROL AND IMPROVEMENT
499-20   DISTRICTS.  Except as otherwise provided by this chapter, the
499-21   authority is vested with all of the rights, powers, and privileges
499-22   conferred by the general laws of this state applicable to water
499-23   control and improvement districts created under authority of
499-24   Section 59, Article XVI, Texas Constitution.
499-25              CHAPTER 270.  SABINE RIVER AUTHORITY OF TEXAS
499-26         Sec. 270.001.  CREATION.  (a)  A conservation and reclamation
 500-1   district to be known as the "Sabine River Authority of Texas" is
 500-2   created.  The authority is a governmental agency and a body politic
 500-3   and corporate.
 500-4         (b)  The authority is created under and is essential to
 500-5   accomplish the purposes of Section 59, Article XVI, Texas
 500-6   Constitution.
 500-7         (c)  The authority may exercise the powers granted by Section
 500-8   59, Article XVI, Texas Constitution, to districts created to
 500-9   conserve, store, control, preserve, utilize, and distribute the
500-10   storm waters, floodwaters, and waters of the rivers and streams of
500-11   the state, as well as such powers as may be contemplated and
500-12   implied by the purposes of that provision of the constitution and
500-13   as may be conferred by general law and by the provisions of this
500-14   chapter; provided, however, that nothing in this chapter shall be
500-15   construed to authorize the authority to levy any taxes or special
500-16   assessments or to create any debt payable out of taxation.
500-17         (d)  The authority may construct, maintain, and operate
500-18   within the state, in the watershed of the Sabine River and its
500-19   tributaries, within or outside the boundaries of the authority, any
500-20   and all works considered essential to the operation of the
500-21   authority and for its administration in the control, storing,
500-22   preservation, and distribution for all useful purposes of the
500-23   waters of the Sabine River and its tributaries, including the storm
500-24   waters and floodwaters.
500-25         (e)  The authority may exercise such authority and power of
500-26   control and regulation over the waters of the Sabine River and its
 501-1   tributaries as may be exercised by the state, subject to the
 501-2   provisions of the constitution and the acts of the legislature.
 501-3         (f)  In all other laws, wherever reference is made to Sabine
 501-4   River Authority, the reference shall mean "Sabine River Authority
 501-5   of Texas."  The Sabine River Authority of Texas shall succeed to
 501-6   all rights, powers, and duties conferred or imposed by all statutes
 501-7   on the Sabine River Authority and to all rights, powers, and duties
 501-8   conferred by or assumed in all contracts to which the Sabine River
 501-9   Authority is a party.
501-10         Sec. 270.002.  DEFINITIONS.  In this chapter:
501-11               (1)  "Authority" means the Sabine River Authority of
501-12   Texas.
501-13               (2)  "Board" means the board of directors of the
501-14   authority.
501-15               (3)  "Director" means a member of the board.
501-16         Sec. 270.003.  TERRITORY.  (a)  The area of the authority
501-17   comprises all of that part of the territory lying within the
501-18   watershed of the Sabine River and its tributaries that is situated
501-19   within the state according to the state contour maps on file in the
501-20   office of the Texas Water Development Board.
501-21         (b)  On the request of the board the commission shall define
501-22   the boundaries so that they may be expressed by the metes and
501-23   bounds of the watershed described by Subsection (a); provided,
501-24   however, that the definition of the boundaries shall not be a
501-25   condition precedent to the exercise of any power conferred by this
501-26   chapter; and provided further, that all the area presently covered
 502-1   by the Lower Neches Valley Authority is excepted from the area
 502-2   covered by the Neches River Conservation District.  It is the
 502-3   intent of the legislature to preserve the present area and
 502-4   authority of the Lower Neches Valley Authority.
 502-5         Sec. 270.004.  BOARD OF DIRECTORS.  (a)  The management and
 502-6   control of the affairs of the authority are vested in a board of
 502-7   directors, consisting of nine members.  Each director must be a
 502-8   freehold property taxpayer and a legal voter of the state.
 502-9         (b)  Directors are appointed by the governor with the advice
502-10   and consent of the senate and serve staggered six-year terms.
502-11         (c)  Four members of the board must reside within a county
502-12   located in the upper basin of the Sabine River, including Collin,
502-13   Rockwall, Kaufman, Hunt, Rains, Van Zandt, Hopkins, Franklin, Wood,
502-14   Smith, Upshur, Gregg, Harrison, and Rusk counties, and four members
502-15   of the board must reside within a county located in the lower basin
502-16   of the Sabine River, including Panola, Shelby, San Augustine,
502-17   Sabine, Jasper, Newton, and Orange counties.  One member of the
502-18   board must reside within a county situated wholly or partially
502-19   within the watershed of the Sabine River.
502-20         (d)  The directors shall hold office after their appointment
502-21   and qualification until their successors are appointed and have
502-22   qualified.
502-23         (e)  A vacancy on the board is filled by the governor, in the
502-24   manner provided by this section, for the unexpired term.
502-25         (f)  Within 15 days after appointment, a director shall
502-26   qualify by taking the official oath and filing a good and
 503-1   sufficient bond with the secretary of state in the amount of
 503-2   $1,000, payable to the authority and conditioned on the faithful
 503-3   performance of official duties of the director.  The bond is
 503-4   subject to approval by the secretary of state.
 503-5         Sec. 270.005.  OFFICERS; VOTING REQUIREMENTS; WARRANTS.
 503-6   (a)  The board shall elect from among its members a president, vice
 503-7   president, secretary, and secretary pro tempore.
 503-8         (b)  Five directors constitute a quorum at any meeting, and a
 503-9   concurrence of a majority of those present is sufficient in all
503-10   matters pertaining to the business of the authority, except that
503-11   the letting of construction contracts and the authorization of the
503-12   issuance of bonds require the concurrence of five directors.
503-13         (c)  Warrants for the payment of money may be drawn and
503-14   signed by two officers or employees designated by resolution
503-15   entered in the minutes of the board when such accounts have been
503-16   contracted and ordered paid by the board.
503-17         Sec. 270.006.  OFFICER AND EMPLOYEE BONDS.  The board shall
503-18   require an officer or employee who collects, pays, or handles any
503-19   funds of the authority to furnish good and sufficient bond, with a
503-20   duly authorized surety company, payable to the authority, in an
503-21   amount determined by the board to be sufficient to safeguard the
503-22   authority.  The bond shall be conditioned on the faithful
503-23   performance of the person's duties and on the person's accounting
503-24   for all funds and property of the authority coming into the
503-25   person's hands.
503-26         Sec. 270.007.  OFFICERS; MEETINGS.  (a)  The president is the
 504-1   chief executive officer of the authority and presides at board
 504-2   meetings.  The vice president acts as president if the president is
 504-3   absent or disabled.
 504-4         (b)  The secretary is responsible for keeping the records and
 504-5   books of the authority.  The secretary pro tempore acts as
 504-6   secretary if the secretary is absent or disabled.
 504-7         (c)  The board shall hold regular meetings at times set by
 504-8   the board and may hold special meetings when required by the
 504-9   business of the authority.
504-10         Sec. 270.008.  DIRECTOR FEES.  A director is entitled to
504-11   receive a fee not to exceed $100 for each day of service necessary
504-12   to discharge the director's duties, plus actual expenses, provided
504-13   the fee and expenses are authorized by vote of the board.  The
504-14   directors must file with the secretary a statement showing the
504-15   amount due each month, or as soon after that month as practicable,
504-16   before a check is issued.
504-17         Sec. 270.009.  RECORDS; AUTHORITY OFFICE.  The board shall
504-18   keep a true and full account of all its meetings and proceedings
504-19   and maintain its records in a secure manner.  The records are the
504-20   property of the authority and are subject to public inspection.  A
504-21   regular office shall be established and maintained within the
504-22   authority for conducting the authority's business.
504-23         Sec. 270.010.  ACCOUNT RECORD; AUDIT.  The authority shall
504-24   keep a complete book of accounts.  The authority's fiscal accounts
504-25   and records shall be audited annually in accordance with Section
504-26   49.191.
 505-1         Sec. 270.011.  DEPOSITORIES.  (a)  The board shall annually
 505-2   select a depository or depositories for the authority.
 505-3         (b)  Funds of the authority shall be deposited in a
 505-4   depository selected under Subsection (a).
 505-5         (c)  The board may allocate authority funds between
 505-6   depositories or accounts maintained in a depository subject only to
 505-7   the duty imposed on the board by statute to invest the funds so as
 505-8   to obtain the highest rate of return consistent with safety.
 505-9         (d)  Subsection (b) does not prohibit the withdrawal of
505-10   authority funds after deposit in order to invest the funds in
505-11   fulfillment of the duty imposed on the board by statute to invest
505-12   the funds so as to obtain the highest rate of return consistent
505-13   with safety.
505-14         Sec. 270.012.  INVESTMENT OF FUNDS.  (a)  Funds of the
505-15   authority shall be invested and reinvested in accordance with:
505-16               (1)  Chapter 2256, Government Code; or
505-17               (2)  the provisions of the authority's bond orders and
505-18   agreements, as applicable.
505-19         (b)  The authority shall comply with Chapter 2257, Government
505-20   Code, to the extent applicable.
505-21         Sec. 270.013.  MANAGER; EMPLOYEES.  (a)  The board may employ
505-22   a manager for the authority and may delegate to the manager full
505-23   authority to manage and operate the affairs of the authority
505-24   subject only to orders of the board.  The manager's compensation
505-25   shall be determined by the board.
505-26         (b)  The terms of employment and compensation of all
 506-1   authority employees shall be determined by the board.
 506-2         Sec. 270.014.  SURETY BONDS.  (a)  All bonds required to be
 506-3   given by officers and employees of the authority shall be executed
 506-4   by a surety company authorized to do business in this state.  The
 506-5   authority may pay the premiums on the bonds.
 506-6         (b)  The authority may maintain a blanket surety bond to
 506-7   cover the directors of the authority.  The bond must be in the
 506-8   amount of at least $1,000 per director.  If the authority maintains
 506-9   a blanket surety bond under this subsection, a director is not
506-10   required to file a surety bond with the secretary of state as
506-11   provided by Section 270.004.
506-12         Sec. 270.015.  CONFLICT OF INTEREST; PENALTY.  (a)  A
506-13   director, engineer, or employee of the authority, either for the
506-14   person or as agent for anyone else, may not benefit directly or
506-15   indirectly by any sale, purchase, or contract entered into by the
506-16   board.  If such a person, directly or indirectly, becomes
506-17   interested in such a contract, sale, or purchase, the person is
506-18   guilty of a misdemeanor and on conviction shall be punished by a
506-19   fine not to exceed $1,000, by confinement in the county jail for
506-20   not less than six months or more than one year, or by both fine and
506-21   imprisonment.
506-22         (b)  In the purchase or sale of any realty bought or sold by
506-23   the authority from or to any director, engineer, or employee of the
506-24   authority, the value of the property shall be set by a board of
506-25   three disinterested citizens who are residents of the county in
506-26   which the property lies, who shall be appointed by the district
 507-1   judge of the county.
 507-2         Sec. 270.016.  JOINT ACTIONS.  A drainage, conservation,
 507-3   reclamation, or other district previously created by the state with
 507-4   powers provided in Section 59, Article XVI, or Section 52, Article
 507-5   III, Texas Constitution, shall have the authority, power, and right
 507-6   to coordinate its plans with the authority and shall have full
 507-7   authority, power, and right to enter into joint undertakings for
 507-8   the purposes for which the districts are created; provided,
 507-9   however, that all such acts must be approved by a majority of the
507-10   board of each district involved.
507-11         Sec. 270.017.  POWERS AND DUTIES.  (a)  The authority may
507-12   control and employ the waters of the Sabine River and its
507-13   tributaries within the state, including the storm waters and
507-14   floodwaters, for the conservation and beneficial use of the waters,
507-15   as provided by Chapters 11, 12, and 49 in the manner and for the
507-16   purposes provided by this section.
507-17         (b)  The authority may provide through practical and legal
507-18   means for the control and coordination of the regulation of the
507-19   waters of the Sabine River and its tributaries.
507-20         (c)  The authority may provide by adequate organization and
507-21   administration for the preservation of the equitable rights of the
507-22   people of the different sections of the watershed area in the
507-23   beneficial use of the waters of the Sabine River and its
507-24   tributaries.
507-25         (d)  The authority may provide for storing, controlling, and
507-26   conserving the waters of the Sabine River and its tributaries
 508-1   within and outside the authority in order to prevent the escape of
 508-2   any of the waters without the maximum of public service, prevent
 508-3   the devastation of lands from recurrent overflows, and protect life
 508-4   and property in the authority from uncontrolled floodwaters.
 508-5         (e)  The authority may take actions necessary to comply with
 508-6   laws, rules, and regulations of this state and the United States
 508-7   relating to the protection of the environment and may borrow money,
 508-8   accept grants, and enter into agreements with this state and the
 508-9   United States to carry out these actions.  If there is any conflict
508-10   between the provisions of this chapter and any law, rule, or
508-11   regulation of this state or the United States, the provisions of
508-12   this chapter prevail unless superseded by federal law.
508-13         (f)  The authority may provide for the conservation of the
508-14   waters of the Sabine River and its tributaries essential for the
508-15   domestic uses of the people of the authority, including all
508-16   necessary water supplies for cities and towns.
508-17         (g)  The authority may provide for the irrigation of lands
508-18   within the state where irrigation is required for agricultural
508-19   purposes or is considered helpful for more profitable agricultural
508-20   production and may provide for the equitable distribution of the
508-21   waters to the regional potential requirements for all beneficial
508-22   uses.  All plans and works provided by the authority or authorized
508-23   by the authority shall give primary consideration to the necessary
508-24   and potential needs for water.  The sale of water by the authority
508-25   and the compensation charged for water shall be subject to
508-26   regulation by the commission, on its own initiative or on the
 509-1   complaint of any user of the water, but such regulation shall be
 509-2   subject to the requirements of Section 270.019.
 509-3         (h)  The authority may provide for the encouragement and
 509-4   development of drainage systems and provisions for drainage systems
 509-5   and for the drainage of lands in the watershed of the Sabine River
 509-6   and its tributaries needed for profitable agricultural production
 509-7   and the drainage of other lands in the watershed area of the
 509-8   authority requiring drainage for the most advantageous use.
 509-9         (i)  The authority may provide for the conservation of all
509-10   soils against destructive erosion and prevent the increased dangers
509-11   caused by destructive soil erosion.
509-12         (j)  The authority may control and make water available for
509-13   use in the development of commercial and industrial enterprises in
509-14   all sections of the authority, may improve the Sabine River for
509-15   navigation, may construct or otherwise acquire and operate
509-16   navigation facilities and ports, and may enter into contracts with
509-17   the United States government with respect to those purposes.
509-18         (k)  The authority may provide for the control, storage, and
509-19   employment of water under its control in the development and
509-20   distribution of hydroelectric power, where such use may be
509-21   economically coordinated with other and superior uses and
509-22   subordinated to the uses declared by law to be superior.
509-23         (l)  The authority may provide for all purposes for which
509-24   floodwaters and storm waters, when controlled and conserved, may be
509-25   utilized in the performance of useful service as contemplated and
509-26   authorized by the provisions of the constitution and the public
 510-1   policy it declares.
 510-2         (m)  The authority may purchase and construct all works
 510-3   necessary or convenient for the exercise of the powers and the
 510-4   accomplishment of the purposes specified in this chapter and may
 510-5   purchase or otherwise acquire all real and personal property
 510-6   necessary or convenient for carrying out those purposes.
 510-7         Sec. 270.018.  EMINENT DOMAIN.  (a)  The right of eminent
 510-8   domain is expressly conferred on the authority to enable it to
 510-9   acquire the fee simple title to, or the easement or right-of-way
510-10   over and through, any and all lands, water, or lands under water,
510-11   private or public, within and outside the authority, which in the
510-12   judgment of the board is necessary or convenient to carry out any
510-13   of the purposes and powers conferred on the authority by this
510-14   chapter; provided, however, that as against persons, firms, and
510-15   corporations, or their receivers or trustees, who have the power of
510-16   eminent domain, the fee title may not be condemned, and the
510-17   authority may condemn only an easement.
510-18         (b)  All condemnation proceedings shall be under the
510-19   direction of the board and in the name of the authority, and the
510-20   assessment of damages and all procedure with reference to
510-21   condemnation, appeal, and payment shall be in conformity with
510-22   Chapter 21, Property Code.
510-23         Sec. 270.019.  FEES AND CHARGES.  The board shall prescribe
510-24   fees and charges to be collected for the use of water, water
510-25   connections, hydroelectric service, or other service that are
510-26   reasonable and equitable and sufficient to produce revenues
 511-1   adequate to pay:
 511-2               (1)  all expenses necessary for the operation and
 511-3   maintenance of the improvements and facilities of the authority,
 511-4   including the cost of the acquisition of properties and materials
 511-5   necessary to maintain the improvements and facilities in good
 511-6   condition and to operate them efficiently, necessary wages and
 511-7   salaries of the authority, and other expenses reasonably necessary
 511-8   to the efficient operation of the improvements and facilities;
 511-9               (2)  the annual or semiannual interest as it becomes
511-10   due on bonds issued under this chapter that are payable out of the
511-11   revenues of the improvements and facilities; and
511-12               (3)  the amount required to be paid annually into the
511-13   sinking fund for the payment of any bonds issued under this chapter
511-14   that are payable out of the revenues of the improvements and
511-15   facilities and the amount required to be paid into the reserve and
511-16   other funds under the resolution authorizing the issuance of the
511-17   bonds.
511-18         Sec. 270.020.  EMPLOYEES.  The authority through its board
511-19   may employ managers, engineers, attorneys, and all employees
511-20   necessary to construct, operate, and maintain the improvements and
511-21   facilities of the authority and to carry out the provisions of this
511-22   chapter, and may pay reasonable compensation set by the board for
511-23   such services.
511-24         Sec. 270.021.  CONTRACTS.  (a)  The authority may make and
511-25   enter into contracts, leases, and agreements necessary or
511-26   convenient to carry out the powers granted by this chapter.
 512-1         (b)  The contracts, leases, and agreements may be entered
 512-2   into with any person, real or artificial; any corporation,
 512-3   municipal, public or private; any government or governmental
 512-4   agency, including the United States government, the State of Texas,
 512-5   or the State of Louisiana, or any public or private corporation or
 512-6   entity created by or under the laws of the State of Louisiana.
 512-7         (c)  The authority may contract with a person, corporation,
 512-8   or entity described by Subsection (b) for the joint construction,
 512-9   operation, or both construction and operation of facilities
512-10   authorized to be operated or constructed by the authority.
512-11         (d)  All such contracts, leases, and agreements authorized by
512-12   this section must be approved by resolution of the board, executed
512-13   by the president or vice president, and attested by the secretary
512-14   or secretary pro tempore.
512-15         Sec. 270.022.  RIGHT TO SUE.  The authority may sue and be
512-16   sued in its own name.
512-17         Sec. 270.023.  APPROVAL OF CERTAIN WORKS.  Before the
512-18   authority establishes a diversion point, or constructs canals,
512-19   pumping plants, and other waterworks, the authority must present
512-20   plans and specifications for the project to the commission for
512-21   approval.
512-22         Sec. 270.024.  ANNUITY CONTRACTS.  The authority may enter
512-23   into agreements with its employees for the purchase of annuities
512-24   for its employees as authorized by Section 403(b), Internal Revenue
512-25   Code of 1986, as amended, and may effect reductions in the salary
512-26   of participants when authorized in writing and apply the amount of
 513-1   the reductions to the purchase of annuity contracts, the exclusive
 513-2   control of which will vest in the participants.
 513-3         Sec. 270.025.  RETIREMENT BENEFITS.  The authority may
 513-4   establish a system of retirement benefits or other benefits for its
 513-5   employees, including a pension or other retirement plan as set
 513-6   forth in the Internal Revenue Code of 1986, as amended.
 513-7         Sec. 270.026.  COMMISSION SUPERVISION.  The authority is
 513-8   subject to the continuing rights of supervision by the commission.
 513-9   The commission may approve, or refuse to approve, the adequacy of
513-10   any plan for flood control or conservation improvement purposes
513-11   devised by the authority for the achievement of the plans and
513-12   purposes intended in the creation of the authority and which plans
513-13   contemplate improvements supervised by the commission under the
513-14   provisions of the general laws.
513-15         Sec. 270.027.  ADDITIONAL POWERS.  (a)  The authority has and
513-16   may exercise such functions, powers, authority, rights, and duties
513-17   necessary to accomplish the purposes for which the authority is
513-18   created, including investigating, planning, acquiring,
513-19   constructing, maintaining, and operating all necessary properties,
513-20   lands, rights, tenements, easements, improvements, reservoirs,
513-21   dams, canals, laterals, plants, works, and facilities, including
513-22   the acquisition within and outside the authority of lands,
513-23   rights-of-way, water rights, and all other properties, tenements,
513-24   and easements, and other rights incident, helpful to, or in aid of
513-25   carrying out the purposes of the authority as provided by this
513-26   chapter.
 514-1         (b)  This chapter shall be liberally construed to accomplish
 514-2   the purposes of the authority.
 514-3         Sec. 270.028.  ACCEPTANCE OF GRANTS; APPROVAL OF CONTRACTS.
 514-4   (a)  The board may accept grants and gratuities in any form for the
 514-5   purpose of promoting, establishing, and accomplishing the
 514-6   objectives provided by this chapter.  Grants and gratuities shall
 514-7   be strictly accounted for and shall be subject to the same rules,
 514-8   regulations, and audits by the state auditor as other funds handled
 514-9   or disbursed by the board.
514-10         (b)  Any contract or agreement entered into or any commitment
514-11   made by and between the authority or any of its agents or
514-12   representatives and the federal government or any of its agents or
514-13   representatives involving the sovereign rights of the State of
514-14   Texas in the control, use, disposition, storage, or sale of the
514-15   water of the Sabine River or its tributaries, or involving the
514-16   control, management, or use of any facilities, properties, or
514-17   improvements constructed on the Sabine River or its tributaries,
514-18   shall be submitted to the attorney general for approval before
514-19   becoming an obligation of the authority.  Nothing in this section
514-20   shall preclude compliance by the authority with federal laws in
514-21   existence on May 3, 1949, or with any compact after that date by
514-22   and between the State of Texas, the federal government, and the
514-23   State of Louisiana, but any agreement, contract, or commitment
514-24   based on or involving any compact promulgated after May 3, 1949,
514-25   between the State of Texas, the federal government, and the State
514-26   of Louisiana shall be submitted to the attorney general for
 515-1   approval.
 515-2         Sec. 270.029.  ADDITIONAL SPECIFIC POWERS.  (a)  In addition
 515-3   to all other powers granted by this chapter or by any other
 515-4   provision of law, the authority is authorized to undertake and
 515-5   carry out any activities and to purchase, construct, acquire, own,
 515-6   operate, maintain, repair, improve, or extend, inside and outside
 515-7   its boundaries, all works, improvements, facilities, plants,
 515-8   equipment, and appliances incident, helpful, or necessary to:
 515-9               (1)  provide for the control, storage, preservation,
515-10   transmission, treatment, distribution, and use of storm water and
515-11   floodwater and the water of rivers and streams for irrigation,
515-12   power (whether hydroelectric, steam-generated, or nuclear), and all
515-13   other beneficial purposes;
515-14               (2)  supply water for municipal, domestic, power
515-15   (whether hydroelectric, steam-generated, or nuclear), industrial,
515-16   irrigation, oil flooding, mining, agricultural, and commercial uses
515-17   and purposes and all other beneficial uses and purposes;
515-18               (3)  collect, transport, process, treat, dispose of,
515-19   and control all municipal, domestic, industrial, or communal water
515-20   and solid waste pollution, whether in fluid, solid, or composite
515-21   state;
515-22               (4)  reclaim and provide drainage and drainage systems
515-23   for lands;
515-24               (5)  provide for the navigation of coastal and inland
515-25   waters and provide port facilities; or
515-26               (6)  establish or otherwise provide for public parks
 516-1   and recreation facilities.
 516-2         (b)  All of the purposes provided in Subsection (a) are for
 516-3   the conservation and development of the natural resources of the
 516-4   state within the meaning of Section 59, Article XVI, Texas
 516-5   Constitution.
 516-6         Sec. 270.030.  CHARGES, FEES, AND RENTALS FOR FACILITY OR
 516-7   SERVICE.  The authority may adopt, enforce, and collect all
 516-8   necessary charges, fees, or rentals for providing any authority
 516-9   facility or service and may require a deposit for any service or
516-10   facility furnished, and the authority may or may not provide that
516-11   the deposit will bear interest.  The authority may discontinue a
516-12   facility or service to prevent an abuse or enforce payment of an
516-13   unpaid charge, fee, or rental due the authority.
516-14         Sec. 270.031.  RULES AND REGULATIONS.  (a)  The authority may
516-15   adopt and enforce reasonable rules and regulations to:
516-16               (1)  secure and maintain safe, sanitary, and adequate
516-17   plumbing installations, connections, and appurtenances as
516-18   subsidiary parts of its sanitary sewer facilities;
516-19               (2)  preserve the sanitary condition of all water
516-20   controlled by the authority;
516-21               (3)  prevent waste or the unauthorized use of water
516-22   controlled by the authority; and
516-23               (4)  regulate privileges on any land or easement owned
516-24   or controlled by the authority.
516-25         (b)  The board shall publish once a week for two consecutive
516-26   weeks a substantive statement of a proposed rule or regulation and
 517-1   the penalty for its violation in one or more newspapers with
 517-2   general circulation in the area in which the rule or regulation is
 517-3   to be effective.  The substantive statement must be condensed as
 517-4   far as possible to explain the purpose to be accomplished or the
 517-5   act forbidden by the rule or regulation.  The notice must advise
 517-6   that breach of the rule or regulation will subject the violator to
 517-7   a penalty and that the full text of the rule or regulation is on
 517-8   file in the principal office of the authority where it may be read
 517-9   by any interested person.  Any number of rules or regulations may
517-10   be included in one notice.
517-11         (c)  The penalty for violation of a rule or regulation is not
517-12   effective and enforceable until five days after the last
517-13   publication of the notice.  Five days after the last publication,
517-14   the published rule or regulation shall be in effect, and ignorance
517-15   of it is not a defense to a prosecution for the enforcement of the
517-16   penalty.
517-17         (d)  The board may set a reasonable penalty for the breach of
517-18   a rule or regulation of the authority.  A penalty shall not exceed
517-19   a fine of more than $200.  The penalty shall be in addition to any
517-20   other penalties and remedies provided by the laws of this state and
517-21   may be enforced by complaints filed in the appropriate court of
517-22   jurisdiction in the county in which the authority's principal
517-23   office is located or in the county in which the violation is
517-24   alleged to have occurred.
517-25         (e)  After the publication required by Subsection (b), a rule
517-26   or regulation adopted by the authority shall be recognized by the
 518-1   courts as if it were a penal ordinance of a city.
 518-2         Sec. 270.032.  ACQUISITION OF PROPERTY; ADDITIONAL PROVISIONS
 518-3   REGARDING EMINENT DOMAIN.  (a)  The authority may acquire, by
 518-4   purchase, lease, gift, or condemnation, any land, easements, or
 518-5   other property, or any interest in land, easements, or other
 518-6   property, within or outside the authority, for any purpose or
 518-7   function authorized by this chapter.
 518-8         (b)  The authority may elect to condemn either the fee simple
 518-9   title or an easement or other interest only, notwithstanding any
518-10   other provisions of this chapter.  The right of eminent domain
518-11   shall be exercised by the authority in the manner provided by
518-12   Chapter 21, Property Code.  The authority is a water improvement
518-13   district within the meaning of that chapter.  The proceedings shall
518-14   be instituted under the direction of the board and in the name of
518-15   the authority.  If the authority, in the exercise of the power of
518-16   eminent domain or power of relocation or any other power, makes
518-17   necessary the relocation, raising, rerouting, changing the grade,
518-18   or altering the construction of any highway, railroad, electric
518-19   transmission line, telephone or telegraph properties and
518-20   facilities, or pipeline, all necessary relocations, raising,
518-21   rerouting, changing the grade, or alteration of construction shall
518-22   be accomplished at the sole expense of the authority.
518-23         Sec. 270.033.  CONTRACTS WITH AGENCIES AND POLITICAL
518-24   SUBDIVISIONS.  The authority may contract, on the terms and
518-25   conditions as the parties may agree, with all cities, public
518-26   agencies, and other political subdivisions, including the United
 519-1   States government and any of its agencies and the states of Texas
 519-2   and Louisiana and any of their agencies, with respect to any power,
 519-3   function, or duty of the authority.
 519-4         Sec. 270.034.  APPLICATION OF REGIONAL WASTE DISPOSAL ACT.
 519-5   (a)  The authority is a district under Chapter 30, and all the
 519-6   provisions of that chapter are applicable to the authority except
 519-7   to the extent of any conflict with this chapter, in which case this
 519-8   chapter shall prevail.
 519-9         (b)  A city, public agency, or other political subdivision
519-10   may contract with the authority in any manner authorized by Chapter
519-11   30, provided, however, that the city, public agency, or other
519-12   political subdivision may execute contracts with the authority and
519-13   may determine, agree, and pledge that payments under the contract
519-14   shall be payable from the source or sources described in Section
519-15   30.030(c), subject only to the authorization of the contract,
519-16   pledge, and payments by a two-thirds vote of the governing board of
519-17   the city, public agency, or political subdivision.
519-18         (c)  The authority and all cities, public agencies, and other
519-19   political subdivisions shall have all the rights, powers, and
519-20   authority with respect to the control, storage, preservation,
519-21   transmission, treatment, and disposition of storm water and
519-22   floodwater, and the water of rivers and streams, and with respect
519-23   to any other power, function, or activity of the authority granted,
519-24   permitted, and authorized to districts and public agencies by
519-25   Chapter 30, with respect to waste, waste disposal systems, and
519-26   treatment facilities.  Contracts made pursuant to this subsection
 520-1   are subject to the provisions of Subsection (b).
 520-2         Sec. 270.035.  CONTRACT CHARGES.  All cities, public
 520-3   agencies, and other political subdivisions may set, charge, and
 520-4   collect fees, rates, charges, rentals, and other amounts for any
 520-5   service or facilities provided pursuant to or in connection with
 520-6   any contract with the authority and may pledge amounts sufficient
 520-7   to make all payments required under the contract.
 520-8         Sec. 270.036.  BONDS.  (a)  For the purpose of providing
 520-9   funds to acquire, purchase, construct, improve, enlarge, or equip
520-10   any property, buildings, structures, or other facilities for any
520-11   purpose or power authorized by law, the board may issue revenue
520-12   bonds from time to time and in one or more issues or series
520-13   pursuant to this section.
520-14         (b)  The bonds may be payable from and secured by liens on
520-15   and pledges of all or any part of the revenues, income, or receipts
520-16   derived by the authority from its ownership or operation of the
520-17   property, buildings, structures, or facilities or any other
520-18   resources of the authority, including the proceeds or revenues from
520-19   contracts with any person, firm, corporation, city, public agency,
520-20   or other political subdivision.
520-21         (c)  The bonds must be issued to mature serially or otherwise
520-22   within not to exceed 50 years, and provision may be made for the
520-23   subsequent issuance of additional parity bonds, or subordinate lien
520-24   bonds, under any terms or conditions that may be provided in the
520-25   resolution authorizing the issuance of the bonds.
520-26         (d)  The bonds, and any interest coupons appertaining to the
 521-1   bonds, are negotiable instruments within the meaning and for all
 521-2   purposes of the Business & Commerce Code, provided, however, that
 521-3   the bonds may be issued registrable as to principal alone or as to
 521-4   both principal and interest.
 521-5         (e)  The bonds shall be executed and may be made redeemable
 521-6   before maturity, may be issued in the form, denominations, and
 521-7   manner and under the terms, conditions, and details, may be sold in
 521-8   the manner, at the price, and under the terms, and shall bear
 521-9   interest at the rates as provided in the resolution authorizing the
521-10   issuance of the bonds.  If provided in the bond resolution, the
521-11   proceeds from the sale of the bonds may be used for paying interest
521-12   on the bonds during the period of the acquisition or construction
521-13   of facilities to be provided through the issuance of the bonds, for
521-14   paying expenses of operation and maintenance of facilities, for
521-15   creating a reserve fund for the payment of the principal of and
521-16   interest on the bonds, and for creating other funds, and the
521-17   proceeds from the sale of the bonds may be placed on time deposit
521-18   or invested until needed, to the extent and in the manner provided
521-19   in the bond resolution.
521-20         (f)  The authority may pledge all or part of its revenues,
521-21   income, or receipts from fees, rentals, rates, charges, contract
521-22   proceeds or payments, or other resources to the payment of the
521-23   bonds, including the payment of principal, interest, and other
521-24   amounts required or permitted in connection with the bonds.  The
521-25   pledged fees, rentals, rates, charges, proceeds, or payments shall
521-26   be set and collected in amounts that will be at a minimum
 522-1   sufficient, together with other pledged resources, to provide for
 522-2   all payments of principal, interest, and other amounts required in
 522-3   connection with the bonds and, to the extent required by the
 522-4   resolution authorizing the issuance of the bonds, to provide for
 522-5   the payment of expenses in connection with the bonds and for the
 522-6   operation, maintenance, and other expenses in connection with the
 522-7   facilities.
 522-8         (g)  The bonds may be additionally secured by mortgages or
 522-9   deeds of trust on real property owned or acquired by the authority,
522-10   and by chattel mortgages or liens on personal property appurtenant
522-11   to the real property, and the board may authorize the execution of
522-12   trust indentures, mortgages, deeds of trust, or other forms of
522-13   encumbrances to evidence same.
522-14         (h)  The authority may pledge to the payment of the bonds all
522-15   or part of any grant, donation, revenues, or income received or to
522-16   be received from the United States government or any other public
522-17   or private source, whether pursuant to an agreement or otherwise.
522-18         (i)  Revenue bonds issued pursuant to this section may be
522-19   refunded as provided by this section or Section 270.040, and the
522-20   bonds may be refunded or otherwise refinanced by the issuance of
522-21   refunding bonds for that purpose, under the terms, conditions, and
522-22   details, and with the security and pledges as determined by
522-23   resolution of the board.  All pertinent and appropriate provisions
522-24   of this chapter apply to refunding bonds, which may be issued in
522-25   the manner provided for other bonds authorized under this section.
522-26   Refunding bonds may be sold for cash and delivered in amounts
 523-1   necessary to pay the principal, interest, and redemption premium,
 523-2   if any, of bonds to be refunded, at maturity or on any redemption
 523-3   date; or the refunding bonds may be issued to be exchanged for the
 523-4   bonds being refunded, in which case the comptroller shall register
 523-5   the refunding bonds and deliver them to the holder or holders of
 523-6   the bonds being refunded, in accordance with the provisions of the
 523-7   resolution authorizing the refunding bonds.  The exchange may be
 523-8   made in one delivery or in several installment deliveries.  Bonds
 523-9   issued at any time by the authority may also be refunded in the
523-10   manner provided by any other applicable law.
523-11         Sec. 270.037.  BOND APPROVAL AND REGISTRATION.  (a)  Bonds
523-12   issued pursuant to this chapter and the appropriate proceedings
523-13   authorizing their issuance shall be submitted to the attorney
523-14   general for examination.  If the bonds recite that they are secured
523-15   by a pledge of revenues of any contract, a copy of the contract and
523-16   the proceedings relating to the contract shall be submitted to the
523-17   attorney general.  If the attorney general finds that the bonds
523-18   have been authorized and that any such contract has been made in
523-19   accordance with law, the attorney general shall approve the bonds
523-20   and the contract and the bonds shall be registered by the
523-21   comptroller.
523-22         (b)  After approval and registration the bonds and the
523-23   contract, if any, are incontestable in any court or other forum,
523-24   for any reason, and are valid and binding obligations in accordance
523-25   with their terms for all purposes.
523-26         Sec. 270.038.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
 524-1   DEPOSITS.  Bonds issued pursuant to this chapter are legal and
 524-2   authorized investments for all banks, trust companies, building and
 524-3   loan associations, savings and loan associations, insurance
 524-4   companies of all kinds and types, fiduciaries, trustees, and
 524-5   guardians and for all interest and sinking funds and other public
 524-6   funds of the state and all agencies, subdivisions, and
 524-7   instrumentalities of the state, including counties, cities, towns,
 524-8   villages, school districts, and all other kinds and types of
 524-9   districts, public agencies, and bodies politic.  The bonds are
524-10   eligible and lawful security for deposits of public funds of the
524-11   state and all agencies, subdivisions, and instrumentalities of the
524-12   state, including counties, cities, towns, villages, school
524-13   districts, and all other kinds and types of districts, public
524-14   agencies, and bodies politic, to the extent of the face value of
524-15   the bonds, when accompanied by any unmatured interest coupons.
524-16         Sec. 270.039.  SOURCE OF AUTHORITY.  The provisions of
524-17   Sections 270.029-270.038 are sufficient authority for the issuance
524-18   of bonds, the execution of contracts, and the performance by the
524-19   authority and by cities, public agencies, and other political
524-20   subdivisions of other acts and procedures authorized by those
524-21   provisions, regardless of any other provisions of this chapter and
524-22   without reference to any other provisions of law or any
524-23   restrictions or limitations contained in those provisions, except
524-24   as specifically provided by this subsection and Sections
524-25   270.029-270.038.  To the extent of any conflict or inconsistency
524-26   between provisions of this section and Sections 270.029-270.038 and
 525-1   any other provision of law, this section and Sections
 525-2   270.029-270.038 prevail and control; provided, however, that the
 525-3   authority and all cities, public agencies, and other political
 525-4   subdivisions may use other provisions of this chapter or other laws
 525-5   not in conflict with this section and Sections 270.029-270.038, to
 525-6   the extent convenient or necessary to carry out any power or
 525-7   authority, express or implied, granted by those sections.
 525-8         Sec. 270.040.  REFUNDING BONDS.  (a)  The authority may issue
 525-9   refunding bonds for the purpose of refunding any outstanding bonds
525-10   authorized by this chapter and interest on the bonds.  Refunding
525-11   bonds may be issued to refund more than one series of outstanding
525-12   bonds and may combine the pledges for the outstanding bonds for the
525-13   security of the refunding bonds, and the refunding bonds may be
525-14   secured by other or additional revenues.
525-15         (b)  The provisions of this chapter with reference to the
525-16   issuance of other bonds and their approval by the attorney general
525-17   and the remedies of the holders are applicable to refunding bonds.
525-18   Refunding bonds shall be registered by the comptroller on surrender
525-19   and cancellation of the bonds to be refunded, but in lieu of
525-20   surrender and cancellation, the resolution authorizing the issuance
525-21   of the refunding bonds may provide that the bonds shall be sold and
525-22   the proceeds of the sale deposited in the bank where the original
525-23   bonds are payable, in which case the refunding bonds may be issued
525-24   in an amount sufficient to pay the interest on the original bonds
525-25   to their option date or maturity date and the comptroller shall
525-26   register the refunding bonds without concurrent surrender and
 526-1   cancellation of the original bonds.
 526-2         Sec. 270.041.  DEED OF TRUST LIEN.  (a)  Bonds, including
 526-3   refunding bonds, authorized by this chapter may be additionally
 526-4   secured by a deed of trust lien on physical properties of the
 526-5   authority and all franchises, easements, water rights and
 526-6   appropriation permits, leases and contracts, and all rights
 526-7   appurtenant to the properties, vesting in the trustee power to sell
 526-8   the properties for payment of the indebtedness, power to operate
 526-9   the properties, and all other powers and authority for the further
526-10   security of the bonds.
526-11         (b)  The deed of trust may contain any provisions prescribed
526-12   by the board for the security of the bonds and the preservation of
526-13   the trust estate and may make provision for amendment or
526-14   modification of the deed of trust and the issuance of bonds to
526-15   replace lost or mutilated bonds.  A purchaser under a sale under
526-16   the deed of trust shall be the owner of the dam or dams and the
526-17   other properties and facilities so purchased and shall have the
526-18   right to maintain and operate them.
526-19         Sec. 270.042.  ADDITIONAL PROVISIONS REGARDING APPROVAL AND
526-20   REGISTRATION OF BONDS.  (a)  After any bonds are authorized by the
526-21   authority, the bonds and the record relating to their issuance
526-22   shall be submitted to the attorney general for examination as to
526-23   the validity of the bonds and the record.  If the bonds recite that
526-24   they are secured by a pledge of the proceeds of a contract
526-25   previously made between the authority and a city or other
526-26   governmental agency or district, a copy of the contract and the
 527-1   proceedings of the city or other governmental agency or district
 527-2   authorizing the contract shall also be submitted to the attorney
 527-3   general.  If the bonds have been authorized and the contract has
 527-4   been made in accordance with the constitution and laws of the
 527-5   state, the attorney general shall approve the bonds and contract
 527-6   and the bonds then shall be registered by the comptroller.
 527-7         (b)  After their approval and registration, the bonds and the
 527-8   contract, if any, are valid and binding and are incontestable for
 527-9   any cause.
527-10         Sec. 270.043.  PROVISIONS REGARDING FURNISHING OF ELECTRICITY
527-11   AND OTHER AUTHORITY SERVICES.  (a)  The rates and charges for
527-12   electric power sold and the services rendered by the authority
527-13   shall be reasonable, nondiscriminatory, and just to the customers,
527-14   and all rates and charges that are unreasonable, discriminatory, or
527-15   unjust to customers are prohibited.
527-16         (b)  The commission shall have the power to regulate and set
527-17   the rates and compensation to be charged by the authority for
527-18   electric energy and other services and to prescribe rules and
527-19   regulations under which electric energy is furnished.  The
527-20   commission shall not set a rate or compensation that will yield
527-21   less than a fair rate of return on the fair value of the property
527-22   used and useful in generating electric energy and rendering other
527-23   service, but in no event shall the return exceed 10 percent per
527-24   year.
527-25         (c)  When the authority proposes to enter into a contract for
527-26   the sale of electric energy, the contract shall be filed with the
 528-1   commission for examination.  On the filing of the contract, the
 528-2   commission shall issue a notice to the parties by registered mail,
 528-3   unless notice is waived, informing the parties of the time and
 528-4   location of a hearing on the contract.  If, following the hearing,
 528-5   the commission finds that the contract or proposal is fair and
 528-6   reasonable and not detrimental to the public interest, it shall
 528-7   approve the contract or proposal.  The action of the commission
 528-8   pursuant to the hearing shall be conclusive unless an appeal is
 528-9   taken.
528-10         (d)  If a party is dissatisfied with the action of the
528-11   commission, the party may file a petition stating the party's
528-12   objections to the action in a district court of Travis County
528-13   against the commission as defendant.  The findings of the
528-14   commission as to the facts, if supported by substantial evidence,
528-15   shall be conclusive.  Appeals may be taken to the court of civil
528-16   appeals and may be removed to the supreme court as in other civil
528-17   causes.
528-18         (e)  The commission may exercise its powers of regulation and
528-19   control on its own initiative or on complaint of any person
528-20   aggrieved.
528-21         Sec. 270.044.  AUTHORITY AS WATER CONTROL AND IMPROVEMENT
528-22   DISTRICT.  The authority has all the powers conferred by general
528-23   laws on water control and improvement districts.  In the event of a
528-24   conflict between the provisions of this chapter and the general
528-25   laws relating to water control and improvement districts or any
528-26   other general law, the provisions of this chapter shall prevail.
 529-1         Sec. 270.045.  ADDITIONAL PROVISIONS REGARDING BONDS AS
 529-2   INVESTMENTS AND AS SECURITY FOR DEPOSITS.  All bonds of the
 529-3   authority are legal and authorized investments for banks, savings
 529-4   banks, trust companies, building and loan associations, savings and
 529-5   loan associations, insurance companies, fiduciaries, trustees, and
 529-6   guardians and for the sinking funds of cities, towns, villages,
 529-7   counties, school districts, or other political corporations or
 529-8   subdivisions of the state.  The bonds are eligible to secure the
 529-9   deposit of all public funds of the state and all public funds of
529-10   cities, towns, villages, counties, school districts, or other
529-11   political corporations or subdivisions of the state, and the bonds
529-12   are lawful and sufficient security for the deposits to the extent
529-13   of their value if the bonds are accompanied by all unmatured
529-14   coupons.
529-15         Sec. 270.046.  TAX EXEMPTION.  The accomplishment of the
529-16   purposes stated in this chapter is for the benefit of the people of
529-17   the state and for the improvement of their properties and
529-18   industries, and the authority, in carrying out the purposes of this
529-19   chapter, will be performing an essential public function under the
529-20   constitution.  The authority shall not be required to pay any tax
529-21   or assessment on the project or a part of the project, and the
529-22   bonds issued under this chapter and the transfer of and income from
529-23   the bonds, including the profits made on the sale of the bonds,
529-24   shall at all times be free from taxation within this state.
529-25         Sec. 270.047.  ADDITIONAL PROVISIONS REGARDING AUTHORITY
529-26   REGULATIONS AND CONTRACTS.  (a)  The board may adopt and promulgate
 530-1   all reasonable regulations to secure, maintain, and preserve the
 530-2   sanitary condition of all water in and to flow into any reservoir
 530-3   owned by the authority, to prevent the waste or unauthorized use of
 530-4   water, and to regulate residence, hunting, fishing, boating, and
 530-5   camping, and all recreational and business privileges, along or
 530-6   around any such reservoir and the Sabine River and its tributaries
 530-7   or on any body of land or easement owned or controlled by the
 530-8   authority.
 530-9         (b)  The board may contract with responsible persons for the
530-10   construction and operation of toll bridges over the authority's
530-11   water or for ferry service on or over the authority's water, for a
530-12   period not to exceed 20 years in the case of a bridge and not to
530-13   exceed 10 years in the case of a ferry, setting reasonable
530-14   compensation to be charged for service by any such facility and
530-15   requiring adequate bond or bonds from contracting persons,
530-16   associations, or corporations, payable to the authority, in an
530-17   amount and conditioned as required in the judgment of the board.
530-18   The contracts may provide for forfeiture of the particular
530-19   franchise in case of a failure of the licensee to render adequate
530-20   public service.
530-21         (c)  The authority may prescribe a reasonable penalty for the
530-22   breach of a regulation of the authority, not to exceed a fine of
530-23   $200 or imprisonment for 30 days, or both a fine and imprisonment.
530-24   The penalty shall be in addition to any other penalties provided by
530-25   the laws of the state and may be enforced by complaints filed in
530-26   the appropriate court of jurisdiction in the county in which the
 531-1   violation occurred; provided, however, that no rule or regulation
 531-2   that provides a penalty for a violation of the rule or regulation
 531-3   shall be in effect, as to enforcement of the penalty, until five
 531-4   days after the authority has caused a substantive statement of the
 531-5   rule or regulation and the penalty for the violation to be
 531-6   published, once a week for two consecutive weeks in the authority.
 531-7   The statement to be published must be as condensed as is possible
 531-8   to afford sufficient notice as to the act forbidden by the rule or
 531-9   regulation.  A single notice may embrace any number of regulations.
531-10   The notice must provide the information that breach of the
531-11   regulation or regulations will subject the violator to the
531-12   imposition of a penalty.  The notice must also state that the full
531-13   text of the regulation or regulations is on file in the principal
531-14   office of the authority and may be read by any interested person.
531-15   Five days after the second publication of the notice, the
531-16   advertised regulation shall be in effect and ignorance of the
531-17   regulation shall not constitute a defense to a prosecution for the
531-18   enforcement of a penalty.  After the required publication, the
531-19   rules and regulations authorized by this section shall judicially
531-20   be known to the courts and shall be considered of a nature similar
531-21   to a valid penal ordinance of a city of the state.
531-22         (d)  The authority may employ and constitute its own peace
531-23   officers, and any such peace officer or any county peace officer
531-24   may make arrests when necessary to prevent or stop the commission
531-25   of an offense against the regulations of the authority, or against
531-26   the laws of the state, when the offense or threatened offense
 532-1   occurs on any land, water, or easement owned or controlled by the
 532-2   authority, or may make an arrest at any place in the case of an
 532-3   offense involving injury or detriment to any property owned or
 532-4   controlled by the authority.
 532-5         Sec. 270.048.  PARKS AND RECREATION FACILITIES.  The
 532-6   authority may establish or otherwise provide for public parks and
 532-7   recreation facilities and may acquire land for such purposes.
 532-8         Sec. 270.049.  LIMITED LIABILITY FOR AQUATIC HERBICIDE
 532-9   APPLICATION.  (a)  In this section, "commercially licensed aquatic
532-10   herbicide applicator" means a person who holds a commercial
532-11   applicator license issued by the Department of Agriculture under
532-12   Chapter 76, Agriculture Code, that authorizes the application of
532-13   aquatic herbicides.
532-14         (b)  Except as provided by Chapter 12, Parks and Wildlife
532-15   Code, an authority employee holding a noncommercial aquatic
532-16   herbicide applicator license or a commercially licensed aquatic
532-17   herbicide applicator working under contract with the authority is
532-18   not liable for damages in excess of $2 million for personal injury,
532-19   property damage, or death resulting from the application by the
532-20   applicator of aquatic herbicide in compliance with applicable law
532-21   and the terms of the license or permit.
532-22                CHAPTER 271.  SAN ANTONIO RIVER AUTHORITY
532-23         Sec. 271.001.  CREATION.  (a)  A conservation and reclamation
532-24   district to be known as the "San Antonio River Authority" is
532-25   created.  The authority is a governmental agency, a municipality,
532-26   body politic and corporate.
 533-1         (b)  The authority is created under and is essential to
 533-2   accomplish the purposes of Section 59, Article XVI, Texas
 533-3   Constitution, including the construction, maintenance, and
 533-4   operation of navigable canals or waterways authorized by this
 533-5   chapter and the control of the waters of those parts of all rivers
 533-6   and streams and their tributaries that are within the boundaries of
 533-7   the authority.
 533-8         Sec. 271.002.  DEFINITIONS.  In this chapter:
 533-9               (1)  "Authority" means the San Antonio River Authority.
533-10               (2)  "Board" means the board of directors of the
533-11   authority.
533-12               (3)  "Director" means a member of the board.
533-13               (4)  "Federal" means the government of the United
533-14   States or its functions or subsidiary agencies.
533-15               (5)  "Flood plain" means the area of the channel of a
533-16   river or stream and those portions of land abutting and adjacent to
533-17   the channel that are reasonably required to carry floodwaters.
533-18               (6)  "Person" means an individual, partnership,
533-19   association, corporation, business trust, legal representative, or
533-20   receiver or any organized group of persons.
533-21               (7)  "Professional services" means services rendered,
533-22   either individually or by firms, by accountants, attorneys,
533-23   engineers, surveyors, geologists, physicians, surgeons, laboratory
533-24   technicians, bond brokers, fiscal advisers, appraisers,
533-25   statisticians, and researchers and by such other vocations,
533-26   callings, occupations, or employments involving labor, skill,
 534-1   education, special knowledge, and compensation or profit in which
 534-2   the labor and skill involved are predominantly mental or
 534-3   intellectual rather than physical or manual.
 534-4               (8)  "San Antonio River Basin" means all of the area
 534-5   except Bandera, Real, and Kerr counties that has topographic
 534-6   characteristics causing surface waters to flow into the San Antonio
 534-7   River and its tributaries.
 534-8               (9)  "State" means or relates to the government of the
 534-9   State of Texas or such of its functions and agencies as are
534-10   appropriate to accomplish the objectives of this chapter.
534-11         Sec. 271.003.  BOUNDARIES OF THE AUTHORITY; FINDING OF
534-12   BENEFIT.  (a)  The authority includes all of the territory within
534-13   the Bexar, Wilson, Karnes, and Goliad counties.
534-14         (b)  It is found and determined that all of the land included
534-15   in the authority will benefit from the exercise of the power
534-16   conferred by this chapter.
534-17         Sec. 271.004.  POWERS AND DUTIES OF THE AUTHORITY.  (a)  The
534-18   authority has all of the powers of the state granted under Section
534-19   59, Article XVI, Texas Constitution, to effectuate the
534-20   construction, maintenance, and operation of navigable canals or
534-21   waterways, to effectuate flood control, to effectuate the
534-22   conservation and use for all beneficial purposes of groundwater,
534-23   storm waters, floodwaters, and unappropriated flow waters in the
534-24   authority, to effectuate irrigation, to effectuate soil
534-25   conservation, to effectuate sewage treatment, to effectuate
534-26   pollution prevention, to encourage and develop parks and
 535-1   recreational facilities and to preserve fish, to effectuate
 535-2   forestation and reforestation, and to do all things required for
 535-3   those purposes, subject only to:
 535-4               (1)  declarations of policy by the legislature as to
 535-5   the use of water;
 535-6               (2)  continuing supervision and control by the
 535-7   commission and any board or agency that succeeds to its duties;
 535-8               (3)  the provisions of Section 11.024, prescribing the
 535-9   priorities of uses for water; and
535-10               (4)  water rights legally acquired by municipalities
535-11   and other users.
535-12         (b)  Subject to the provisions of Subsection (a), the
535-13   authority shall exercise the powers, rights, privileges, and
535-14   functions provided by this section and Sections 271.005-271.015, in
535-15   the manner and for the purposes specified in those sections and in
535-16   this chapter, for the greatest practicable measure of conservation
535-17   and beneficial utilization of all groundwater, storm waters,
535-18   floodwaters, and unappropriated flow waters of the authority.
535-19         Sec. 271.005.  NAVIGATION.  (a)  The authority may promote,
535-20   construct, maintain, and operate or may make practicable, promote,
535-21   aid, and encourage the construction, maintenance, and operation of
535-22   navigable canals or waterways, and all navigational systems or
535-23   facilities auxiliary to navigable canals or waterways, using the
535-24   natural bed and banks of the San Antonio River to its junction with
535-25   the Guadalupe River where practicable and from there traversing
535-26   such route as may be found by the authority to be most feasible and
 536-1   practicable to connect with the Gulf Intracoastal Waterway or with
 536-2   any new canal to be constructed or with any harbor at or near San
 536-3   Antonio Bay or the Gulf of Mexico and also using such new
 536-4   correlated artificial waterways, together with all locks and other
 536-5   works, structures, and artificial facilities, as may be necessary
 536-6   and convenient for the construction, maintenance, and operation of
 536-7   the navigable canals or waterways and all navigational systems or
 536-8   facilities auxiliary to them.
 536-9         (b)  The authority may construct or cause to be constructed
536-10   the system of artificial waterways, canals, locks, works, and other
536-11   facilities to connect the watershed area of the San Antonio River,
536-12   including navigation to or at a point near the city of San Antonio,
536-13   with the Gulf Intracoastal Waterway or with any new canal to be
536-14   constructed or with any harbor at or near San Antonio Bay or the
536-15   Gulf of Mexico.
536-16         (c)  The authority may control, develop, store, and use the
536-17   natural flow and floodwaters of the San Antonio River and its
536-18   tributaries for the purpose of operating and maintaining the
536-19   navigable canals or waterways and all navigational systems or
536-20   facilities auxiliary to the canals and waterways; provided,
536-21   however, that the navigational use shall be subordinate to the
536-22   consumptive use of water, and navigation shall be incidental to the
536-23   consumptive use of water.
536-24         (d)  In the case of the construction of the navigable canals
536-25   or waterways and all navigational systems or facilities auxiliary
536-26   to them by the federal government or otherwise, the authority may
 537-1   construct, maintain, and operate lateral connecting canals and
 537-2   turning basins to serve local needs, and may also provide,
 537-3   construct, acquire, purchase, take over, lease from others, lease
 537-4   to others, maintain, operate, develop, and regulate, or by
 537-5   franchise control, wharves, docks, warehouses, grain elevators,
 537-6   bunkering facilities, belt or terminal railroads, floating plants,
 537-7   lighterage, towing facilities, and all other facilities incident to
 537-8   or in aid of the efficient operation and development of the canals
 537-9   or waterways and all navigational systems or facilities auxiliary
537-10   to them, and any ports incident to them, whether on land or on
537-11   water.
537-12         (e)  If the construction or maintenance and operation of the
537-13   navigable canals or waterways and all navigational systems or
537-14   facilities auxiliary to the canals or waterways is taken over by
537-15   the federal government or any agency of the federal government, the
537-16   authority may make and enter into any contracts lawfully required
537-17   by the federal government, including assignments and transfers of
537-18   property and rights of property and easements and privileges and
537-19   all other lawful things and acts necessary and required to meet the
537-20   requirements of the federal government, or any agency of the
537-21   federal government, in taking over the construction or maintenance
537-22   and operation of the navigable canals or waterways and all
537-23   navigational systems or facilities auxiliary to the canals and
537-24   waterways.
537-25         (f)  The authority may grant a franchise or right to any
537-26   person or body politic or corporate for the use of the navigable
 538-1   canals or waterways and all navigational systems or facilities
 538-2   auxiliary to the canals or waterways or any facility in aid of
 538-3   navigation.  A person or body politic or corporate may not provide,
 538-4   maintain, or operate any facility in aid of navigation in any way
 538-5   connected with the navigable canals or waterways and all
 538-6   navigational systems or facilities auxiliary to the canals or
 538-7   waterways and intended for use by the public within the meaning and
 538-8   intent of this chapter, except by and under the franchise granted
 538-9   by the authority in the form of an ordinance as provided by this
538-10   chapter.
538-11         (g)  A franchise may be granted under Subsection (f) for a
538-12   term not to exceed 50 years.  An ordinance granting the franchise:
538-13               (1)  may contain provisions for the payment of
538-14   reasonable fees or other charges to be paid to the authority; and
538-15               (2)  shall contain:
538-16                     (A)  provisions adequate to regulate the fees,
538-17   tolls, rates, or exactions to be demanded for the use of, or
538-18   service to be rendered by, any means or facility to be provided or
538-19   operated under the franchise, so that the terms will be uniform,
538-20   reasonable, and without discrimination against any person, both as
538-21   to charges and the conditions of use or service; and 
538-22                     (B)  all provisions reasonably required to
538-23   procure service adequate to serve the public necessity and
538-24   convenience.
538-25         (h)  The authority may grant a franchise for the design,
538-26   construction, repair, enlargement, alteration, maintenance, or
 539-1   operation of, service from, or use of any facility to be provided
 539-2   for use in aid of navigation on the navigable canals or waterways
 539-3   and all navigational systems or facilities auxiliary to the canals
 539-4   or waterways, whether on land or in or on water.
 539-5         (i)  In granting a franchise under this section, the
 539-6   authority may require:
 539-7               (1)  uniform and adequate analytic accounting systems
 539-8   and forms;
 539-9               (2)  periodic verified reports based on the accounting
539-10   system;
539-11               (3)  audits by the authority; and
539-12               (4)  other reasonable regulations designed to protect
539-13   the public.
539-14         (j)  To procure observance of the conditions of a franchise
539-15   granted under this section and compliance with the rules and
539-16   regulations established by ordinance of the authority, to be
539-17   adopted as provided in this chapter, the ordinance may provide
539-18   reasonable and commensurate penalties set by general law, not to
539-19   exceed the limit for penalties provided by this chapter.
539-20         (k)  Unless the franchise otherwise provides, the forfeiture
539-21   or suspension of a franchise granted under this chapter may be only
539-22   because of discrimination in rendering service, in affording use,
539-23   or in taking or demanding a toll, rate, or charge.  Forfeiture or
539-24   suspension of a franchise granted under this section, unless
539-25   otherwise provided in the franchise, shall be on a decree of a
539-26   district court within the county in which the authority maintains
 540-1   its general office.
 540-2         (l)  The authority may by ordinance establish rules necessary
 540-3   or designed to protect the physical property owned by the
 540-4   authority, or physical property owned or operated by another under
 540-5   a franchise granted under this section, or to effect the safety or
 540-6   efficient use of the property.  In the ordinance the authority may
 540-7   provide a reasonable and commensurate penalty for the violation of
 540-8   a rule.  The penalty, which shall be cumulative of other penalties
 540-9   provided by general law, may not exceed the limit for penalties
540-10   provided by this chapter.
540-11         Sec. 271.006.  FLOOD CONTROL AND FLOOD PLAIN MANAGEMENT.  The
540-12   authority may prevent and aid in the prevention of damage to
540-13   persons and property by the overflow of rivers, streams, or
540-14   tributaries of rivers and streams within the authority, including
540-15   the study and designation of flood plains and their regulation.
540-16         Sec. 271.007.  WATER CONSERVATION, STORAGE, PROCUREMENT,
540-17   DISTRIBUTION AND SUPPLY.  (a)  The authority may store and conserve
540-18   water for the greatest beneficial use, for standby service as well
540-19   as for the actual delivery of water.
540-20         (b)  The authority may conserve water for uses within or
540-21   outside the authority, including providing water supply services
540-22   for cities and towns and the right to sell water within or outside
540-23   the authority.
540-24         (c)  The authority may acquire water appropriation permits
540-25   within or outside the authority.
540-26         (d)  The authority may purchase water, water supply
 541-1   facilities, or conservation storage capacity within or outside the
 541-2   authority.
 541-3         (e)  The authority may execute water supply contracts with
 541-4   users of water within or outside the authority for stand-by service
 541-5   as well as for the actual delivery of water.
 541-6         (f)  The authority may provide water for the development of
 541-7   commercial and industrial enterprises within or outside the
 541-8   authority.
 541-9         (g)  The authority may bring water into the boundaries of the
541-10   authority.
541-11         (h)  The authority may construct, acquire, equip, acquire
541-12   storage rights at, and operate and maintain dams and reservoirs,
541-13   either within or outside the authority, in carrying out the powers
541-14   conferred on the authority, or may exercise such powers in
541-15   conjunction with others.
541-16         (i)  The authority may contract for, operate, maintain, or
541-17   otherwise provide water supply lines and water purification and
541-18   water pumping systems and facilities either within or outside the
541-19   authority.
541-20         (j)  The authority may execute contracts with municipalities
541-21   and others involving the construction of reservoirs, dams, water
541-22   supply lines, and water purification and pumping facilities and the
541-23   furnishing of water supply service substantially in the manner
541-24   provided by Section 402.020, Local Government Code, for districts
541-25   organized and created pursuant to Section 59, Article XVI, Texas
541-26   Constitution, extended so as to permit such contracts with
 542-1   individuals, partnerships, and all classes of corporations and to
 542-2   permit the inclusion of provisions for the operation, maintenance,
 542-3   and ownership of such properties.  The powers granted the authority
 542-4   in this section are not to be construed as a limitation on the
 542-5   powers, rights, privileges, and functions otherwise granted by this
 542-6   chapter.
 542-7         (k)  The authority may acquire from the United States
 542-8   government, through the secretary of the army or the secretary of
 542-9   the interior or any of its officials authorized to make such
542-10   contracts, from the state or an agency of the state, or from any
542-11   privately financed reservoirs, unsold conservation storage capacity
542-12   at any dam within or outside the authority constructed or to be
542-13   constructed either by or with the assistance of the United States
542-14   government or the state, or both.  The authority may acquire
542-15   additional conservation storage capacity that may be provided at
542-16   any such dam.
542-17         Sec. 271.008.  IRRIGATION.  The authority may provide water
542-18   for the irrigation of lands within and outside the authority, and
542-19   incident to that purpose may construct, operate, and maintain
542-20   supply lines and pumping systems and facilities either within or
542-21   outside the authority.
542-22         Sec. 271.009.  SOIL CONSERVATION.  (a)  The authority may
542-23   provide for the conservation of soils and other surface resources
542-24   within the authority against destructive erosion, for the
542-25   prevention of the increased threat of flood caused by soil erosion,
542-26   and for the prevention of sedimentation and siltation of lands,
 543-1   channels, and reservoirs, including the right either to act as
 543-2   local sponsoring agent for upstream soil and water conservation and
 543-3   flood prevention projects authorized by state or federal agencies
 543-4   in conjunction with soil conservation districts or to aid and
 543-5   supplement the work of such upstream soil and water conservation
 543-6   and flood prevention projects.
 543-7         (b)  The authority may make arrangements satisfactory to the
 543-8   secretary of agriculture of the United States for defraying costs
 543-9   of operating and maintaining the projects described by Subsection
543-10   (a) in accordance with regulations promulgated by the secretary of
543-11   agriculture; provided, however, that any portion of the total
543-12   construction cost of any such project that is allocable to flood
543-13   control or soil conservation shall be paid for or financed by funds
543-14   that have their source in the county in which the project is
543-15   located.  The funds may be of any kind or character except taxes
543-16   collected in accordance with the provisions of Sections 271.026 and
543-17   271.027.
543-18         Sec. 271.010.  SEWAGE TREATMENT AND SOLID WASTE DISPOSAL.
543-19   (a)  Except as provided by Subsection (b) as a necessary aid to the
543-20   conservation, control, preservation, purification, and distribution
543-21   of surface waters and groundwater within the authority, the
543-22   authority may construct, own, operate, maintain, or otherwise
543-23   provide within the San Antonio River Basin sewage gathering,
543-24   treatment, or disposal services, including solid waste disposal
543-25   services, may charge for those services, and may make contracts in
543-26   reference to those services with counties, municipalities, and
 544-1   others.
 544-2         (b)  The authority may not exercise the powers granted by
 544-3   this section within the boundaries of Kerr, Real, or Bandera
 544-4   counties unless the commissioners court of the county or counties
 544-5   has consented by a majority vote to the exercise of those powers
 544-6   within the county or counties.
 544-7         Sec. 271.011.  POLLUTION PREVENTION.  (a)  The authority may
 544-8   provide for the study, correcting, and control of both artificial
 544-9   and natural pollution, including organic, inorganic, and thermal
544-10   pollution, of all groundwater or surface water within the San
544-11   Antonio River Basin.
544-12         (b)  Except as provided by Subsection (c), the authority may
544-13   by ordinance promulgate rules and regulations with regard to
544-14   pollution, both artificial and natural, may police to enforce the
544-15   rules and regulations, and may provide reasonable and commensurate
544-16   penalties for the violation of the rules and regulations.  The
544-17   penalties, which shall be cumulative of any penalties fixed by
544-18   general law, may not exceed the limit for penalties provided by
544-19   this chapter.
544-20         (c)  An ordinance enacted under this section may not be
544-21   promulgated in any county or counties outside the boundaries of the
544-22   authority.
544-23         Sec. 271.012.  PARKS, RECREATIONAL FACILITIES, AND
544-24   PRESERVATION OF FISH.  For the encouragement and development of
544-25   parks and recreational facilities and the preservation of fish, the
544-26   authority may acquire additional land adjoining any permanent work
 545-1   of improvement constructed within the authority for the purpose of
 545-2   developing parks or recreational facilities.  The authority may
 545-3   negotiate contracts with any county, municipality, municipal
 545-4   corporation, person, firm, corporation, nonprofit organization, or
 545-5   state or federal agency for the operation or maintenance of any
 545-6   such park or recreational facility.  The preservation of fish shall
 545-7   be in accordance with rules and regulations, if any, prescribed by
 545-8   the Parks and Wildlife Department.
 545-9         Sec. 271.013.  FORESTATION AND REFORESTATION.  The authority
545-10   may forest and reforest and aid in the foresting and reforesting of
545-11   all areas within the authority.
545-12         Sec. 271.014.  CONTRACTS.  (a)  The authority may make
545-13   contracts and execute instruments necessary or convenient to the
545-14   exercise of the powers, rights, privileges, and functions conferred
545-15   on it by this chapter.  The contracts or instruments may be with
545-16   the United States and its agencies, with counties, cities,
545-17   municipal corporations, political subdivisions, and districts, and
545-18   with private persons, partnerships, associations, and corporations.
545-19   The authority shall make and execute the contracts and instruments
545-20   in accordance with the procedures provided by this section.
545-21         (b)  Concerning any wholesale contract for the sale,
545-22   purchase, procurement, distribution, or supply of water or
545-23   conservation storage capacity or for the construction of a
545-24   navigable canal or waterway or any contract authorized by Section
545-25   411.003, Local Government Code, the affirmative vote of at least
545-26   seven members of the board is required for the approval of
 546-1   confirmation or ratification of the contract.  Of those seven
 546-2   affirmative votes, at least three affirmative votes must be cast by
 546-3   directors from Bexar County, at least one affirmative vote must be
 546-4   cast by a director from Wilson County, at least one affirmative
 546-5   vote must be cast by a director from Karnes County, and at least
 546-6   one affirmative vote must be cast by a director from Goliad County.
 546-7   The authority may use any such contract as the sole basis, or as a
 546-8   supplement to the basis, for securing the authority's bonds.
 546-9         (c)  Concerning any construction, maintenance, operation or
546-10   repair contract, any contract for the purchase of material,
546-11   equipment, or supplies, or any contract for services other than
546-12   professional services, if the contract will require an estimated
546-13   expenditure of more than the maximum amount for which competitive
546-14   bidding is required by statute for any political subdivision of the
546-15   state or if the contract is for a term of two years or more, the
546-16   board, on the affirmative vote of a majority of a quorum present at
546-17   any regular or special meeting, shall award the contract to the
546-18   lowest and best bidder.  The board by bylaw shall promulgate the
546-19   procedures for the publication of notice to bidders and related
546-20   procedures and may, within the limitations provided by this
546-21   section, from time to time prescribe the amount of estimated
546-22   expenditures to be subjected to competitive bidding.  In the event
546-23   of an emergency, the authority may let such contracts as are
546-24   necessary to protect and preserve the public health and welfare or
546-25   the properties of the authority without such bidding procedures.
546-26   Members of the board shall be ineligible to submit such bids.  Any
 547-1   provision of this section to the contrary notwithstanding, the
 547-2   authority may purchase surplus property from the United States by
 547-3   negotiated contract and without the necessity of advertising for
 547-4   bids.
 547-5         Sec. 271.015.  GENERAL POWERS AND DUTIES.  (a)  The authority
 547-6   is vested with such title and right of control as the state has, or
 547-7   may have, in, to, and concerning the natural bed and banks of the
 547-8   San Antonio River in its entire length, and all of its tributaries
 547-9   as are within the boundaries of the authority as defined by Section
547-10   271.003, and the authority is further vested with such title and
547-11   right of control as the state has, or may have, in, to, and
547-12   concerning the natural bed and banks of any other navigable stream
547-13   or tributary of such stream as may be situated within the
547-14   boundaries of the authority; which investment, however, shall be in
547-15   trust and to authorize the authority to make such uses or
547-16   disposition of such lands and rights and the proceeds, income,
547-17   revenues, or trading values of those lands and rights as in actual
547-18   experience may prove to be reasonably required for, or in aid of,
547-19   the accomplishment of the purposes of this chapter.
547-20         (b)  The authority may make preliminary investigations and
547-21   surveys in the manner and for the purposes specified in Chapters 49
547-22   and 51, either independently at its own cost or jointly with
547-23   others, or may contribute to the cost of investigations and surveys
547-24   when done by another, in order to procure cooperation by the
547-25   government of the United States to the end that any project
547-26   lawfully within the purposes of this chapter may be approved for
 548-1   construction as a federal project under such contractual terms and
 548-2   conditions as may be demanded by the congress.
 548-3         (c)  The authority may expend all sums reasonably determined
 548-4   by the board to be necessary or expedient for seeking cooperation
 548-5   in accomplishing the objectives of this chapter from the federal
 548-6   government or any and all other persons, creatures, or entities,
 548-7   whether natural or creatures of law or contract.
 548-8         (d)  Subject to the provisions of this chapter, the authority
 548-9   may sell or otherwise dispose of property of any kind, real,
548-10   personal, or mixed, or any interest in property, that is not
548-11   necessary to the carrying on of the business of the authority.
548-12         (e)  The authority may overflow and inundate any public lands
548-13   and public property and may require the relocation of roads and
548-14   highways in the manner and to the extent permitted to districts
548-15   organized under general laws pursuant to Section 59, Article XVI,
548-16   Texas Constitution.  If the authority, in the exercise of the power
548-17   of eminent domain or power of relocation or any other power granted
548-18   under this chapter, makes necessary the relocation, raising,
548-19   rerouting, changing the grade, or altering the construction of any
548-20   railroad or street railway, all such necessary relocation, raising,
548-21   rerouting, changing of grade, or alteration of construction shall
548-22   be accomplished at the sole expense of the authority.
548-23         (f)  The authority may construct, extend, improve, maintain,
548-24   and reconstruct, may cause to be constructed, extended, improved,
548-25   maintained, and reconstructed, and may use and operate, facilities
548-26   of any kind necessary or convenient to the exercise of the powers,
 549-1   rights, privileges, and functions conferred on the authority by
 549-2   this chapter.
 549-3         (g)  The authority may sue and be sued in its corporate name.
 549-4         (h)  The authority may adopt, use, and alter a corporate
 549-5   seal.
 549-6         (i)  The authority may adopt and amend its bylaws for the
 549-7   management of its affairs.
 549-8         (j)  The authority may appoint officers, agents, employees,
 549-9   and professional consultants, who may not have any interest, direct
549-10   or indirect, in any contracts awarded by the authority.
549-11         (k)  The authority may prescribe the duties and set the
549-12   compensation of all officers, agents, employees, and professional
549-13   consultants.
549-14         (l)  The authority may acquire by purchase, lease, or gift or
549-15   in any other lawful manner and may maintain, use, and operate
549-16   property of any kind, real, personal or mixed, or any interest in
549-17   property, within and outside the boundaries of the authority,
549-18   necessary or convenient to the exercise of the powers, rights,
549-19   privileges, and functions conferred on the authority by this
549-20   chapter, in the manner provided by general law with respect to
549-21   condemnation or, at the option of the authority, in the manner
549-22   provided by the statutes relative to condemnation by districts
549-23   organized under general law pursuant to Section 59, Article XVI,
549-24   Texas Constitution.
549-25         (m)  The authority may condemn lands used or dedicated for
549-26   cemetery purposes in the manner provided by general law if
 550-1   reasonably necessary to effectuate the powers, rights, privileges,
 550-2   and functions of the authority; provided, however, that when the
 550-3   power of condemnation is sought to be exercised with respect to a
 550-4   perpetual care cemetery, as defined in Section 711.001, Health and
 550-5   Safety Code, as to the condemnation of the perpetual care cemetery
 550-6   or a portion of the cemetery, jurisdiction for such purpose is
 550-7   conferred by this section on the district court or courts of the
 550-8   county in which the cemetery land or any part of the cemetery land
 550-9   is located, and the condemnation action shall likewise involve the
550-10   issue of the removal of the dedication of the land as a perpetual
550-11   care cemetery and the issue of the necessity for such taking.
550-12         (n)  The authority may borrow money for its corporate
550-13   purposes, may execute proper notes or other evidences of
550-14   indebtedness, and may borrow money and accept grants from the
550-15   United States and in connection with any such loan or grant, may
550-16   enter into such agreements as the United States or such corporation
550-17   or agency may require.  The authority may issue negotiable bonds
550-18   for money borrowed in the manner and to the extent provided in
550-19   Section 271.028; provided, however, that nothing in this chapter
550-20   shall be construed to authorize the issuance of any bonds, notes,
550-21   or other evidences of indebtedness of the authority except as
550-22   specifically provided by this chapter, and no issuance of bonds,
550-23   notes, or other evidences of indebtedness, except as specifically
550-24   provided by this chapter, shall ever be authorized except by an act
550-25   of the legislature.
550-26         (o)  The authority may obtain loans from and accept grants
 551-1   from the United States and its agencies and from the state and its
 551-2   agencies and may participate in and be the beneficiary of any plan
 551-3   which may be evolved by the state or federal government for
 551-4   guaranteeing or otherwise subsidizing the obligations of the
 551-5   authority.
 551-6         (p)  The authority may adopt and promulgate by ordinance all
 551-7   reasonable rules and regulations for purposes provided in this
 551-8   chapter and generally to secure and protect all of its property and
 551-9   all of its works of improvement and to regulate residence, hunting,
551-10   fishing, boating, and camping, and all recreational and business
551-11   privileges, on any navigable river of the authority or any
551-12   reservoir of the authority or on any land owned by the authority.
551-13   The authority may prescribe a reasonable and commensurate penalty
551-14   for the violation of a rule or regulation of the authority.  The
551-15   penalty, which shall be cumulative of any penalties fixed by
551-16   general law, may not exceed a fine of $200 or imprisonment for 180
551-17   days or both a fine and imprisonment.  A rule or regulation that
551-18   provides a penalty for a violation does not take effect, as to
551-19   enforcement of the penalty, until five days after the authority has
551-20   published a substantive statement of the rule or regulation and the
551-21   penalty for the violation once a week for three consecutive weeks
551-22   in a newspaper of general circulation in each county in which the
551-23   rule or regulation is to be effective.  The substantive statement
551-24   to be published must be as condensed as possible and must afford
551-25   sufficient notice as to the act forbidden by the rule or
551-26   regulation.  One notice may embrace any number of regulations.  The
 552-1   notice must state that breach of the regulation or regulations will
 552-2   subject the violator to the imposition of a penalty and that the
 552-3   full text of the regulations is on file in the principal office of
 552-4   the authority, where it may be read by any interested person.  Five
 552-5   days after the third publication of the notice required by this
 552-6   subsection, the advertised regulation shall be in effect and
 552-7   ignorance of the regulation shall not constitute a defense to
 552-8   prosecution for the enforcement of a penalty.  After the required
 552-9   publication, the rules and regulations authorized by this
552-10   subsection shall judicially be known to the courts and shall be
552-11   considered of a nature like unto that of a valid penal ordinance of
552-12   a city of the state.  The authority shall be primarily liable for
552-13   any court costs incurred under this subsection and for the cost to
552-14   maintain any offender committed for imprisonment under this
552-15   subsection.  A fine imposed in a proceeding under this subsection
552-16   and paid in money shall be payable to the authority and applied as
552-17   the board directs.
552-18         (q)  The authority may designate an official newspaper of the
552-19   authority in each county in the authority.  Each of the newspapers
552-20   must be a newspaper with general circulation in the county in which
552-21   it is located.
552-22         (r)  The authority may acquire rights-of-way necessary to
552-23   construct, operate, and maintain roads necessary for ingress and
552-24   egress to any work of improvement or to any park, recreational
552-25   facility, or fish or wildlife preserve or reserve.
552-26         (s)  The authority may grant concessions and franchises on
 553-1   the premises of any works of improvement or any park, recreational
 553-2   facility, or fish or wildlife preserve or reserve to any person or
 553-3   corporation.
 553-4         (t)  When germane to the accomplishment of the purposes of
 553-5   this chapter, and not otherwise adequately provided by Chapters 49
 553-6   and 51 or provided elsewhere in this chapter, the board may adopt
 553-7   and promulgate ordinances, which may be done by a majority, except
 553-8   as specifically provided elsewhere in this chapter, of the
 553-9   directors present at any meeting held in compliance with the
553-10   provisions of the bylaws at which a majority of the board is
553-11   present, constituting a quorum.  Notice is not required before the
553-12   passage of an ordinance, except for notice of a special or regular
553-13   meeting of the board as may be provided elsewhere in this chapter.
553-14   After an ordinance is adopted, the board shall cause the ordinance
553-15   to be filed and recorded in the official records of the authority.
553-16   The board may, within its discretion, in addition to filing and
553-17   recording the ordinance in the official records of the authority,
553-18   either cause certified copies of the ordinance to be immediately
553-19   filed of record in the office of the county clerk of each county
553-20   situated in whole or in part within the authority within which the
553-21   ordinance is intended to have application or cause the ordinance to
553-22   be published once or more each week for three or more consecutive
553-23   weeks in a newspaper or newspapers of general circulation in each
553-24   county within the authority within which the ordinance is intended
553-25   to have application.  Following any or all of these methods of
553-26   recording or publication, the ordinance shall be in full force and
 554-1   effect, and all courts and persons shall be held to have knowledge
 554-2   of it, just as though the ordinance had been included in this
 554-3   chapter.  The county clerk in any county shall file and record all
 554-4   certified copies of the ordinance and shall charge for such filing
 554-5   and recording the same fees as is provided for recording deeds of
 554-6   conveyance.  If Title 4 does not provide a specific power or right
 554-7   germane to, or appropriate to, or adequate to accomplish a purpose
 554-8   of this chapter, and the specific power has been, or may be,
 554-9   conferred by law on counties, cities, water improvement districts,
554-10   water control and improvement districts, drainage districts,
554-11   navigation districts, canal corporations, channel and dock
554-12   corporations, deep water corporations, railway corporations,
554-13   terminal railway corporations, telegraph and telephone
554-14   corporations, or other like creatures of the law, then to the
554-15   extent required to make the powers and rights of the authority
554-16   adequate for that purpose, the authority may by ordinance adopt so
554-17   much of the power and right of an entity described by this
554-18   subsection as will enable the authority to effectively accomplish
554-19   that purpose.  The adoption of a power or mode of procedure under
554-20   this subsection does not include any incidental limitation that
554-21   would impede the lawful accomplishment of the purposes of this
554-22   chapter.  This provision is limited only by the provisions of the
554-23   constitutions of the United States and the state concerning the
554-24   rights of others.
554-25         (u)  The authority has all the powers, rights, and
554-26   regulations for government and procedure, as are contained in
 555-1   Chapters 49 and 51, which shall be cumulative of those provided by
 555-2   this chapter, and such rules for procedure as may be provided by
 555-3   ordinances adopted by the authority under other provisions of this
 555-4   chapter.
 555-5         (v)  The authority may provide for the orderly development,
 555-6   management, and conservation of all rivers and streams and their
 555-7   tributaries that are within the boundaries of the authority in
 555-8   order to further economic development.
 555-9         Sec. 271.016.  AUTHORITY CONSTABULARY.  In order to
555-10   accomplish the objectives of this chapter, the authority may
555-11   constitute and maintain its own independent constabulary under oath
555-12   and bond, insofar as is applicable, conditioned as is provided for
555-13   a sheriff of a county.  The constabulary shall police the
555-14   authority's property and its controlled facilities and may make
555-15   arrests to prevent injury to the properties or after the offense or
555-16   violation of any penal ordinance of the authority, and, on
555-17   complaint or indictment lawfully had on the offense or violation,
555-18   may make arrests either within or beyond the boundaries of the
555-19   authority.
555-20         Sec. 271.017.  DUTIES OF CERTAIN STATE OFFICERS.  The
555-21   commission shall cooperate with the authority in the making of
555-22   investigations and plans and the approval of plans for improvements
555-23   to be provided by the authority.  The plans are subject to approval
555-24   by the commission when appropriate under the general laws of the
555-25   state; provided, only, that if the federal government has adopted a
555-26   plan for improvements, the plan shall control as to all matters
 556-1   except the use of water already under permit from the state.
 556-2         Sec. 271.018.  BOARD OF DIRECTORS; QUALIFICATIONS OF
 556-3   DIRECTORS; VACANCIES; TERM OF OFFICE.  (a)  The government and
 556-4   control of the authority are vested in a board of directors.  The
 556-5   board consists of 12 directors.  Six of the directors must be
 556-6   elected from Bexar County, two from Wilson County, two from Karnes
 556-7   County, and two from Goliad County.
 556-8         (b)  Each director serves for a term of six years, and holds
 556-9   office until a successor is elected and has qualified by taking the
556-10   oath of office.
556-11         (c)  Before assuming the person's duties as director, each
556-12   director shall take the constitutional oath of office, which shall
556-13   be filed in written form with the secretary of the board.
556-14         (d)  Vacancies occurring on the board from any county shall
556-15   be filled by appointment by the governor, with the advice and
556-16   consent of the senate, for the unexpired term.
556-17         (e)  Any person over the age of 21 years residing within the
556-18   authority and within the county from which the person is elected or
556-19   appointed and possessing the qualifications of a juror is eligible
556-20   to be elected or appointed and to serve as a director.
556-21         Sec. 271.019.  ELECTION OF DIRECTORS.  (a)  All elections
556-22   within the authority must be conducted in accordance with rules
556-23   provided by the bylaws and the Election Code.  The results of all
556-24   elections shall be canvassed by the board at the next regular
556-25   meeting following each biennial election.  All elections shall be
556-26   held on the third Saturday in January of each odd-numbered year and
 557-1   at the polling places designated by the board.  The terms of office
 557-2   of directors elected at each election after the first election
 557-3   shall commence on the first day of February following their
 557-4   election.  Elections shall be conducted as provided by this
 557-5   section.
 557-6         (b)  Persons seeking to have their names placed on the ballot
 557-7   shall make application to the secretary of the board in accordance
 557-8   with rules prescribed by the board either in the ordinance calling
 557-9   the election or in the bylaws.
557-10         (c)  The secretary of the board shall make up the ballot for
557-11   each county from the names of candidates who have filed
557-12   applications, and the placing of the names of the candidates on the
557-13   ballot shall be determined by lot.  The drawing of lots for the
557-14   placing of the names of the candidates on the ballot shall be by
557-15   the secretary of the board, and all candidates, or their designated
557-16   representatives, may be present at the drawing.
557-17         (d)  The directors from Wilson, Karnes, and Goliad counties
557-18   shall be elected at large from each county.  Four directors from
557-19   Bexar County shall be elected from single-member districts and two
557-20   directors shall be elected at large.  The four single-member
557-21   districts shall be coterminous with and bear the same number as the
557-22   Bexar County commissioners precincts.  A candidate for a
557-23   single-member district position must live in the district the
557-24   candidate seeks to represent.
557-25         (e)  The candidates receiving the greatest number of votes,
557-26   that is a plurality, shall be declared elected.  Should there be a
 558-1   tie in the votes received, the winner of the election shall be
 558-2   determined by a majority of the board.  The two at-large directors
 558-3   of Bexar County shall be elected simultaneously by plurality, and
 558-4   the two candidates receiving the greatest number of votes shall be
 558-5   declared elected.
 558-6         (f)  Directors serving from single-member districts at the
 558-7   time new single-member districts are adopted shall serve for the
 558-8   remainder of the terms to which they were elected regardless of the
 558-9   redistricting.
558-10         Sec. 271.020.  COMPENSATION AND EXPENSES OF DIRECTORS.  A
558-11   director is entitled to the compensation and allowances established
558-12   by general law for each day of official service, whether at a
558-13   meeting of the board or while serving on a committee of the board,
558-14   and in addition is entitled to reimbursement for all expenses
558-15   necessarily incurred by reason of such service.  A meeting shall be
558-16   considered a day of service; provided, however, that no charge
558-17   shall be made for more than one meeting held on any one day, and a
558-18   director may not be paid per diem in excess of 150 days in any one
558-19   fiscal year, exclusive of reimbursement for expenses, as
558-20   compensation for service rendered as a director and as a member of
558-21   a committee.
558-22         Sec. 271.021.  REMOVAL OF DIRECTORS AND OFFICERS.  A director
558-23   or officer is subject to removal or suspension from office, by the
558-24   affirmative vote of eight directors, for incompetency, official
558-25   misconduct, official gross negligence, or habitual drunkenness or
558-26   for nonattendance at six consecutive regular meetings of the board;
 559-1   provided, however, that a director or officer may not be removed or
 559-2   suspended from office unless charges in writing are filed against
 559-3   the director and the director is given the opportunity of a fair
 559-4   hearing before the board.
 559-5         Sec. 271.022.  ORGANIZATION AND MEETINGS OF THE BOARD;
 559-6   OFFICERS; QUORUM; MEETINGS.  (a)  At the first regular meeting of
 559-7   the board held in the month of February of each odd-numbered year,
 559-8   the board shall elect by majority vote a chairman, a vice chairman,
 559-9   a secretary, and a treasurer, and, within the discretion of the
559-10   board, an assistant secretary and an assistant treasurer, who need
559-11   not be members of the board and who may be granted limited powers
559-12   in the bylaws.  The officers so elected shall serve for a term of
559-13   two years and until their successors have been elected, except that
559-14   the assistant secretary and the assistant treasurer, if such
559-15   officers are elected, shall hold office at the pleasure of the
559-16   board.
559-17         (b)  A quorum at all meetings of the board shall consist of
559-18   not less than seven members.  A quorum at all meetings of the
559-19   executive committee shall consist of not less than three members.
559-20   Regular and special meetings of the board shall be held as provided
559-21   by the bylaws, and notice of the meetings shall be given as
559-22   required by the bylaws.  All meetings of the board shall be open to
559-23   the public.
559-24         Sec. 271.023.  POWERS OF THE BOARD AND EXECUTIVE COMMITTEE;
559-25   MANAGER; EMPLOYEES; SURETY BONDS.  (a)  The board shall be
559-26   responsible for the management and control of all affairs of the
 560-1   authority.  The board may exercise the powers provided by this
 560-2   section.
 560-3         (b)  The board may exercise all the powers, rights,
 560-4   privileges, and functions conferred by law on the authority.
 560-5         (c)  The board may adopt all such bylaws as are not
 560-6   inconsistent with the law.  The bylaws may provide for the
 560-7   designation by the board of an executive committee of five members
 560-8   upon whom the manager may call for policy decisions and advice
 560-9   concerning matters that arise between meetings of the board.  The
560-10   executive committee may authorize, on behalf of the authority, the
560-11   execution of any contract involving the expenditure of an amount
560-12   not exceeding $20,000.
560-13         (d)  The board may appoint and set the salary of a manager,
560-14   who shall be the chief executive officer of the authority.  The
560-15   manager shall employ and supervise, subject to policies promulgated
560-16   by the board, all employees, agents, accountants, attorneys,
560-17   engineers, and others rendering professional services necessary and
560-18   required to accomplish the purposes of this chapter.  The manager
560-19   may execute, on behalf of the authority, without specific
560-20   authorization of the board, any contract not subject to competitive
560-21   bidding.  The manager may execute on behalf of the authority and
560-22   with specific authorization of the board, any other contract.
560-23         (e)  Except as specifically provided by this chapter, all the
560-24   powers, rights, privileges, and functions of the authority may be
560-25   exercised by a majority of the directors present at a meeting of
560-26   the board, or of the executive committee if the sum involved is no
 561-1   greater than $20,000, held in compliance with the provisions of the
 561-2   bylaws provided a majority of the board, or of the executive
 561-3   committee, is present, constituting a quorum.
 561-4         (f)  The board shall have all such additional powers as may
 561-5   be conferred on the authority by other provisions of this chapter,
 561-6   Section 59, Article XVI, Texas Constitution, and Chapters 49 and
 561-7   51; provided, however, that the directors shall be ineligible to
 561-8   engage in any transaction for gain or profit with the authority and
 561-9   shall be subject to the provisions of Chapter 171, Local Government
561-10   Code.
561-11         (g)  The directors and all officers of the authority who are
561-12   not directors shall, within 15 days after their election or
561-13   appointment, file a good and sufficient bond with the secretary of
561-14   the board.  The official bond of each director and officer shall be
561-15   in the sum of $5,000, shall be payable to the authority, shall be
561-16   conditioned on the faithful performance of the person's duties as
561-17   director or officer, and shall be subject to approval by the
561-18   secretary of the board.
561-19         Sec. 271.024.  AUDIT.  (a)  A complete system of accounts
561-20   shall be kept by the authority in accordance with generally
561-21   accepted principles of accounting.  Each audit shall cover the
561-22   fiscal year from July 1 to June 30, and a report of the audit shall
561-23   be made before January 1 of each year.  A copy of the audit report
561-24   shall be filed with the commission.
561-25         (b)  Nothing in this section shall prohibit the authority
561-26   from employing the professional services of an independent
 562-1   certified public accountant or firm of certified public accountants
 562-2   for any purpose.  All books, accounts, contracts, records, papers,
 562-3   and archives of the authority shall be kept and maintained at the
 562-4   authority's general office and shall be subject to the provisions
 562-5   of Chapter 552, Government Code.
 562-6         Sec. 271.025.  PAYMENT OF DEBTS.  Each indebtedness,
 562-7   liability, or obligation of the authority for the payment of money,
 562-8   however entered into or incurred and whether arising from express
 562-9   contracts or implied contracts or otherwise, shall be payable
562-10   solely out of revenue received by the authority with respect to its
562-11   properties and out of any other funds or income from any source
562-12   whatsoever coming into possession of the authority including
562-13   proceeds of the sale of bonds.
562-14         Sec. 271.026.  TAXATION.  (a)  Subject to the limitation as
562-15   to the maximum rate of tax as prescribed in this section, the
562-16   authority may levy and collect throughout the territory of the
562-17   authority such ad valorem taxes as are voted at an election or
562-18   elections called by the board for that purpose and conducted
562-19   throughout the territory of the authority.  The maximum rate of tax
562-20   that can be levied and collected for any year shall be two cents on
562-21   the $100 of taxable property based on its assessed valuation, in
562-22   accordance with the conditions and procedures provided by this
562-23   section.
562-24         (b)  The board may, by ordinance, call an election to submit
562-25   to the voters for approval of an ad valorem tax; provided, however,
562-26   that a public hearing to discuss the proposed tax issue shall be
 563-1   held in each county in the authority.  The public hearings shall be
 563-2   held not less than 10 days nor more than 25 days prior to the
 563-3   scheduled date of the election.  The hearings shall be called by
 563-4   the board and notice of the time, day, date, place, and purpose of
 563-5   the hearings shall be given by publishing the notice in at least
 563-6   one newspaper of general circulation in each county where a hearing
 563-7   is to be held at least 10 days before the hearing.
 563-8         (c)  Only qualified electors residing within the boundaries
 563-9   of the authority shall be entitled to vote in the election.  An
563-10   elector otherwise qualified must vote in the county of the
563-11   elector's residence and at the polling place designated for the
563-12   precinct of the elector's residence.  The ordinance calling the
563-13   election shall specify the polling place or places in each of the
563-14   counties.  The notice of election will be sufficient as to any
563-15   county within the authority if it states that the election is to be
563-16   held throughout the territory comprising the authority and if it
563-17   specifies the polling place or places in the county.  It shall not
563-18   be necessary to publish such details except in the county in which
563-19   they are applicable.
563-20         (d)  Returns of the election shall be made to the board, and
563-21   the board shall canvass the returns of the election and adopt an
563-22   ordinance declaring the results.  The board may levy taxes within
563-23   the maximum rate voted if a majority of the votes cast throughout
563-24   the authority are in favor of the levy of the tax and if a majority
563-25   of the votes cast in any three counties in the authority are in
563-26   favor of the levy of the tax.
 564-1         (e)  The rate of tax shall be uniform throughout the
 564-2   territory comprising the authority and shall be certified by the
 564-3   chairman and the secretary of the board to the tax assessor and the
 564-4   tax collector of each included county.
 564-5         (f)  If the election results are in favor of the levy of a
 564-6   tax, the board may borrow money payable from the tax and may
 564-7   evidence such loan by a negotiable note given in the name of the
 564-8   authority.
 564-9         (g)  Taxes collected under this section shall be used for the
564-10   purpose of general administration and for other planning and
564-11   services with respect to any of the purposes, rights, privileges,
564-12   and functions of the authority; provided, however, that none of the
564-13   taxes thus collected shall be used to pay for or finance the
564-14   construction of any dams, reservoirs, levees, channels, pipelines,
564-15   or other major physical works of the authority, to pay for the cost
564-16   of any right-of-way acquisitions or the expenses of right-of-way
564-17   acquisition, or to pay damages awarded by any court under Section
564-18   17, Article I, Texas Constitution.  It is the intent of this
564-19   chapter that any taxes collected under this section will enable the
564-20   authority to provide for the maximum development of the soil and
564-21   water resources of the authority, it being found and determined
564-22   that the benefits to be realized from such maximum development can
564-23   be obtained only through areawide participation and planning.  The
564-24   construction of any dams, reservoirs, levees, channels, pipelines,
564-25   or other major physical works of the authority shall be paid for or
564-26   financed by revenue bonds of the authority to be redeemed either by
 565-1   the sale of services or by taxes to be levied by a county or
 565-2   municipality and paid over to the authority as an independent
 565-3   contractor of the county or municipality.  Any taxes collected
 565-4   under this section may be used to pay for the operation, repair, or
 565-5   maintenance of any flood control, soil conservation, watershed
 565-6   protection or erosion structures, or works of improvement
 565-7   constructed in cooperation with the federal government; provided,
 565-8   however, that any such operation, repair, or maintenance costs
 565-9   shall be paid for out of taxes collected under this section in the
565-10   county in which the structure or work of improvement is located.
565-11   The taxes authorized by this section and collected shall not be
565-12   pledged to the redemption of any bonds of the authority.
565-13         Sec. 271.027.  RENDITION, ASSESSMENT, LEVYING, AND COLLECTION
565-14   OF TAXES.  (a)  The rendition and assessment of property for
565-15   taxation and the collection of taxes for the benefit of the
565-16   authority shall be in accordance with the law applicable to
565-17   counties, insofar as such law is applicable.  Renditions shall be
565-18   to the county tax assessor of the county in which the property is
565-19   taxable for state and county purposes.  The assessor and collector
565-20   in each county shall cause to be placed on the county tax rolls
565-21   such additional column or columns as are needed to show the tax
565-22   levied by the authority and the amount of the tax, based on the
565-23   value of the property as approved finally for state and county
565-24   purposes by the appraisal review board of the county.  All of the
565-25   laws for the enforcement of state and county taxes shall be
565-26   available to the authority.  The authority has the right to cause
 566-1   the officers of each county to enforce the taxes due to the
 566-2   authority in that county as provided in the law for the enforcement
 566-3   of state and county taxes.
 566-4         (b)  Taxes assessed and levied for the benefit of the
 566-5   authority shall be payable and shall become delinquent at the same
 566-6   time, in the same manner, and subject to the same discount for
 566-7   advance payment as taxes levied by and for the benefit of the
 566-8   county in which the property is taxable.  The fee for collecting
 566-9   delinquent taxes through prosecution of suit shall be 15 percent of
566-10   the taxes collected by the suit, to be paid over and disbursed in
566-11   each county in the manner that other fees of office are paid over.
566-12         Sec. 271.028.  ISSUANCE OF BONDS.  (a)  For the purpose of
566-13   constructing improvements related to the exercise of any power or
566-14   powers conferred on the authority by law, the authority may issue
566-15   negotiable bonds, either as a single issue or in separate issues,
566-16   from time to time, to be secured by a pledge of revenues, income,
566-17   and funds of the authority without reference to their source and
566-18   having such priority of liens on the revenues, income, and funds as
566-19   may be prescribed in the proceedings authorizing the issuance of
566-20   the bonds; provided, however, that no ad valorem taxes collected in
566-21   accordance with the provisions of Sections 271.026 and 271.027
566-22   shall be pledged to any issue or issues of bonds.
566-23         (b)  The authority may issue the bonds provided for in this
566-24   section by action of the board without the necessity of an
566-25   election.
566-26         (c)  Bonds of the authority may be:
 567-1               (1)  sold for cash, at public or private sale, at such
 567-2   price or prices as the board determines, provided that the interest
 567-3   cost of the money received, computed to maturity in accordance with
 567-4   standard bond tables in general use by banks and insurance
 567-5   companies, shall not exceed the maximum per annum rate authorized
 567-6   by Chapter 1204, Government Code;
 567-7               (2)  issued on the terms the board determines in
 567-8   exchange for property of any kind, real, personal, or mixed, or any
 567-9   interest in the property that the board determines necessary or
567-10   convenient for any corporate purpose; or
567-11               (3)  issued in exchange for principal amounts or other
567-12   obligations of the authority, matured or unmatured.
567-13         (d)  The proceeds of sale of bonds may be deposited in such
567-14   banks or trust company or trust companies and may be paid out
567-15   pursuant to such terms and conditions as may be agreed between the
567-16   authority and the purchasers of the bonds.
567-17         (e)  Bonds of the authority must be authorized by resolution
567-18   of the board concurred in by at least eight of the members of the
567-19   board.  The bonds must bear such date or dates; mature at such time
567-20   or times; bear interest at such rate or rates not exceeding the
567-21   maximum per annum rate authorized by Chapter 1204, Government Code,
567-22   payable annually or semiannually; be in such denominations; be in
567-23   such form, either coupon or registered; carry such registration
567-24   privileges as to principal only or as to both principal and
567-25   interest and as to exchange of coupon bonds for registered bonds,
567-26   or vice versa, and exchange of bonds of one denomination for bonds
 568-1   of another denomination; be executed in such manner; and be payable
 568-2   at such place or places, within or outside the state, as the
 568-3   resolution or resolutions may provide.
 568-4         (f)  The resolution or resolutions authorizing the issuance
 568-5   of bonds may contain provisions, which shall be part of the
 568-6   contract between the authority and the purchaser and successive
 568-7   holders of the bonds:
 568-8               (1)  reserving the right to redeem the bonds at such
 568-9   time or times, in such amounts, and at such prices, not exceeding
568-10   105 percent of the principal amount of the bonds plus accrued
568-11   interest, as may be provided in the resolution;
568-12               (2)  providing for the setting aside of sinking funds
568-13   or reserve funds and the regulation and disposition of such funds;
568-14               (3)  pledging, to secure the payment of the principal
568-15   of and interest on the bonds and of the sinking fund or reserve
568-16   fund payments agreed to be made with respect to the bonds, part or
568-17   all of the revenue and income of every kind and character from any
568-18   source later received by the authority;
568-19               (4)  prescribing the purposes to which the bonds or
568-20   bonds later issued, or the proceeds of the bonds, may be applied;
568-21               (5)  agreeing to set and collect rates, charges, and
568-22   assessments sufficient to produce net revenues adequate to pay the
568-23   items specified in Subdivisions (1), (2), and (3) and prescribing
568-24   the use and disposition of all revenues;
568-25               (6)  prescribing limitations on the issuance of
568-26   additional bonds and on the agreements that may be made with the
 569-1   purchasers and successive holders of the bonds;
 569-2               (7)  relating to the construction, extension,
 569-3   improvement, reconstruction, operation, maintenance, and repair of
 569-4   the properties of the authority and to the carrying of insurance on
 569-5   all or any part of the properties covering loss or damage or loss
 569-6   of use and occupancy resulting from specified risks;
 569-7               (8)  fixing the procedure, if any, by which, if the
 569-8   authority desires, the terms of any contract with the holders of
 569-9   the bonds may be amended or abrogated, the amount of bonds the
569-10   holders of which must consent to the amendment or abrogation, and
569-11   the manner in which such consent may be given;
569-12               (9)  providing for the execution and delivery by the
569-13   authority to a bank or trust company authorized by law to accept
569-14   trusts, or to the United States or any officer or agency of the
569-15   United States, of indentures and agreements for the benefit of the
569-16   holders of the bonds setting forth any or all of the agreements
569-17   authorized by this section to be made with or for the benefit of
569-18   the holders of the bonds and such other provisions as may be
569-19   customary in such indentures or agreements;
569-20               (10)  providing that, if the authority issues bonds
569-21   which are payable in whole or in part from utility system revenues
569-22   the authority receives under a contract with a municipality,
569-23   district, river authority, or other political subdivision of the
569-24   state, the payments made under such contract are the paying party's
569-25   operating expenses for the utility system or systems from which
569-26   such payments are to be made to the authority if the contract so
 570-1   provides; and
 570-2               (11)  making such other provisions not inconsistent
 570-3   with the provisions of this chapter as the board may approve.
 570-4         Sec. 271.029.  DEFAULT PROCEDURES.  (a)  A resolution
 570-5   authorizing the issuance of bonds and any indenture or agreement
 570-6   entered into pursuant to the resolution may include provisions
 570-7   regarding a default on the:
 570-8               (1)  payment of the interest on any bonds as the
 570-9   interest becomes due and payable;
570-10               (2)  payment of the principal of any bonds as they
570-11   become due and payable, whether at maturity, by call for
570-12   redemption, or otherwise; or
570-13               (3)  performance of an agreement made with the
570-14   purchasers or successive holders of any bonds.
570-15         (b)  If a default described by Subsection (a) has occurred
570-16   and has continued for a period, if any, prescribed by the
570-17   resolution authorizing the issuance of the bonds, the trustee under
570-18   the indenture or indentures entered into with respect to the bonds
570-19   authorized by the resolution, or, if there is no indenture, a
570-20   trustee appointed in the manner provided in the resolution by the
570-21   holders of 25 percent in aggregate principal amount of the bonds
570-22   authorized by the resolution and then outstanding may, and on the
570-23   written request of the holders of 25 percent in aggregate principal
570-24   amount of the bonds authorized by the resolution and then
570-25   outstanding shall, in the trustee's own name but for the equal and
570-26   proportionate benefit of the holders of all the bonds, and with or
 571-1   without having possession of the bonds:
 571-2               (1)  by mandamus or other suit, action, or proceeding
 571-3   at law or in equity, enforce all rights of the holders of the
 571-4   bonds;
 571-5               (2)  bring suit on the bonds or the appurtenant
 571-6   coupons;
 571-7               (3)  by action or suit in equity, require the authority
 571-8   to account as if it were the trustee of an express trust for the
 571-9   bondholders;
571-10               (4)  by action or suit in equity, enjoin any acts or
571-11   things which may be unlawful or in violation of the rights of the
571-12   holders of the bonds; or
571-13               (5)  after such notice to the authority as the
571-14   resolution may provide, declare the principal of all of the bonds
571-15   due and payable, and if all defaults have been made good, then with
571-16   the written consent of the holders of 25 percent in aggregate
571-17   principal amount of the bonds then outstanding, annul the
571-18   declaration and its consequences; provided, however, that the
571-19   holders of more than a majority in principal amount of the bonds
571-20   authorized by the resolution and then outstanding shall, by written
571-21   instrument delivered to the trustee, have the right to direct and
571-22   control any and all action taken or to be taken by the trustee
571-23   under this section.
571-24         (c)  A resolution, indenture, or agreement relating to bonds
571-25   may provide that in a suit, action, or proceeding under this
571-26   section, the trustee, whether or not all of the bonds have been
 572-1   declared due and payable and with or without possession of any of
 572-2   the bonds, shall be entitled as of right to the appointment of a
 572-3   receiver who may enter and take possession of all or any part of
 572-4   the properties of the authority and operate and maintain the
 572-5   properties, and set, collect, and receive rates and charges
 572-6   sufficient to provide revenues adequate to apply the items set
 572-7   forth in Sections 271.028(f)(1), (2), and (3) and the costs and
 572-8   disbursements of the suit, action, or proceeding and apply such
 572-9   revenues in conformity with the provisions of this chapter and the
572-10   resolution or resolutions authorizing the bonds.
572-11         (d)  In any suit, action, or proceeding by a trustee under
572-12   this section, the reasonable fees, counsel fees, and expenses of
572-13   the trustee and of the receiver or receivers, if any, shall
572-14   constitute taxable disbursements, and all costs and disbursements
572-15   allowed by the court shall be a first charge on any revenues
572-16   pledged to secure the payment of the bonds.
572-17         (e)  Subject to the provisions of the constitution, the
572-18   courts of Bexar County shall have jurisdiction of any such suit,
572-19   action, or proceeding by a trustee under this section on behalf of
572-20   the bondholders and of all property involved in the suit, action,
572-21   or proceeding.
572-22         (f)  In addition to the powers specifically provided by this
572-23   section, the trustee shall have and possess all powers necessary or
572-24   appropriate for the exercise of the powers specifically provided or
572-25   incident to the general representation of the bondholders in the
572-26   enforcement of their rights.
 573-1         Sec. 271.030.  BOND APPROVAL AND REGISTRATION.  (a)  Before
 573-2   bonds may be sold by the authority, a certified copy of the
 573-3   proceedings for the issuance of the bonds, including the form of
 573-4   the bonds, together with any other information that the attorney
 573-5   general may require, shall be submitted to the attorney general,
 573-6   and if the attorney general finds that the bonds have been issued
 573-7   in accordance with law, the attorney general shall approve the
 573-8   bonds and execute a certificate to that effect, which shall be
 573-9   filed in the office of the comptroller and be recorded in a record
573-10   kept for that purpose.  In lieu of the approval by the attorney
573-11   general, the authority may institute proceedings as authorized by
573-12   Chapter 1205, Government Code.  The comptroller shall register the
573-13   bonds if the attorney general has filed with the comptroller the
573-14   certificate approving the bonds and the proceedings for the
573-15   issuance of the bonds as provided in this section.  Bonds may not
573-16   be issued until the bonds have been registered by the comptroller.
573-17         (b)  Bonds approved by the attorney general, registered by
573-18   the comptroller, and issued in accordance with the proceedings as
573-19   approved are valid and binding obligations of the authority and are
573-20   incontestable for any cause after registration.
573-21         (c)  Nothing in this chapter shall prevent the authority from
573-22   making a private sale of its bonds to the Texas Water Development
573-23   Board or any other agency of the state or of the United States
573-24   under such terms and conditions as the board in its discretion
573-25   determines advisable, and such private sale is specifically
573-26   authorized by this chapter.
 574-1         Sec. 271.031.  PURCHASE OF BONDS BY AUTHORITY.  The authority
 574-2   may, out of any funds available for the purpose, purchase any bonds
 574-3   issued by it at a price not exceeding the redemption price
 574-4   applicable at the time of the purchase or, if such bonds are not
 574-5   redeemable, at a price not exceeding the principal amount of the
 574-6   bonds plus accrued interest.  All bonds so purchased shall be
 574-7   cancelled, and no bonds shall ever be issued in lieu of such bonds.
 574-8         Sec. 271.032.  BONDS LEGAL FOR INVESTMENT AND SECURITY.  The
 574-9   bonds of the authority are legal and authorized investments for
574-10   banks, savings banks, trust companies, building and loan
574-11   associations, savings and loan associations, insurance companies,
574-12   fiduciaries, trustees, and guardians and for the sinking funds of
574-13   cities, towns, villages, counties, school districts, or other
574-14   political corporations or subdivisions of the state.  The bonds are
574-15   eligible to secure the deposit of all public funds of the state and
574-16   all public funds of cities, towns, villages, counties, school
574-17   districts, or other political corporations or subdivisions of the
574-18   state, and the bonds are lawful and sufficient security for such
574-19   deposits to the extent of their value when accompanied by all
574-20   unmatured coupons.
574-21         Sec. 271.033.  PROPERTY OF THE AUTHORITY.  (a)  Nothing in
574-22   this chapter shall be construed as authorizing the authority, and
574-23   it may not be authorized, to mortgage or otherwise encumber any of
574-24   its property of any kind, real, personal, or mixed, or any interest
574-25   in such property, or to acquire any such property or interest
574-26   subject to a mortgage or conditional sale; provided, however, that
 575-1   this subsection shall not be construed as preventing the pledging
 575-2   of any revenues and income of the authority of every kind and
 575-3   character and from any source whatever, except ad valorem taxes
 575-4   collected by the authority in accordance with Sections 271.026 and
 575-5   271.027.
 575-6         (b)  Nothing in this chapter shall be construed as
 575-7   authorizing the authority or any receiver of its properties or any
 575-8   court to sell, lease, or otherwise dispose of any of the
 575-9   authority's property of any kind, real, personal, or mixed, or any
575-10   interest in such property, unless such sale, lease, or other
575-11   disposition has been generally authorized by this chapter;
575-12   provided, however, that the authority may sell or otherwise dispose
575-13   of property of any kind or any interest in property that is not
575-14   necessary to carry on the business of the authority if the board,
575-15   by a majority vote of a quorum present at any regular or special
575-16   meeting, determines that the property is not convenient to the
575-17   business of the authority and is surplus.
575-18         (c)  All property of the authority shall at all times be
575-19   exempt from forced sale and nothing in this chapter shall authorize
575-20   the sale of any of the property of the authority under any judgment
575-21   rendered in any suit, and such sales are hereby prohibited and
575-22   forbidden.
575-23         Sec. 271.034.  BONDS EXEMPT FROM TAXATION.  Bonds and
575-24   interest on bonds issued under this chapter are exempt from
575-25   taxation, except inheritance taxes, by the state or by any
575-26   municipal corporation, county, or other political subdivision or
 576-1   taxing district of the state.
 576-2         Sec. 271.035.  APPEAL BOND NOT REQUIRED.  The authority may
 576-3   not be required to give bond on any appeal from judgment in any
 576-4   court.
 576-5         Sec. 271.036.  FULL AUTHORITY TO ISSUE BONDS.  This chapter,
 576-6   without reference to other statutes of the state, constitutes full
 576-7   authority for the authorization and issuance of bonds under this
 576-8   chapter, and no other act or law with regard to the authorization
 576-9   or issuance of obligations or the deposit of the proceeds of
576-10   obligations or in any way impeding or restricting the carrying out
576-11   of the acts authorized by this chapter shall be construed as
576-12   applying to any proceedings taken or acts done pursuant to this
576-13   chapter.
576-14         Sec. 271.037.  CONTRACT WITH BEXAR COUNTY.  Recognizing the
576-15   fact that the authority has previously entered into a contract with
576-16   the Commissioners Court of Bexar County for the purpose of
576-17   financing the construction of certain flood control and soil
576-18   conservation works of improvement in Bexar County, the authority is
576-19   prohibited from spending any income or revenue derived from the
576-20   contract and from all amendments to or reformations of the contract
576-21   for any purpose other than those specifically provided for in this
576-22   chapter; provided, however, that a reasonable amount of the income
576-23   or revenue may be allocated by the board for the payment of the
576-24   authority's overhead, operational costs, and the fees of the
576-25   directors who reside in Bexar County.
576-26         Sec. 271.038.  POLLUTION CONTROL DISTRICT.  (a)  The
 577-1   authority may establish one or more pollution control districts for
 577-2   the purpose of accomplishing any of the powers, purposes, rights,
 577-3   privileges, or authority vested in the authority regarding waste
 577-4   treatment.  Pollution control districts may be established by the
 577-5   procedures provided by this section.
 577-6         (b)  The board may adopt a resolution calling for the
 577-7   creation of a pollution control district, defining the boundaries
 577-8   of the district, and:
 577-9               (1)  estimating the principal amount of and stating the
577-10   purpose of bonds proposed to be issued by the authority on behalf
577-11   of the proposed pollution control district, declaring that taxes
577-12   for the payment of the proposed bonded indebtedness shall be levied
577-13   exclusively on the taxable property within the proposed pollution
577-14   control district, and setting a time and place for a public hearing
577-15   on the matters set out in the resolution; or
577-16               (2)  declaring that taxes for the maintenance of the
577-17   authority and its improvements shall be levied on the taxable
577-18   property within the proposed pollution control district and setting
577-19   a time and place for a public hearing on the matters set out in the
577-20   resolution.
577-21         (c)  The resolutions authorized by Subsection (b) may be
577-22   adopted simultaneously, and simultaneous hearings on proposed bond
577-23   and maintenance taxes may be held.
577-24         (d)  The public hearing may be conducted by a quorum of the
577-25   board, by one or more directors, or by one or more employees
577-26   designated by the board.  If someone other than a quorum of the
 578-1   board conducts the hearing, the person or persons shall have power
 578-2   to accept evidence and make recommendations on which the board may
 578-3   act.  The board may alter, modify, or change any provision of the
 578-4   resolution calling for the creation of the proposed pollution
 578-5   control district subsequent to the public hearing; provided,
 578-6   however, that the boundaries of the pollution control district may
 578-7   not be enlarged or expanded without compliance with the notice
 578-8   requirements of Subsection (e).
 578-9         (e)  Notice of the public hearing shall be published in a
578-10   newspaper of general circulation within the proposed pollution
578-11   control district once not less than 15 or more than 30 days before
578-12   the public hearing.  To the extent not inconsistent with the
578-13   provisions of this section, notice of the public hearing must
578-14   comply with Chapter 551, Government Code.
578-15         (f)  All public hearings on the creation of a pollution
578-16   control district shall be held within the boundaries of the
578-17   proposed pollution control district.  The public hearings may be
578-18   held concurrently or in connection with any other public hearing,
578-19   meeting, or proceeding conducted by the board.
578-20         (g)  Any interested person, including persons residing or
578-21   owning property within the authority, may appear at the public
578-22   hearing and present evidence relevant to the matter set forth in
578-23   the resolution calling for the creation of the proposed pollution
578-24   control district.  All persons residing within or owning property
578-25   within the proposed pollution control district shall have the right
578-26   to appear at the public hearing and present evidence with regard to
 579-1   whether they will receive benefits from the proposed improvements
 579-2   or taxation.  Failure to appear at the public hearing shall
 579-3   constitute a waiver of all objections the absent party might have
 579-4   had to all matters set forth in the resolution calling for the
 579-5   creation of the proposed pollution control district.
 579-6         (h)  The board shall review the findings and recommendations
 579-7   resulting from the public hearing and may adopt a resolution
 579-8   creating the pollution control district, stating the purposes for
 579-9   which the pollution control district has been created, designating
579-10   the boundaries of the pollution control district, declaring that
579-11   the indebtedness to be incurred or the cost of services to be
579-12   rendered by the authority for the benefit of the pollution control
579-13   district shall be payable from taxes levied on property within the
579-14   pollution control district, finding that the property within the
579-15   pollution control district will benefit from the indebtedness
579-16   proposed to be incurred or the services proposed to be rendered by
579-17   the authority on its behalf, and calling for an election within the
579-18   pollution control district to authorize the indebtedness or
579-19   maintenance tax.  The resolution shall further state the date of
579-20   the election, the proposition or propositions to be voted on, the
579-21   location of the polling places, and the names of the officers of
579-22   the election.  The election may be held in conjunction with a
579-23   general election or a special election other than a primary
579-24   election.  The provisions of the Election Code shall govern the
579-25   election unless contrary to any provision of this chapter.
579-26         (i)  The resolution of the board creating a pollution control
 580-1   district shall be final and conclusive and shall not be subject to
 580-2   review by any court except on the basis of whether the resolution
 580-3   is supported by substantial evidence.  The resolution shall be
 580-4   filed in the deed records of the county or counties in which the
 580-5   territory within the pollution control district is situated.
 580-6   Unless an action or a proceeding in which the validity of the
 580-7   board's resolution creating a pollution control district or of the
 580-8   proceedings relative to the resolution is contested, questioned, or
 580-9   denied is commenced within 30 days from the effective date of the
580-10   resolution, the resolution and all proceedings relative to the
580-11   resolution, including the creation of the pollution control
580-12   district, shall be valid and in every respect legal and
580-13   incontestable.
580-14         (j)  The boundaries of a pollution control district may
580-15   include any territory within the authority, whether or not the
580-16   territory contains noncontiguous parcels of land and whether or not
580-17   the territory is located within the boundaries of any incorporated
580-18   city, town, village, or any other governmental entity or political
580-19   subdivision of the state.  If any portion of the territory of a
580-20   proposed pollution control district is located within the
580-21   boundaries or within the exclusive extraterritorial jurisdiction of
580-22   an incorporated city, town, or village, the board may not create
580-23   the pollution control district unless it has obtained the consent
580-24   of that city, town, or village.  The consent may contain such
580-25   conditions as may be mutually agreed by the authority and the city,
580-26   town, or village and shall be evidenced by a duly enacted ordinance
 581-1   of the governing body of the city, town, or village.
 581-2         (k)  Proceedings for the annexation of territory to an
 581-3   existing pollution control district may be initiated by a
 581-4   resolution of the board or by a petition signed by the owners of 50
 581-5   percent or more of the value of the land subject to the proceedings
 581-6   or by a petition signed by a majority of the residents of the
 581-7   territory to be annexed.  The petition must, insofar as is
 581-8   practicable, set forth substantially those matters that would be
 581-9   set forth in a resolution calling for the creation of a pollution
581-10   control district and must request a public hearing by the board on
581-11   the matters set out in the petition.  The public hearing shall be
581-12   held in substantial compliance with the provisions set forth in
581-13   this section for a public hearing on creation of a pollution
581-14   control district.  If the board determines that the annexation
581-15   should be accomplished, the board may adopt a resolution calling
581-16   separate elections on the matter of annexation to be held within
581-17   the existing pollution control district and within the territory to
581-18   be annexed.  The annexation shall not become final unless approved
581-19   by a majority of the qualified voters within the existing pollution
581-20   control district and unless a majority of the qualified voters
581-21   within the boundaries of the territory to be annexed approve the
581-22   annexation and elect to allow the territory that is to be annexed
581-23   to be taxed for maintenance purposes or to allow the territory that
581-24   is to be annexed to assume its pro rata share of indebtedness
581-25   previously authorized or of taxes necessary to support the voted
581-26   but unissued tax bonds or tax revenue bonds of the authority that
 582-1   are to be issued on behalf of the existing pollution control
 582-2   district and authorize the board to levy a tax on the property in
 582-3   the territory that is to be annexed for payment for the unissued
 582-4   bonds, when issued.  The elections shall conform to the Election
 582-5   Code to the extent that the code is not inconsistent with the
 582-6   provisions of this chapter.  The board's resolution canvassing the
 582-7   returns of the elections shall redefine the boundaries of the
 582-8   pollution control district and shall be recorded in the deed
 582-9   records of the county within which the annexed territory lies.
582-10         (l)  Proceedings for the addition of territory to an existing
582-11   pollution control district on which less than three qualified
582-12   voters reside may be initiated by a petition signed by the owner or
582-13   owners of the territory to be annexed seeking that the territory
582-14   described in the petition be added to the pollution control
582-15   district.  The petition must, to the extent applicable, set forth
582-16   substantially those matters that would be set forth in a resolution
582-17   calling for the creation of a pollution control district and must
582-18   request a public hearing by the board on the matters set out in the
582-19   petition.  The public hearing must be held in substantial
582-20   compliance with the provisions of this section relating to public
582-21   hearings on the creation of a pollution control district.  If the
582-22   board determines that the addition should be accomplished, it may
582-23   adopt a resolution adding such territory.  If taxes or bonds have
582-24   been authorized within the pollution control district prior to the
582-25   addition of the territory, the resolution adding the territory must
582-26   be temporary and the addition shall not become final unless
 583-1   approved by a majority of the qualified voters within the pollution
 583-2   control district as it exists after the addition.  The election
 583-3   must be held, as soon as practicable after the addition, on the
 583-4   proposition of approving the addition, ratifying the unissued tax
 583-5   bonds or tax revenue bonds of the authority that are to be issued
 583-6   on behalf of the pollution control district, and authorizing the
 583-7   board to levy a tax on the property within the pollution control
 583-8   district as enlarged for payment of the unissued bonds when issued
 583-9   or for the maintenance of the authority.  The election must conform
583-10   to the Election Code to the extent that the code is not
583-11   inconsistent with the provisions of this chapter.  The board's
583-12   resolution canvassing the returns of the election or adding the
583-13   territory shall redefine the boundaries of the pollution control
583-14   district and shall be recorded in the deed records of the county
583-15   within which the added territory lies.
583-16         (m)  If the qualified voters in an election called pursuant
583-17   to this section authorize the authority to incur indebtedness for
583-18   the benefit of a pollution control district, the board may issue
583-19   bonds as provided in this chapter; provided, however, that taxes
583-20   levied for the purpose of making payments of the interest on or
583-21   principal of the bonds shall be levied only on taxable property
583-22   within the pollution control district.
583-23         (n)  Notwithstanding any provision of this chapter to the
583-24   contrary, if the qualified voters in an election called pursuant to
583-25   this section authorize the authority to levy and collect ad valorem
583-26   taxes for the maintenance of the authority and its improvements,
 584-1   the board may levy, assess, and collect a maintenance tax;
 584-2   provided, however, that the maintenance tax may be levied only on
 584-3   taxable property within the pollution control district.
 584-4         (o)  The board may incur such indebtedness as may be
 584-5   necessary to provide all improvements, and the maintenance of the
 584-6   improvements, requisite to the achievement of the purposes for
 584-7   which any pollution control district is organized.  The authority
 584-8   may levy and collect such taxes as may be necessary for the payment
 584-9   of the interest on the indebtedness and the creation of a sinking
584-10   fund for the payment of the indebtedness, and such taxes shall be a
584-11   lien on the property assessed for the payment of the indebtedness.
584-12         Sec. 271.039.  LIBERAL CONSTRUCTION; CONFLICTS.  This chapter
584-13   and all its terms and provisions shall be liberally construed to
584-14   effectuate the purposes set forth in this chapter; provided,
584-15   however, that:
584-16               (1)  if any authority or power granted by this chapter
584-17   conflicts with any authority or power previously vested in the
584-18   Guadalupe-Blanco River Authority as created by Chapter 410, Acts of
584-19   the 44th Legislature, 1st Called Session, 1935, the power and
584-20   authority granted by the Act creating the Guadalupe-Blanco River
584-21   Authority shall supersede and control over any power or authority
584-22   granted by this chapter unless the Guadalupe-Blanco River Authority
584-23   consents to the exercise of such power or authority by the San
584-24   Antonio River Authority;
584-25               (2)  no provision of this chapter shall have the effect
584-26   of divesting any person, firm, or corporation of any riparian
 585-1   rights previously vested, or any vested rights derived under
 585-2   existing permits for the appropriation and use of public waters
 585-3   previously issued by the commission, or any vested rights derived
 585-4   under any certified filings previously filed with the commission;
 585-5   and
 585-6               (3)  nothing in this chapter shall impair or supersede
 585-7   the authority and supervision granted to the commission under other
 585-8   statutory provisions of the state or under the rules formulated by
 585-9   the commission in accordance with law, any provision of this
585-10   chapter to the contrary notwithstanding.
585-11         Sec. 271.040.  DOMICILE.  The general office and place of
585-12   domicile of the authority shall be in the city of San Antonio,
585-13   Bexar County.
585-14         Sec. 271.041.  CONSTITUTIONAL CONFORMITY.  Nothing in this
585-15   chapter shall be construed to violate any provision of the federal
585-16   or state constitution, and all acts done under this chapter shall
585-17   be done in such a manner as will conform to those constitutions,
585-18   whether expressly provided in this chapter or not.  If the board
585-19   determines that any procedure under this chapter violates the
585-20   federal or state constitution, the board may by ordinance provide a
585-21   procedure conformable with those constitutions.
585-22         Sec. 271.042.  SEVERABILITY.  The provisions of this chapter
585-23   are severable.  If any section, subsection, provision, or part of
585-24   this chapter should be held to be invalid, it shall not affect the
585-25   validity of the remaining portions of this chapter.
 586-1                CHAPTER 272.  SAN JACINTO RIVER AUTHORITY
 586-2         Sec. 272.001.  CREATION.  (a)  A conservation and reclamation
 586-3   district to be known as the "San Jacinto River Authority" is
 586-4   created.  The authority is a governmental agency and a body politic
 586-5   and corporate.
 586-6         (b)  The authority is created under and is essential to
 586-7   accomplish the purposes of Section 59, Article XVI, Texas
 586-8   Constitution.
 586-9         (c)  The authority may exercise the powers granted by Section
586-10   59, Article XVI, Texas Constitution, to districts created to
586-11   conserve, control, and utilize to beneficial service the storm
586-12   waters and floodwaters of rivers and streams of the state, as well
586-13   as such powers as may be contemplated and implied by the purposes
586-14   of that provision of the constitution and as may be conferred by
586-15   general law and by the provisions of this chapter.
586-16         (d)  The authority may formulate plans considered essential
586-17   to the operation of the authority and for its administration in the
586-18   control, storing, preservation, and distribution to all useful
586-19   purposes of the storm waters and floodwaters of the San Jacinto
586-20   River and its tributaries.
586-21         (e)  The authority may exercise such authority and power of
586-22   control and regulation over the storm waters and floodwaters of the
586-23   San Jacinto River and its tributaries as may be exercised by the
586-24   state, subject to the provisions of the constitution and the acts
586-25   of the legislature.
586-26         Sec. 272.002.  DEFINITIONS.  In this chapter:
 587-1               (1)  "Authority" means the San Jacinto River Authority.
 587-2               (2)  "Board" means the board of directors of the
 587-3   authority.
 587-4               (3)  "Director" means a member of the board.
 587-5         Sec. 272.003.  TERRITORY.  (a)  The authority comprises all
 587-6   the territory within the watershed of the San Jacinto River and its
 587-7   tributaries except the portion of the watershed that is within the
 587-8   boundaries of Harris County, which is expressly excluded from the
 587-9   boundaries of the authority.
587-10         (b)  The written description of the boundaries shall be
587-11   certified by the commissioner of the General Land Office, approved
587-12   by the commission or its predecessor agency, and recorded in the
587-13   minutes of the authority.
587-14         (c)  The board shall cause a copy of the certified boundaries
587-15   to be filed and recorded in the office of the county clerk of each
587-16   county lying in whole or in part within the boundaries of the
587-17   authority.  The board shall also file a copy of the certified
587-18   boundaries, together with a map showing the boundaries, with the
587-19   tax assessor and collector of each of the counties that lie in
587-20   whole or in part within the authority.
587-21         Sec. 272.004.  EFFECT OF CHANGE OF NAME OF AUTHORITY.
587-22   (a)  All laws applicable to the San Jacinto River Conservation and
587-23   Reclamation District and all contracts and bonds or other
587-24   debentures effected under that name are applicable to the San
587-25   Jacinto River Authority.
587-26         (b)  Wherever the name San Jacinto River Conservation and
 588-1   Reclamation District or any reference to that district appears in
 588-2   any law or in any court decision, the name and reference shall mean
 588-3   and apply to the San Jacinto River Authority.
 588-4         (c)  All grants and donations of state ad valorem taxes made
 588-5   by the state to the San Jacinto River Conservation and Reclamation
 588-6   District and all appropriations and benefits under those grants and
 588-7   donations are available to and apply to the San Jacinto River
 588-8   Authority.
 588-9         (d)  The change in name of the authority in no way affects
588-10   the organization, authority, functions, or powers previously
588-11   conferred by law and as expressly authorized in the provisions of
588-12   Section 59, Article XVI, Texas Constitution.
588-13         Sec. 272.005.  SPECIFIC POWERS.  The authority, in addition
588-14   to possessing all powers expressly or impliedly granted by other
588-15   sections of this chapter, by complying where applicable with the
588-16   provisions of this code may:
588-17               (1)  store, control, and conserve the storm waters and
588-18   floodwaters of the watershed of the San Jacinto River and its
588-19   tributaries and prevent the escape of any such waters through every
588-20   practical means in order to prevent the devastation of lands from
588-21   recurrent overflows and to protect life and property;
588-22               (2)  provide through every practical means for the
588-23   control, utilization, and coordination of regulation of the waters
588-24   of the San Jacinto River and its tributaries;
588-25               (3)  appropriate the waters of the San Jacinto River
588-26   and its tributaries, construct dams and other facilities for the
 589-1   impoundment, conservation, diversion, and utilization of such
 589-2   waters, and devote waters to municipal, domestic, agricultural,
 589-3   commercial, industrial, mining, and other beneficial uses, within
 589-4   and outside the watershed of the river;
 589-5               (4)  provide waters for the irrigation of lands where
 589-6   irrigation is required for agricultural purposes or may be
 589-7   considered helpful to more profitable agricultural production;
 589-8               (5)  provide water for domestic, municipal, commercial,
 589-9   industrial, and mining purposes within and outside the watershed of
589-10   the river, including water supplies for cities, towns, and
589-11   industries, and in connection with those purposes may construct or
589-12   otherwise acquire water transportation, treatment, and distribution
589-13   facilities and supplemental sources of supply;
589-14               (6)  encourage and develop drainage systems and
589-15   provisions for the drainage of lands in the valleys of the San
589-16   Jacinto River and its tributaries needing drainage for profitable
589-17   agricultural production and the drainage of other lands in the
589-18   watershed area of the authority requiring drainage for the most
589-19   advantageous use;
589-20               (7)  encourage through practical and legal means the
589-21   conservation of soils against destructive erosion and prevent the
589-22   increased flood danger caused by soil erosion;
589-23               (8)  forest and reforest and aid in the foresting and
589-24   reforesting of the watershed area of the San Jacinto River and its
589-25   tributaries and may prevent and aid in the prevention of soil
589-26   erosion and floods in, on, and upon all lands situated within the
 590-1   boundaries of the authority;
 590-2               (9)  control, store, and employ the waters of the San
 590-3   Jacinto River and its tributaries in the development and
 590-4   distribution of hydroelectric power, where such use may be
 590-5   economically coordinated with other and superior uses and
 590-6   subordinated to the uses declared by law to be superior;
 590-7               (10)  encourage, aid, and protect navigation and harbor
 590-8   improvements;
 590-9               (11)  acquire land adjacent to or in the vicinity of
590-10   any waters impounded by the authority or adjacent to or in the
590-11   vicinity of the San Jacinto River or any of its tributaries for
590-12   park and recreation purposes and acquire or construct park and
590-13   recreation facilities on such land; provided, however, that except
590-14   as may otherwise be provided by general law, the acquisition or
590-15   construction of any recreation and park facilities by the authority
590-16   shall be subject to the approval of the Parks and Wildlife
590-17   Commission and to such conditions as the Parks and Wildlife
590-18   Commission may prescribe;
590-19               (12)  acquire or construct facilities for the
590-20   gathering, transporting, treating, and disposing of sewage and
590-21   industrial waste and effluent;
590-22               (13)  control, store, and employ the waters of the San
590-23   Jacinto River and its tributaries for every purpose for which such
590-24   waters, when controlled and conserved, may be utilized in the
590-25   performance of a useful service as contemplated and authorized by
590-26   the provisions of the Texas Constitution and the public policy it
 591-1   declares;
 591-2               (14)  construct and otherwise acquire and repair,
 591-3   improve, extend, operate, and maintain all works, plants, and other
 591-4   facilities necessary or useful in the furtherance of any power
 591-5   granted by law to the authority, including water storage
 591-6   reservoirs, dams, canals, waterways, and water transportation
 591-7   facilities of all kinds, water treatment facilities, hydroelectric
 591-8   facilities, municipal water supply facilities, facilities for the
 591-9   treatment of sewage and industrial waste and effluent, parks and
591-10   recreation facilities, and all other necessary and useful
591-11   structures, facilities, and equipment;
591-12               (15)  enter into necessary and proper contracts with
591-13   other state or federal agencies, districts, bodies politic and
591-14   corporate, and others and may make and enter into cooperative and
591-15   coordinative contracts with such agencies, districts, bodies
591-16   politic and corporate, and others necessary or useful in the
591-17   furtherance of any power granted by law to the authority, including
591-18   the power to pledge the authority's funds and its other assets or
591-19   any part of such funds or assets;
591-20               (16)  acquire any properties necessary for any of the
591-21   authority's corporate purposes by purchase, by condemnation as
591-22   provided by this chapter, or by gift and may acquire property by
591-23   lease or other contract, on such terms as may be agreed by the
591-24   board;
591-25               (17)  operate the water and sewage properties and
591-26   facilities of other public bodies or political subdivisions on such
 592-1   terms as the authority may agree in connection with the supplying
 592-2   by the authority of any water or sewage or waste disposal or other
 592-3   services to public bodies;
 592-4               (18)  enter into such contracts, on such terms, and for
 592-5   such periods as the board approves, with municipalities or other
 592-6   corporate bodies or persons, public or private, for the purpose of
 592-7   establishing and collecting, and by resolution or order to
 592-8   otherwise establish and collect, rates and other charges for the
 592-9   sale or use of water, water transmission, treatment or connection
592-10   facilities, sewage or industrial or other waste disposal services
592-11   and facilities of all types, park or recreation facilities, power,
592-12   electric energy, and any other services sold, furnished, or
592-13   supplied by the authority, which rates and charges shall be
592-14   sufficient to produce revenue adequate to:
592-15                     (A)  pay expenses necessary to operate and
592-16   maintain the properties and facilities of the authority;
592-17                     (B)  pay the interest on or the principal of any
592-18   bonds or other obligations issued by the authority when and as the
592-19   interest or principal becomes due and payable and to fulfill any
592-20   reserve or other fund obligations of the authority in connection
592-21   with such bonds; and
592-22                     (C)  pay such other expenses the board determines
592-23   necessary and proper for any purpose in the corporate operations
592-24   and functions of the authority; and
592-25               (19)  authorize by contract any other districts,
592-26   agencies, bodies politic and corporate, and individuals to
 593-1   participate in the joint construction, operation, and maintenance
 593-2   of water storage reservoirs, dams, canals, waterways, and water
 593-3   lines and all other structures, facilities, and equipment in
 593-4   connection with such reservoirs, dams, canals, waterways, and water
 593-5   lines or in connection with sewage or waste facilities of all types
 593-6   and all necessary facilities for the manufacture, sale, and
 593-7   transportation of hydroelectric power, and by such contracts allow
 593-8   such other agencies, districts, bodies politic and corporate, and
 593-9   others to receive such portion of the revenues derived from the
593-10   sale of water and hydroelectric power or from furnishing sewage and
593-11   waste facilities and services as the board determines just,
593-12   equitable, and proper.
593-13         Sec. 272.006.  LIMITATION OF AUTHORITY; COMMISSION
593-14   SUPERVISION.  (a)  The powers and duties granted to the authority
593-15   by this chapter are subject to all legislative declarations of
593-16   public policy in the maximum utilization of the storm waters,
593-17   floodwaters, and unappropriated flow waters of the state for the
593-18   purpose for which the authority is created, as expressed and
593-19   indicated in this chapter and subject to the continuing rights of
593-20   supervision by the state, which shall be exercised through the
593-21   commission.
593-22         (b)  The commission is charged with the authority and duty to
593-23   approve, or to refuse to approve, the adequacy of any plan or plans
593-24   devised in the exercise of any power granted under this chapter
593-25   that contemplate improvements or facilities, the plans pertaining
593-26   to which are required to be supervised or approved by the
 594-1   commission under the provisions of general law.
 594-2         (c)  If the plans described by Subsection (b) contemplate the
 594-3   installation, construction, or other acquisition of parks and
 594-4   recreation facilities or of facilities for the gathering,
 594-5   transporting, or disposal of sewage or industrial wastes and
 594-6   effluent, the commission shall not approve the plans unless it
 594-7   finds that the Parks and Wildlife Commission has issued such
 594-8   approvals or permits relating to the matters as may be required by
 594-9   this chapter or general law.
594-10         Sec. 272.007.  BOARD OF DIRECTORS.  (a)  The management and
594-11   control of the affairs of the authority are vested in, and the
594-12   powers, rights, privileges, and functions of the authority are
594-13   exercised by, a board of directors.  The board consists of six
594-14   directors, all of whom must be freehold property taxpayers and
594-15   legal voters of the state.
594-16         (b)  Directors are appointed by the Texas Water Development
594-17   Board and serve for staggered terms of six years, holding office
594-18   after their appointment and qualification until their successors
594-19   are appointed and have qualified.  If a vacancy occurs on the
594-20   board, the vacancy is filled by the Texas Water Development Board
594-21   for the unexpired term.  The provisions of Section 49.103 regarding
594-22   the election and terms of directors do not apply to directors of
594-23   the authority.
594-24         (c)  Within 30 days after appointment, a director shall
594-25   qualify by taking the official oath required of county
594-26   commissioners and shall execute bond in the sum of $5,000 payable
 595-1   to the authority.  The sufficiency of the bond shall be determined
 595-2   by the Texas Water Development Board.  The bonds shall be recorded
 595-3   in the official bond records of the county in which the authority
 595-4   maintains its office and shall be deposited with the depository
 595-5   selected and approved for the deposit of the funds of the
 595-6   authority.
 595-7         (d)  The board shall elect from among its members a
 595-8   president, vice president, secretary, and treasurer.  The president
 595-9   presides at all meetings of the board and is the chief executive
595-10   officer of the authority.  The vice president acts as president in
595-11   case of the absence or disability of the president.  The secretary
595-12   shall keep a record of all proceedings and all orders of the board.
595-13   The treasurer shall receive and receipt for all funds received by
595-14   the authority and shall keep books and records of all funds
595-15   received and expended.  In case of the absence or inability of the
595-16   secretary to act, a secretary pro tempore shall be selected by the
595-17   board.
595-18         (e)  Four members, including the presiding officer,
595-19   constitute a quorum to transact business.
595-20         Sec. 272.008.  OFFICE; MEETINGS; ACCOUNTS.  (a)  The domicile
595-21   of the authority is Montgomery County, where the authority shall
595-22   maintain its principal office.
595-23         (b)  The board may set the time, place, and number of
595-24   meetings of the board by proper resolutions, regulations, and
595-25   bylaws passed by the board.
595-26         (c)  The board shall keep complete and accurate accounts
 596-1   conforming to approved methods of bookkeeping.  The accounts and
 596-2   all contracts, documents, and records of the authority shall be
 596-3   kept at the principal office and shall be open to public inspection
 596-4   at all reasonable times.
 596-5         Sec. 272.009.  GENERAL POWERS.  (a)  The board has all
 596-6   powers, both express and implied, to do and perform any and all
 596-7   acts for and on behalf of the authority that are authorized by the
 596-8   constitution and laws of the United States and the state for the
 596-9   purpose of achieving the plans and purposes intended in the
596-10   creation of the authority and in the exercise of all powers granted
596-11   to the authority by this chapter.  The board has full and complete
596-12   authority to do anything necessary or convenient to the exercise of
596-13   the powers, privileges, and functions conferred on the authority
596-14   and the board by this chapter or any other law.
596-15         Sec. 272.010.  SURVEYS AND ENGINEERING INVESTIGATIONS.
596-16   (a)  The board shall make or cause to be made surveys and
596-17   engineering investigations for the information of the authority and
596-18   shall determine the plans necessary to accomplish the purposes for
596-19   which the authority is created.  The board may employ engineers,
596-20   attorneys, and all other technical and nontechnical assistants or
596-21   employees and set and provide the amount and manner of their
596-22   compensation for the making of surveys, the preparation of plans,
596-23   and the collection of data essential to the determination of the
596-24   character, extent, and cost of all improvements essential in the
596-25   exercise of any power granted by this chapter or by any other law
596-26   applicable to the authority, and for expenditures found essential
 597-1   in the maintenance and administration of the authority.
 597-2         Sec. 272.011.  DIRECTOR FEES.  Directors are entitled to
 597-3   receive a per diem of not more than an amount determined by the
 597-4   board and permitted by Chapter 49 per day for the period served,
 597-5   together with traveling and other necessary expenses.  A director
 597-6   may perform any service required by the board but may not receive
 597-7   the per diem and other compensation at the same time.
 597-8         Sec. 272.012.  BONDS AS AUTHORIZED INVESTMENT; INVESTMENT OF
 597-9   FUNDS.  (a)  All bonds issued by the authority are legal and
597-10   authorized investments for banks, savings banks, trust companies,
597-11   building and loan associations, insurance companies, fiduciaries,
597-12   and trustees and for the sinking funds of cities, towns, villages,
597-13   counties, school districts, and other political corporations and
597-14   subdivisions of the state.  Bonds issued by the authority are
597-15   eligible to secure the deposit of all public funds of the state and
597-16   all public funds of cities, towns, villages, counties, school
597-17   districts, and other political corporations or subdivisions of the
597-18   state and shall be lawful and sufficient security for such deposits
597-19   at their market value when accompanied by all unmatured coupons.
597-20         (b)  Money in any fund of the authority or any fund
597-21   established by the board in connection with the authorization of
597-22   bonds, including proceeds from the sale of bonds, and which funds
597-23   are not needed to satisfy their particular purpose for any period,
597-24   may be invested or reinvested in direct obligations of or
597-25   obligations whose principal and interest are guaranteed by the
597-26   United States or invested in direct obligations of or participation
 598-1   certificates guaranteed by the Federal Intermediate Credit Banks,
 598-2   Federal Land Banks, the Federal National Mortgage Association,
 598-3   Federal Home Loan Banks, and Banks for Cooperatives and in
 598-4   certificates of deposit of any bank or trust company whose deposits
 598-5   are fully secured by a pledge of securities of any of the kind
 598-6   specified in this section.
 598-7         (c)  The type and maturity of investments made under this
 598-8   section shall be determined by the board, which, in the case of
 598-9   funds established in connection with the authorization of bonds,
598-10   shall provide appropriate recitals with regard to such investments
598-11   in the resolutions relating to the issuance of the bonds.  Income
598-12   and profits on such investments shall be applied as provided in the
598-13   resolution and, absent such provision, shall be applied to the uses
598-14   specified by this section for bond proceeds.
598-15         Sec. 272.013.  FUNDS FOR SURVEYS AND DATA COLLECTION.  For
598-16   the purpose of providing funds requisite to procure necessary
598-17   engineering surveys and the collection and compilation of data
598-18   respecting regional and general conditions entering into and
598-19   influencing the character and extent of the improvements necessary
598-20   to the storage, control, conservation, and equitable distribution
598-21   of floodwaters, when stored and controlled, to the greatest public
598-22   advantage, the counties lying in whole or in part within the area
598-23   of the authority may from year to year contribute to the funds for
598-24   such engineering surveys and the compilation of data essential to
598-25   the progress of flood control improvement in such amount as may be
598-26   deemed an equitable part of the cost of such surveys and the
 599-1   compilation of necessary information, in the estimated relation of
 599-2   such expenditures to the contemplated and probable benefit to the
 599-3   respective counties from the accomplishment of the plans and
 599-4   purposes of the creation of the authority.  For the provision of
 599-5   such funds, the counties may make the necessary collections through
 599-6   their respective general funds or may appropriate the amounts of
 599-7   the estimated equitable contribution of such costs of developing
 599-8   essential engineering data from their general fund.
 599-9         Sec. 272.014.  ADOPTION OF RULES; PENALTY; ENFORCEMENT.
599-10   (a)  The board may adopt and enforce rules to:
599-11               (1)  preserve and protect the sanitary condition and
599-12   prevent waste or unauthorized use of water owned or controlled by
599-13   the authority;
599-14               (2)  preserve, protect, secure, and regulate privileges
599-15   on any authority property; and
599-16               (3)  ensure the public safety on, in, under, across, or
599-17   within any authority property.
599-18         (b)  A rule adopted under this section must clearly define
599-19   any conduct that constitutes an offense and plainly state the
599-20   punishment for the offense.  In adopting a rule under this section,
599-21   the board must prescribe a punishment that is proportionate to the
599-22   seriousness of the offense.  The board may designate an offense
599-23   only as a Class C misdemeanor.
599-24         (c)  A rule adopted under this section does not take effect
599-25   until the authority has published once a week for two consecutive
599-26   weeks a substantive statement of the rule and the penalty for
 600-1   violation of the rule in a newspaper with general circulation in
 600-2   each county in which the rule is to be effective.  The statement
 600-3   must intelligently explain the purpose to be accomplished by or the
 600-4   acts prohibited by the rule.  The statement must advise the public
 600-5   that violation of the rule will subject the violator to a penalty.
 600-6   The statement must advise the public that the full text of the rule
 600-7   is on file in the principal office of the authority and that any
 600-8   interested person is entitled to read the full text.  The board may
 600-9   use one statement to satisfy the notice requirements of this
600-10   section for any number of rules the board adopts.  The board may
600-11   amend a rule after the rule is adopted, but must meet the notice
600-12   requirements under this subsection.
600-13         (d)  The violation of a rule is not punishable as an offense
600-14   unless the violation occurs after the 30th day after the date on
600-15   which the notice requirements under this section are met.  A rule
600-16   adopted under this section is effective until repealed, revoked,
600-17   rescinded, or amended by official action of the board.
600-18         (e)  A rule adopted under this section shall be recognized by
600-19   the courts of the state and is enforceable by complaint filed in
600-20   the appropriate court by the proper prosecuting authority in a
600-21   jurisdiction in which authority property is located in the same
600-22   manner as a penal statute under state law.  A penalty provided by a
600-23   rule adopted under this section is in addition to any other penalty
600-24   provided by law.  Rules promulgated under the authority of this
600-25   chapter shall not conflict with any provision of the Parks and
600-26   Wildlife Code or a rule adopted under the authority of the Parks
 601-1   and Wildlife Code.
 601-2         (f)  The board, the commissioners court, and the law
 601-3   enforcement officials in a county in which authority property is
 601-4   located may enter into a contract to provide for the employment,
 601-5   assignment, duties, equipping, or compensation of local law
 601-6   enforcement personnel to enforce the board's rules.  A contract
 601-7   under this subsection may require the authority to pay to the
 601-8   commissioners court a specified portion of the cost of providing
 601-9   the law enforcement personnel.
601-10         (g)  In this section, "authority property" means any land,
601-11   easement, water, property, equipment, work, or facility owned or
601-12   controlled, in whole or in part, by the authority, including a
601-13   reservoir, impoundment, lake, canal, channel, conduit, pipe,
601-14   siphon, dam, dike, levee, embankment, or berm but excluding Lake
601-15   Houston and the San Jacinto River below Lake Houston, except for
601-16   equipment, works, and facilities owned by the authority at or near
601-17   a dam site.
601-18         Sec. 272.015.  ADDITIONAL POWERS AND DUTIES.  (a)  The
601-19   provisions of Title 4 apply to the authority, to the extent such
601-20   provisions are applicable and practicable, except that such
601-21   provisions do not apply to any matter specifically provided for in,
601-22   or expressly or impliedly excluded from, this chapter relating to
601-23   the creation of a district and to the issuance of preliminary bonds
601-24   to finance investigations on which to base a plan for improvements
601-25   and to the levy of a tax to retire the bonds.  The authority may on
601-26   a vote of the qualified electors issue preliminary bonds for such
 602-1   investigations and levy a tax to retire the bonds, which tax may be
 602-2   in addition to all other taxes authorized by this chapter.
 602-3         (b)  After the completion and approval of a plan for the
 602-4   coordination of improvements considered adequate to serve the
 602-5   watershed of the San Jacinto River and its tributaries as a whole,
 602-6   as provided for by this chapter, the commission and the reclamation
 602-7   department of the General Land Office, in authorizing improvements
 602-8   to control the waters of or in allocating the right to use waters
 602-9   from the San Jacinto River and its tributaries, shall substantially
602-10   conform to, and shall effectually preserve the benefits of, the
602-11   plan formulated by the authority, and the authority shall have the
602-12   right to enforce the observance of the plan by judicial decree.
602-13         (c)  The authority may provide and maintain improvements for
602-14   the common benefit of the authority as a whole, subject only to
602-15   constitutional and statutory provisions concerning a vote by the
602-16   qualified electors of the authority.
602-17         (d)  The authority may exercise the powers contained in
602-18   Sections 51.510-51.530 relating to improvements peculiar to defined
602-19   areas within a district.
602-20         (e)  Conflicting provisions of Sections 51.510-51.530 shall
602-21   not control the authority.
602-22         (f)  If the electors of a defined area within the authority
602-23   desire, the electors may create a water control and improvement
602-24   district for the purpose of independently providing, operating, and
602-25   maintaining improvements designed peculiarly to serve that defined
602-26   area.  The contained defined area may be created under the
 603-1   applicable provisions of Title 4.  In like manner, any other
 603-2   political subdivision of the state located in whole or in part in
 603-3   the authority may independently provide, maintain, and operate
 603-4   works peculiarly designed to benefit that political subdivision.
 603-5   The improvements or works of the defined area or political
 603-6   subdivision shall be constructed and operated in a manner that
 603-7   conforms to the authority's plan described under Subsection (a) to
 603-8   the greatest practicable degree.
 603-9         (g)  To the extent necessary to enable the authority to
603-10   construct, maintain, and operate works beneficial to the authority
603-11   as a whole, to supervise, to perform any service inuring to the
603-12   benefit of the authority as a whole, and to provide funds adequate
603-13   to defray the cost of the administration to the authority, the
603-14   authority may levy and collect taxes, equitably distributed.  The
603-15   taxes shall be in addition to other taxes that may lawfully be
603-16   levied by the state and other political subdivisions of the state.
603-17         (h)  The authority may do all things necessary or suitable
603-18   for the prevention of recurrent, devastating floods in the valley
603-19   of the San Jacinto River.
603-20         Sec. 272.016.  CONTRACTS, GRANTS, AND LOANS.  The board is a
603-21   state agency and has full authority to negotiate and contract with
603-22   the United States, or any of its agencies, and others for grants,
603-23   loans, or allotments.  The authority may receive and accept grants,
603-24   loans, or allotments from the United States or others for the
603-25   purpose of making investigations and assembling data or for any
603-26   purpose set forth in this chapter and may receive and use the
 604-1   grants, loans, or allotments for the purposes provided in this
 604-2   chapter.
 604-3         Sec. 272.017.  BOND ELECTION REQUIRED.  The authority may not
 604-4   issue bonds, incur any form of continuing obligations for purposes
 604-5   of effecting improvements comprehended in the plan of organization
 604-6   and administration of the authority or incur any indebtedness which
 604-7   imposes a continuing charge on land or properties within the
 604-8   authority unless such proposition has been submitted to the
 604-9   qualified voters of the authority, or when appropriate, the voters
604-10   of a defined area or political subdivision within the authority,
604-11   and approved by a majority of those voting on the proposition.
604-12         Sec. 272.018.  ISSUANCE OF BONDS.  (a)  The authority may
604-13   issue negotiable revenue bonds for the purposes of:
604-14               (1)  making investigations and assembling data;
604-15               (2)  purchasing, acquiring, or condemning lands,
604-16   easements, rights-of-way, and other properties;
604-17               (3)  constructing, repairing, improving, and extending
604-18   any structures, dams, reservoirs, transmission facilities, water
604-19   treatment and water supply facilities, and sewage and other waste
604-20   gathering, transmission, treatment, and disposal facilities;
604-21               (4)  developing park and recreation facilities; and
604-22               (5)  acquiring, constructing, improving, repairing, and
604-23   extending any other properties and facilities considered
604-24   appropriate by the board in the exercise of powers granted the
604-25   authority in Section 272.005 and elsewhere in this chapter.
604-26         (b)  Any of the purposes described by this section may be
 605-1   combined into a single issue of bonds.  The bonds shall be issued
 605-2   in accordance with Subsection (d) and (e) and may be secured by and
 605-3   payable from the revenues of the authority permitted by Subsection
 605-4   (f), including the proceeds of one or more contracts between the
 605-5   authority and any persons, firms, corporations, cities, and
 605-6   political subdivisions.
 605-7         (c)  The authority may issue refunding bonds to refund,
 605-8   currently or in advance of their call dates, any bonds or refunding
 605-9   bonds of the authority issued under this chapter or under general
605-10   law in any manner now or hereafter permitted by general law for
605-11   political subdivisions of the state.
605-12         (d)  The bonds or refunding bonds of the authority may be
605-13   issued on terms the board deems necessary or convenient for any
605-14   corporate purpose.
605-15         (e)  The bonds or refunding bonds of the authority may be
605-16   authorized by resolution or order concurred in by a majority of the
605-17   directors.  The dates, forms, methods of execution, denominations,
605-18   interest rates and methods of accruing or compounding interest,
605-19   times, places and methods of payment, prices, including any
605-20   discount or premium, terms of sale, whether public or private and
605-21   whether for cash or for exchange, security, sources of payment,
605-22   provisions for additional security, provisions as to registration
605-23   and exchange, insurability, collateralization, and all other terms
605-24   and provisions of such bonds or refunding bonds shall be as
605-25   determined by the board and as permitted by either this chapter or
605-26   general law.
 606-1         (f)  The resolution authorizing the issuance of bonds may
 606-2   contain provisions, which shall be part of the contract between the
 606-3   board and the initial and successive holders of the bonds:
 606-4               (1)  reserving the right to redeem the bonds at such
 606-5   time or times, in such amounts, and at such prices, not exceeding
 606-6   102 percent of the principal amount of the bonds plus accrued
 606-7   interest, as may be provided in the resolution;
 606-8               (2)  providing for the setting aside of sinking funds
 606-9   or reserve funds and the regulation and disposition of the funds;
606-10               (3)  pledging, to secure the payment of the principal
606-11   of and interest on the bonds and the sinking fund or reserve fund
606-12   payments agreed to be made with respect to the bonds, all or part
606-13   of the funds that may be donated or granted by the state as
606-14   provided by this chapter and all or part of the gross or net
606-15   revenues received by the authority with respect to the property,
606-16   real, personal, or mixed, to be acquired or constructed with the
606-17   bonds or with proceeds of the bonds, or all or part of the gross or
606-18   net revenues received by the authority from any source;
606-19               (4)  prescribing the purposes to which the bonds or
606-20   bonds later issued, or the proceeds of the bonds, may be applied;
606-21               (5)  agreeing to set and collect rates and charges
606-22   sufficient to produce revenues that, together with the funds that
606-23   may be granted or donated by the state, are adequate to pay the
606-24   items specified by this chapter, and prescribing the use and
606-25   disposition of all revenues;
606-26               (6)  prescribing limitations on the issuance of
 607-1   additional bonds and on the agreements that may be made with the
 607-2   purchaser and successive bondholders;
 607-3               (7)  relating to the construction, extension,
 607-4   improvement, operation, maintenance, depreciation, replacement, and
 607-5   betterments of the properties of the authority and to the carrying
 607-6   of insurance on all or part of the property covering loss or damage
 607-7   or loss of use and occupancy resulting from specified risks;
 607-8               (8)  fixing the procedure, if any, by which, if the
 607-9   authority so desires, the terms of any contract with the holders of
607-10   the bonds may be amended or abrogated, the amount of bonds whose
607-11   holders must consent to the amendment or abrogation, and the manner
607-12   in which such consent shall be evidenced;
607-13               (9)  providing for the execution and delivery by the
607-14   authority to a bank or trust company authorized by law to accept
607-15   trusts, or to the United States or any officer or agency of the
607-16   United States, of indentures or agreements authorized by this
607-17   chapter to be made with or for the benefit of the holders of the
607-18   bonds and such other provisions as may be contained in such
607-19   indentures or agreements; and
607-20               (10)  making such other provisions, not inconsistent
607-21   with provisions of this chapter, as the board may approve.
607-22         Sec. 272.019.  DEFAULT PROCEDURES.  (a)  A  resolution
607-23   authorizing the issuance of bonds and any indenture or agreement
607-24   entered into pursuant to the resolution may include provisions
607-25   regarding a default on the:
607-26               (1)  payment of the interest on any bonds as the
 608-1   interest becomes due and payable;
 608-2               (2)  payment of the principal of any bonds as they
 608-3   become due and payable, whether at maturity, by call for
 608-4   redemption, or otherwise; or
 608-5               (3)  performance of an agreement made with the
 608-6   purchasers or successive holders of any bonds.
 608-7         (b)  If a default described by Subsection (a) has occurred
 608-8   and has continued for the period, if any, prescribed by the
 608-9   resolution authorizing the issuance of the bonds, the trustee under
608-10   the indenture or indentures entered into with respect to the bonds
608-11   authorized by the resolution, or, if there is no indenture, a
608-12   trustee appointed in the manner provided in the resolution by the
608-13   holders of 25 percent in aggregate principal amount of the bonds
608-14   authorized by the resolution and then outstanding, may, and on the
608-15   written request of the holders of 25 percent in aggregate principal
608-16   amount of the bonds authorized by the resolution and then
608-17   outstanding shall, in the trustee's own name but for the equal and
608-18   proportionate benefit of the holders of all the bonds and, with or
608-19   without having possession of the bonds, for the holders of all the
608-20   bonds:
608-21               (1)  by mandamus or suit, action, or proceeding at law
608-22   or in equity, enforce all rights of the holders of the bonds;
608-23               (2)  bring suit on the bonds or the appurtenant
608-24   coupons;
608-25               (3)  by action or suit in equity, require the board to
608-26   act as if it were the trustee of an express trust for the holders
 609-1   of the bonds;
 609-2               (4)  by action or suit in equity, enjoin anything that
 609-3   may be unlawful or in violation of the rights of the holders of the
 609-4   bonds; or
 609-5               (5)  after such notice to the board as the resolution
 609-6   may provide, declare the principal of all of the bonds due and
 609-7   payable, and if all defaults have been made good, then with the
 609-8   written consent of the holders of 25 percent aggregate principal
 609-9   amount of the bonds then outstanding, annul the declaration and its
609-10   consequences; provided, however, that the holders of more than a
609-11   majority in principal amount of the bonds authorized by the
609-12   resolution and then outstanding shall, by written instrument
609-13   delivered to the trustee, have the right to direct and control any
609-14   and all actions taken or to be taken by the trustee under this
609-15   section.
609-16         (c)  A resolution, indenture, or agreement relating to bonds
609-17   may provide that in a suit, action, or proceeding under this
609-18   section, the trustee, whether or not all of the bonds have been
609-19   declared due and payable and with or without possession of any of
609-20   the bonds, shall be entitled as of right to the appointment of a
609-21   receiver who may enter and take possession of all or any part of
609-22   the properties of the authority and operate and maintain the
609-23   properties and set, collect, and receive rates and charges that,
609-24   together with the funds that may be granted or donated by the
609-25   state, will be sufficient to provide revenues adequate to pay the
609-26   items set forth in this chapter and the costs and disbursements of
 610-1   the suit, action, or proceeding and apply such revenue in
 610-2   conformity with the provisions of this chapter and the resolution
 610-3   or resolutions authorizing the bonds.
 610-4         (d)  In any suit, action, or proceeding by a trustee or
 610-5   receiver, if any, under this section, counsel fees and expenses of
 610-6   the trustee and of the receiver or receivers, if any, shall
 610-7   constitute taxable disbursements, and all costs and disbursements
 610-8   allowed by the court shall be a first charge on any revenue pledged
 610-9   to secure the payment of the bonds.
610-10         (e)  In addition to the powers specifically provided by this
610-11   section, the trustee shall have and possess all powers necessary or
610-12   appropriate for the exercise of the powers specifically provided or
610-13   incident to the general representation of the bondholders in
610-14   enforcement of their rights.
610-15         Sec. 272.020.  BOND APPROVAL AND REGISTRATION.  (a)  Before
610-16   any bonds may be sold by the authority, a certified copy of the
610-17   proceedings for the issuance of the bonds, including the form of
610-18   the bonds, together with any other information the attorney general
610-19   may require, shall be submitted to the attorney general, and if the
610-20   attorney general finds that the bonds have been issued in
610-21   accordance with law and approves the bonds, the attorney general
610-22   shall execute a certificate to that effect which shall be filed in
610-23   the office of the comptroller and be recorded in a record kept for
610-24   that purpose.  Bonds may not be issued until the bonds have been
610-25   registered by the comptroller, who shall register the bonds if the
610-26   attorney general has filed with the comptroller the certificate
 611-1   approving the bonds and the proceedings for the issuance of the
 611-2   bonds as provided in this subsection.
 611-3         (b)  Bonds approved by the attorney general and registered by
 611-4   the comptroller as provided by this section and issued in
 611-5   accordance with the proceedings so approved are valid and binding
 611-6   obligations of the authority and are incontestable for any cause
 611-7   after their registration.
 611-8         Sec. 272.021.  OIL AND GAS LEASES.  The authority may enter
 611-9   into oil and gas leases with respect to its properties on terms the
611-10   board determines appropriate in the production of revenues to the
611-11   authority.
611-12         Sec. 272.022.  DISPOSAL OF AUTHORITY PROPERTY.  The authority
611-13   may sell or otherwise dispose of its properties if the board has
611-14   determined that the property or interest to be disposed of is not
611-15   necessary to the business of the authority and has approved the
611-16   terms of the sale.
611-17         Sec. 272.023.  EXEMPTION OF AUTHORITY PROPERTY FROM FORCED
611-18   SALE.  Property of the authority is exempted from forced sale under
611-19   any judgment, suit, or proceeding of any nature or kind.
611-20         Sec. 272.024.  ACQUISITION AND USE OF PROPERTY.  The
611-21   authority may acquire by purchase, lease, or gift or in any other
611-22   manner, other than by condemnation, and may maintain, use, and
611-23   operate property of any kind, real, personal, or mixed, or any
611-24   interest in such property, within or outside the boundaries of the
611-25   authority, necessary or convenient to the exercise of the powers,
611-26   rights, privileges, and functions conferred on the authority by
 612-1   this chapter.
 612-2         Sec. 272.025.  EMINENT DOMAIN.  (a)  The authority has the
 612-3   power and right of eminent domain for the purpose of acquiring by
 612-4   condemnation property of any kind, real, personal, or mixed, or any
 612-5   interest in such property, within or outside the boundaries of the
 612-6   authority (other than such property or interest in such property
 612-7   outside the boundaries of the authority that may at the time be
 612-8   owned by any body politic) necessary or convenient to the exercise
 612-9   of the powers, rights, privileges, and functions conferred on the
612-10   authority by this chapter in the manner provided by general law
612-11   with respect to condemnation or, at the option of the authority, in
612-12   the manner provided by statutes relative to condemnation by
612-13   districts organized under general law pursuant to Section 59,
612-14   Article XVI, Texas Constitution.
612-15         (b)  In condemnation proceedings being prosecuted by the
612-16   authority, the authority shall not be required to give bond for
612-17   appeal or bond for costs.
612-18         (c)  The authority may overflow and inundate public lands and
612-19   public property and require the relocation of roads and highways in
612-20   the manner and to the extent permitted to districts organized under
612-21   general law pursuant to Section 59, Article XVI, Texas
612-22   Constitution.
612-23         (d)  If, in the exercise of the power of eminent domain, the
612-24   relocation or change of grade of any railroad facilities is
612-25   required, the relocation or change of grade shall be accomplished
612-26   under the provisions of Section 49.223.
 613-1         Sec. 272.026.  LIMITED LIABILITY FOR AQUATIC HERBICIDE
 613-2   APPLICATION.  (a)  In this section, "commercially licensed aquatic
 613-3   herbicide applicator" means a person who holds a commercial
 613-4   applicator license issued by the Department of Agriculture under
 613-5   Chapter 76, Agriculture Code, to apply aquatic herbicides.
 613-6         (b)  Except as provided by Chapter 12, Parks and Wildlife
 613-7   Code, a commercially licensed aquatic herbicide applicator working
 613-8   under contract with the authority is not liable for damages in
 613-9   excess of $2 million of all types for personal injury, property
613-10   damage, or death resulting directly or indirectly from the
613-11   application of aquatic herbicide in compliance with such contract,
613-12   applicable law, and the license terms or permit.
613-13         (c)  The control and elimination of noxious weeds, grasses,
613-14   and vegetation in the San Jacinto River and its tributaries,
613-15   impoundments, and reservoirs through the application by the
613-16   authority or its agents, employees, or contractors, in compliance
613-17   with applicable law, licenses, and permits, of aquatic herbicides
613-18   is an essential governmental function of the authority, and except
613-19   to the extent provided in Chapter 101, Civil Practice and Remedies
613-20   Code, nothing in this chapter shall be deemed or construed to
613-21   waive, limit, or restrict the governmental immunity of the
613-22   authority in the performance of such governmental function.
613-23         Sec. 272.027.  RULES AND REGULATIONS.  The board may make all
613-24   necessary rules and regulations for the government and control of
613-25   the authority not inconsistent with the constitution and laws of
613-26   the state.
 614-1         Sec. 272.028.  USE OF SAN JACINTO RIVER AND TRIBUTARIES.  In
 614-2   the prosecution of the plans for which the authority has been
 614-3   created for storing, controlling, conserving, and distributing for
 614-4   useful purposes the storm waters and floodwaters of the San Jacinto
 614-5   River watershed, the authority may make use of the bed and banks of
 614-6   the San Jacinto River and of its tributaries for any purposes
 614-7   necessary to the accomplishment of the plans of the authority.
 614-8         Sec. 272.029.  CONFLICTS.  Nothing in this chapter shall be
 614-9   construed to violate any provision of the federal or state
614-10   constitutions, and all acts done under this chapter shall be done
614-11   in a manner that conforms to those constitutions, whether expressly
614-12   provided or not.  If any procedure under this chapter is held by
614-13   any court to be violative of either of those constitutions, the
614-14   authority may by resolution provide an alternative procedure
614-15   conformable with those constitutions.
614-16         Sec. 272.030.  APPLICATION OF PRIOR GENERAL LAWS.  Nothing in
614-17   this chapter shall be deemed or construed to limit or restrict the
614-18   effectiveness or the application of any general law applicable to
614-19   the authority prior to the effective date of this chapter.  To the
614-20   extent of any conflict, ambiguity, or inconsistency between any
614-21   such general law and this chapter, the previously applicable
614-22   general law shall control and prevail.
614-23               CHAPTER 273.  SULPHUR RIVER BASIN AUTHORITY
614-24         Sec. 273.001.  CREATION.  (a)  A conservation and reclamation
614-25   district to be known as the "Sulphur River Basin Authority" is
614-26   created.  The authority is a governmental agency and a body politic
 615-1   and corporate.
 615-2         (b)  The authority is created under and is essential to
 615-3   accomplish the purposes of Section 59, Article XVI, Texas
 615-4   Constitution.
 615-5         (c)  The authority may not levy any taxes or create any debt
 615-6   payable out of taxation.
 615-7         (d)  The authority may exercise all the rights and powers of
 615-8   an independent agency and body politic and corporate to construct,
 615-9   maintain, and operate inside the state and in the watershed of the
615-10   Sulphur River and its tributaries, inside or outside the boundaries
615-11   of the authority, any works considered essential to the operation
615-12   of the authority and for its administration in controlling,
615-13   storing, preserving, and distributing the water of the Sulphur
615-14   River and its tributary streams, including the storm water and
615-15   floodwater.  The authority may exercise the power of control and
615-16   regulation over the water of the Sulphur River and its tributaries
615-17   as may be exercised by the state, subject to the constitution and
615-18   the laws of this state.
615-19         Sec. 273.002.  DEFINITIONS.  In this chapter:
615-20               (1)  "Authority" means the Sulphur River Basin
615-21   Authority.
615-22               (2)  "Basin" means the watersheds of the Sulphur River
615-23   within the boundaries of the authority as defined in Section
615-24   273.003.
615-25               (3)  "Board" means the board of directors of the
615-26   authority.
 616-1               (4)  "Director" means a member of the board.
 616-2               (5)  "Person" means an individual, corporation,
 616-3   organization, public agency, business trust, estate, trust,
 616-4   partnership, association, and any other legal entity.
 616-5               (6)  "Public agency" means any government or
 616-6   governmental subdivision or agency.
 616-7               (7)  "State" means the State of Texas or any of its
 616-8   agencies, departments, boards, political subdivisions, or other
 616-9   entities.
616-10               (8)  "United States" includes any department, bureau,
616-11   and other agency of the United States.
616-12               (9)  "Waste" means sewage, industrial waste, municipal
616-13   waste, recreational waste, agricultural waste, waste heat, solid
616-14   waste, or any other waste.
616-15         Sec. 273.003.  BOUNDARIES.  (a)  The authority is composed of
616-16   the territory in each county in Texas, other than Fannin County,
616-17   that is located in whole or in part within the watershed of the
616-18   Sulphur River and its tributaries with confluences with the Sulphur
616-19   River upstream from the eastern boundary of Texas, as those
616-20   watersheds and tributaries are defined by maps on file with the
616-21   Texas Water Development Board.
616-22         (b)  The legislature finds that all of the land included in
616-23   the authority will benefit from the improvements to be acquired and
616-24   constructed by the authority.
616-25         Sec. 273.004.  AUTHORITY PURPOSES.  The purpose of this
616-26   chapter is to authorize the authority to provide for the
 617-1   conservation and development of the state's natural resources
 617-2   within the basin of Sulphur River, including:
 617-3               (1)  the control, storage, preservation, and
 617-4   distribution of the state's water for domestic and municipal uses,
 617-5   industrial uses, irrigation, mining and recovery of minerals, stock
 617-6   raising, groundwater recharge, electric power generation,
 617-7   navigation, recreation and pleasure, and other beneficial uses and
 617-8   purposes;
 617-9               (2)  the reclamation and irrigation of land needing
617-10   irrigation;
617-11               (3)  the reclamation and drainage of overflowed land
617-12   and other land needing drainage;
617-13               (4)  the maintenance and enhancement of the quality of
617-14   the water;
617-15               (5)  the conservation and development of the forests,
617-16   water, and hydroelectric power;
617-17               (6)  the navigation of inland water; and
617-18               (7)  the provision of systems, facilities, and
617-19   procedures for the collection, transportation, handling, treatment,
617-20   and disposal of waste of all types.
617-21         Sec. 273.005.  CONSTRUCTION OF CHAPTER.  This chapter shall
617-22   be liberally construed to achieve its purposes, and any particular
617-23   grant of power included in this chapter shall be held to specify
617-24   but not to limit general powers.  This chapter is sufficient
617-25   authority for the performance of all acts and procedures authorized
617-26   by this chapter, without reference to any other law or any
 618-1   restrictions or limitations included in any other law.
 618-2         Sec. 273.006.  BOARD OF DIRECTORS.  (a)  The authority shall
 618-3   be governed by a board of directors composed of six members.  The
 618-4   directors are appointed by the governor with the advice and consent
 618-5   of the senate.  Two directors are appointed from each of the
 618-6   following regions:
 618-7               (1)  Region 1:  Bowie and Red River counties;
 618-8               (2)  Region 2:  Cass, Franklin, Hunt, Morris, and Titus
 618-9   counties; and
618-10               (3)  Region 3:  Delta, Hopkins, and Lamar counties.
618-11         (b)  Each director must be a qualified elector and a resident
618-12   of a county in the region for which the director is appointed.
618-13         (c)  Each director serves for a term of office as provided by
618-14   this subsection and until a successor has qualified.  Directors
618-15   serve staggered terms of six years, with the terms of one-third of
618-16   the directors expiring February 1 of each odd-numbered year.
618-17         (d)  Each director shall qualify by taking the constitutional
618-18   oath of office and by executing a bond in an amount determined by
618-19   the board conditioned on the faithful performance of the person's
618-20   duties as director.
618-21         (e)  All vacancies on the board shall be filled in the manner
618-22   provided by this section for making the original appointment.
618-23         (f)  The governor may remove a director from office for
618-24   inefficiency, neglect of duty, misconduct in office, or absence
618-25   from three consecutive regular meetings of the board.  Before a
618-26   director is removed from office, the board shall call and hold a
 619-1   hearing on the charges against the director, and the director who
 619-2   is the subject of the proposed removal is entitled to appear at the
 619-3   hearing and present evidence to show why the director should not be
 619-4   removed from office.  Not later than the 30th day before the date
 619-5   of the hearing, the board shall give the accused director notice of
 619-6   the charges against the director and the time and place for the
 619-7   hearing.  An affirmative vote of at least four of the directors is
 619-8   required to approve a recommendation for removal.  A recommendation
 619-9   for removal shall be forwarded to the governor for the governor's
619-10   consideration and action as provided by this subsection.
619-11         (g)  A majority of the members of the board constitutes a
619-12   quorum for the transaction of business.
619-13         (h)  The board shall adopt and may amend necessary rules for
619-14   the conduct of the authority's business.
619-15         (i)  The board shall elect a president, one or more vice
619-16   presidents, a secretary, a treasurer, and other officers as the
619-17   members of the board consider necessary.  The president and vice
619-18   president must be directors, but other officers are not required to
619-19   be members of the board.  The offices of the secretary and
619-20   treasurer may be combined, and the offices of assistant secretary
619-21   and assistant treasurer may be combined.
619-22         Sec. 273.007.  INTEREST IN CONTRACT.  A director who has a
619-23   financial interest in a contract of the authority for the purchase,
619-24   sale, lease, rental, or supply of property, including supplies,
619-25   materials, and equipment, or the construction of facilities shall
619-26   disclose that fact to the other members of the board and may not
 620-1   vote on or participate in discussions during board meetings on the
 620-2   acceptance of the contract.  A financial interest of a director
 620-3   does not affect the validity of a contract if disclosure is made
 620-4   and the director with the financial interest does not vote on the
 620-5   question of entering into the contract.
 620-6         Sec. 273.008.  DIRECTOR'S COMPENSATION.  (a)  A director is
 620-7   entitled to receive $25 per day and reimbursement for actual and
 620-8   necessary expenses incurred:
 620-9               (1)  for each day the director spends attending
620-10   meetings of the board; and
620-11               (2)  for each day the director spends attending to
620-12   business of the authority that is authorized by the board.
620-13         (b)  A director is not entitled to receive a per diem
620-14   allowance for more than 50 days in any single calendar year.
620-15         Sec. 273.009.  COMMITTEES.  The board may appoint or
620-16   establish committees from the membership of the board as necessary
620-17   or desirable in conducting the business of the authority.  Subject
620-18   to the applicable rules of law on delegation of powers, the board
620-19   may assign or delegate or provide for the assignment or delegation
620-20   of any powers, duties, and functions to its committees as the board
620-21   may provide by rule or resolution.
620-22         Sec. 273.010.  EXECUTIVE DIRECTOR.  (a)  By majority vote of
620-23   the qualified directors the board may employ an executive director
620-24   and set the executive director's salary and other compensation.
620-25         (b)  The executive director is the chief executive officer of
620-26   the authority.
 621-1         (c)  Under policies established by the board, the executive
 621-2   director is responsible to the board for:
 621-3               (1)  administering the directives of the board;
 621-4               (2)  keeping the authority's records, including minutes
 621-5   of the meetings of the board and the executive committee;
 621-6               (3)  coordinating with state, federal, and local
 621-7   agencies;
 621-8               (4)  developing plans and programs for the approval of
 621-9   the board or the executive committee;
621-10               (5)  hiring, supervising, training, and discharging the
621-11   authority's employees, as authorized by the board or the executive
621-12   committee;
621-13               (6)  contracting for or retaining technical,
621-14   scientific, legal, fiscal, and other professional services, as
621-15   authorized by the board; and
621-16               (7)  performing any other duties assigned by the board.
621-17         (d)  The board may discharge the executive director on a
621-18   majority vote of the qualified directors.
621-19         Sec. 273.011.  DIRECTORS' AND EMPLOYEES' BONDS.  (a)  The
621-20   executive director, the treasurer, and other officers, agents, and
621-21   employees of the authority who have responsibilities that involve
621-22   the collection, custody, or payment of any money of the authority
621-23   shall execute a fidelity bond.  The board shall approve the form,
621-24   amount, and surety of the bond.
621-25         (b)  The authority shall pay the premiums on the bonds
621-26   required under this chapter.
 622-1         Sec. 273.012.  PRINCIPAL OFFICE.  The authority shall
 622-2   maintain its principal office inside its boundaries.
 622-3         Sec. 273.013.  RECORDS.  (a)  The authority shall keep
 622-4   complete and accurate accounts of its business transactions in
 622-5   accordance with generally accepted methods of accounting.
 622-6         (b)  The authority shall keep complete and accurate minutes
 622-7   of its meetings.
 622-8         (c)  The authority shall keep its accounts, contracts,
 622-9   documents, minutes, and other records at its principal office.
622-10         (d)  Except as otherwise required by law, the authority may
622-11   not disclose any records that it has relating to trade secrets or
622-12   the economics of operation of any business or industry.
622-13         (e)  Except as provided by Subsection (d), the authority
622-14   shall permit reasonable public inspection of its records during
622-15   regular business hours under rules adopted by the board.
622-16         Sec. 273.014.  SEAL.  The authority shall adopt a seal.
622-17         Sec. 273.015.  SUIT.  (a)  The authority may sue and be sued
622-18   in the name of the authority.
622-19         (b)  Service of process may be accomplished by serving the
622-20   president or vice president of the board or the executive director.
622-21         (c)  All courts of this state shall take judicial notice of
622-22   the establishment of the authority.
622-23         Sec. 273.016.  GENERAL POWERS AND DUTIES.  (a)  The authority
622-24   shall administer this chapter and shall use its facilities and
622-25   powers to accomplish the purposes of this chapter.
622-26         (b)  The authority may exercise the powers, rights, and
 623-1   privileges necessary or convenient for accomplishing the purposes
 623-2   of this chapter.
 623-3         (c)  The powers granted to the authority by this chapter are
 623-4   cumulative of all powers granted by other laws that are applicable
 623-5   to the authority.  The powers granted to the authority by this
 623-6   chapter are not intended to restrict the powers of any conservation
 623-7   and reclamation district previously created within the basin or
 623-8   area of the authority under Section 59, Article XVI, Texas
 623-9   Constitution.  It is the legislature's intent that the authority
623-10   and those districts exercise their respective powers in a
623-11   cooperative manner.
623-12         (d)  A district previously created under Section 59, Article
623-13   XVI, or Sections 52(b)(1) and (2), Article III, Texas Constitution,
623-14   may coordinate its plans with the authority and may enter into
623-15   joint undertakings for the purposes for which the districts are
623-16   created.  However, those undertakings must be approved by a
623-17   majority of the boards of directors of the district and of the
623-18   authority.
623-19         Sec. 273.017.  CONTROL AND USE OF WATERS.  (a)  Subject to
623-20   the constitution and other laws of the state and the continuing
623-21   right of supervision of the state through the commission, the
623-22   authority may exercise authority over the storm water and
623-23   floodwater of the basin, subject to applicable provisions of this
623-24   code.
623-25         (b)  The authority may exercise the powers of control and use
623-26   of the state's water in the following manner and for the following
 624-1   purposes:
 624-2               (1)  to provide for the control and coordination of
 624-3   water use in the basin as a unit;
 624-4               (2)  to provide by adequate organization and
 624-5   administration for the preservation of the rights of the people of
 624-6   the different sections of the basin in the beneficial use of water;
 624-7               (3)  to provide for conserving storm water, floodwater,
 624-8   and unappropriated flow water of the basin, including the storage,
 624-9   control, transportation, treatment, and distribution of that water,
624-10   and for the prevention of the escape of water without the maximum
624-11   of public service, the prevention of devastation of land from
624-12   recurrent overflows, and the protection of life and property in the
624-13   river basin from uncontrolled floodwater;
624-14               (4)  to provide for the conservation of water essential
624-15   for domestic and other water uses of the people of the basin,
624-16   including necessary water supplies for cities, towns, and
624-17   industrial districts;
624-18               (5)  to provide for the irrigation of land in the basin
624-19   where irrigation is required for agricultural purposes or is
624-20   considered helpful to more profitable agricultural production and
624-21   to provide for the equitable distribution of storm water,
624-22   floodwater, and unappropriated flow water to the regional potential
624-23   requirements for all uses;
624-24               (6)  to provide for the encouragement and development
624-25   of drainage systems and provisions for drainage of land in the
624-26   valleys of the basin needing drainage for profitable agricultural
 625-1   and livestock production and industrial activities and for other
 625-2   drainage of land for the most advantageous use;
 625-3               (7)  to provide for the conservation of soil against
 625-4   destructive erosion and to prevent the increased risk of flood
 625-5   incident to erosion;
 625-6               (8)  to control and make available for use storm water,
 625-7   floodwater, and unappropriated flow water, as authorized by the
 625-8   commission, in the development of commercial and industrial
 625-9   enterprises in all sections of the watershed area of the authority;
625-10               (9)  to provide for the control, storage, and use of
625-11   storm water, floodwater, and unappropriated flow water in the
625-12   development and distribution of hydroelectric power, where this use
625-13   may be economically coordinated with other and superior uses and
625-14   subordinated to the uses declared by law to be superior;
625-15               (10)  to provide for each purpose and use for which
625-16   storm water, floodwater, and unappropriated flow water when
625-17   controlled and conserved may be used in the performance of a useful
625-18   service as contemplated and authorized by the provisions of the
625-19   constitution and laws of the state;
625-20               (11)  to control, store, and preserve the water of the
625-21   basin inside the boundaries of the authority for any useful
625-22   purpose;
625-23               (12)  to use, distribute, and sell water for any
625-24   beneficial purpose inside and outside the authority; and
625-25               (13)  to acquire water and water rights inside and
625-26   outside the authority.
 626-1         (c)  Plans and works provided by the authority or under
 626-2   authorization of the authority should give primary consideration to
 626-3   the necessary and potential needs for water by or within the
 626-4   various areas within the watersheds of the basin.
 626-5         (d)  The authority shall adopt and implement a program of
 626-6   water conservation consistent with rules and criteria duly adopted
 626-7   and enforceable by the commission for similarly situated
 626-8   authorities.  A program of water conservation means the use of
 626-9   practices, techniques, and technologies that will reduce the
626-10   consumption of water, reduce the loss or waste of water, improve
626-11   efficiency in the use of water, or increase the recycling and reuse
626-12   of water so that a water supply is made available for future uses.
626-13         Sec. 273.018.  FORESTATION AND REFORESTATION.  The authority
626-14   may forest and reforest and aid in the foresting and reforesting of
626-15   the watershed area of the basin.
626-16         Sec. 273.019.  GROUNDWATER.  (a)  The authority may conduct
626-17   surveys and studies of the groundwater supplies in the authority
626-18   for the purpose of determining the location and quantity of
626-19   groundwater available and develop and ascertain other data and
626-20   information that in the judgment of the board may be necessary to
626-21   fully develop water uses from the groundwater in the authority.
626-22         (b)  Subject to the requirements of applicable laws and with
626-23   the approval and under the supervision of the commission, the
626-24   authority may appropriate storm water and floodwater to recharge
626-25   underground freshwater-bearing sand and aquifers in the basin.
626-26         Sec. 273.020.  WATER QUALITY CONTROL.  The authority is a
 627-1   river authority for the purposes and definitions of Chapters 362
 627-2   and 383, Health and Safety Code, and Chapter 30 as they apply to
 627-3   the authority.  If one of those chapters conflicts with this
 627-4   chapter, this chapter prevails.
 627-5         Sec. 273.021.  SOLID WASTE.  The authority may purchase,
 627-6   acquire, construct, maintain, and provide facilities, equipment,
 627-7   and disposal sites to furnish solid waste collection,
 627-8   transportation, treatment, and disposal services inside the
 627-9   authority, may charge for the services, and may enter into
627-10   contracts for those services with any person.
627-11         Sec. 273.022.  PARKS AND RECREATIONAL FACILITIES.  The
627-12   authority may acquire land adjacent to or in the basin for park and
627-13   recreational purposes and may acquire, construct, and maintain park
627-14   and recreational facilities on that land.
627-15         Sec. 273.023.  PERMITS AND LICENSES.  (a)  The authority
627-16   shall apply for any permits, licenses, franchises, and other grants
627-17   of authority required from the commission.
627-18         (b)  The authority may apply for any permits, licenses,
627-19   franchises, and financial assistance it may need from the Texas
627-20   Water Development Board, the commission, or any other state,
627-21   federal, or local governmental agency.
627-22         Sec. 273.024.  SERVICE CONTRACTS AND CHARGES.  (a)  The
627-23   authority may enter into service contracts and may adopt
627-24   resolutions and orders establishing rates and providing for the
627-25   collection of fees and charges for the sale or use of water, the
627-26   services of water transmission, treatment, and storage facilities,
 628-1   solid and liquid waste collection, treatment and disposal
 628-2   facilities and services, the use of park and recreational
 628-3   facilities, the sale of power and electric energy, and any other
 628-4   services or facilities sold, furnished, or supplied by the
 628-5   authority.
 628-6         (b)  The fees and charges shall be sufficient to produce
 628-7   revenues adequate to:
 628-8               (1)  pay expenses necessary for the operation and
 628-9   maintenance of the property and facilities of the authority;
628-10               (2)  pay the principal of and interest on any bonds or
628-11   other obligations issued by the authority when due and payable and
628-12   to fulfill any reserve or other fund obligations of the authority
628-13   in connection with the bonds or other obligations; and
628-14               (3)  pay any other expenses the board considers
628-15   necessary and proper for the operations of the authority.
628-16         Sec. 273.025.  EMINENT DOMAIN.  (a)  The authority may
628-17   acquire land inside and outside the authority to carry out the
628-18   powers, rights, privileges, authority, and functions authorized by
628-19   this chapter by condemnation when the board determines, after
628-20   notice and hearing, that it is necessary.
628-21         (b)  The right of eminent domain shall be exercised by the
628-22   authority in the manner provided by Chapter 21, Property Code,
628-23   except that the authority is not required to give bond for appeal
628-24   or bond for costs in a condemnation suit or other suit to which it
628-25   is a party and is not required to deposit double the amount of any
628-26   award in any suit.
 629-1         (c)  If the authority, in the exercise of the power of
 629-2   eminent domain, makes necessary the relocation, raising, lowering,
 629-3   rerouting, changing the grade, or alteration of the construction of
 629-4   any highway, railroad, electric transmission or distribution line,
 629-5   telephone or telegraph properties and facilities, or pipeline, all
 629-6   necessary relocations, raising, lowering, rerouting, changing the
 629-7   grade, or alteration of construction shall be accomplished at the
 629-8   sole expense of the authority.  In this subsection "sole expense"
 629-9   means the actual cost of relocation, raising, lowering, rerouting,
629-10   change in grade, or alteration of construction to provide
629-11   comparable replacement without enhancement of facilities after
629-12   deducting the net salvage value derived from the old facility.
629-13         Sec. 273.026.  ACQUISITION AND DISPOSITION OF PROPERTY.
629-14   (a)  The authority may purchase, lease, acquire by gift, maintain,
629-15   use, and operate property of any kind inside or outside the
629-16   authority appropriate for the exercise of its powers or the
629-17   accomplishment of its purposes.
629-18         (b)  The authority may sell any property or interest in
629-19   property owned by the authority by installments or otherwise,
629-20   including sales in any manner prescribed or authorized by Section
629-21   402.014, Local Government Code, Chapter 383, Health and Safety
629-22   Code, and Chapter 30.  The authority may also lease, exchange, or
629-23   otherwise dispose of any property or interest in property.
629-24         Sec. 273.027.  FACILITIES.  The authority may acquire,
629-25   construct, extend, improve, maintain, reconstruct, use, and operate
629-26   facilities inside or outside the authority necessary or convenient
 630-1   to the exercise of its powers, rights, duties, and functions or the
 630-2   accomplishment of its purposes.
 630-3         Sec. 273.028.  USE OF PUBLIC EASEMENTS.  The authority may
 630-4   use public roadways, streets, alleys, or public easements inside or
 630-5   outside the boundaries of the authority in the exercise of its
 630-6   powers or the accomplishment of its purposes without the necessity
 630-7   of securing a franchise.
 630-8         Sec. 273.029.  CONTRACTS GENERALLY.  (a)  The authority may
 630-9   enter into contracts and execute instruments that are necessary or
630-10   convenient to the exercise of its powers, rights, duties, and
630-11   functions or the accomplishment of its purposes.
630-12         (b)  Notwithstanding any other law, the authority may
630-13   undertake and carry out any activities, enter into contracts, loan
630-14   agreements, leases, or installment sales agreements, and acquire,
630-15   purchase, construct, own, operate, maintain, repair, improve, or
630-16   extend and loan, lease, sell, or otherwise dispose of, as the
630-17   parties may agree, any facilities, plants, buildings, structures,
630-18   equipment, and appliances, property or any interest in property,
630-19   and any or all money or proceeds of bonds and other obligations.
630-20   These activities and agreements may be accomplished by such methods
630-21   as loan payments, rentals, sales, and installment sales.
630-22         (c)  The authority may contract with all persons in any
630-23   manner authorized by this chapter, Chapters 362 and 383, Health and
630-24   Safety Code, and Chapter 30 with respect to water, waste, pollution
630-25   control, or any other facilities and any services provided by the
630-26   authority.  A public agency may also enter into and execute such a
 631-1   contract with the authority and may determine, agree, and pledge
 631-2   that all or any parts of its payments under the contract are
 631-3   payable from the source described in Section 30.030(c), subject
 631-4   only to the authorization of the contract, pledge, and payments by
 631-5   the governing body of the public agency.  A public agency may also
 631-6   use and pledge other available revenues or resources for payment of
 631-7   amounts due under those contracts, as an additional source or
 631-8   sources of payment or as the sole source or sources of payment.
 631-9         (d)  A public agency may set, charge, and collect fees,
631-10   rates, charges, rentals, and other amounts for services or
631-11   facilities provided by a utility operated by the agency, or
631-12   provided pursuant to or in connection with a contract with the
631-13   authority, from its inhabitants or from users or beneficiaries of
631-14   the utility, services, or facilities, including water charges and
631-15   garbage collection or handling fees and other fees or charges, may
631-16   use and pledge those funds to make payments to the authority
631-17   required under the contract, and may covenant to do so in amounts
631-18   sufficient to make all or part of those payments to the authority
631-19   when due.  If the parties agree in the contract, the payments
631-20   constitute an expense of operation of any facilities or utility
631-21   operated by the public agency.
631-22         Sec. 273.030.  BIDS AND CONTRACT CONDITIONS.  (a)  A
631-23   construction, maintenance, operation, or repair contract, a
631-24   contract for the purchase of material, equipment, or supplies, or a
631-25   contract for services, other than technical, scientific, legal,
631-26   fiscal, or other professional services, that will require an
 632-1   estimated expenditure of more than $10,000 or is for a term of six
 632-2   months or more shall be awarded to the lowest and best bidder.  If
 632-3   the board finds that an extreme emergency exists, the board may
 632-4   award contracts necessary to protect and preserve the public health
 632-5   and welfare or the property of the authority without using the
 632-6   bidding procedures.
 632-7         (b)  A notice to bidders shall be published once each week
 632-8   for three consecutive weeks before the date set for awarding the
 632-9   contract.  The notice must be published in a newspaper with general
632-10   circulation in the authority and may also be published in any other
632-11   appropriate publication.
632-12         (c)  The notice of bids is sufficient if it states the time
632-13   and place at which the bids will be opened and the general nature
632-14   of the work to be done, the material, equipment, or supplies to be
632-15   purchased, or the nonprofessional services to be rendered and
632-16   states the terms on which copies of the plans, specifications, or
632-17   other pertinent information may be obtained.
632-18         (d)  A person who desires to bid on the construction of any
632-19   work or project that is advertised for bids shall, on written
632-20   application to the authority, be provided a copy of the plans and
632-21   specifications or other engineering and architectural documents
632-22   showing the work to be done and all of the details of the work to
632-23   be done.  The authority may make a charge to cover the cost of
632-24   making the copy.  Bids must be in writing and sealed and delivered
632-25   to the authority and must be accompanied by a certified check on a
632-26   responsible bank in the state, or, at the discretion of the
 633-1   authority, a bid bond from a company approved by the authority, for
 633-2   at least one percent of the total amount bid.  The check or bond is
 633-3   forfeited to the authority if the successful bidder fails or
 633-4   refuses to enter into a proper contract or fails or refuses to
 633-5   furnish bond as required by law.  Any or all bids may be rejected
 633-6   by the authority, and the authority may waive any irregularity in
 633-7   the bids.
 633-8         (e)  Bids shall be opened at the place specified in the
 633-9   published notice and shall be announced by the authority.  The
633-10   place where the bids are opened and announced shall be open to the
633-11   public.  The award of the contract shall be made by the board.
633-12         (f)  The contract price of construction contracts of the
633-13   authority may be paid in partial payment as the work progresses,
633-14   but the payments shall not exceed 90 percent of the amount due at
633-15   the time of the payment as shown by the report of the engineer of
633-16   the authority.  During the progress of the work, the executive
633-17   director shall inspect the construction or have the construction
633-18   inspected by the authority's engineer or the engineer's assistants.
633-19   On certification of the executive director and the authority's
633-20   engineer of the completion of the contract in accordance with its
633-21   terms, and in the case of any construction contract for which
633-22   notice to bidders is required by this chapter, on approval of the
633-23   board, the board shall draw a warrant on its depository to pay the
633-24   balance due on the contract.
633-25         (g)  The person, firm, or corporation with whom the contract
633-26   is made shall provide the performance and payment bonds required by
 634-1   law.
 634-2         (h)  This section does not prohibit the authority from
 634-3   purchasing or acquiring land or interests in land from any person,
 634-4   from acquiring, constructing, or improving pollution control or
 634-5   waste collection and disposal facilities as provided by Chapter
 634-6   383, Health and Safety Code, or Chapter 30 or other applicable
 634-7   laws, or from purchasing or acquiring surplus property from a
 634-8   governmental entity by negotiated contract and without necessity
 634-9   for advertising for bids.
634-10         (i)  An officer, agent, or employee of the authority who has
634-11   a financial interest in a contract shall disclose that fact to the
634-12   board before the board votes on the acceptance of the contract.
634-13         Sec. 273.031.  AUTHORITY RULES.  (a)  The authority may adopt
634-14   and enforce rules reasonably required to carry out the purposes of
634-15   this chapter.
634-16         (b)  In adopting rules, the board shall comply, as
634-17   appropriate, with the requirements of Chapter 2001, Government
634-18   Code.
634-19         (c)  The board shall print its rules and furnish copies to
634-20   any person on written request.
634-21         Sec. 273.032.  PENALTIES.  (a)  A person who violates a rule
634-22   or order of the authority is subject to a civil penalty of not less
634-23   than $50 nor more than $1,000 for each day of violation.
634-24         (b)  The authority may sue to recover the penalty in a
634-25   district court in the county in which the violation occurred.
634-26   Penalties shall be paid to the authority.
 635-1         (c)  The authority may sue for injunctive relief in a
 635-2   district court in the county in which the violation of any rule or
 635-3   order occurred or is threatened.
 635-4         (d)  The authority may sue for injunctive relief and
 635-5   penalties in the same proceeding.
 635-6         Sec. 273.033.  COURT REVIEW.  (a)  A person who is adversely
 635-7   affected by a rule or order of the authority may, before the 31st
 635-8   day after the day on which the rule or order takes effect, sue the
 635-9   authority in a district court to set aside the rule or order.
635-10         (b)  Venue for suits under Subsection (a) is in any county
635-11   located wholly or partially in the authority.
635-12         Sec. 273.034.  SURVEYS AND ENGINEERING INVESTIGATIONS;
635-13   PLANNING.  (a)  The authority may make surveys and engineering
635-14   investigations to develop information for the authority's use.
635-15         (b)  The board may make and determine plans necessary to
635-16   accomplish the purposes for which the authority is created and may
635-17   carry out the plans.
635-18         Sec. 273.035.  ACCESS.  (a)  To provide for the safety and
635-19   welfare of persons and their property or for the protection and
635-20   security of the property and facilities of the authority, the board
635-21   may adopt rules with respect to the property of the authority and
635-22   any water reservoir or dam, the construction, operation, or
635-23   management of which is participated in by the authority, to control
635-24   and regulate ingress, egress, and use and the operation of land and
635-25   water vehicles.
635-26         (b)  All public roads, streets, and state highways traversing
 636-1   the areas adjacent to the areas to be covered by any impounded
 636-2   water shall remain open as a way of public passing to and from the
 636-3   lakes created, unless changed by the authority.
 636-4         Sec. 273.036.  USE OF BED AND BANKS OF SULPHUR RIVER AND ITS
 636-5   TRIBUTARIES.  Subject to the approval of the commission, the
 636-6   authority may use the beds and banks of the Sulphur River and its
 636-7   tributary streams for any purposes necessary to accomplish the
 636-8   plans of the authority for storing, controlling, conserving,
 636-9   transporting, and distributing storm water, floodwater, and
636-10   appropriated flow waters for useful purposes.
636-11         Sec. 273.037.  WORK WITH DEVELOPMENT BOARD.  The authority
636-12   has and may exercise all the powers vested in political
636-13   subdivisions under Title 2, including the powers necessary to
636-14   enable the authority to participate in the programs administered by
636-15   the Texas Water Development Board for the acquisition and
636-16   development of facilities, the sale or lease of facilities,
636-17   financial assistance to political subdivisions, and other programs.
636-18         Sec. 273.038.  GENERAL PROVISIONS.  (a)  The board may
636-19   provide for any expenditures it considers essential or useful in
636-20   the maintenance, operation, and administration of the authority.
636-21         (b)  The authority may perform any other acts or things
636-22   necessary or convenient to the exercise of the powers, rights,
636-23   privileges, or functions conferred by this chapter or other laws.
636-24         Sec. 273.039.  LIMITATIONS ON AUTHORITY AND SUPERVISION BY
636-25   COMMISSION.  (a)  The powers and duties granted and prescribed by
636-26   this chapter are subject to all legislative declarations of public
 637-1   policy in the maximum use of the storm water, floodwater, and
 637-2   unappropriated flow water of the basin for the purposes for which
 637-3   the authority is created and subject to the continuing right of
 637-4   supervision of the state through the commission.
 637-5         (b)  The commission shall approve or refuse to approve the
 637-6   adequacy of any plan or plans for flood control or conservation
 637-7   improvement purposes that are devised by the authority for the
 637-8   achievement of the plans and purposes intended in the creation of
 637-9   the authority and that contemplate improvements supervised by the
637-10   commission under general law.
637-11         Sec. 273.040.  DISBURSEMENT OF FUNDS.  The authority's funds
637-12   may be disbursed only by check, draft, order, or other instrument
637-13   signed by the person or persons authorized in the board's rules or
637-14   by resolution of the board.
637-15         Sec. 273.041.  FEES AND CHARGES.  The authority shall
637-16   establish fees and charges that may not be higher than necessary to
637-17   fulfill the obligations imposed by this chapter.
637-18         Sec. 273.042.  LOANS AND GRANTS.  (a)  The authority may
637-19   borrow money and accept grants and donations for its corporate
637-20   purposes from private sources, the United States, the state, local
637-21   governments, or any other person.  The authority may enter into any
637-22   agreement in connection with the loan, grant, or donation that is
637-23   not in conflict with the constitution and laws of the state.
637-24         (b)  The sources of any funds accepted by the authority are
637-25   public information.
637-26         Sec. 273.043.  FUNDS FOR SURVEYS AND DATA COLLECTION.  The
 638-1   authority may apply to the state, the United States, or any other
 638-2   person for funds necessary to secure engineering surveys and the
 638-3   compilation and collection of data relating to regional and general
 638-4   conditions entering into and influencing the character and the
 638-5   extent of the improvements necessary to accomplish the storage,
 638-6   control, transportation, treatment, conservation, and equitable
 638-7   distribution to the greatest public advantage of the storm water,
 638-8   floodwater, and normal flow that is stored and controlled and to
 638-9   accomplish or carry out any of the other purposes of this chapter.
638-10   The authority shall request an amount it considers sufficient.  The
638-11   authority may make the necessary agreements with the party
638-12   providing the funds and may appropriate the amount of the estimated
638-13   equitable contribution of the costs of developing essential
638-14   engineering data.
638-15         Sec. 273.044.  TRUST FUNDS.  Funds collected by or donated,
638-16   granted, loaned, or advanced to the authority are declared to be
638-17   trust funds for the purposes provided by this chapter.
638-18         Sec. 273.045.  INVESTMENT OF FUNDS.  (a)  Funds in the
638-19   authority treasury that are not required for current payment of
638-20   obligations of the authority or for sinking funds and that the
638-21   board considers available for investment may be invested or
638-22   reinvested by the authority in:
638-23               (1)  direct obligations of or obligations the principal
638-24   and interest of which are guaranteed by the United States;
638-25               (2)  direct obligations of or participation
638-26   certificates guaranteed by the Federal Intermediate Credit Banks,
 639-1   Federal Land Banks, Federal National Mortgage Association, Federal
 639-2   Home Loan Banks, and Banks for Cooperatives;
 639-3               (3)  certificates of deposit of a bank or trust company
 639-4   the deposits of which are fully secured by a pledge of securities
 639-5   of any of the institutions specified in this subsection;
 639-6               (4)  other securities eligible for investment under
 639-7   other laws; or
 639-8               (5)  any combination of the investments listed in this
 639-9   subsection.
639-10         (b)  The type and maturity of investments made under this
639-11   section shall be determined by the board.  In the case of funds
639-12   established in connection with the authorization of bonds or other
639-13   obligations, the board shall include appropriate provisions
639-14   relating to such investments in the resolution relating to the
639-15   issuance of the bonds.  Income and profits on such investments
639-16   shall be applied as directed by the board.
639-17         Sec. 273.046.  AUDIT.  (a)  The fiscal year of the authority
639-18   ends on August 31 of each year.
639-19         (b)  On or before January 1 following the close of each
639-20   fiscal year, the state auditor shall audit the books and accounts
639-21   of the authority for the preceding fiscal year.
639-22         (c)  The audit must state the amount of money received by the
639-23   authority under this chapter during the preceding fiscal year and
639-24   how, to whom, and for what purpose the money was spent.
639-25         (d)  A copy of the audit report shall be filed with the
639-26   authority, the governor, the lieutenant governor, the speaker of
 640-1   the house of representatives, the attorney general, the commission,
 640-2   and the comptroller.
 640-3         (e)  After completing the audit report, the state auditor
 640-4   shall prepare a statement showing the actual cost of the audit and
 640-5   shall certify the statement to the governor for his approval.
 640-6   After the statement is approved by the governor, it shall be
 640-7   delivered to the authority.  The authority shall pay for the cost
 640-8   of the audit by depositing the money for the audit with the
 640-9   comptroller, who shall place the money in the general revenue fund.
640-10         (f)  This section does not prohibit the authority from
640-11   employing the professional services of accountants for any
640-12   purposes.
640-13         Sec. 273.047.  DEPOSITORY BANKS.  (a)  The board shall
640-14   designate one or more banks inside or outside the authority to
640-15   serve as depository for the funds of the authority.
640-16         (b)  All money of the authority shall be deposited in the
640-17   depository bank or banks, except that bond proceeds or proceeds of
640-18   other obligations, money pledged to pay those obligations, money
640-19   placed in special funds, and money remitted to a bank of payment
640-20   for the payment of the principal of and interest on obligations may
640-21   be handled as provided in a trust indenture or resolution.
640-22         (c)  To the extent that funds in the depository banks or a
640-23   trustee bank are not invested or insured by the Federal Deposit
640-24   Insurance Corporation, the funds shall be secured in the manner
640-25   provided by law for the security of county funds.
640-26         (d)  Before designating a depository bank or banks, the board
 641-1   shall issue a notice stating the time and place at which the board
 641-2   will meet to designate the depositories and inviting banks to
 641-3   submit applications to be designated depositories.  The term of
 641-4   service for depositories shall be prescribed by the board.  The
 641-5   notice must be published one time in a newspaper or newspapers of
 641-6   general circulation in the authority and specified by the board, or
 641-7   in lieu of publication, a copy of the notice may be mailed to each
 641-8   bank inside the boundaries of the authority.
 641-9         (e)  At the time stated in the notice, the board shall
641-10   consider the applications and the management and conditions of the
641-11   banks filing them and shall designate as depositories the bank or
641-12   banks that offer the most favorable terms and conditions for the
641-13   handling of the funds of the authority and that the board finds
641-14   have proper management and are in condition to warrant handling of
641-15   authority funds.  Membership on the board by an officer or director
641-16   of a bank does not disqualify the bank from being designated as
641-17   depository.
641-18         (f)  If no applications seeking designation as depository are
641-19   received by the time stated in the notice, the board shall
641-20   designate a bank or banks inside or outside the authority as
641-21   depository on terms and conditions the board considers advantageous
641-22   to the authority.
641-23         Sec. 273.048.  BONDS.  (a)  For the purpose of carrying out
641-24   any power or authority provided by this chapter, including the
641-25   expense of preparing the master plan and the payment of engineering
641-26   and other expenses, the authority may issue bonds or other
 642-1   obligations in one general class secured by a pledge of all or part
 642-2   of the revenues accruing to the authority, including without
 642-3   limitations the revenues received from the sale of water or other
 642-4   products, from the rendition of service, from tolls and charges,
 642-5   and from all other sources other than ad valorem taxes.
 642-6         (b)  The bonds must be authorized by resolution of the board,
 642-7   issued in the name of the authority, signed by the president or a
 642-8   vice president, and attested by the secretary.  The bonds must bear
 642-9   the seal of the authority.  If authorized by the board, the
642-10   signatures of the president or vice president and of the secretary
642-11   or of both may be printed or lithographed on the bonds, and the
642-12   seal of the authority may be impressed on the bonds or may be
642-13   printed or lithographed on the bonds.
642-14         (c)  The bonds shall be in the form prescribed by the board,
642-15   shall be in any denomination or denominations, must mature serially
642-16   or otherwise in not to exceed 50 years from their date, shall bear
642-17   interest according to law, and may be sold at a price and under
642-18   terms determined by the board to be the most advantageous
642-19   reasonably obtainable.  The board may make the bonds callable
642-20   before maturity at the times and prices prescribed in the bonds,
642-21   and the bonds may be made registrable as to principal or as to both
642-22   principal and interest.  The bonds may be further secured by a
642-23   trust indenture with a corporate trustee.
642-24         (d)  Bonds may be issued in more than one series, and from
642-25   time to time, as required for carrying out the purposes of this
642-26   chapter.  A pledge of revenue may reserve the right, under
 643-1   specified conditions, to issue additional obligations that will be
 643-2   on a parity with or subordinate to the obligations being issued.
 643-3         (e)  The authority is an "issuer" for the purpose of Chapter
 643-4   1371, Government Code, and that law applies to the authority.
 643-5         (f)  The resolution authorizing the bonds or the trust
 643-6   indenture further securing the bonds may specify additional
 643-7   provisions that constitute a contract between the authority and the
 643-8   owners of the bonds.  The board may provide for additional
 643-9   provisions, including a corporate trustee or receiver provided by
643-10   the authority to take possession of facilities of the authority in
643-11   the event of default on the part of the authority in fulfilling the
643-12   covenants.
643-13         Sec. 273.049.  REFUNDING BONDS.  The authority may issue
643-14   refunding bonds to refund outstanding obligations issued under this
643-15   chapter.  Refunding bonds may be issued by the authority as
643-16   provided by Chapter 1207, Government Code.  Obligations issued at
643-17   any time by the authority may also be refunded in the manner
643-18   provided by any other applicable law.
643-19         Sec. 273.050.  APPROVAL AND REGISTRATION OF BONDS.
643-20   (a)  After bonds, including refunding bonds, are authorized by the
643-21   authority, the bonds and the record relating to their issuance
643-22   shall be submitted to the attorney general for examination as to
643-23   the validity of the bonds.  If obligations are to be issued to
643-24   finance in whole or in part water-using facilities, before granting
643-25   approval the attorney general shall be furnished a resolution from
643-26   the commission certifying that the authority has the necessary
 644-1   water rights authorizing it to impound and appropriate the water to
 644-2   be used by the project.  If the obligations recite that they are
 644-3   secured by a pledge of the proceeds of a contract made between the
 644-4   authority and any public agency, a copy of the contract and the
 644-5   proceedings of the public agency authorizing the contract shall
 644-6   also be submitted to the attorney general.
 644-7         (b)  If the attorney general finds that the bonds have been
 644-8   authorized and the contracts have been made as provided by the
 644-9   constitution and laws of the state, the attorney general shall
644-10   approve the bonds and the contracts and the bonds shall then be
644-11   registered by the comptroller.
644-12         (c)  After approval and registration, the bonds and contracts
644-13   are valid and binding and are incontestable for any cause.
644-14         Sec. 273.051.  BONDS AS INVESTMENTS OR SECURITY FOR DEPOSITS.
644-15   (a)  Authority bonds are legal and authorized investments for:
644-16               (1)  banks;
644-17               (2)  savings banks;
644-18               (3)  trust companies;
644-19               (4)  savings and loan associations;
644-20               (5)  insurance companies;
644-21               (6)  fiduciaries;
644-22               (7)  trustees;
644-23               (8)  guardians; and
644-24               (9)  sinking funds of cities, counties, school
644-25   districts, and other political subdivisions of the state and other
644-26   public funds of the state and its agencies, including the permanent
 645-1   school fund.
 645-2         (b)  Authority bonds are eligible to secure deposits of
 645-3   public funds of the state and cities, counties, school districts,
 645-4   and other political subdivisions of the state.  The bonds are
 645-5   lawful and sufficient security for deposits to the extent of their
 645-6   value.
 645-7         Sec. 273.052.  LEGISLATIVE FINDINGS.  The legislature finds
 645-8   and determines that the boundaries of the authority form a closure.
 645-9   If a mistake is made in the description of the boundaries in the
645-10   legislative process or a mistake is otherwise made, the mistake
645-11   does not affect the organization, existence, and validity of the
645-12   authority or the right of the authority to issue any types of
645-13   bonds, including refunding bonds, for the purposes for which the
645-14   authority is created or to pay the principal of or interest on the
645-15   obligations or in any other manner affect the legality or operation
645-16   of the authority or its governing body.
645-17          CHAPTER 274.  SULPHUR RIVER MUNICIPAL WATER DISTRICT
645-18         Sec. 274.001.  CREATION.  (a)  A conservation and reclamation
645-19   district to be known as the "Sulphur River Municipal Water
645-20   District" is created.  The district is a governmental agency and a
645-21   body politic and corporate.
645-22         (b)  The district is created under and is essential to
645-23   accomplish the purposes of Section 59, Article XVI, Texas
645-24   Constitution.
645-25         Sec. 274.002.  DEFINITIONS.  In this chapter:
645-26               (1)  "Board" means the board of directors of the
 646-1   district.
 646-2               (2)  "Director" means a member of the board.
 646-3               (3)  "District" means the Sulphur River Municipal Water
 646-4   District.
 646-5         Sec. 274.003.  TERRITORY.  (a)  The district comprises all
 646-6   the territory that was contained within the cities of Cooper,
 646-7   Commerce, and Sulphur Springs on March 1, 1955.  A defect in the
 646-8   definition of the boundaries of any of those cities or in any past
 646-9   or future proceedings for the annexation of territory to any of
646-10   those cities does not affect the validity of the district or any of
646-11   its powers or duties.
646-12         (b)  It is found that all the land included in the district
646-13   will benefit from the improvements to be acquired and constructed
646-14   by the district.
646-15         Sec. 274.004.  BOARD OF DIRECTORS.  (a)  All powers of the
646-16   district shall be exercised by a board of directors.  The directors
646-17   shall be appointed by a majority vote of the governing body of each
646-18   of the cities contained in the district.
646-19         (b)  In May of each year, the governing body of each city
646-20   shall appoint one director for a two-year term beginning on June 1
646-21   of that year.
646-22         (c)  Each director serves for a term of office as provided by
646-23   this section and until a successor is appointed and has qualified.
646-24         (d)  A director must reside in and own taxable property in
646-25   the city from which the director is appointed.  A member of a
646-26   governing body of a city or an employee of a city is not eligible
 647-1   to serve as a director.
 647-2         (e)  A director shall subscribe the constitutional oath of
 647-3   office and shall give bond for the faithful performance of the
 647-4   director's duties in the amount of $5,000.  The cost of the bond
 647-5   shall be paid by the district.
 647-6         (f)  A majority of the members of the board constitutes a
 647-7   quorum.
 647-8         Sec. 274.005.  DIRECTOR FEES.  (a)  Each director is entitled
 647-9   to receive a fee of $20 for attending each meeting of the board;
647-10   provided, however, that not more than $40 shall be paid to any
647-11   director for meetings held in any one calendar month.
647-12         (b)  A director is entitled to receive a fee of $20 per day
647-13   for each day devoted to the business of the district and to
647-14   reimbursement for actual expenses incurred in attending to district
647-15   business if such service and expense are expressly approved by the
647-16   board.
647-17         Sec. 274.006.  OFFICERS; EMPLOYEES; SEAL.  (a)  The board
647-18   shall elect from among its members a president and a vice president
647-19   of the district and other officers the board considers necessary.
647-20         (b)  The president is the chief executive officer of the
647-21   district and the presiding officer of the board and has the same
647-22   right to vote as any other director.
647-23         (c)  The vice president shall perform all duties and exercise
647-24   all powers conferred by this chapter on the president when the
647-25   president is absent or fails or declines to act.
647-26         (d)  The board shall appoint a secretary and a treasurer, who
 648-1   may or may not be members of the board, and may combine those
 648-2   offices.  The treasurer shall give bond in an amount required by
 648-3   the board, but in no event less than $25,000.  The bond shall be
 648-4   conditioned on the treasurer's faithfully accounting for all money
 648-5   that comes into the treasurer's custody as treasurer of the
 648-6   district.  Until the district authorizes the issuance of bonds, the
 648-7   amount of the official bond of the treasurer may be set by the
 648-8   board in any amount not less than $5,000.
 648-9         (e)  The board shall appoint and employ all necessary
648-10   engineers, attorneys, and other employees.
648-11         (f)  The board shall adopt a seal for the district.
648-12         Sec. 274.007.  ANNEXATION OF TERRITORY IN CERTAIN COUNTIES.
648-13   (a)  Other territory in Delta, Hunt, Hopkins, and Franklin counties
648-14   may be annexed to the district as provided in this section.
648-15         (b)  A petition for annexation must:
648-16               (1)  be signed by 50 or a majority of the qualified
648-17   voters of the territory to be annexed who own taxable property in
648-18   the territory and who have duly rendered the property to the city,
648-19   if situated within a city or town, or county for taxation;
648-20               (2)  be filed with the board; and
648-21               (3)  describe the territory to be annexed by metes and
648-22   bounds or otherwise unless the territory is the same as that
648-23   contained in a city or town, in which event it shall be sufficient
648-24   to state that the territory to be annexed is that which is
648-25   contained within the city or town.
648-26         (c)  If the board finds that the petition complies with and
 649-1   is signed by the number of qualified persons required under
 649-2   Subsection (b), that the annexation would be in the interest of the
 649-3   territory to be annexed and the district, and that the district
 649-4   will be able to supply water to the territory to be annexed, the
 649-5   board shall adopt a resolution stating the conditions, if any,
 649-6   under which the territory may be annexed to the district and
 649-7   requesting the commission to annex the territory to the district.
 649-8   A certified copy of the resolution and of the petition shall be
 649-9   filed with the commission.
649-10         (d)  The commission shall adopt a resolution declaring its
649-11   intention to call an election in the territory to be annexed for
649-12   the purpose of submitting the proposition of whether or not the
649-13   territory shall be annexed to the district.  The commission shall
649-14   set a time and place for a hearing to be held by the commission on
649-15   the question of whether the territory to be annexed will be
649-16   benefited by the improvements, works, and facilities then owned or
649-17   operated or contemplated to be owned or operated by the district.
649-18   A railroad right-of-way that is not situated within the defined
649-19   limits of an incorporated city or town will not benefit from the
649-20   improvements, works, and facilities that the district is authorized
649-21   to construct.  A railroad right-of-way may not be annexed to the
649-22   district unless the right-of-way is contained within the limits of
649-23   an incorporated city or town that has been annexed to the district.
649-24         (e)  Notice of the adoption of the resolution stating the
649-25   time and place of the hearing and addressed to the citizens and
649-26   owners of property in the territory to be annexed shall be
 650-1   published one time in a newspaper published within or having
 650-2   general circulation within the territory, designated by the
 650-3   commission, at least 10 days before the date of the hearing.  The
 650-4   notice must describe the territory to be annexed in the same manner
 650-5   as required or permitted by the petition.
 650-6         (f)  All interested persons may appear at the hearing and
 650-7   offer evidence for or against the intended annexation.  The hearing
 650-8   may proceed in the order and under the rules prescribed by the
 650-9   commission, and the hearing may be recessed from time to time.  If,
650-10   at the conclusion of the hearing, the commission finds that all of
650-11   the lands in the territory to be annexed will benefit from the
650-12   present or contemplated improvements, works, or facilities of the
650-13   district, the commission shall adopt a resolution calling an
650-14   election in the territory to be annexed stating the date and place
650-15   or places for holding the election and appointing a presiding judge
650-16   for each voting place, who shall appoint the necessary assistant
650-17   judges and clerks to assist in holding the election.
650-18         (g)  Notice of the election, stating the date of the
650-19   election, the proposition to be voted on, and the conditions under
650-20   which the territory may be annexed, or making reference to the
650-21   resolution of the board for that purpose, and the place or places
650-22   for holding the election, shall be published one time in a
650-23   newspaper designated by the commission at least 10 days before the
650-24   date set for the election.  If the newspaper carrying the notice is
650-25   not published within the territory to be annexed, additional notice
650-26   shall be given for the required period by posting copies of the
 651-1   notice of election at three public places in the territory.
 651-2         (h)  Only qualified electors who reside in the territory to
 651-3   be annexed may vote in the election.  Returns of the election shall
 651-4   be made to the commission.
 651-5         (i)  The commission shall canvass the returns of the election
 651-6   and adopt a resolution declaring the results.  If the resolution
 651-7   shows that a majority of the votes cast are in favor of annexation,
 651-8   the commission shall enter an order annexing the territory to the
 651-9   district, and the annexation shall be incontestable except in the
651-10   manner and within the time for contesting elections under the
651-11   Election Code.  A certified copy of the order shall be recorded in
651-12   the deed records of the county in which the territory is situated.
651-13         (j)  The commission, in calling the election on the
651-14   proposition for annexation of territory, may include a proposition
651-15   for the assumption of the territory's part of the tax-supported
651-16   bonds of the district then outstanding and those voted but not yet
651-17   sold and for the levy of an ad valorem tax on taxable property in
651-18   the territory along with the tax in the remainder of the district
651-19   for the payment of the bonds.
651-20         (k)  After territory is added to the district, the board may
651-21   call an election over the entire district for the purpose of
651-22   determining whether the district as enlarged shall assume the
651-23   tax-supported bonds, if any, then outstanding, and those voted but
651-24   not yet sold, and whether an ad valorem tax shall be levied on all
651-25   taxable property within the district as enlarged for the payment of
651-26   the bonds, unless the proposition is voted along with the
 652-1   annexation election and becomes lawfully binding on the territory
 652-2   annexed.  The election shall be called and held in the same manner
 652-3   as elections for the issuance of bonds as provided by this chapter.
 652-4         (l)  If no newspaper is published in the territory to be
 652-5   annexed, the notices required by this section shall be posted in
 652-6   three public places in the territory.
 652-7         Sec. 274.008.  APPOINTMENT OF DIRECTORS IN ANNEXED TERRITORY.
 652-8   (a)  When a city, the territory of which is annexed to the
 652-9   district, has a population of 5,000 or more, the governing body of
652-10   the city shall appoint one director for a term ending the following
652-11   May 31 and one director for a term ending one year after the
652-12   following May 31.  In May of each year the governing body of the
652-13   city shall appoint one director for a two-year term as provided by
652-14   this chapter for cities originally included in the district.
652-15         (b)  When a city, the territory of which is annexed to the
652-16   district has a population of less than 5,000, the governing body of
652-17   the city shall appoint one director for a term ending the following
652-18   May 31.  In that May and in May of each second year after that the
652-19   governing body of the city shall appoint one director for a
652-20   two-year term.
652-21         (c)  If a city initially subject to Subsection (b) later has
652-22   a population of 5,000 or more, it shall be entitled to two
652-23   directors to be appointed as provided by Subsection (a).
652-24         Sec. 274.009.  USE OF CERTAIN WATERS AND FACILITIES.
652-25   (a)  The district may acquire:
652-26               (1)  all rights to conservation storage and storage
 653-1   capacity in the reservoir to be provided by Cooper Dam and
 653-2   conservation storage as may result from an increase in the size of
 653-3   such structure; and
 653-4               (2)  the right to take water from the reservoir
 653-5   described by Subdivision (1) in which the dam will impound storm
 653-6   waters and floodwaters and the unappropriated flow of the South
 653-7   Sulphur River and its tributaries by complying with the applicable
 653-8   provisions of this code and pursuant to any contracts that the
 653-9   district may make with the United States government in reference to
653-10   those rights.
653-11         (b)  The district may construct or otherwise acquire all
653-12   works, plants, and other facilities necessary or useful for the
653-13   purpose of diverting and further impounding or storing the water
653-14   described by Subsection (a) and processing and transporting it to
653-15   cities and others for municipal, domestic, and industrial purposes.
653-16         (c)  To the extent permissible under any contract or
653-17   contracts with the United States government and its agencies under
653-18   this section, the district may dispose of surplus waters under its
653-19   control for irrigation purposes.
653-20         (d)  As an aid to conserving the water in the district, the
653-21   district may construct and operate sewage disposal plants and
653-22   related facilities and may make contracts necessary to financing
653-23   the construction and operation of the plants and facilities with
653-24   any city included within the district.
653-25         (e)  Any works for diverting water from the impounding dam
653-26   may not be constructed until the plans for the works are approved
 654-1   by the commission.
 654-2         (f)  None of the powers granted by this section extend
 654-3   outside of Delta County, Hunt County, Hopkins County, and Franklin
 654-4   County.
 654-5         Sec. 274.010.  EMINENT DOMAIN.  (a)  For the purpose of
 654-6   carrying out any power or authority conferred by this chapter the
 654-7   district may acquire land and easements within and outside the
 654-8   district in Delta County, Hunt County, Hopkins County, and Franklin
 654-9   County, including land above the probable high-water line around
654-10   any impounding or diversion reservoir, by condemnation in the
654-11   manner provided by Chapter 21, Property Code.
654-12         (b)  The district is a municipal corporation within the
654-13   meaning of Section 21.021(c), Property Code.
654-14         (c)  Except as provided by Subsection (d), the amount and
654-15   character of interest in land and easements acquired under this
654-16   section shall be determined by the board.
654-17         (d)  As against persons, firms, and corporations, or their
654-18   receivers or trustees, who have the power of eminent domain, the
654-19   district may condemn only an easement, and the fee title may not be
654-20   condemned.
654-21         (e)  If the district, in the exercise of the power of eminent
654-22   domain or power of relocation or any other power granted under this
654-23   chapter, makes necessary the relocation, raising, rerouting,
654-24   changing the grade, or altering the construction of any highway,
654-25   railroad, electric transmission line, or pipeline, all such
654-26   necessary relocation, raising, rerouting, changing of grade, or
 655-1   alteration of construction shall be accomplished at the sole
 655-2   expense of the district.
 655-3         Sec. 274.011.  NOTICE REQUIRED FOR CERTAIN CONTRACTS.  (a)  A
 655-4   construction contract requiring an expenditure of more than $5,000
 655-5   may be made only after publication of a notice to bidders once each
 655-6   week for two weeks before awarding the contract.
 655-7         (b)  The notice required by this section is sufficient if it
 655-8   states the time and place the bids will be opened and the general
 655-9   nature of the work to be done or the material, equipment, or
655-10   supplies to be purchased and states where and the terms on which
655-11   copies of the plans and specifications may be obtained.  The
655-12   publication of the notice shall be in a newspaper published in the
655-13   district and designated by the board.
655-14         Sec. 274.012.  BONDS.  (a)  For the purpose of providing a
655-15   source of water supply for cities and other users for municipal,
655-16   domestic, and industrial purposes, as authorized by this chapter,
655-17   or of providing sewage disposal plants and related facilities, or
655-18   for both such purposes, and for the purpose of carrying out any
655-19   other power or authority conferred by this chapter, the district
655-20   may issue negotiable bonds payable from the revenues or taxes, or
655-21   both revenues and taxes, of the district as pledged by resolution
655-22   of the board.  Pending the issuance of definitive bonds, the board
655-23   may authorize the delivery of negotiable interim bonds or notes
655-24   that are eligible for exchange or substitution by the definitive
655-25   bonds.
655-26         (b)  Bonds must be authorized by resolution of the board and
 656-1   shall be issued in the name of the district, signed by the
 656-2   president or vice president, attested by the secretary, and have
 656-3   the seal of the district impressed on the bonds.
 656-4         (c)  Bonds must mature serially or otherwise in not to exceed
 656-5   40 years and may be sold at a price and under terms determined by
 656-6   the board to be the most advantageous reasonably obtainable,
 656-7   provided that the interest cost to the district, calculated by use
 656-8   of standard bond interest tables currently in use by insurance
 656-9   companies and investment houses, does not exceed six percent per
656-10   year.  Within the discretion of the board, bonds may be made
656-11   callable prior to maturity at times and prices prescribed in the
656-12   resolution authorizing the bonds and may be made registrable as to
656-13   principal or as to both principal and interest.
656-14         (d)  Bonds may be issued in more than one series and from
656-15   time to time as required for carrying out the purposes of this
656-16   chapter.
656-17         (e)  Bonds may be secured by a pledge of all or part of the
656-18   net revenues of the district, of the net revenues of one or more
656-19   contracts made before or after the bonds are issued, or of other
656-20   revenues specified by resolution of the board.  A pledge may
656-21   reserve the right, under conditions specified in the pledge, to
656-22   issue additional bonds that will be on a parity with or subordinate
656-23   to the bonds being issued.  In this subsection, "net revenues"
656-24   means the gross revenues of the district less the amount necessary
656-25   to pay the cost of maintaining and operating the district and its
656-26   properties.  Within the sole discretion of the board, the bonds may
 657-1   be secured by the combined revenues of the district's water
 657-2   properties and sewage disposal facilities or may be secured by
 657-3   revenues from either of those sources.
 657-4         (f)  For the purposes stated in Subsection (a), the district
 657-5   may issue bonds payable from ad valorem taxes to be levied on all
 657-6   taxable property in the district or may issue bonds secured by and
 657-7   payable from both the taxes and the revenues of the district,
 657-8   subject to the conditions prescribed in Sections 274.015(a)-(c).
 657-9   If bonds are issued that are payable wholly or partially from ad
657-10   valorem taxes, the board shall levy a tax sufficient to pay the
657-11   bonds and the interest on the bonds as the bonds and interest
657-12   become due.  The rate of the tax for any year may be set after
657-13   giving consideration to the money received from the pledged
657-14   revenues available for payment of principal and interest to the
657-15   extent and in the manner permitted by the resolution authorizing
657-16   the issuance of the bonds.
657-17         (g)  If bonds payable wholly from revenues are issued, the
657-18   board shall set, and from time to time revise, rates of
657-19   compensation for water sold and services rendered by the district
657-20   that will be sufficient to pay the expense of operating and
657-21   maintaining the facilities of the district, to pay the bonds as
657-22   they mature and the interest as it accrues, and to maintain the
657-23   reserve fund and other funds as provided in the resolution
657-24   authorizing the bonds.  If bonds payable partially from revenues
657-25   are issued, the board shall set, and from time to time revise,
657-26   rates of compensation for water sold and services rendered by the
 658-1   district that will be sufficient to assure compliance with the
 658-2   resolution authorizing the bonds.
 658-3         (h)  From the proceeds from the sale of the bonds, the
 658-4   district may set aside an amount for the payment of interest
 658-5   expected to accrue during construction and for a reserve interest
 658-6   and sinking fund, and such provision may be made in the resolution
 658-7   authorizing the bonds.  Proceeds from the sale of the bonds may
 658-8   also be used for the payment of all expenses necessarily incurred
 658-9   in accomplishing the purpose for which the district is created,
658-10   including the expenses of issuing and selling the bonds and of
658-11   creating and organizing the district.
658-12         (i)  The district may invest all or any part of the proceeds
658-13   of the bonds before and during the period of construction in
658-14   obligations of or in obligations unconditionally guaranteed by the
658-15   United States government.
658-16         (j)  In the event of a default or a threatened default in the
658-17   payment of principal of or interest on bonds payable wholly or
658-18   partially from revenues, any court of competent jurisdiction may,
658-19   on petition of the holders of 25 percent of the outstanding bonds
658-20   of the issue in default or threatened with default, appoint a
658-21   receiver with authority to collect and receive all income of the
658-22   district except income from taxes, to employ and discharge agents
658-23   and employees of the district, to take charge of the district's
658-24   funds on hand (except funds received from taxes, unless
658-25   commingled), and to manage the proprietary affairs of the district
658-26   without consent or hindrance by the board.  The receiver may also
 659-1   be authorized to sell or make contracts for the sale of water or
 659-2   renew the contracts with the approval of the court appointing the
 659-3   receiver.  The court may vest the receiver with other powers and
 659-4   duties the court finds necessary for the protection of the holders
 659-5   of the bonds.
 659-6         Sec. 274.013.  REFUNDING BONDS.  (a)  The district may issue
 659-7   refunding bonds for the purpose of refunding any outstanding bonds
 659-8   authorized by this chapter and interest on the bonds.  The
 659-9   refunding bonds may be issued to refund more than one series of
659-10   outstanding bonds and combine the pledges for the outstanding bonds
659-11   for the security of the refunding bonds, and the refunding bonds
659-12   may be secured by other or additional revenues.
659-13         (b)  The provisions of this chapter with reference to the
659-14   issuance of other bonds by the district, the approval of the other
659-15   bonds by the attorney general, and the remedies of the holders are
659-16   applicable to refunding bonds.  Refunding bonds shall be registered
659-17   by the comptroller on surrender and cancellation of the bonds to be
659-18   refunded, but in lieu of that process, the resolution authorizing
659-19   the issuance of the refunding bonds may provide that the bonds
659-20   shall be sold and the proceeds of the sale deposited in the bank
659-21   where the original bonds are payable, in which case the refunding
659-22   bonds may be issued in an amount sufficient to pay the interest on
659-23   the original bonds to their option date or maturity date, and the
659-24   comptroller shall register the refunding bonds without concurrent
659-25   surrender and cancellation of the original bonds.
659-26         Sec. 274.014.  TRUST INDENTURE.  Bonds, including refunding
 660-1   bonds, authorized by this chapter that are not payable wholly from
 660-2   ad valorem taxes may be additionally secured by a trust indenture
 660-3   under which the trustee may be a bank with trust powers located
 660-4   either within or outside the state.  The bonds may, in the
 660-5   discretion of the board, be additionally secured by a deed of trust
 660-6   lien on physical properties of the district and all franchises,
 660-7   easements, water rights and appropriation permits, leases, and
 660-8   contracts and all rights appurtenant to the properties, vesting in
 660-9   the trustee power to sell the properties for payment of the
660-10   indebtedness, power to operate the properties, and all other powers
660-11   and authority for the further security of the bonds.
660-12         (b)  The trust indenture, regardless of the existence of a
660-13   deed of trust lien, may contain any provisions prescribed by the
660-14   board for the security of the bonds and the preservation of the
660-15   trust estate and may make provision for amendment or modification
660-16   of the trust indenture and the issuance of bonds to replace lost or
660-17   mutilated bonds.
660-18         (c)  A purchaser under a sale under a deed of trust lien,
660-19   where one is given, shall be the owner of the properties,
660-20   facilities, and rights so purchased and shall have the right to
660-21   maintain and operate the properties, facilities, and rights.
660-22         Sec. 274.015.  BOND ELECTIONS.  (a)  Bonds payable wholly or
660-23   partially from ad valorem taxes, except refunding bonds, may not be
660-24   issued unless authorized by an election at which only the qualified
660-25   voters who reside in the district may participate and a majority of
660-26   the votes cast at the election is in favor of the issuance of the
 661-1   bonds.
 661-2         (b)  Before calling an election for the issuance of bonds
 661-3   secured either wholly or partially by a pledge of ad valorem taxes,
 661-4   the board shall publish, in the manner prescribed by this section,
 661-5   a summary of the improvements to be financed with the proceeds of
 661-6   bonds to be issued.  If the district has not provided facilities
 661-7   for delivering water to any city within the district and the
 661-8   summary of improvements does not include provision for delivering
 661-9   water to the city, the district shall publish in the city notice of
661-10   its intention, on a date specified in the notice, to call an
661-11   election involving the issuance of bonds, wholly or partly secured
661-12   by a pledge of ad valorem taxes.  The notice must contain the
661-13   summary of the proposed improvements.  The notice must be published
661-14   at least once in a newspaper published or having general
661-15   circulation in the city.  The date of publication must be at least
661-16   14 days before the date on which the district intends to adopt a
661-17   resolution ordering the election.  If no newspaper is published in
661-18   the city, notice shall be given by posting a copy of the notice of
661-19   intention at three public places in the city for at least 14 days
661-20   before the election is to be ordered.  The district shall also mail
661-21   a copy of the notice to the mayor of the city at least 14 days
661-22   before the date on which the election is to be ordered.  Before the
661-23   date of the election, the governing body of the city notified may
661-24   adopt a resolution stating that the district has not provided
661-25   facilities for delivering water to the city and does not propose to
661-26   provide the facilities necessary for that purpose with the proceeds
 662-1   from the proposed tax-supported bonds on a reasonable cost basis;
 662-2   stating that eliminating the city from the district for all
 662-3   purposes is in the best interest for the people of the city; and
 662-4   seeking withdrawal from the district.  If, before the date
 662-5   designated for the election, a certified copy of the resolution is
 662-6   delivered to the district and to the commission, the district may
 662-7   not proceed with the calling of an election until the commission
 662-8   has acted finally on the request for withdrawal from the district.
 662-9         (c)  On receipt of a certified copy of a resolution from a
662-10   city requesting withdrawal from the district, the commission shall
662-11   set a date for a hearing on the request, giving written notice of
662-12   the hearing to the city and to the district.  If at the hearing the
662-13   commission finds that no facilities have been provided to the city
662-14   and that none will be provided from proceeds of the proposed
662-15   tax-supported bond issue for the delivery of water to the city on a
662-16   reasonable cost basis, the commission shall enter an order
662-17   eliminating the city from the district.  In lieu of a hearing the
662-18   district may file with the commission a consent to the elimination
662-19   of the territory.  However, if the commission finds that the
662-20   facilities are available or will be provided from the proceeds of
662-21   the proposed bonds on a reasonable cost basis, the commission shall
662-22   enter an order denying the request for withdrawal.  After the
662-23   commission enters the order, the district may order an election
662-24   with the city either eliminated or retained in the boundaries of
662-25   the district as prescribed in the order.
662-26         (d)  An election for the issuance of bonds payable wholly or
 663-1   partially from ad valorem taxes may be called by the board without
 663-2   a petition.  The resolution calling the election shall specify the
 663-3   time and location of the election, the purpose for which the bonds
 663-4   are to be issued, the maximum amount of the bonds, the maximum
 663-5   maturity of the bonds, the form of the ballot, and the presiding
 663-6   judge for each voting place.  The presiding judge serving at each
 663-7   voting place shall appoint one assistant judge and at least two
 663-8   clerks to assist in holding the election.  Notice of the election
 663-9   shall be given by publishing a substantial copy of the resolution
663-10   in one newspaper published in each city contained in the district
663-11   for two consecutive weeks.  The first publication must be at least
663-12   21 days prior to the election.  If no newspaper is published in a
663-13   city, notice shall be given by posting a copy of the resolution in
663-14   three public places.
663-15         (e)  The returns of the election shall be made to and
663-16   canvassed by the board.
663-17         (f)  The general laws relating to elections apply to
663-18   elections held under this section except as otherwise provided by
663-19   this chapter.
663-20         (g)  Bonds not payable wholly or partially from ad valorem
663-21   taxes may be issued without an election.
663-22         Sec. 274.016.  APPROVAL AND REGISTRATION OF BONDS.  After any
663-23   bonds, including refunding bonds, are authorized by the district,
663-24   the bonds and the record relating to their issuance shall be
663-25   submitted to the attorney general for examination as to the
663-26   validity of the bonds.  If the bonds recite that they are secured
 664-1   by a pledge of the proceeds of a contract previously made between
 664-2   the district and a city or other governmental agency or district, a
 664-3   copy of the contract and the proceedings of the city or other
 664-4   governmental agency or district authorizing the contract shall also
 664-5   be submitted to the attorney general.  If the bonds have been
 664-6   authorized and the contracts have been made in accordance with the
 664-7   constitution and laws of the state, the attorney general shall
 664-8   approve the bonds, and the contracts and the bonds shall then be
 664-9   registered by the comptroller.  After the approval and
664-10   registration, the bonds and the contracts, if any, are valid and
664-11   binding and are incontestable for any cause.
664-12         Sec. 274.017.  WATER SUPPLY CONTRACTS.  The district may
664-13   contract with cities and others for the purpose of supplying water
664-14   to them.  The district may also contract with a city for the rental
664-15   or leasing of, or for the operation of, the water production, water
664-16   supply, or water filtration or purification and the water supply
664-17   facilities of the city for such consideration as the district and
664-18   the city may agree.  The contract may be on the terms and for the
664-19   time as the parties may agree, and the contract may provide that it
664-20   shall continue in effect until bonds specified in the contract and
664-21   refunding bonds issued in lieu of the bonds are paid.
664-22         Sec. 274.018.  DISTRICT DEPOSITORY.  (a)  The board shall
664-23   designate one or more banks within the district to serve as
664-24   depository or depositories for the funds of the district.  All
664-25   funds of the district shall be deposited in the depository bank or
664-26   banks, except that funds pledged to pay bonds may be deposited with
 665-1   the trustee bank named in the trust agreement and except that funds
 665-2   shall be remitted to the bank of payment for the payment of
 665-3   principal of and interest on bonds.  To the extent that funds in
 665-4   the depository banks and the trustee bank are not insured by the
 665-5   Federal Deposit Insurance Corporation, the funds shall be secured
 665-6   in the manner provided by law for the security of county funds, or
 665-7   the resolution or trust agreement, or both, securing the bonds may
 665-8   require that all such funds be secured by obligations of or
 665-9   obligations unconditionally guaranteed by the United States
665-10   government.
665-11         (b)  Before designating a depository bank or banks, the board
665-12   shall issue a notice stating the time and place the board will meet
665-13   for such purpose and inviting the banks in the district to submit
665-14   applications to be designated depositories.  The notice must be
665-15   published one time in a newspaper or newspapers published in the
665-16   district and specified by the board.
665-17         (c)  At the time stated in the notice of the meeting, the
665-18   board shall consider the applications and the management and
665-19   condition of the banks filing the applications and shall designate
665-20   as depositories the bank or banks that offer the most favorable
665-21   terms and conditions for the handling of the funds of the district
665-22   and that the board finds have proper management and are in
665-23   condition to warrant handling of district funds.  Membership on the
665-24   board of an officer or director of a bank shall not disqualify the
665-25   bank from being designated as depository.
665-26         (d)  If no applications are received by the time stated in
 666-1   the notice of the meeting, the board shall designate a bank or
 666-2   banks within or outside the district on the terms and conditions
 666-3   the board determines advantageous to the district.
 666-4         (e)  The term of service for depositories shall be prescribed
 666-5   by the board.
 666-6         Sec. 274.019.  WATER APPROPRIATION PERMITS; WATER SUPPLY
 666-7   CONTRACTS.  The district may acquire water appropriation permits
 666-8   directly from the commission or from owners of permits.  The
 666-9   district may also purchase water or a water supply from any person,
666-10   firm, corporation, or public agency or from the United States
666-11   government or any of its agencies.  The district may, within the
666-12   discretion of its board, contract with one or more large users of
666-13   water to acquire a water supply on an agreed allocation of storage
666-14   space between the district and the user, or the district may
666-15   contract independently for the district's water supply.
666-16         Sec. 274.020.  BONDS ELIGIBLE FOR INVESTMENT AND SECURITY OF
666-17   DEPOSITS.  (a)  All bonds of the district are legal and authorized
666-18   investments for banks, savings banks, trust companies, building and
666-19   loan associations, savings and loan associations, insurance
666-20   companies, fiduciaries, trustees, and guardians and for the sinking
666-21   funds of cities, towns, villages, counties, school districts, or
666-22   other political corporations or subdivisions of the state.
666-23         (b)  District bonds are eligible to secure the deposit of all
666-24   public funds of the state and of cities, towns, villages, counties,
666-25   school districts, or other political corporations or subdivisions
666-26   of the state.  The bonds shall be lawful and sufficient security
 667-1   for such deposits to the extent of the value of the bonds when
 667-2   accompanied by all unmatured coupons.
 667-3         Sec. 274.021.  EXEMPTION FROM TAXATION.  The accomplishment
 667-4   of the purposes stated in this chapter are for the benefit of the
 667-5   people of this state and for the improvement of the properties and
 667-6   industries of the state, and the district in carrying out the
 667-7   purposes of this chapter will be performing an essential public
 667-8   function under the constitution and shall not be required to pay a
 667-9   tax or assessment on a project or any part of a project under this
667-10   chapter.  The bonds issued under this chapter and the transfer of
667-11   and income from the bonds, including the profits made on the sale
667-12   of the bonds, are free from taxation within the state.
667-13         Sec. 274.022.  ASSESSMENT, EQUALIZATION, LEVYING, AND
667-14   COLLECTION OF TAXES.  (a)  The tax rolls of the cities situated
667-15   within the district, and within territory later annexed, are
667-16   adopted and shall constitute the tax rolls of the district until
667-17   assessments and tax rolls are made by the district.
667-18         (b)  Before the sale and delivery of district bonds that are
667-19   payable wholly or partially from ad valorem taxes, the board shall
667-20   appoint a tax assessor and collector and a board of equalization
667-21   and cause taxes to be assessed, valuations to be equalized, and tax
667-22   rolls to be prepared.  General laws applicable to water control and
667-23   improvement districts with reference to tax assessors and
667-24   collectors, boards of equalization, tax rolls, and the levy and
667-25   collection of taxes and delinquent taxes are applicable to the
667-26   district, except that the board of equalization, which is to be
 668-1   appointed each year by the board, shall consist of one member
 668-2   residing in each city contained in the district.
 668-3         Sec. 274.023.  DISTRICT RULES AND REGULATIONS.  (a)  The
 668-4   board may adopt and promulgate all reasonable rules and regulations
 668-5   to secure, maintain, and preserve the sanitary condition of all
 668-6   water in and to flow into any reservoir owned by the district, or
 668-7   which the district may control by contract or otherwise, to prevent
 668-8   the waste or the unauthorized use of the water, and to regulate
 668-9   residence, hunting, fishing, boating, camping, and all recreational
668-10   and business privileges, along or around any reservoir or any body
668-11   of land or easement owned or controlled by the district.  The
668-12   district shall have the same power to enforce the rules and
668-13   regulations as is accorded by law to water control and improvement
668-14   districts, except that the rules and regulations shall be enforced
668-15   by duly constituted peace officers.
668-16         Sec. 274.024.  DISTRICT MAP.  The board shall file a map and
668-17   plat of the district, clearly showing the boundaries and limits,
668-18   with each of the following offices:  two copies with the Texas
668-19   Water Development Board, one copy with the secretary of state, and
668-20   one copy with the county clerk of each county in which any portion
668-21   of the district is located.
668-22             CHAPTER 275.  TRINITY RIVER AUTHORITY OF TEXAS
668-23         Sec. 275.001.  CREATION.  (a)  A conservation and reclamation
668-24   district to be known as the "Trinity River Authority of Texas" is
668-25   created.  The authority is a governmental agency and a body politic
668-26   and corporate.
 669-1         (b)  The authority is created under and is essential to
 669-2   accomplish the purposes of Section 59, Article XVI, Texas
 669-3   Constitution.
 669-4         Sec. 275.002.  DEFINITIONS.  In this chapter:
 669-5               (1)  "Authority" means the Trinity River Authority of
 669-6   Texas.
 669-7               (2)  "Board" means the board of directors of the
 669-8   authority.
 669-9               (3)  "Director" means a member of the board.
669-10               (4)  "Person" means:
669-11                     (A)  an individual, partnership, corporation,
669-12   public utility, or other private entity; and
669-13                     (B)  a public agency.
669-14               (5)  "Public agency" means an authority, district,
669-15   city, town, other political subdivision, joint board, or other
669-16   public agency created and operating under the laws of this state.
669-17         Sec. 275.003.  BOUNDARIES.  (a)  The authority includes the
669-18   territory described by Section 2, Chapter 518, Acts of the 54th
669-19   Legislature, Regular Session, 1955.
669-20         (b)  The area of the authority shall also include the Maria
669-21   G. Castro League in Trinity County, which includes the area of the
669-22   city of Groveton.
669-23         (c)  It is found and determined that all the land included in
669-24   the authority will benefit from the exercise of the powers
669-25   conferred by this chapter.  No provision of this chapter is
669-26   intended to or shall be applicable outside the area specifically
 670-1   included in this section, notwithstanding anything in this chapter
 670-2   to the contrary.
 670-3         Sec. 275.004.  BOARD OF DIRECTORS.  (a)  All powers of the
 670-4   authority shall be exercised by a board of directors.
 670-5         (b)  The board shall consist of 24 directors to be appointed
 670-6   by the governor with the advice and consent of the senate.  When
 670-7   the legislature is in session, an appointment shall not become
 670-8   effective until it is approved by the senate.
 670-9         (c)  For the purposes of the appointment of directors the
670-10   authority is divided into 18 areas, numbered 1 to 18, both
670-11   inclusive, respectively containing the county as follows:
670-12         Area 1.  Tarrant
670-13         Area 2.  Dallas
670-14         Area 3.  Kaufman
670-15         Area 4.  Henderson
670-16         Area 5.  Ellis
670-17         Area 6.  Navarro
670-18         Area 7.  Anderson
670-19         Area 8.  Freestone
670-20         Area 9.  Leon
670-21         Area 10.  Houston
670-22         Area 11.  Trinity
670-23         Area 12.  Madison
670-24         Area 13.  Walker
670-25         Area 14.  San Jacinto
670-26         Area 15.  Polk
 671-1         Area 16.  Liberty
 671-2         Area 17.  Chambers
 671-3         Area 18.  All the territory contained within the above named
 671-4   17 areas and 17 counties, which shall be known as "the
 671-5   area-at-large."
 671-6         (d)  The board shall include three directors from Tarrant
 671-7   County, four directors from Dallas County, and two directors from
 671-8   the area-at-large.  One director shall be appointed from each of
 671-9   the other areas named in Subsection (c).
671-10         (e)  Each director serves for a term of six years and until a
671-11   successor is appointed and has qualified.  The terms of the
671-12   directors expire on the 15th day of March of the year in which
671-13   their respective terms terminate under the provisions of this
671-14   chapter.
671-15         (f)  The board may appoint an executive committee to perform
671-16   the functions of the board between meetings, except as its powers
671-17   may be restricted in the action setting up the committee.
671-18         (g)  A director must reside and own taxable property within
671-19   the area from which the director is appointed.  An officer or
671-20   employee of a county or city shall not be eligible to serve as a
671-21   director.
671-22         (h)  Each director shall subscribe the constitutional oath
671-23   and shall give bond in the amount of $5,000, the cost of which
671-24   shall be paid by the authority.
671-25         (i)  If a director moves out of the area from which the
671-26   director is appointed, the governor shall promptly appoint a
 672-1   successor to the director's position.
 672-2         Sec. 275.005.  DIRECTOR FEES.  A director is entitled to
 672-3   receive fees of office and reimbursement expenses as provided by
 672-4   Section 49.060.
 672-5         Sec. 275.006.  OFFICERS.  (a)  The board shall elect from
 672-6   among its members a president and a vice president of the authority
 672-7   and other officers that the board considers necessary.
 672-8         (b)  The president is the presiding officer of the board and
 672-9   the chief officer of the authority and has the same right to vote
672-10   as any other director.
672-11         (c)  The vice president shall perform all duties and exercise
672-12   all powers conferred by this chapter on the president when the
672-13   president is absent or fails, is unable, or declines to act.
672-14         (d)  The board shall appoint a secretary and a treasurer who
672-15   shall not be members of the board.  Within the discretion of the
672-16   board the offices of secretary and treasurer may be held by one
672-17   person, whose title shall be secretary-treasurer.  The treasurer
672-18   shall give bond in an amount prescribed by the board.
672-19         (e)  The board may appoint a general manager and all
672-20   necessary engineers, attorneys, and other employees as provided by
672-21   general law.
672-22         Sec. 275.007.  GENERAL POWERS AND DUTIES.  (a)  The authority
672-23   shall have all the powers of the state under Section 59, Article
672-24   XVI, Texas Constitution, to effectuate flood control and the
672-25   conservation and use, for all beneficial purposes, of storm waters
672-26   and floodwaters and unappropriated flow waters in the Trinity River
 673-1   watershed, subject only to:
 673-2               (1)  declarations of policy by the legislature as to
 673-3   use of water;
 673-4               (2)  continuing supervision and control by the
 673-5   commission;
 673-6               (3)  the provisions of Section 11.024, prescribing the
 673-7   priorities of uses for water; and
 673-8               (4)  the water rights legally acquired at any time by
 673-9   municipalities and other users.
673-10         (b)  The authority shall have all the powers of the state
673-11   under Section 59, Article XVI, Texas Constitution, to encourage,
673-12   promote, and provide for the navigation of inland and coastal
673-13   waters within the Trinity River watershed, including the power to
673-14   cooperate with the Chambers-Liberty Counties Navigation District in
673-15   the development and construction of navigation canals and
673-16   facilities or harbor and terminal facilities within the boundaries
673-17   of the Chambers-Liberty Counties Navigation District.
673-18         (c)  The authority shall exercise the powers described by
673-19   this section, to the greatest extent practical, for the
673-20   conservation and beneficial use of storm waters, floodwaters, and
673-21   unappropriated flow waters of the Trinity River watershed in the
673-22   manner and for the particular purposes specified in this section
673-23   and in this chapter, including the power:
673-24               (1)  to store and conserve such waters in order to
673-25   prevent the escape of any water without the maximum beneficial use
673-26   either within or outside the authority;
 674-1               (2)  to provide for the conservation of water for uses
 674-2   within and outside the watershed, including providing a water
 674-3   supply for cities and towns, and the right to sell water and
 674-4   standby service to any person, firm, or corporation, including
 674-5   cities and towns and other public agencies, within and outside the
 674-6   watershed; provided, however, that the purchasers of conservation
 674-7   storage water for domestic, industrial, or irrigation uses shall
 674-8   not be required to pay any part of the cost of benefits accruing
 674-9   for flood control purposes;
674-10               (3)  to provide for the conservation of soils and other
674-11   surface resources against destructive erosion and prevent the
674-12   increased flood dangers caused by destructive erosion;
674-13               (4)  to provide for the prevention of sedimentation and
674-14   siltation of lands, channels, reservoirs, and coastal waters,
674-15   including aiding and supplementing the work of upstream soil and
674-16   water conservation and flood prevention projects authorized by
674-17   state or federal agencies in conjunction with soil conservation
674-18   districts, in furtherance of the master plan as described in
674-19   Section 275.028;
674-20               (5)  to provide water for the irrigation of lands
674-21   within and outside the watershed;
674-22               (6)  to provide water for the development of commercial
674-23   and industrial enterprises, within and outside the watershed;
674-24               (7)  to execute contracts with municipalities and
674-25   others involving the construction of reservoirs, dams, water supply
674-26   lines, water purification and pumping facilities, and the
 675-1   furnishing of water supply service substantially in the manner
 675-2   prescribed by Section 402.020, Local Government Code, for districts
 675-3   organized and created pursuant to Section 59, Article XVI, Texas
 675-4   Constitution, extended to permit such contracts with individuals,
 675-5   partnerships, and all classes of corporations and to permit the
 675-6   inclusion in the authorized contracts of provisions for operation
 675-7   and ownership of such properties;
 675-8               (8)  to bring water into the boundaries of the
 675-9   authority for beneficial uses when the authority considers it
675-10   necessary for the interest of conservation, and subject to the
675-11   approval of the commission;
675-12               (9)  to provide for the encouragement and development
675-13   of recreational facilities and the preservation of fish and
675-14   wildlife;
675-15               (10)  to acquire, purchase, take over, construct,
675-16   maintain, operate, develop, and regulate canals, locks, wharves,
675-17   docks, warehouses, grain elevators, bunkering facilities, belt
675-18   railroads, floating plants, lighterage, lands, towing facilities,
675-19   and all other facilities or aids incident to or necessary to the
675-20   operation or development of ports or waterways within the Trinity
675-21   River watershed and extending to the Gulf of Mexico;
675-22               (11)  to adopt through action of the board any powers
675-23   permitted under this code;
675-24               (12)  to construct, own, and operate sewage-gathering,
675-25   transmission, and disposal services, charge for the services, and
675-26   enter into contracts for the services with municipalities and
 676-1   others as necessary to aid in the conservation, control,
 676-2   preservation, and distribution of water for beneficial use; and
 676-3               (13)  to adopt all reasonable rules and regulations
 676-4   designed to facilitate the exercise of the rights and the
 676-5   performance of the duties of the authority and adopt and amend the
 676-6   bylaws of the authority.
 676-7         (d)  For the purposes of operating or developing ports or
 676-8   waterways under Subsection (c)(10), the authority may issue bonds
 676-9   as provided by this chapter.  The authority may borrow funds for
676-10   current expenses and evidence the same by negotiable notes or
676-11   warrants payable not later than the close of any calendar year for
676-12   which the loans are made.
676-13         (e)  Any actions under Subsection (c)(10) within the
676-14   boundaries of the Chambers-Liberty Counties Navigation District may
676-15   be conducted in cooperation with that district.
676-16         Sec. 275.008.  POWERS RELATING TO RECREATIONAL FACILITIES.
676-17   (a)  The board shall acquire sufficient additional land adjoining
676-18   any lakes constructed on the Trinity River for the purpose of
676-19   developing recreational facilities under Section 275.007(c)(9) and
676-20   for acquiring roads for ingress and egress of the public to the
676-21   lakes.
676-22         (b)  The board shall use its discretion in determining the
676-23   amount of the additional land required for suitable recreational
676-24   parks but shall secure approximately 20 percent of the adjoining
676-25   lakefront, such 20 percent being intended merely as a guide and not
676-26   as a maximum or minimum limitation.
 677-1         (c)  The board may charge and collect entrance or gate fees
 677-2   to all the authority's developed park sites and recreational areas
 677-3   and may charge and collect fees for the use of facilities and for
 677-4   services rendered at or on the developed park sites and
 677-5   recreational areas.
 677-6         (d)  The authority shall arrange for the public to have
 677-7   adequate free access to each lake owned by the authority.
 677-8         (e)  The authority may negotiate contracts with any county,
 677-9   municipality, municipal corporation, person, firm, corporation,
677-10   nonprofit organization, or state or federal agency for the
677-11   acquisition, establishment, operation, or maintenance of a park
677-12   site or recreational area.
677-13         Sec. 275.009.  MUNICIPAL CONTRACTS.  (a)  In this section,
677-14   "sewage disposal services" includes sewage transportation,
677-15   treatment, and disposal.
677-16         (b)  A municipality that is located in whole or in part
677-17   inside the boundaries of the authority or located in whole or in
677-18   part in the watershed of the Trinity River may, by ordinance,
677-19   contract with the authority for the authority to provide the
677-20   municipality with sewage disposal services.  The contract may
677-21   contain a provision for standby service.  The contract may be made
677-22   on terms and for a duration agreeable to the parties and may
677-23   provide that it will continue in effect as long as specified bonds
677-24   of the authority, including refunding bonds, remain unpaid.  The
677-25   municipality is entitled to the continued performance of services
677-26   covered by the contract after amortization of the authority's
 678-1   investment in facilities during the useful life of the facilities,
 678-2   on payment of charges reduced to take the amortization into
 678-3   account.
 678-4         (c)  Except as provided by Subsection (d), revenue received
 678-5   by the authority from a municipality under a contract made under
 678-6   this section may be used only for:
 678-7               (1)  payment of principal of and interest on, and
 678-8   providing reserves for, bonds issued by the authority to finance
 678-9   facilities for sewage disposal services; and
678-10               (2)  operation and maintenance expenses related to the
678-11   contract, including legal, administrative, and management
678-12   supervision fees and expenses.
678-13         (d)  The authority and a municipality may provide in a
678-14   contract made under this section that a designated part of any
678-15   surplus revenue accumulated for the benefit of the municipality may
678-16   be spent by the authority to enlarge or improve facilities of the
678-17   authority used especially to serve that municipality.
678-18         (e)  The authority becomes owner of sewage accepted by it for
678-19   transportation and treatment and is solely responsible for the
678-20   proper treatment and disposal of the sewage and the effluent.  A
678-21   contracting municipality is immune from liability for any improper
678-22   treatment or disposal of the sewage or effluent.  A municipality is
678-23   not entitled to credit of any type, either in the exchange of
678-24   water, money, or other consideration, for any effluent delivered to
678-25   the authority.  Such an exchange or sale may not be made a
678-26   condition to any contract under this section.
 679-1         (f)  Payments by a municipality under a contract made under
 679-2   this section shall be made from revenues of the municipality's
 679-3   water system, sanitary sewer system, or both of those systems, or
 679-4   of the municipality's combined water and sanitary sewer system, as
 679-5   specified in the contract.  Those payments are an operating expense
 679-6   of the system whose revenues are pledged under the contract.
 679-7   Except as provided by Subsection (h), neither the authority nor a
 679-8   holder of bonds of the authority may demand payment of the
 679-9   municipality's obligations out of funds raised or to be raised by
679-10   taxation.
679-11         (g)  If at the time it executes a contract under this section
679-12   a municipality has outstanding revenue bonds secured by a pledge of
679-13   the net revenue from a combined water and sanitary sewer system
679-14   plus the net revenue from the municipality's gas distribution or
679-15   electric power system, that portion of the payments made by the
679-16   municipality to the authority and used by the authority for debt
679-17   service on bonds of the authority may be treated by the
679-18   municipality for its accounting purposes as a capital expenditure
679-19   if:
679-20               (1)  revenue from the municipality's gas or electric
679-21   system, as the case may be, is adequate to satisfy the requirements
679-22   of the ordinance or ordinances authorizing the outstanding revenue
679-23   bonds and similarly secured bonds that may later be authorized,
679-24   regarding the provision of funds for operation, maintenance, and
679-25   debt service; and
679-26               (2)  revenue from the municipality's sanitary sewer
 680-1   system and, if encumbered under the contract, from the
 680-2   municipality's water system, are sufficient to meet the
 680-3   requirements of the contract with the authority.
 680-4         (h)  A municipality may pledge its taxing power in a contract
 680-5   made under this section if a majority of the qualified voters of
 680-6   the municipality who vote on the question at an election vote in
 680-7   favor of the proposed contract and the levy of property taxes to
 680-8   pay the municipality's obligations to the authority under the
 680-9   contract.  The election shall be conducted in substantially the
680-10   same manner as a municipal bond election held under Subtitles A and
680-11   C, Title 9, Government Code.  If the voters approve the contract
680-12   and tax levy:
680-13               (1)  the municipal governing body shall enact an
680-14   ordinance prescribing the form and substance of the contract and
680-15   directing the proper officers of the municipality to sign it; and
680-16               (2)  once the contract has been executed, the
680-17   municipality's obligations to the authority under the contract are
680-18   an obligation of the municipality's taxing power, but may be paid
680-19   as provided by the contract, from taxes and revenues from which
680-20   payments are required by Subsection (f).
680-21         (i)  A municipality that has executed a contract under this
680-22   section that is payable in whole or in part from revenue of the
680-23   municipality's water or sewer system, or both of those systems, or
680-24   the municipality's or combined water and sewer system shall set and
680-25   periodically adjust rates charged to users so that at all times
680-26   that revenue is sufficient to pay:
 681-1               (1)  the expenses of operating and maintaining the
 681-2   system in accordance with current standards and requirements for
 681-3   preventing stream pollution;
 681-4               (2)  obligations of the municipality under the
 681-5   contract; and
 681-6               (3)  all obligations of the municipality relating to
 681-7   revenue bonds issued for the system before or after execution of
 681-8   the contract under this section.
 681-9         (j)  A contract under this section may require the use of
681-10   consulting engineers and financial experts to advise the
681-11   municipality as to when service rates are to be adjusted.
681-12         (k)  The authority may render services concurrently to more
681-13   than one municipality through construction and operation of a plant
681-14   serving multiple municipalities, with the cost for the services to
681-15   be allocated among the participating municipalities as provided by
681-16   one or more contracts made under this section.  All the
681-17   compensation to be received by and all the security pledged to the
681-18   authority by all municipalities is available to the authority to
681-19   secure bonds issued to provide necessary construction funds.  A
681-20   contract used by the authority to secure bonds to finance its plant
681-21   and facilities must be submitted by the authority to the attorney
681-22   general for examination.  If the attorney general approves the
681-23   contract and bonds, the contract is incontestable.
681-24         Sec. 275.010.  FLOOD CONTROL.  (a)  In addition to all other
681-25   powers explicitly or impliedly granted by this chapter, the
681-26   authority may:
 682-1               (1)  cooperate with the commission and the United
 682-2   States Army Corps of Engineers to carry out the purposes of this
 682-3   chapter and Subchapter Q, Chapter 51;
 682-4               (2)  develop and implement procedures to exercise
 682-5   emergency prerelease programs on Lake Livingston when flooding is
 682-6   imminent; and
 682-7               (3)  establish programs for reservoirs in the Trinity
 682-8   River Basin that do not have flood control structures, with the
 682-9   approval of the commission and after notice and public hearing.
682-10         (b)  The authority and other reservoir owners shall be immune
682-11   from any liability for damages resulting from the implementation of
682-12   a prerelease program.
682-13         (c)  The commission shall review and approve the prerelease
682-14   procedures to determine the reasonableness of the procedures.
682-15         Sec. 275.011.  REGULATIONS.  (a)  The board may adopt and
682-16   promulgate all reasonable regulations to regulate residence,
682-17   hunting, fishing, boating, camping, and all recreational and
682-18   business privileges on all lands and easements owned by the
682-19   authority and to protect the property of the authority.
682-20         (b)  The regulations shall not include any provisions for the
682-21   collection of fees or the requirement of permits or licenses for
682-22   boat inspections, noncommercial fishing, the use of boats operated
682-23   for noncommercial purposes on lakes owned by the authority, and
682-24   hunting, except for the use of duck blinds constructed, operated,
682-25   and maintained by the authority.
682-26         Sec. 275.012.  CONTRACTS FOR CONSTRUCTION AND OPERATION OF
 683-1   FACILITIES.  (a)  The board may enter into contracts with
 683-2   responsible persons for the construction and operation of a
 683-3   facility on the authority's property, setting reasonable
 683-4   compensation for service by the facility, and requiring adequate
 683-5   bond from the contracting person, association, or corporation,
 683-6   payable to the authority and of such amount and condition as the
 683-7   board in its discretion considers appropriate.
 683-8         (b)  A contract under this section may provide for forfeiture
 683-9   of the particular franchise in case of a failure of the licensee to
683-10   render adequate public service.
683-11         Sec. 275.013.  PENALTIES FOR VIOLATION OF RULES OR
683-12   REGULATIONS.  (a)  For the breach of any authority rule or
683-13   regulation, the authority may prescribe reasonable penalties that
683-14   shall not exceed fines of more than $200 or imprisonment for more
683-15   than 30 days, or both fine and imprisonment.
683-16         (b)  The penalties authorized by this section shall be in
683-17   addition to any other penalties provided by the laws of this state
683-18   and may be enforced by complaints filed in the appropriate court of
683-19   jurisdiction in the county in which the violation occurred.
683-20         Sec. 275.014.  NOTICE OF RULES AND REGULATIONS.  (a)  Before
683-21   a rule or regulation providing for a penalty may take effect, a
683-22   substantive statement of the rule or regulation and the penalty
683-23   must be published once a week for two consecutive weeks in the
683-24   authority.
683-25         (b)  The statement must be as condensed as possible so that
683-26   the act forbidden by the rule or regulation can be easily
 684-1   understood.
 684-2         (c)  Any number of rules or regulations may be included in
 684-3   one notice.
 684-4         (d)  The notice must advise that violation of a rule or
 684-5   regulation will subject the violator to a penalty and that the full
 684-6   text of the rule or regulation sought to be enforced is on file in
 684-7   the principal office of the authority, where it may be read by any
 684-8   interested person.
 684-9         (e)  Five days after the second publication of the notice,
684-10   the published rule or regulation shall be in effect and ignorance
684-11   of the rule or regulation shall not constitute a defense to a
684-12   prosecution for the enforcement of the penalty.
684-13         Sec. 275.015.  EFFECT OF RULES AND REGULATIONS.  After the
684-14   required publication, rules and regulations adopted by the
684-15   authority shall be recognized by the courts as if they were penal
684-16   ordinances of a city.
684-17         Sec. 275.016.  POLICE POWERS.  (a)  The authority may employ
684-18   and constitute its own law enforcement officers.
684-19         (b)  A law enforcement officer of the authority or of any
684-20   other governmental entity may make arrests when necessary to
684-21   prevent or abate the commission of an offense against the
684-22   regulations of the authority, and against the laws of this state,
684-23   when the offense or threatened offense occurs on any land, water,
684-24   or easement owned or controlled by the authority.
684-25         Sec. 275.017.  ADDITIONAL POWERS AND DUTIES.  (a)  The
684-26   authority is a district and a river authority as defined in Chapter
 685-1   30.  All the provisions of Chapter 30 are applicable to the
 685-2   authority, except to the extent of any conflict with this chapter,
 685-3   in which case this chapter prevails.
 685-4         (b)  The authority and all persons may enter into contracts
 685-5   with each other in any manner and on terms that the parties may
 685-6   agree with respect to any power, function, facility, or service of
 685-7   the authority.  All public agencies are authorized to use and
 685-8   pledge any available revenues for and in the payment of amounts due
 685-9   under the contracts as an additional or the sole source of payment
685-10   of the contracts and may covenant with respect to available
685-11   revenues to assure the availability of the revenues when required.
685-12   The term "revenues" as used in this subsection does not mean or
685-13   include revenues from ad valorem taxes levied and collected by a
685-14   public agency or the proceeds from the sale or refunding of bonds
685-15   of a public agency that are to be wholly or partially paid from ad
685-16   valorem taxes levied and collected by the public agency unless the
685-17   use or pledge of the tax revenues or bond proceeds is approved by
685-18   the qualified voters of the public agency at an election called for
685-19   the purpose of levying taxes or issuing or refunding bonds or both
685-20   for the purpose of using or pledging their revenues or proceeds
685-21   under contracts entered into under this section.
685-22         (c)  A public agency may set, charge, and collect fees,
685-23   rates, charges, rentals, and other amounts for any service or
685-24   facility provided by a utility operated by the agency or provided
685-25   pursuant to or in connection with a contract with the authority
685-26   from its inhabitants or from any users or beneficiaries of the
 686-1   utility, service, or facility including:
 686-2               (1)  water charges;
 686-3               (2)  sewage charges;
 686-4               (3)  solid waste disposal system fees and charges,
 686-5   including garbage collection or handling fees; and
 686-6               (4)  other fees or charges.
 686-7         (d)  A public agency may use and pledge the fees, rates,
 686-8   charges, rentals, and other amounts authorized by Subsection (c) to
 686-9   make payments to the authority required under a contract with the
686-10   authority and may covenant to do so in amounts sufficient to make
686-11   all or any part of the payments to the authority when due.  If the
686-12   parties agree in the contract, the payments shall constitute an
686-13   expense of operation of any facility or utility operated by the
686-14   public agency.
686-15         (e)  The authority, acting through the board, may undertake
686-16   and carry out any activities and may acquire, purchase, construct,
686-17   own, operate, maintain, repair, improve, or extend and may lease or
686-18   sell on terms and conditions, including rentals or sale prices, on
686-19   which the parties may agree all works, improvements, facilities,
686-20   plants, buildings, structures, equipment, and appliances and all
686-21   real and personal property, or any interest in related real or
686-22   personal property, that are incident to or necessary in carrying
686-23   out or performing any power or function of the authority under this
686-24   section.
686-25         (f)  The authority may issue bonds with respect to the
686-26   acquisition, purchase, construction, maintenance, repair,
 687-1   improvement, and extension of works, improvements, facilities,
 687-2   plants, buildings, structures, appliances, and property for the
 687-3   purpose of exercising any of its powers and functions under this
 687-4   section in the manner provided in Section 275.022.
 687-5         (g)  The authority may issue revenue bonds to pay for the
 687-6   costs of feasibility studies for proposed projects of the
 687-7   authority, including engineering, planning and design, and
 687-8   environmental studies.  The authority may include in any revenue
 687-9   bond issue the funds to operate and maintain, for a period not to
687-10   exceed two years after completion, the facilities acquired or
687-11   constructed through the revenue bond issue.
687-12         (h)  If bonds issued by the authority recite that they are
687-13   secured by a pledge of payments under a contract, a copy of the
687-14   contract and the proceedings relating to the contract shall be
687-15   submitted to the attorney general along with the bonds, which must
687-16   be submitted under Section 275.022(l).  If the attorney general
687-17   finds that the bonds have been authorized and the contract has been
687-18   made and entered into in accordance with law, the attorney general
687-19   shall approve the bonds and the contract, which are then
687-20   incontestable in any court or other forum for any reason and are
687-21   valid and binding in accordance with their terms and provisions for
687-22   all purposes.
687-23         (i)  The provisions of Chapter 1204, Government Code, and
687-24   Chapter 618, Government Code, as added by Chapter 227, Acts of the
687-25   76th Legislature, Regular Session, 1999, are applicable to bonds
687-26   issued by the authority, notwithstanding any provision of this
 688-1   chapter to the contrary.
 688-2         (j)  This section is wholly sufficient authority for the
 688-3   issuance of bonds, the execution of contracts, and the performance
 688-4   of the other acts and procedures authorized by this section by the
 688-5   authority and all persons, including public agencies, without
 688-6   reference to any other provisions of law or any restriction or
 688-7   limitation contained in any other law, except as provided by this
 688-8   section.  To the extent of any conflict or inconsistency between a
 688-9   provision of this subsection and any other provision of law,
688-10   including a home-rule city charter, this subsection prevails and
688-11   controls.  The authority and all persons, including public
688-12   agencies, may use any provision of law not in conflict with this
688-13   section to the extent convenient or necessary to carry out any
688-14   power or authority, express or implied, granted by this section.
688-15         (k)  This section does not affect:
688-16               (1)  the taxing power of the authority;
688-17               (2)  the election process pertaining to the authority's
688-18   taxing power; or
688-19               (3)  any provision of Section 275.020.
688-20         Sec. 275.018.  HYDROELECTRIC POWER.  The authority may
688-21   produce and sell hydroelectric energy or power on a wholesale basis
688-22   to any public utility on terms and conditions as the parties may
688-23   agree.
688-24         Sec. 275.019.  AD VALOREM TAXES; ELECTION.  (a)  Subject to
688-25   the limitation prescribed in this section, the authority may levy
688-26   and collect the ad valorem taxes that are voted at an election
 689-1   called by the board for the purpose and conducted throughout the
 689-2   territory of the authority.
 689-3         (b)  The maximum rate of tax that may be levied and collected
 689-4   for any year is 15 cents on the $100 of taxable property based on
 689-5   the assessed valuation.
 689-6         (c)  Only qualified electors may vote in a tax election.
 689-7         (d)  An elector otherwise qualified must vote in the county
 689-8   and precinct where the elector resides.
 689-9         (e)  The resolution calling for a tax election must state the
689-10   maximum rate or rates of taxes that are to be authorized.
689-11         (f)  The authority shall publish notice of a tax election and
689-12   the proposed tax rates at least once in each of four weeks on the
689-13   same day of each week in a newspaper published in, or having
689-14   general circulation in, each county within the authority.  The date
689-15   of the first publication must be at least 30 days before the date
689-16   of the election.
689-17         (g)  The resolution calling for an election must specify the
689-18   voting places in each of the several counties.  The notice of an
689-19   election will be sufficient as to any county within the authority
689-20   if it states that the election is to be held throughout the
689-21   territory comprising the authority and specifies the voting places
689-22   in such county.  It shall not be necessary to publish such details
689-23   except in the county to which the details are applicable.
689-24         (h)  Returns of the election shall be made to the board.
689-25         (i)  If a majority of the qualified electors voting in a
689-26   majority of the counties that are wholly or partially within the
 690-1   authority and a majority of the qualified electors voting in the
 690-2   entire authority vote in favor of the levy of the tax, the board
 690-3   may levy the tax at the maximum rate approved by the electors.
 690-4         (j)  The rate of tax shall be uniform throughout the
 690-5   territory comprising the authority and shall be certified by the
 690-6   president and secretary of the authority to the tax assessor and
 690-7   the tax collector of each included county.
 690-8         (k)  The board may use funds from a tax that was approved by
 690-9   the electors under this section for any purpose authorized by the
690-10   powers conferred on the authority by this chapter.
690-11         Sec. 275.020.  CERTAIN LANDS AND PROPERTY EXCLUDED.  (a)  It
690-12   is found that none of the lands and property owned or controlled by
690-13   a railroad company or motor carrier regulated by the Railroad
690-14   Commission of Texas within the authority benefit from the exercise
690-15   of any powers conferred by this chapter, and such lands and
690-16   property are expressly excluded from the authority.  None of the
690-17   lands or property of such railroad companies or motor carriers
690-18   regulated by the Railroad Commission of Texas may be subjected to
690-19   any of the specific or general provisions in the chapter.  The
690-20   finding under this subsection supersedes the provisions of Section
690-21   275.003 and any other sections of this chapter.
690-22         (b)  The taxing power and authority provided by this chapter
690-23   shall not extend to nor apply to the lands and property of a
690-24   railroad company or motor carrier regulated by the Railroad
690-25   Commission of Texas required by law to pay a tax on intangible
690-26   assets, and no tax assessor, collector, or any other public
 691-1   official shall have any powers relating to taxation or otherwise
 691-2   over such properties.
 691-3         (c)  If a tax assessor or collector of any county wholly or
 691-4   partly within the authority undertaking an official act for the
 691-5   authority exercises or attempts to exercise any act that could be
 691-6   construed by a railroad company or motor carrier regulated by the
 691-7   Railroad Commission of Texas as extending a taxing power or
 691-8   authority over the lands and property of the railroad company or
 691-9   motor carrier, the railroad company or motor carrier may withhold
691-10   payment to the county for which the tax assessor or collector
691-11   normally performs official duties for the reasons that:
691-12               (1)  the lands and properties of the companies do not
691-13   benefit from the exercise of any powers contained in this chapter;
691-14   and
691-15               (2)  the companies are not required to pay any taxes to
691-16   the authority because they are required by law to pay a tax on
691-17   intangible assets.
691-18         (d)  Any court of competent jurisdiction within this state
691-19   shall enforce the provisions of this section through injunction,
691-20   mandatory injunction, writ of prohibition, or any other process
691-21   entered or promulgated to effectuate the sense and purposes of this
691-22   section.
691-23         (e)  At an election called by the authority or an authorized
691-24   public official for the purpose of levying a tax provided by this
691-25   chapter, the ballot and the notice of the election shall confine
691-26   the property subject to taxation to property that benefits by
 692-1   submitting to the voters the proposition substantially as follows:
 692-2             "Shall Trinity River Authority of Texas be
 692-3             authorized to levy a tax on all taxable
 692-4             property in the authority at a rate not to
 692-5             exceed 15 cents on the $100 of assessed
 692-6             valuation?"
 692-7         Sec. 275.021.  TAX ASSESSMENT AND COLLECTION.  (a)  The
 692-8   rendition and assessment of property for taxation and the
 692-9   collection of taxes for the benefit of the authority shall be in
692-10   accordance with the law applicable to counties, in so far as such
692-11   law is applicable.
692-12         (b)  Renditions shall be to the county tax assessor of the
692-13   county in which the property is taxable for state and county
692-14   purposes.
692-15         (c)  The assessor and collector in each county shall place on
692-16   the county tax rolls any additional columns that are needed to show
692-17   the tax levied by the authority and the amount of the tax, based on
692-18   the value of the property as approved finally for state and county
692-19   purposes by the board of equalization of the county.
692-20         (d)  The fee for assessing and collecting taxes shall be
692-21   one-half of one percent of the taxes collected.  The fee shall be
692-22   paid over and disbursed in each county as are other fees of office.
692-23         (e)  Laws for the enforcement of state and county taxes shall
692-24   be available to the authority.  The authority may require the
692-25   officers of each county to enforce the taxes due to the authority
692-26   in that county, as provided in the law for the enforcement of state
 693-1   and county taxes.
 693-2         (f)  Taxes assessed and levied for the benefit of the
 693-3   authority shall be payable and shall become delinquent at the same
 693-4   time, in the same manner, and subject to the same discount for
 693-5   advance payment as taxes levied by and for the benefit of the
 693-6   county in which the property is taxable.
 693-7         Sec. 275.022.  BONDS.  (a)  For the purpose of carrying out
 693-8   any powers of the authority, the authority may issue negotiable
 693-9   bonds of three general classes:
693-10               (1)  bonds secured by ad valorem taxes, when voted,
693-11   provided that the maximum rate of tax in any one year to be levied
693-12   by the authority for bonds and all other purposes shall not exceed
693-13   15 cents on the $100 of taxable property;
693-14               (2)  bonds secured solely by a pledge of all or part of
693-15   the revenues accruing to the authority, including revenues received
693-16   from the sale of water, the rendition of services, tolls, charges,
693-17   and all sources other than ad valorem taxes; and
693-18               (3)  bonds secured by a combination pledge of revenues
693-19   and taxes, provided that taxes will be collected for the purpose
693-20   only to the extent that the revenues are insufficient to provide
693-21   the amount of money necessary to pay operating and maintenance
693-22   expenses and to service the bonds as prescribed in the resolution
693-23   authorizing, or the indenture securing, the bonds.
693-24         (b)  The authority may issue bonds prescribed in Subsection
693-25   (a)(2) by action of the board and without an election.  Bonds
693-26   issued under Subsections (a)(1) and (3) may be issued only after
 694-1   authorization at an election held throughout the territory
 694-2   comprising the authority.  The elections shall be conducted
 694-3   substantially in accordance with the procedure prescribed in
 694-4   Section 275.019 for elections authorizing ad valorem taxes.  The
 694-5   qualifications of voters at bond elections shall be the same as
 694-6   those prescribed in Section 275.019 for elections authorizing ad
 694-7   valorem taxes.
 694-8         (c)  Bonds of the authority must be authorized by resolution
 694-9   adopted by the board and shall be signed by the president or vice
694-10   president, attested by the secretary, and impressed with the seal
694-11   of the authority.  At the discretion of the board, as evidenced by
694-12   the resolution, bonds may be issued bearing the facsimile signature
694-13   of the president, vice president, or secretary and the seal of the
694-14   authority may be printed on the bonds.  Bonds must mature serially
694-15   or otherwise within the period and at the times prescribed in the
694-16   resolution, not to exceed 50 years.  The bonds may be sold at a
694-17   price and under terms determined by the board to be the most
694-18   advantageous reasonably obtainable, provided that the interest cost
694-19   to the authority calculated by the use of standard bond interest
694-20   tables currently in use by insurance companies and investment
694-21   houses does not exceed six percent per year, except that bonds
694-22   payable wholly or partially from taxes shall bear interest costs
694-23   not to exceed four and one-half percent per year.  The bonds, at
694-24   the discretion of the board, may be made callable prior to maturity
694-25   at the times and prices prescribed in the resolution authorizing
694-26   the bonds.  The bonds may be registrable as to principal or as to
 695-1   both principal and interest.  Appropriate provisions may be
 695-2   inserted in the resolution authorizing the execution and delivery
 695-3   of bonds for the conversion of registered bonds into bearer bonds
 695-4   and vice versa.  Provisions may be made in the bond resolution or
 695-5   trust indenture for the substitution of new bonds for those lost or
 695-6   mutilated.  If bonds are approved by the attorney general and
 695-7   registered by the comptroller as prescribed in Subsection (l), it
 695-8   shall not be necessary to obtain the approval of the attorney
 695-9   general or registration by the comptroller of the converted or
695-10   substituted bonds.
695-11         (d)  Bonds secured wholly or in part by a pledge of the
695-12   revenues of the authority may be secured by all or part of the
695-13   revenues specified in the resolution authorizing the bonds or in
695-14   the indenture securing the bonds.  At the discretion of the board,
695-15   bonds may be secured further by a lien on all or any part of the
695-16   physical property of the authority.  In making the pledge of the
695-17   revenues the right, under the conditions specified in the pledge,
695-18   to issue additional bonds to be on a parity with, senior to, or
695-19   subordinate to the bonds then being issued may be expressly
695-20   reserved.
695-21         (e)  If bonds are issued payable wholly from ad valorem
695-22   taxes, the board shall, at the time of the authorization of the
695-23   bonds, levy a tax sufficient to pay the principal of and interest
695-24   on the bonds as the interest and principal become due and shall
695-25   provide the reserve funds if prescribed in the resolution
695-26   authorizing or the trust indenture securing the bonds, with regard
 696-1   to the maximum rate of tax permitted under this chapter.
 696-2         (f)  If bonds are issued payable both from ad valorem taxes
 696-3   and from revenues of the authority, an ad valorem tax shall be
 696-4   levied at the time of the authorization of the bonds sufficient to
 696-5   pay the principal of and interest on the bonds and create and
 696-6   maintain reserve funds, but the rate of tax to be collected for any
 696-7   year shall be set to take into consideration the money that has
 696-8   been in the interest and sinking fund from the pledged revenues and
 696-9   that will be available for payment of the principal and interest
696-10   and for the creation of the reserve funds, to the extent and in the
696-11   manner permitted by the resolution authorizing or the trust
696-12   indenture securing the bonds.
696-13         (g)  If bonds are issued payable wholly from revenues, the
696-14   board shall set and from time to time revise the rates, tolls, and
696-15   charges for the sales and services rendered by the authority.  The
696-16   revenues from the rates, tolls, and charges are pledged so that the
696-17   rates, tolls, and charges will yield sufficient money to pay the
696-18   designated expenses of the authority and the principal of and
696-19   interest on the bonds as the principal and interest mature and to
696-20   create and maintain funds as prescribed in the resolution
696-21   authorizing or the trust indenture securing the bonds.  If the
696-22   bonds are issued payable both from ad valorem taxes and from
696-23   revenues, the board shall set and from time to time revise the rate
696-24   of compensation for water sold, services rendered, and tolls and
696-25   charges levied by the authority, to the extent the revenues are
696-26   pledged and to the extent sufficient to assure compliance with the
 697-1   resolution authorizing the bonds or the trust indenture securing
 697-2   the bonds.
 697-3         (h)  From the proceeds of the sale of any issue of bonds the
 697-4   authority may set aside an amount for the payment of interest
 697-5   anticipated to accrue for the period specified, or for the
 697-6   construction period and two additional years, and to provide for a
 697-7   deposit into reserves for the interest and sinking fund to the
 697-8   extent prescribed in the resolution authorizing or the trust
 697-9   indenture securing the bonds.  Proceeds from the sale of the bonds
697-10   shall be used for the purposes for which the bonds were authorized
697-11   and may be used for the payment of all expenses necessarily
697-12   incurred in accomplishing the purposes for which the authority is
697-13   created, including the expense of issuing and selling the bonds.
697-14   However, no expenditure of the proceeds shall be made in violation
697-15   of the provisions in the resolution authorizing or the trust
697-16   indenture securing the bonds.
697-17         (i)  In the event of a default or a threatened default in the
697-18   payment of the principal of or interest on bonds payable wholly or
697-19   partially from revenues, any court of competent jurisdiction may,
697-20   on petition of the holders of outstanding bonds, appoint a receiver
697-21   with authority to collect and receive all income of the authority
697-22   except taxes, employ and discharge agents and employees of the
697-23   authority, take charge of funds on hand, except funds received from
697-24   taxes unless commingled, and manage the proprietary affairs of the
697-25   authority without consent or hindrance by the directors.  The
697-26   receiver may also be authorized to sell or make contracts for the
 698-1   sale of water or renew such contracts with the approval of the
 698-2   court appointing the receiver.  The court may vest the receiver
 698-3   with other powers and duties the court may find necessary for the
 698-4   protection of the holders of the bonds.  The resolution authorizing
 698-5   the issuance of the bonds or the trust indenture securing the bonds
 698-6   may limit or qualify the rights of the holders of less than all of
 698-7   the outstanding bonds payable from the same source to institute or
 698-8   prosecute any litigation affecting the authority's property or
 698-9   income.
698-10         (j)  Pending the issuance of definitive bonds the board may
698-11   authorize the delivery of negotiable interim bonds or notes,
698-12   eligible for exchange or substitution, by use of definitive bonds.
698-13         (k)  The authority is authorized to issue refunding bonds for
698-14   the purpose of refunding any outstanding bonds and interest on the
698-15   bonds authorized by this chapter or any other indebtedness which
698-16   the authority may lawfully assume.  The refunding bonds may be
698-17   issued to refund more than one series of outstanding bonds and may
698-18   for the benefit of the refunding bonds combine the pledges securing
698-19   the outstanding bonds and may inject additional security for the
698-20   refunding issue.  Refunding bonds shall be registrable by the
698-21   comptroller on surrender and cancellation of the bonds to be
698-22   refunded, but in lieu of that procedure the resolution authorizing
698-23   the issuance of the refunding bonds may provide that the bonds
698-24   shall be sold and the proceeds deposited in the bank, or in one or
698-25   more of the banks where the original bonds are payable.  If the
698-26   bonds are sold and the proceeds deposited in the bank, the
 699-1   refunding bonds may be issued in an amount sufficient to pay the
 699-2   interest on the original bonds to their maturity date, or to the
 699-3   date on which the bonds are to be redeemed, and the amount of the
 699-4   call premium, if any, for bonds called for redemption prior to
 699-5   maturity; in that event the comptroller shall register the
 699-6   refunding bonds without the concurrent surrender and cancellation
 699-7   of the original bonds.  No election shall be necessary in
 699-8   connection with the authorization and issuance of refunding bonds.
 699-9         (l)  Bonds shall not be issued by the authority until the
699-10   bonds have been approved by the attorney general.  After the bonds
699-11   have been approved by the attorney general and registered by the
699-12   comptroller the bonds are negotiable and incontestable.  If the
699-13   bonds of an issue have been properly approved and registered, the
699-14   replacement bonds delivered by the authority in lieu of the
699-15   approved and registered bonds under Subsection (c), in connection
699-16   with the exchange of registered for unregistered bonds or
699-17   unregistered bonds for registered bonds, or in lieu of lost or
699-18   mutilated bonds, need not be reapproved by the attorney general or
699-19   reregistered by the comptroller.  The replacement bonds are
699-20   incontestable except that the limitations resulting from
699-21   registration are negotiable.
699-22         (m)  Bonds, including refunding bonds, authorized by this
699-23   chapter and not payable wholly from ad valorem taxes may be
699-24   additionally secured by a trust indenture under which the trustee
699-25   may be a bank having trust powers situated either within or outside
699-26   the state.  The trust indenture may contain provisions prescribed
 700-1   by the board for the security of the bonds and the preservation of
 700-2   the properties, contracts, and rights of the authority.  The trust
 700-3   indenture may contain a provision for the amendment or modification
 700-4   of the indenture in the manner prescribed in the indenture.
 700-5   Without limiting the generality of the provisions contained in the
 700-6   indenture, the indenture may provide that the authority shall
 700-7   comply with the requirements of designated consulting engineers for
 700-8   the proper maintenance and operation of the authority's properties
 700-9   and for the setting of adequate tolls, charges, and rates to assure
700-10   proper maintenance and operation and to provide proper debt service
700-11   for the outstanding bonds in the manner prescribed in the
700-12   resolution authorizing the issuance of the bonds or in the trust
700-13   indenture securing the bonds.
700-14         (n)  The proceeds from the sale of any issue of bonds may,
700-15   within the discretion of the board, be invested during the period
700-16   of construction, or before the use of the proceeds for construction
700-17   purposes, in bonds or other direct obligations of the United States
700-18   government, and the securities may be sold pursuant to the
700-19   directions of the board as and when needed for construction
700-20   purposes.
700-21         Sec. 275.023.  BOND VALIDATION BY DISTRICT COURT.  (a)  The
700-22   authority, in lieu of having its bonds and water supply or sewer
700-23   contracts approved by the attorney general, and at the discretion
700-24   of the board, may have the bonds and contracts validated by a suit
700-25   in the district court in the manner and with the effect provided in
700-26   Sections 55.504-55.510, relating to water improvement districts.
 701-1   However, the publication of the general notice of the suit shall be
 701-2   in a newspaper designated by the judge of the court in which the
 701-3   suit is filed, and the interest rate and sale price of the bonds
 701-4   need not be set until after the termination of the suit.
 701-5         (b)  If the proposed bonds recite that the bonds are secured
 701-6   by a pledge of the proceeds of a contract or contracts previously
 701-7   made between the authority and one or more cities, the petition
 701-8   shall so allege and the general notice of the suit must specify the
 701-9   allegation and the city fund or revenues from which the contract or
701-10   contracts are payable.  The judgment shall be res judicata as to
701-11   the validity of the contract or contracts and the pledge of the
701-12   revenues of the contract or contracts.
701-13         Sec. 275.024.  INVESTMENT AND DEPOSIT OF FUNDS.  The
701-14   authority may invest any of its funds, including proceeds from the
701-15   sale of bonds, in direct obligations of, or obligations whose
701-16   principal and interest are guaranteed by, the United States and may
701-17   invest the funds in direct obligations of the Federal Intermediate
701-18   Credit Bank, the Federal Home Loan Bank, the Federal Land Bank, or
701-19   banks for cooperatives and may place the funds of the authority on
701-20   interest bearing time deposits with banks if the deposits are
701-21   secured with a pledge of securities of the kind specified in this
701-22   section, to the extent not otherwise provided in the resolution or
701-23   the trust indenture under which the bonds are issued.  Income and
701-24   profits on the investments shall be applied as provided in the
701-25   resolution or trust indenture.
701-26         Sec. 275.025.  BOND ISSUANCE.  The authority is authorized to
 702-1   issue bonds for cash or in exchange for property of any kind, real,
 702-2   personal, or mixed, or any interest in property that the board
 702-3   considers necessary or convenient for any corporate purpose.
 702-4         Sec. 275.026.  EXEMPTION FROM TAXATION.  The accomplishment
 702-5   of the purposes stated in this chapter being for the benefit of the
 702-6   people of the state and for the protection and improvement of their
 702-7   properties and industries, the authority, in carrying out the
 702-8   purposes of this chapter, will be performing an essential public
 702-9   function under the constitution and is not required to pay any tax
702-10   or assessments on its properties.  The bonds issued as provided by
702-11   this chapter and the transfer and the income from the bonds,
702-12   including the profits made on the sale of the bonds, are at all
702-13   times free from taxation within this state.
702-14         Sec. 275.027.  BONDS AS INVESTMENTS AND SECURITY FOR
702-15   DEPOSITS.  (a)  All bonds of the authority are legal and authorized
702-16   investments for banks, savings banks, trust companies, building and
702-17   loan associations, savings and loan associations, and insurance
702-18   companies.
702-19         (b)  Authority bonds are eligible to secure the deposit of
702-20   all public funds of the state and all public funds of cities,
702-21   towns, villages, counties, school districts, or other political
702-22   corporations or subdivisions of the state.  The bonds are lawful
702-23   and sufficient security for the deposits to the extent of the
702-24   principal amount of the bonds or the value of the bonds on the
702-25   market, whichever is less, when accompanied by all unmatured
702-26   coupons.
 703-1         Sec. 275.028.  MASTER PLAN.  (a)  The authority shall prepare
 703-2   a master plan for the maximum development of the soil and water
 703-3   resources of the entire Trinity River watershed, including plans
 703-4   for the complete utilization, for all economically beneficial
 703-5   purposes, of the water resources of the watershed.  The portion of
 703-6   the master plan and any amendments to the plan relating to soil
 703-7   conservation and upstream flood prevention structures shall be
 703-8   prepared by the soil conservation districts on the Trinity River
 703-9   watershed, subject to approval by the State Soil and Water
703-10   Conservation Board.  The master plan shall be filed with and
703-11   approved by the commission.  Notwithstanding any provision of this
703-12   chapter, the portion of the master plan pertaining to the
703-13   designation of major reservoir sites on Chambers Creek shall not be
703-14   effective unless approved by Ellis County Drainage District No. 1
703-15   and any designation of major reservoir sites on Waxahachie Creek
703-16   other than the Bardwell site shall not be effective unless approved
703-17   by Ellis County Water Improvement District No. 1.  The master plan
703-18   may be amended or supplemented from time to time by the authority,
703-19   provided that a copy of the amendment or supplement to the master
703-20   plan is filed with and approved by the commission.
703-21         (b)  After the master plan has been filed with the
703-22   commission, the plan of a water development proposed within the
703-23   Trinity River watershed not exempted by law from the requirements
703-24   for procuring a permit shall be submitted to the commission.  A
703-25   copy of the proposed water development plan shall be furnished to
703-26   the board, which shall make recommendations in reference to the
 704-1   proposed development to the commission within 60 days after receipt
 704-2   of the copy of the proposed water development plan.  The commission
 704-3   shall hold a hearing at which the proponents of the proposed
 704-4   development and the authority shall have an opportunity to present
 704-5   evidence and recommendations to the commission.  The commission
 704-6   shall approve or disapprove the proposed water development
 704-7   notwithstanding any provision of the master plan in accordance with
 704-8   the provisions of Section 16.020.
 704-9         Sec. 275.029.  PURCHASE OR CONSTRUCTION CONTRACT.  A
704-10   construction contract or contract for the purchase of material,
704-11   equipment, or supplies is subject to the requirements of general
704-12   law.
704-13         Sec. 275.030.  CONSERVATION DISTRICTS.  (a)  This chapter
704-14   shall not prevent the organization of conservation districts or
704-15   prevent boundary changes of conservation districts within the
704-16   boundaries of the authority as authorized in Section 59, Article
704-17   XVI, Texas Constitution, or as prescribed in Section 52, Article
704-18   III, Texas Constitution.  After the master plan of the authority
704-19   has been prepared and after it has been filed with and approved by
704-20   the commission as prescribed in Section 275.028, the procedure
704-21   prescribed in Section 275.028 shall be followed.  Until the master
704-22   plan has been filed with and approved by the commission, it shall
704-23   be the duty of the sponsors of a conservation district to file with
704-24   the board information as to proposed plans of the district.  It
704-25   shall also be the duty of an existing district within the Trinity
704-26   River watershed to file with the board information regarding the
 705-1   district's planned improvements so that the authority may make
 705-2   recommendations to the commission within 60 days from the date the
 705-3   district files the information.
 705-4         (b)  To the extent that the creation of a conservation
 705-5   district or the prosecution of the planned improvements of a
 705-6   conservation district is in harmony with the objectives of the
 705-7   authority, it shall be the duty of the authority to cooperate in
 705-8   every practical manner with the sponsors of the proposed or
 705-9   existing conservation district in the prosecution of the proposed
705-10   improvements.  It shall be the duty of the authority to encourage
705-11   the improvements in local areas where the expense of the project is
705-12   to be borne principally by the local property owners.  To the
705-13   extent that the authority is financially capable of cooperating and
705-14   to the extent that the local agency will be performing a service
705-15   that is the duty of the authority, the authority shall, within the
705-16   discretion of the board, cooperate financially in the improvements
705-17   of the conservation district.
705-18         (c)  The authority, within its ability, is authorized to
705-19   cooperate with a conservation district, or with any other municipal
705-20   or public agency in the Trinity River watershed, in providing a
705-21   water supply, to the extent that such project is feasible, in such
705-22   a manner that the needs of the district, municipality, or public
705-23   agency are fully met, but with provision that water not needed for
705-24   such purposes will continue to be available for the uses and
705-25   purposes of the authority.  The board is authorized to issue the
705-26   authority's bonds for the purpose of cooperating in water supply
 706-1   projects.
 706-2         Sec. 275.031.  SOIL CONSERVATION.  (a) Notwithstanding any
 706-3   other provisions of this chapter, the authority shall have no
 706-4   control over soil conservation districts created in any county or
 706-5   counties of its territory but may:
 706-6               (1)  assist in the accomplishment and coordination of
 706-7   storm waters, floodwaters, and unappropriated flow waters
 706-8   throughout the Trinity River watershed consistent with the
 706-9   objectives of the soil conservation districts in the watershed
706-10   area;
706-11               (2)  assist in the conservation of soil and other
706-12   surface resources against destructive erosion to prevent the
706-13   increase of flood danger incident to erosion and to prevent
706-14   sedimentation and siltation of lands, channels, reservoirs, and
706-15   coastal waters, including aiding and assisting in the work of upper
706-16   stream soil and water conservation and flood prevention projects by
706-17   the State Soil and Water Conservation Board;
706-18               (3)  assist in upstream watershed projects of a soil
706-19   conservation district, particularly those projects above the
706-20   Navarro Mills, Italy, and Bardwell reservoir sites and the major
706-21   reservoir program on Richland and Chambers creeks; or
706-22               (4)  encourage and, when requested, aid financially in
706-23   the construction of any upstream project or program planned or
706-24   promoted by a soil conservation district on the Trinity River
706-25   watershed below the watersheds of Upper Keechi Creek and Elkhart
706-26   Creek and in the completion of upstream programs planned by the
 707-1   soil conservation districts in the Trinity River watershed above
 707-2   and including the watersheds of Upper Keechi Creek and Elkhart
 707-3   Creek.
 707-4         (b)  The authority shall have no power to control or direct
 707-5   and shall have no supervisory responsibility to determine the
 707-6   feasibility of, and may not negotiate, deal, or contract with
 707-7   federal government agencies with regard to, federal projects under
 707-8   the Watershed Protection and Flood Prevention Act (16 U.S.C.
 707-9   Section 1001 et seq.), as amended, or any other federal law, in
707-10   which the federal projects' problems relating to water are merely
707-11   incidental to soil conservation projects and which federal projects
707-12   the State Soil and Water Conservation Board promotes and supervises
707-13   and with regard to which projects the board has the responsibility
707-14   and authority to deal with the federal governmental agencies on
707-15   behalf of the state.
707-16         Sec. 275.032.  CREATION OF WATER CONTROL AND IMPROVEMENT
707-17   DISTRICT.  If the electors of a defined area or areas acting
707-18   jointly within the authority desire, the area or areas may become a
707-19   water control and improvement district for the purpose of
707-20   independently providing, operating, and maintaining improvements
707-21   designed peculiarly to serve the defined area.  The defined area
707-22   contained in the authority may constitute a water control and
707-23   improvement district under the applicable provision of Chapter 51.
707-24   Similarly, any other political subdivision of the state contained
707-25   in whole or in part in the authority may independently provide,
707-26   maintain, and operate works peculiarly designed to benefit the
 708-1   political subdivision.  The works and the operation of the works
 708-2   shall be constructed and operated in a manner that will conform to
 708-3   the authority's master plan to the greatest practicable degree.
 708-4         Sec. 275.033.  RIGHTS OF MUNICIPALITIES AND OTHERS.  Nothing
 708-5   in this chapter shall be construed to diminish, or in any other
 708-6   manner affect, the right of a municipality or other political
 708-7   subdivision, person, firm, or corporation to operate a water supply
 708-8   system or to drill or operate wells using groundwater.
 708-9         Sec. 275.034.  COOPERATION WITH AGENCIES.  The authority is
708-10   authorized specifically to cooperate with any agency situated
708-11   within the boundaries of the authority to the extent of paying the
708-12   costs of local improvements that will have the effect of relieving
708-13   the authority of any duty the authority might have for providing
708-14   the improvements, to the extent that the authority has money or
708-15   revenues available for the improvements and when in the opinion of
708-16   the board cooperation or contribution is justified.
708-17         Sec. 275.035.  ADDITIONAL PROVISIONS REGARDING CONTRACTS AND
708-18   FUNDING.  (a)  The authority may make contracts with the United
708-19   States and its agencies, the state and its agencies, all municipal
708-20   corporations, political subdivisions, and districts, and private
708-21   persons.  The authority may obtain loans from and accept grants
708-22   from the United States and its agencies and from the state and its
708-23   agencies and may participate in and be the beneficiary of any plan
708-24   that is evolved by the state or federal government for guaranteeing
708-25   or otherwise subsidizing the obligations of the authority;
708-26   provided, however, that a contract may not be entered into between
 709-1   the authority and the federal government for navigation purposes to
 709-2   any point on the Trinity River north of Ellis County, unless the
 709-3   contract provides for construction and operation of the navigation
 709-4   facilities to a point in Tarrant County.
 709-5         (b)  Without limitation as to the exercise of the general
 709-6   powers of the authority as provided by Subsection (a), the
 709-7   authority has the right to acquire from the United States
 709-8   government through the secretary of the army, or from any other
 709-9   official of the United States government authorized to make such
709-10   contracts, unsold conservation storage at the several multipurpose
709-11   dams constructed by the army within or available to the Trinity
709-12   River watershed.  The authority may acquire additional conservation
709-13   storage that may be provided at any such dam.
709-14         (c)  The authority may use any contract authorized by this
709-15   section as the sole basis or as a supplement to the basis for
709-16   securing the bonds of the authority.
709-17         Sec. 275.036.  WATER CONSERVATION, STORAGE, PROCUREMENT,
709-18   DISTRIBUTION, AND SUPPLY.  In addition to all other powers, the
709-19   authority may construct, acquire, equip, acquire storage rights at,
709-20   and operate dams and reservoirs that in the opinion of the board
709-21   are useful in carrying out the powers conferred on the authority,
709-22   whether a dam is designed to serve a single purpose or several
709-23   purposes permitted under this chapter.  The authority is authorized
709-24   to provide water supply lines, water purification, and pumping
709-25   facilities.  The authority may execute contracts with
709-26   municipalities in the state substantially in the manner prescribed
 710-1   by Chapter 402, Local Government Code, for districts organized or
 710-2   created pursuant to Section 59, Article XVI, Texas Constitution,
 710-3   and may execute water supply contracts with other users of water.
 710-4   Standby service, as well as the actual delivery of water, is
 710-5   included in the services for which the authority may contract, and
 710-6   for which it may make charges.  If a dam is constructed that will
 710-7   result in the impairment of gravity drainage of water from lands
 710-8   protected by a levee in existence at the time this chapter becomes
 710-9   effective, the authority shall, at its cost, make provision for the
710-10   installation, maintenance, and operation of pumping facilities or
710-11   provide a gravity system for the drainage of the land.
710-12         Sec. 275.037.  PROTECTION OF RIGHTS.  (a)  The authority, in
710-13   carrying out the powers and duties secured to it under this chapter
710-14   and in the operation of any water development or conservation
710-15   projects under this chapter, shall act in a manner not to impair
710-16   the flow of the Trinity River to the detriment of the vested water
710-17   rights of users downstream.  The authority shall not store storm
710-18   waters, floodwaters, and flow waters that are then needed by any
710-19   downstream appropriators to satisfy the amount of water authorized
710-20   to be appropriated by presently existing and valid water permits
710-21   and certified filings.  If the authority stores waters in violation
710-22   of this subsection, the downstream appropriators may require by any
710-23   lawful means the release by the authority of the storm waters,
710-24   floodwaters, and flow waters so stored.
710-25         (b)  Nothing in this chapter shall have the effect of
710-26   altering, changing, or impairing any rights or privileges existing
 711-1   on September 6, 1955, to appropriate and use water from the Trinity
 711-2   River.  Nothing in this chapter shall have the effect of altering,
 711-3   changing, or impairing any rights or privileges existing on
 711-4   September 6, 1955, to apply to the commission for, and if approved
 711-5   by the commission to retain or obtain, permits to appropriate and
 711-6   use water from the Trinity River.
 711-7         (c)  The authority shall have the responsibility, both
 711-8   financial and otherwise, for the construction of a saltwater
 711-9   barrier with barge lock in the Trinity River at a location and of a
711-10   design approved by the Chambers-Liberty Counties Navigation
711-11   District that will protect the users of fresh water for irrigation
711-12   purposes.
711-13         Sec. 275.038.  AUTHORITY DEPOSITORY.  (a)  The board shall
711-14   designate one or more banks within the authority to serve as
711-15   depository for the funds of the authority.  All funds of the
711-16   authority shall be deposited in the depository bank or banks except
711-17   that funds pledged to pay bonds may be deposited with the trustee
711-18   bank named in the trust agreement, and except that funds shall be
711-19   remitted to the bank of payment for the payment of the principal of
711-20   and interest on bonds.  To the extent that funds in the depository
711-21   banks and the trustee bank are not insured by the Federal Deposit
711-22   Insurance Corporation, the funds shall be secured in the manner
711-23   provided by law for the security of county funds.
711-24         (b)  Before designating a depository bank or banks, the board
711-25   shall issue a notice stating the time and place when and where the
711-26   board will meet for that purpose and inviting the banks in the
 712-1   authority to submit applications to be designated depositories.
 712-2   The term of service for depositories shall be prescribed by the
 712-3   board.  The notice must be published one time in a newspaper or
 712-4   newspapers published in the authority and specified by the board.
 712-5         (c)  At the time mentioned in the notice of the meeting, the
 712-6   board shall consider the applications and the management and
 712-7   condition of the banks filing the applications and shall designate
 712-8   as depositories the bank or banks that offer the most favorable
 712-9   terms and conditions for the handling of the funds of the authority
712-10   and that the board finds have proper management and are in
712-11   condition to warrant handling of authority funds.  Membership on
712-12   the board of an officer or director of a bank shall not disqualify
712-13   the bank from being designated as depository.
712-14         (d)  If no applications are received by the time stated in
712-15   the notice of the meeting, the board shall designate a bank or
712-16   banks within or outside the authority based on terms and conditions
712-17   the board finds advantageous to the authority.
712-18         Sec. 275.039.  PROTECTION OF PROPERTIES AND WATER SUPPLY.
712-19   The authority shall have the same power to make provision for the
712-20   protection of the properties and water supply of the authority as
712-21   is provided by general law.
712-22         Sec. 275.040.  EMPLOYEES.  (a)  The board shall have full
712-23   power to employ agents, attorneys, engineers, and other employees
712-24   that the board considers necessary.
712-25         (b)  The board may within its discretion employ fiscal agents
712-26   or advisers in connection with the authority financing program and
 713-1   in connection with the issuance of authority bonds.
 713-2         Sec. 275.041.  ACQUISITION, SALE, OR EXCHANGE OF PROPERTY.
 713-3   (a)  The authority may acquire within or outside the boundaries of
 713-4   the authority property, real and personal, including easements,
 713-5   through purchase, gift, or exchange, that the board considers
 713-6   necessary to accomplish the objectives of the authority and may
 713-7   purchase the properties and facilities of any other district within
 713-8   the authority created under Section 52, Article III, or Section 59,
 713-9   Article XVI, Texas Constitution, and assume the indebtedness of
713-10   such properties and facilities.
713-11         (b)  The board shall have the right to sell or exchange
713-12   property if within its discretion the sale or exchange is in the
713-13   best interests of the authority.
713-14         Sec. 275.042.  ACQUISITION OF WATER.  (a)  The authority
713-15   shall acquire water appropriation permits directly from the
713-16   commission and may purchase permits from owners of permits.  The
713-17   authority may purchase water, or a water supply, from any person,
713-18   firm, corporation, or public agency or from the United States or
713-19   its agencies.
713-20         (b)  Nothing in this chapter shall impair the authority
713-21   granted the commission under the general laws of the state to
713-22   prescribe rates governing the sale of surface water by or to the
713-23   authority.
713-24         Sec. 275.043.  EMINENT DOMAIN.  (a)  For the purpose of
713-25   carrying out any power or authority conferred by this chapter the
713-26   authority may acquire land, property, and easements, including land
 714-1   above the probable high-water line around any reservoir, by
 714-2   condemnation in the manner provided by Chapter 21, Property Code.
 714-3   The authority is declared to be a municipal corporation within the
 714-4   meaning of Section 21.021(c), Property Code.  The amount of and
 714-5   character of interest in land and easements thus to be acquired
 714-6   shall be determined by the board; provided, however, that the
 714-7   authority shall only acquire the land, property, and easements
 714-8   reasonably necessary.
 714-9         (b)  If the authority, in the exercise of the power of
714-10   eminent domain or power of relocation or any other power granted
714-11   under this chapter, makes necessary the relocation, raising,
714-12   rerouting, changing of grade, or alteration of construction of any
714-13   highway, railroad, electric transmission line, telephone or
714-14   telegraph properties and facilities, or pipeline, the relocation,
714-15   raising, rerouting, changing of grade, or alteration of
714-16   construction shall be accomplished at the sole expense of the
714-17   authority.
714-18         Sec. 275.044.  SCOPE OF AUTHORITY POWERS.  No provision of
714-19   this chapter is intended to or shall in any manner impair or change
714-20   any of the powers, rights, or privileges existing on September 6,
714-21   1955, or conferred before that time on the North Texas Municipal
714-22   Water District, Tarrant County Water Control & Improvement District
714-23   No. 1, the Chambers-Liberty Counties Navigation District, or the
714-24   municipalities within the authority area, but each of the districts
714-25   and municipalities shall have, keep, and retain all the powers
714-26   conferred by law and otherwise rightfully acquired on and by the
 715-1   district or municipality, notwithstanding anything in this chapter
 715-2   to the contrary.
 715-3         Sec. 275.045.  LIMITATIONS ON AUTHORITY.  (a)  The powers,
 715-4   authority, and duties granted to the authority in this chapter
 715-5   shall be applicable only in the counties expressly named in Section
 715-6   2, Chapter 518, Acts of the 54th Legislature, Regular Session,
 715-7   1955, and in no other county or counties of this state,
 715-8   notwithstanding anything in this chapter to the contrary.
 715-9         (b)  The authority or jurisdiction of the authority shall be
715-10   confined to counties enumerated in Section 2, Chapter 518, Acts of
715-11   the 54th Legislature, Regular Session, 1955, and Section
715-12   275.004(c).  Counties or parts of counties within the Trinity River
715-13   watershed that are not mentioned in those sections are outside the
715-14   jurisdiction and authority of the authority and are not affected by
715-15   the provisions of this chapter.
715-16         Sec. 275.046.  RIPARIAN RIGHTS.  No provision of this chapter
715-17   shall be construed to affect, alter, or impair riparian rights.
715-18              CHAPTER 276.  UPPER COLORADO RIVER AUTHORITY
715-19         Sec. 276.001.  CREATION.  (a)  A conservation and reclamation
715-20   district to be known as the "Upper Colorado River Authority" is
715-21   created.  The authority is a governmental agency and a body politic
715-22   and corporate.
715-23         (b)  The authority is created under and is essential to
715-24   accomplish the purposes of Section 59(a), Article XVI, Texas
715-25   Constitution, including, to the extent authorized by this chapter,
715-26   the control, storing, preservation, and distribution of the waters
 716-1   of the Upper Colorado River and its tributaries for irrigation,
 716-2   power, and other useful purposes, the reclamation and irrigation of
 716-3   arid, semiarid, and other lands needing irrigation, and the
 716-4   conservation and development of the forests, water and
 716-5   hydroelectric power of the state.  Nothing in this chapter or in
 716-6   any other law shall be construed as authorizing the authority to
 716-7   levy or collect taxes or assessments or to create any indebtedness
 716-8   payable out of taxes or assessments or in any way to pledge the
 716-9   credit of the state.
716-10         Sec. 276.002.  DEFINITIONS.  In this chapter:
716-11               (1)  "Authority" means the Upper Colorado River
716-12   Authority.
716-13               (2)  "Board" means the board of directors of the
716-14   authority.
716-15               (3)  "Director" means a member of the board.
716-16         Sec. 276.003.  TERRITORY.  The authority includes all the
716-17   territory within the boundaries of Coke and Tom Green counties.
716-18         Sec. 276.004.  POWERS AND DUTIES.  (a)  Except as expressly
716-19   limited by this chapter, the authority has all the powers, rights,
716-20   privileges, and functions conferred by general law on any district
716-21   or districts created pursuant to Section 59, Article XVI, Texas
716-22   Constitution, and as provided by this section.
716-23         (b)  The authority may control, store, and preserve, within
716-24   the boundaries of the authority, the waters of the Colorado River
716-25   and its tributaries for any useful purpose and may use, distribute,
716-26   and sell those waters within the boundaries of the authority for
 717-1   any such purposes.
 717-2         (c)  The authority may sell and distribute water outside the
 717-3   boundaries of the authority to any municipality for domestic,
 717-4   municipal, and irrigation purposes and to any person, firm, or
 717-5   corporation for municipal purposes or irrigation and may construct
 717-6   flumes, irrigation ditches, pipelines, and storage reservoirs
 717-7   outside the authority for such purposes.
 717-8         (d)  The authority may develop and generate waterpower and
 717-9   electric energy within the boundaries of the authority and may
717-10   distribute and sell waterpower and electric energy within or
717-11   outside the boundaries of the authority, but such use shall be
717-12   subordinate and inferior to all requirements for irrigation.
717-13         (e)  The authority may prevent or aid in the prevention of
717-14   damage to persons or property from the waters of the Colorado River
717-15   and its tributaries.
717-16         (f)  The authority may forest and reforest and aid in the
717-17   foresting and reforesting of the watershed area of the Colorado
717-18   River and its tributaries and may prevent and aid in the prevention
717-19   of soil erosion and floods within the watershed area.
717-20         (g)  The authority may acquire by purchase, lease, or gift or
717-21   in any other manner, other than by condemnation, and may maintain,
717-22   use, and operate property of any kind, real, personal, or mixed, or
717-23   any interest in property, within or outside the boundaries of the
717-24   authority, necessary or convenient to the exercise of the powers,
717-25   rights, privileges, and functions conferred on the authority by
717-26   this chapter.
 718-1         (h)  The authority may acquire by condemnation property of
 718-2   any kind, real, personal, or mixed, or any interest in property,
 718-3   within or outside the boundaries of the authority, necessary or
 718-4   convenient to the exercise of the powers, rights, privileges, and
 718-5   functions conferred on the authority by this chapter.  The
 718-6   authority may condemn property in the manner provided by general
 718-7   law with respect to condemnation or, at the option of the
 718-8   authority, in the manner provided by the statutes relating to
 718-9   condemnation by districts organized under general law pursuant to
718-10   Section 59, Article XVI, Texas Constitution.
718-11         (i)  The authority may, subject to the provisions of this
718-12   chapter, sell or otherwise dispose of property of any kind, real,
718-13   personal, or mixed, or any interest in property, that is not
718-14   necessary to carrying on the business of the authority.
718-15         (j)  The authority may overflow and inundate any public lands
718-16   and public property and may require the relocation of roads and
718-17   highways in the manner and to the extent permitted to districts
718-18   organized under general law pursuant to Section 59, Article XVI,
718-19   Texas Constitution.
718-20         (k)  The authority may construct, extend, improve, maintain,
718-21   and reconstruct, or cause to be constructed, extended, improved,
718-22   maintained, and reconstructed, and may use and operate facilities
718-23   of any kind necessary or convenient to the exercise of its powers,
718-24   rights, privileges, and functions.
718-25         (l)  The authority may sue and be sued in its corporate name.
718-26         (m)  The authority may make bylaws for the management and
 719-1   regulation of its affairs.
 719-2         (n)  The authority may adopt, use, and alter a corporate
 719-3   seal.
 719-4         (o)  The authority may appoint officers, agents, and
 719-5   employees and may prescribe their duties and fix their
 719-6   compensation.
 719-7         (p)  The authority may make contracts and execute instruments
 719-8   necessary or convenient to the exercise of the powers, rights,
 719-9   privileges, and functions conferred on the authority by this
719-10   chapter.
719-11         (q)  The authority may borrow money for its corporate
719-12   purposes and may borrow money and accept grants from the United
719-13   States and, in connection with such loan or grant, may enter into
719-14   such agreements as the United States or such corporation or agency
719-15   may require.  The authority may make and issue negotiable bonds for
719-16   funds borrowed in the manner and to the extent provided by Section
719-17   276.014.  Nothing in this chapter shall be construed to authorize
719-18   the issuance of any bonds, notes, or other evidences of
719-19   indebtedness of the authority except as specifically provided by
719-20   this chapter, and no issuance of bonds, notes, or other evidences
719-21   of indebtedness of the authority, except as specifically provided
719-22   by this chapter, shall ever be authorized except by an act of the
719-23   legislature.
719-24         (r)  The authority may do any other acts or things necessary
719-25   or convenient to the exercise of the powers, rights, privileges, or
719-26   functions conferred on the authority by this chapter or any other
 720-1   act or law.
 720-2         Sec. 276.005.  REVENUE BONDS.  The authority and the Brazos
 720-3   River Authority, originally created by Chapter 13, Special Laws,
 720-4   Acts of the 41st Legislature, 2nd Called Session, 1929, may issue
 720-5   negotiable revenue bonds secured only by pledge of the amounts
 720-6   granted or donated by the state or out of any other current
 720-7   revenues of the authority in such amount as may be authorized by
 720-8   the board of such authority, which amounts shall be paid to the
 720-9   legal holders of such bonds.
720-10         Sec. 276.006.  LIMITATIONS OF AUTHORITY.  (a) Notwithstanding
720-11   any rights or permits issued by the commission or its predecessor
720-12   agency that are held or acquired by the authority, the impounding
720-13   and use of the floodwaters of the Colorado River or its tributaries
720-14   for the generation of hydroelectric power by the authority or
720-15   anyone who may succeed to the rights and privileges conferred on
720-16   the authority by this chapter are subject to the rights of a
720-17   person, municipal corporation, or body politic that is impounding
720-18   or putting to beneficial use the waters for the purposes set forth
720-19   in Section 11.024(1)-(3) if the person, municipal corporation, or
720-20   body politic:
720-21               (1)  has received a permit for the use from the
720-22   commission; or
720-23               (2)  is permitted to impound water for the purposes
720-24   described by this subsection.
720-25         (b)  Nothing in this chapter shall be construed to subject to
720-26   condemnation by the authority or any successors, or by anyone who
 721-1   may succeed to the rights and privileges conferred on the authority
 721-2   by this chapter, any waters:
 721-3               (1)  impounded or to be impounded within or outside the
 721-4   authority under any law authorizing water to be impounded or under
 721-5   any permits granted to a municipal corporation or body politic; or
 721-6               (2)  impounded or permitted to be impounded or used
 721-7   outside the authority under permits granted to any person.
 721-8         (c)  Nothing in this chapter shall be construed as depriving
 721-9   any person or municipality of the right to impound the waters of
721-10   the Colorado River or its tributaries for domestic or municipal
721-11   purposes or as repealing any law granting such rights to persons
721-12   and municipalities.
721-13         (d)  The rights of the authority to impound, use, and sell
721-14   the waters of the Colorado River and its tributaries for the
721-15   generation of hydroelectric power are subordinate and inferior to
721-16   the rights of:
721-17               (1)  cities and towns situated within the watershed of
721-18   the Colorado River and its tributaries to build dams and impound
721-19   floodwaters for municipal purposes; and
721-20               (2)  any citizen of Texas, or bodies politic, to build
721-21   dams and impound the floodwaters within the watershed of the
721-22   Colorado River and its tributaries for domestic purposes and for
721-23   the purposes of irrigation.
721-24         (e)  The title to any rights, properties, licenses,
721-25   franchises, or permits acquired, or to be acquired, by the
721-26   authority shall be subject to the limitations imposed by Subsection
 722-1   (d).
 722-2         Sec. 276.007.  BOARD OF DIRECTORS; QUORUM; VOTING
 722-3   REQUIREMENTS.  (a)  The powers, rights, privileges, and functions
 722-4   of the authority shall be exercised by a board of nine directors.
 722-5         (b)  Each director must be a resident and freehold property
 722-6   taxpayer of the state.  Three of the directors must be resident
 722-7   citizens of Tom Green County, three must be resident citizens of
 722-8   Coke County, and three must be resident citizens of counties
 722-9   contiguous to the authority or in any county any part of which may
722-10   be within 25 miles of the authority.
722-11         (c)  All of the directors shall be appointed by the governor
722-12   with the advice and consent of the senate.  Directors are appointed
722-13   for staggered terms of six years, with three directors' terms
722-14   expiring on February 1 of each odd-numbered year.  At the
722-15   expiration of the term of a director, a successor shall be
722-16   appointed by the governor.
722-17         (d)  Each director shall hold office until the expiration of
722-18   the term for which the director was appointed and until a successor
722-19   is appointed and has qualified, unless removed sooner as provided
722-20   by this chapter.  A director may be removed by the governor for
722-21   inefficiency, neglect of duty, or misconduct in office, after at
722-22   least 10 days' written notice of the charges against the director
722-23   and an opportunity to be heard in person or by counsel at a public
722-24   hearing.  A vacancy resulting from the death, resignation, or
722-25   removal of a director shall be filled by the governor for the
722-26   unexpired term.
 723-1         (e)  Each director shall qualify by taking the official oath
 723-2   of office prescribed by general statute.
 723-3         (f)  Until the adoption of bylaws fixing the time and place
 723-4   of regular meetings and the manner in which special meetings may be
 723-5   called, meetings of the board shall be held at such times and
 723-6   places as five of the directors may designate in writing.  Five
 723-7   directors constitute a quorum at any meeting.
 723-8         (g)  Except as otherwise provided in this chapter or in the
 723-9   bylaws, all actions may be taken by the affirmative vote of a
723-10   majority of the directors present at any meeting, except that an
723-11   affirmative vote of at least five directors is required to
723-12   authorize or ratify a contract that involves an amount greater than
723-13   $10,000 or that is to run for a period longer than one year, the
723-14   issuance of bonds, notes, or other evidence of indebtedness, or
723-15   amendment of the bylaws.
723-16         Sec. 276.008.  OFFICERS; EMPLOYEES.  (a)  The board shall
723-17   select a secretary, who shall keep true and complete records of all
723-18   proceedings of the board.  Until the appointment of a secretary, or
723-19   in the event of the secretary's absence or inability to act, a
723-20   secretary pro tempore shall be selected by the board.
723-21         (b)  The board shall select a chair.  The chair is the chief
723-22   executive officer of the authority.
723-23         (c)  The board shall select a treasurer, who may also hold
723-24   the office of secretary.
723-25         (d)  The officers have the powers and duties, hold office for
723-26   the term, and are subject to removal in the manner provided in the
 724-1   bylaws.  The board shall set the compensation of the officers.
 724-2         (e)  The board may appoint officers, agents, and employees,
 724-3   may set their compensation and term of office and the method by
 724-4   which they may be removed, and may delegate to them the power and
 724-5   duties it determines appropriate.
 724-6         Sec. 276.009.  DISBURSEMENT OF FUNDS; SURETY BONDS.  (a)  The
 724-7   funds of the authority may be disbursed only on checks, drafts,
 724-8   orders, or other instruments signed by the persons authorized by
 724-9   the bylaws or a resolution concurred in by not less than five
724-10   directors.
724-11         (b)  The chair, the treasurer, and all other officers,
724-12   agents, and employees of the authority charged with the collection,
724-13   custody, or payment of any funds of the authority shall give bond
724-14   conditioned on the faithful performance of their duties and an
724-15   accounting for all funds and property of the authority coming under
724-16   their control.
724-17         (c)  The bonds shall be in a form and amount and with a
724-18   surety (by a surety company authorized to do business in the state)
724-19   approved by the board.
724-20         (d)  The premiums on the bonds shall be paid by the authority
724-21   and charged as an operating expense.  The bonds shall be payable to
724-22   the board for the use and benefit of the authority.
724-23         Sec. 276.010.  AUTHORITY OFFICE; RECORDS.  (a)  The general
724-24   offices of the authority shall be located by vote of a majority of
724-25   the board.  The county in which the general offices are located
724-26   shall constitute the domicile of the authority.  The general
 725-1   offices shall be in the charge of the chair.
 725-2         (b)  The authority shall keep complete and accurate accounts
 725-3   conforming to approved methods of bookkeeping.
 725-4         (c)  The accounts and all contracts, documents, and records
 725-5   of the authority shall be kept at the principal office.  The
 725-6   accounts and contracts shall be open to public inspection at all
 725-7   reasonable times.
 725-8         (d)  The board shall cause to be made and completed, within
 725-9   90 days after the end of each calendar year, an audit of the books
725-10   of account and financial records of the authority for that calendar
725-11   year.  The audit shall be made by an independent certified public
725-12   accountant or firm of certified public accountants.
725-13         (e)  Copies of a written report of the audit, certified to by
725-14   the accountant or accountants, shall be placed and kept on file
725-15   with the comptroller, with the commission, and at the principal
725-16   office of the authority and shall be open to public inspection at
725-17   all reasonable times.
725-18         Sec. 276.011.  CONFLICT OF INTEREST; PENALTY.  A director,
725-19   officer, agent, or employee of the authority may not have an
725-20   interest, directly or indirectly, in any contract for the purchase
725-21   of any property or construction of any work by or for the
725-22   authority.  If a director, officer, agent, or employee of the
725-23   authority is or becomes interested in a contract described by this
725-24   section, the person shall be guilty of a felony and on conviction
725-25   shall be subject to a fine in an amount not to exceed $10,000 or to
725-26   confinement in the state penitentiary for not less than one year or
 726-1   more than 10 years, or both a fine and confinement.
 726-2         Sec. 276.012.  RATES AND CHARGES.  (a)  The board shall
 726-3   establish and collect rates and other charges for the sale or use
 726-4   of water, water connections, power, electric energy, or other
 726-5   services sold, furnished, or supplied by the authority.  The fees
 726-6   and charges must be reasonable and nondiscriminatory and sufficient
 726-7   to produce revenues adequate, in addition to funds received from
 726-8   tax diversion, to:
 726-9               (1)  pay all expenses necessary to the operation and
726-10   maintenance of the properties and facilities of the authority;
726-11               (2)  pay the interest on and principal of all bonds
726-12   issued under this chapter as the interest and principal become due
726-13   and payable;
726-14               (3)  pay all sinking fund and reserve fund payments
726-15   agreed to be made with respect to bonds and payable out of
726-16   revenues, as the payments become due and payable; and
726-17               (4)  fulfill the terms of any agreements made with the
726-18   holders of bonds or with any person in their behalf.
726-19         (b)  Out of the revenues that may be received in excess of
726-20   those required for the purposes specified in Subsection (a), the
726-21   board may, in its discretion:
726-22               (1)  establish a reasonable depreciation and emergency
726-23   fund;
726-24               (2)  retire, by purchase and cancellation or
726-25   redemption, bonds issued under this chapter; or
726-26               (3)  apply the excess revenues to any corporate
 727-1   purpose.
 727-2         (c)  The rates and charges of the authority may not be in
 727-3   excess of what may be necessary to fulfill the obligations imposed
 727-4   on the authority by this chapter.  Nothing in this section shall be
 727-5   construed as depriving the state of its power to regulate and
 727-6   control fees or charges to be collected for the use of water, water
 727-7   connections, power, electric energy, or other service; provided,
 727-8   however, that the state pledges to and agrees with the purchasers
 727-9   and successive holders of the bonds issued under this chapter that
727-10   the state will not limit or alter the power vested in the authority
727-11   by this chapter to establish and collect the fees and charges as
727-12   will produce revenues sufficient to pay the items specified in
727-13   Subsection (a) or in any way impair the rights or remedies of the
727-14   holders of the bonds, or of any person in their behalf, until the
727-15   bonds, together with the interest on the bonds and on unpaid
727-16   installments of interest and all costs and expenses in connection
727-17   with any action or proceedings by or on behalf of the bondholders
727-18   and all other obligations of the authority in connection with the
727-19   bonds are fully met and discharged.
727-20         Sec. 276.013.  PAYMENT OF DEBTS.  Each indebtedness,
727-21   liability, or obligation of the authority for the payment of money,
727-22   however entered into or incurred and whether arising from contract,
727-23   implied contract, or otherwise, shall be payable solely:
727-24               (1)  out of the revenues received by the authority with
727-25   respect to its properties, including funds received by reason of
727-26   diversion of taxes, subject to any prior lien on the revenues
 728-1   conferred by any resolution previously adopted authorizing the
 728-2   issuance of bonds as provided in this chapter; or
 728-3               (2)  if the board so determines, out of the proceeds of
 728-4   sale by the authority of bonds payable solely from revenues.
 728-5         Sec. 276.014.  ISSUANCE OF BONDS.  (a)  The authority may
 728-6   issue bonds as provided by this section for any corporate purpose,
 728-7   not to exceed $6 million in aggregate principal amount.  Any
 728-8   additional amount of bonds must be authorized by an act of the
 728-9   legislature.
728-10         (b)  Bonds may be:
728-11               (1)  sold for cash at public or private sale, at such
728-12   price or prices as the board determines, provided that the interest
728-13   cost of the money received for the bonds, computed to maturity in
728-14   accordance with standard bond tables in general use by banks and
728-15   insurance companies, shall not exceed six percent per year; or
728-16               (2)  issued on such terms as the board determines in
728-17   exchange for property of any kind, real, personal or mixed, or any
728-18   interest in property, that the board determines necessary or
728-19   convenient for any corporate purpose; or
728-20               (3)  issued in exchange for like principal amounts of
728-21   other obligations of the authority, matured or unmatured.
728-22         (c)  The proceeds of sale of bonds shall be deposited in a
728-23   bank or banks or trust company or trust companies and shall be paid
728-24   out pursuant to such terms and conditions as may be agreed on
728-25   between the authority and the purchasers of the bonds.
728-26         (d)  Bonds must be authorized by a resolution of the board
 729-1   concurred in by at least five members.  Bonds must bear such date
 729-2   or dates; mature at such time or times; bear interest at such rate
 729-3   or rates, not exceeding six percent per year, payable annually or
 729-4   semiannually; be in such denominations; be in such form, either
 729-5   coupon or registered; carry such registration privileges as to
 729-6   principal only or as to both principal and interest and as to
 729-7   exchange of coupon bonds for registered bonds, or vice versa, and
 729-8   exchange of bonds of one denomination for bonds of other
 729-9   denominations; be executed in such manner; and be payable at such
729-10   place or places within or outside the state, as the resolution
729-11   provides.
729-12         (e)  A resolution authorizing bonds may contain provisions,
729-13   which shall be part of the contract between the authority and the
729-14   purchasers and successive holders of the bonds:
729-15               (1)  reserving the right to redeem the bonds at the
729-16   time or times, in the amount and at the prices, not exceeding 105
729-17   percent of the principal amount of the bonds plus accrued interest,
729-18   as may be provided in the resolution;
729-19               (2)  providing for the setting aside of sinking funds
729-20   or reserve funds and the regulation and disposition of the funds;
729-21               (3)  pledging, to secure the payment of the principal
729-22   of and interest on the bonds and of the sinking fund or reserve
729-23   fund payments agreed to be made with respect to the bonds, all or
729-24   any part of the gross or net revenues received by the authority
729-25   with respect to the property, real, personal or mixed, to be
729-26   acquired or constructed with the bonds or the proceeds of the
 730-1   bonds, or all or part of the gross or net revenues received by the
 730-2   authority from any source;
 730-3               (4)  prescribing the purposes to which the bonds or any
 730-4   bonds later issued, or the proceeds of the bonds, may be applied;
 730-5               (5)  agreeing to set and collect rates and charges
 730-6   sufficient to produce revenues adequate to pay the items specified
 730-7   in Section 276.012 (a) and prescribing the use and disposition of
 730-8   all revenues;
 730-9               (6)  prescribing limitations on the issuance of
730-10   additional bonds and on the agreements that may be made with the
730-11   purchasers and successive holders of such bonds;
730-12               (7)  relating to the construction, extension,
730-13   improvement, reconstruction, operation, maintenance, and repair of
730-14   the properties of the authority and the carrying of insurance, on
730-15   all or any part of the properties, covering loss or damage or loss
730-16   of use and occupancy resulting from specified risks;
730-17               (8)  setting the procedure, if any, by which, if the
730-18   authority so desires, the terms of any contract with the holders of
730-19   the bonds may be amended or abrogated, the amount of bonds the
730-20   holders of which must consent to the amendment or abrogation, and
730-21   the manner in which such consent may be given;
730-22               (9)  providing for the execution and delivery by the
730-23   authority to a bank or trust company authorized by law to accept
730-24   trusts, or to the United States or any officer or agency of the
730-25   United States, of indentures and agreements for the benefit of the
730-26   holders of the bonds setting forth all of the agreements authorized
 731-1   by this chapter to be made with or for the benefit of the holders
 731-2   of the bonds and other provisions as may be customary in indentures
 731-3   or agreements; and
 731-4               (10)  making other provisions, not inconsistent with
 731-5   the provisions of this chapter, as the board may approve.
 731-6         Sec. 276.015.   DEFAULT PROCEDURES.  (a)  A resolution
 731-7   authorizing the issuance of bonds and any indenture or agreement
 731-8   entered into pursuant to the resolution may include provisions
 731-9   regarding a default on the:
731-10               (1)  payment of the interest on any bonds as the
731-11   interest becomes due and payable;
731-12               (2)  payment of the principal of any bonds as they
731-13   become due and payable, whether at maturity, by call for
731-14   redemption, or otherwise; or
731-15               (3)  performance of an agreement made with the
731-16   purchasers or successive holders of any bonds.
731-17         (b)  If a default described by Subsection (a) has occurred
731-18   and has continued for a period, if any, prescribed by the
731-19   resolution authorizing the issuance of the bonds, the trustee under
731-20   the indenture or indentures entered into with respect to the bonds
731-21   authorized by the resolution, or, if there is no indenture, a
731-22   trustee appointed in the manner provided in the resolution by the
731-23   holders of 25 percent in aggregate principal amount of the bonds
731-24   authorized by the resolution and then outstanding may, and on the
731-25   written request of the holders of 25 percent in aggregate principal
731-26   amount of the bonds authorized by the resolution and then
 732-1   outstanding shall, in the trustee's own name but for the equal and
 732-2   proportionate benefit of the holders of all the bonds, and with or
 732-3   without having possession of the bonds:
 732-4               (1)  by mandamus or other suit, action, or proceeding
 732-5   at law or in equity, enforce all rights of the holders of the
 732-6   bonds;
 732-7               (2)  bring suit on the bonds or the appurtenant
 732-8   coupons;
 732-9               (3)  by action or suit in equity, require the authority
732-10   to account as if it were the trustee of an express trust for the
732-11   bondholders;
732-12               (4)  by action or suit in equity, enjoin any acts or
732-13   things which may be unlawful or in violation of the rights of the
732-14   holders of the bonds; or
732-15               (5)  after such notice to the authority as the
732-16   resolution may provide, declare the principal of all of the bonds
732-17   due and payable, and if all defaults have been made good, then with
732-18   the written consent of the holders of 25 percent in aggregate
732-19   principal amount of the bonds then outstanding, annul the
732-20   declaration and its consequences; provided, however, that the
732-21   holders of more than a majority in principal amount of the bonds
732-22   authorized by the resolution and then outstanding shall, by written
732-23   instrument delivered to the trustee, have the right to direct and
732-24   control any and all action taken or to be taken by the trustee
732-25   under this section.
732-26         (c)  A resolution, indenture, or agreement relating to bonds
 733-1   may provide that in a suit, action, or proceeding under this
 733-2   section, the trustee, whether or not all of the bonds have been
 733-3   declared due and  payable and with or without possession of any of
 733-4   the bonds, shall be entitled as of right to the appointment of a
 733-5   receiver who may enter and take possession of all or part of the
 733-6   properties of the authority, operate and maintain the properties,
 733-7   and set, collect, and receive rates and charges sufficient to
 733-8   provide revenues adequate to pay the items set forth in Section
 733-9   276.012(a) and the costs and disbursements of the suit, action, or
733-10   proceeding and apply such revenues in conformity with the
733-11   provisions of this chapter and the resolution authorizing the
733-12   bonds.
733-13         (d)  In a suit, action, or proceeding by a trustee under this
733-14   section, the reasonable fees, counsel fees, and expenses of the
733-15   trustee and of the receiver or receivers, if any, shall constitute
733-16   taxable disbursements, and all costs and disbursements allowed by
733-17   the court shall be a first charge on any revenues pledged to secure
733-18   the payment of the bonds.
733-19         (e)  Subject to the provisions of the constitution, the
733-20   courts of the county of domicile of the authority shall have
733-21   jurisdiction of a suit, action, or proceeding under this section by
733-22   a trustee on behalf of the bondholders and of all property involved
733-23   in the suit, action, or proceeding.
733-24         (f)  In addition to the powers specifically provided by this
733-25   section, the trustee shall have all powers necessary or appropriate
733-26   for the exercise of the powers specific or incident to the general
 734-1   representation of the bondholders in the enforcement of their
 734-2   rights.
 734-3         Sec. 276.016.  BOND APPROVAL AND REGISTRATION.  (a)  Before
 734-4   any bonds may be sold by the authority, a certified copy of the
 734-5   proceedings for the issuance of the bonds, including the form of
 734-6   the bonds, together with any other information that the attorney
 734-7   general may require, shall be submitted to the attorney general,
 734-8   and if the attorney general finds that the bonds have been issued
 734-9   in accordance with law, the attorney general shall approve the
734-10   bonds and execute a certificate to that effect, which shall be
734-11   filed in the office of the comptroller and recorded in a record
734-12   kept for that purpose.  The comptroller shall register the bonds if
734-13   the attorney general has filed with the comptroller the certificate
734-14   approving the bonds and the proceedings for the issuance of the
734-15   bonds as provided in this section.  Bonds may not be issued until
734-16   the bonds have been registered by the comptroller.
734-17         (b)  Bonds approved by the attorney general, registered by
734-18   the comptroller, and issued in accordance with the proceedings so
734-19   approved are valid and binding obligations of the authority and are
734-20   incontestable for any cause from and after the time of
734-21   registration.
734-22         Sec. 276.017.  BONDS AS NEGOTIABLE INSTRUMENTS.  Bonds issued
734-23   by the authority under the provisions of this chapter are
734-24   negotiable instruments within the meaning of the laws of the state.
734-25         Sec. 276.018.  ADDITIONAL POWERS RELATING TO CONTRACTS,
734-26   RULES, AND REGULATIONS.  The authority may, without intending by
 735-1   this provision to limit any powers granted to the authority by this
 735-2   chapter, enter into and carry out contracts or establish or comply
 735-3   with rules and regulations concerning labor and materials and other
 735-4   related matters, in connection with any project, as the authority
 735-5   considers desirable or as requested by the United States or any
 735-6   corporation or agency created, designated, or established by the
 735-7   United States that may assist in the financing of the project.
 735-8         Sec. 276.019.  REDEMPTION OF BONDS.  The authority may, out
 735-9   of funds available for the purpose, purchase bonds issued by it at
735-10   a price not exceeding the redemption price applicable at the time
735-11   of the purchase, or if the bonds are not redeemable, at a price not
735-12   exceeding the principal amount of the bonds plus accrued interest.
735-13   All bonds so purchased shall be canceled and no bonds shall ever be
735-14   issued in lieu of the canceled bonds.
735-15         Sec. 276.020.  DISPOSITION OF PROPERTY.  (a)  Nothing in this
735-16   chapter shall be construed as authorizing the authority, and the
735-17   authority may not be authorized, to mortgage or otherwise encumber
735-18   any of its property of any kind, real, personal, or mixed, or any
735-19   interest in property, or to acquire any property or interest
735-20   subject to a mortgage or conditional sale, provided that this
735-21   section shall not be construed as preventing the pledging of the
735-22   revenues of the authority as authorized by this chapter.
735-23         (b)  Nothing in this chapter shall be construed as
735-24   authorizing the sale, lease, or other disposition of any property
735-25   or interest by the authority or by any receiver of any of its
735-26   properties or through any court proceeding or otherwise; provided,
 736-1   however, that the authority may sell for cash any property or
 736-2   interest with an aggregate value not exceeding $50,000 in any one
 736-3   year if the board, by the affirmative vote of six of its members,
 736-4   has determined that the property or interest is not necessary or
 736-5   convenient to the business of the authority and has approved the
 736-6   terms of the sale.  Except by sale as expressly authorized in this
 736-7   section, no such property or interest shall ever come into the
 736-8   ownership or control, directly or indirectly, of any person, firm,
 736-9   or corporation other than a public authority created under the laws
736-10   of the state.
736-11         (c)  All property of the authority shall be at all times
736-12   exempted from forced sale, and nothing in this chapter shall be
736-13   construed to authorize the sale of any of the property of the
736-14   authority under any judgment rendered in any suit, and such sales
736-15   are prohibited.
736-16         Sec. 276.021.  PUBLIC ACCESS.  (a)  The authority may not
736-17   prevent the free public use of its lands for recreation purposes
736-18   and for hunting and fishing except:
736-19               (1)  at points where, in the opinion of the board, the
736-20   use would interfere with the proper conduct of the business of the
736-21   authority; or
736-22               (2)  in connection with the enforcement of sanitary
736-23   regulations or the protection of the public's health.
736-24         (b)  Public rights-of-way traversing the areas adjacent to
736-25   the areas to be flooded by the impounded waters shall remain open
736-26   as a way of free public passage to and from the lakes created, and
 737-1   no charge shall ever be made to the public for the right to engage
 737-2   in hunting, fishing, boating, or swimming on the lakes.
 737-3         (c)  If any citizen of the state notifies the attorney
 737-4   general that this section has not been complied with, the attorney
 737-5   general shall institute the proper legal proceedings to require the
 737-6   authority or its successor to comply with the provisions of this
 737-7   section.
 737-8         (d)  If any of the land owned by the authority bordering the
 737-9   lakes to be created under the authority of this chapter is sold by
737-10   the authority, the authority shall retain in each tract a strip 80
737-11   feet wide abutting the high-water line of the lake for the purpose
737-12   of passage and use by the public for public sports and amusements;
737-13   provided, however, that this subsection shall not apply to any
737-14   sales of land by the authority to any state or federal agency to be
737-15   used for game or fish sanctuaries or preserves or for propagation
737-16   purposes.
737-17         Sec. 276.022.  BONDS EXEMPT FROM TAXATION.  Bonds and
737-18   interest on bonds issued under the provisions of this chapter are
737-19   exempt from taxation, except inheritance taxes, by the state or by
737-20   any municipal corporation, county, or other political subdivision
737-21   or taxing district of the state.
737-22         Sec. 276.023.  SOURCE OF AUTHORITY.  This chapter, without
737-23   reference to other statutory provisions of the state, constitutes
737-24   full authority for the authorization and issuance of bonds under
737-25   this chapter, and no other act or law with regard to the
737-26   authorization or issuance of obligations or the deposit of the
 738-1   proceeds of such obligations or in any way impeding or restricting
 738-2   the carrying out of the acts authorized by this chapter to be done
 738-3   shall be construed as applying to any proceedings taken or acts
 738-4   done under this chapter.
 738-5         Sec. 276.024.  CONSTRUCTION.  This chapter and all of its
 738-6   terms and provisions shall be liberally construed to effectuate the
 738-7   purposes set forth in this chapter.
 738-8              CHAPTER 277.  UPPER GUADALUPE RIVER AUTHORITY
 738-9         Sec. 277.001.  CREATION.  (a)  A conservation and reclamation
738-10   district to be known as the "Upper Guadalupe River Authority" is
738-11   created.  The authority is a governmental agency and a body politic
738-12   and corporate.
738-13         (b)  The authority is created under and is essential to
738-14   accomplish the purposes of Section 59, Article XVI, Texas
738-15   Constitution.
738-16         (c)  All actions and proceedings taken by the authority
738-17   before the effective date of this chapter are validated.
738-18         Sec. 277.002.  DEFINITIONS.  In this chapter:
738-19               (1)  "Authority" means the Upper Guadalupe River
738-20   Authority.
738-21               (2)  "Board" means the board of directors of the
738-22   authority.
738-23               (3)  "Director" means a member of the board.
738-24         Sec. 277.003.  TERRITORY.  The authority comprises all of the
738-25   territory contained within and has the same boundaries as Kerr
738-26   County.
 739-1         Sec. 277.004.  FINDING OF BENEFIT.  The legislature finds and
 739-2   determines that all of the land and other property included within
 739-3   the area and boundaries of the authority will benefit from the
 739-4   works and projects that are to be accomplished by the authority
 739-5   pursuant to the powers conferred by the provisions of Section 59,
 739-6   Article XVI, Texas Constitution, and that the authority is created
 739-7   to serve a public use and benefit.
 739-8         Sec. 277.005.  GRANTS AND CONTRACTS.  The authority may
 739-9   accept grants from or contract with the United States government or
739-10   the state, any agency, arm, branch, department, or political
739-11   subdivision of the United States or the state, any municipality,
739-12   city, or town, or any public or private corporation, firm, or
739-13   person in connection with the exercise of or in aid of any right,
739-14   power, privilege, function, or authority of the authority.
739-15         Sec. 277.006.  POWERS APPLICABLE TO WATER CONTROL AND
739-16   IMPROVEMENT DISTRICTS.  The authority shall exercise all of the
739-17   rights, powers, privileges, authority, and duties conferred and
739-18   imposed by the general laws of the state applicable to water
739-19   control and improvement districts created under authority of
739-20   Section 59, Article XVI, Texas Constitution.  To the extent that
739-21   general laws applicable to water control and improvement districts
739-22   may be in conflict or inconsistent with the provisions of this
739-23   chapter, the provisions of this chapter prevail.  All general laws
739-24   of the state applicable to water control and improvement districts
739-25   created under authority of Section 59, Article XVI, Texas
739-26   Constitution, are adopted and incorporated by reference with the
 740-1   same effect as if incorporated in full in this chapter.
 740-2         Sec. 277.007.  NO HEARING ON EXCLUSION OF LAND OR PLAN OF
 740-3   TAXATION REQUIRED.  (a)  The board is not required to call or hold
 740-4   a hearing on the exclusions of land or other property from the
 740-5   authority.
 740-6         (b)  The board is not required to call or hold a hearing on
 740-7   the adoption of a plan of taxation.  The ad valorem plan of
 740-8   taxation shall be used by the authority.
 740-9         Sec. 277.008.  BOARD OF DIRECTORS.  (a)  All powers of the
740-10   authority shall be exercised by a board of nine directors.  Each
740-11   director serves for a term of office as provided by this section
740-12   and until a successor is appointed and has qualified.  A person may
740-13   not be appointed a director unless the person is 21 years of age or
740-14   older and is a resident of Kerr County and owns land in the county.
740-15   Each director shall subscribe the oath of office and shall give
740-16   bond in the amount of $5,000 for the faithful performance of the
740-17   person's duties as director.  The cost of the bond shall be borne
740-18   by the authority.  A majority of directors constitutes a quorum.
740-19         (b)  The directors are appointed by the governor.  The
740-20   directors are appointed for staggered six-year terms, with three
740-21   directors' terms expiring on February 1 of each odd-numbered year.
740-22   The governor shall fill a vacancy on the board by appointment for
740-23   the unexpired term.
740-24         (c)  The board shall elect from among its members a
740-25   president, a vice president, and a secretary and other officers the
740-26   board considers necessary.  The president is the chief executive
 741-1   officer of the authority and the presiding officer of the board and
 741-2   has the same right to vote as any other director.  The vice
 741-3   president shall perform all duties and exercise all power conferred
 741-4   by this chapter or general law on the president when the president
 741-5   is absent or fails or declines to act.  The secretary shall keep
 741-6   and sign the minutes of the meetings of the board.  In the absence
 741-7   of the secretary from any board meeting, a secretary pro tempore
 741-8   shall be named for that meeting, who may exercise all the duties
 741-9   and powers of the secretary for the meeting, sign the minutes of
741-10   the meeting, and attest all orders passed or other action taken at
741-11   the meeting.  The secretary is the custodian of all minutes and
741-12   records of the authority.
741-13         (d)  The board shall appoint all necessary engineers,
741-14   attorneys, auditors, and other employees, including a general
741-15   manager.
741-16         (e)  The board shall adopt a seal for the authority.
741-17         Sec. 277.009.  CONSTRUCTION BONDS.  Before issuing any
741-18   construction bonds, the authority shall submit plans and
741-19   specifications for the project to the commission for approval in
741-20   the manner required by Section 49.181, and the authority's project
741-21   and improvements during the course of construction shall be subject
741-22   to inspection in the manner provided by Section 49.182.
741-23         Sec. 277.010.  AD VALOREM TAX; ELECTION.  (a)  The authority
741-24   may continue to levy an annual ad valorem tax not to exceed 5 cents
741-25   per $100 valuation.  The authority may increase its ad valorem tax
741-26   rate and levy an ad valorem tax not to exceed 50 cents per $100
 742-1   valuation if:
 742-2               (1)  a petition signed by five percent of the resident
 742-3   qualified property taxpaying voters in the county is presented to
 742-4   the board requesting that an election be called to determine
 742-5   whether:
 742-6                     (A)  a specified rate of tax may be levied by the
 742-7   authority; or
 742-8                     (B)  a tax not to exceed a specified rate may be
 742-9   levied by the authority;
742-10               (2)  the board calls an election to submit the question
742-11   to the resident qualified voters; and
742-12               (3)  a majority of the qualified voters participating
742-13   in the election vote in favor of the tax.
742-14         (b)  The election shall be called, conducted, and held, the
742-15   returns of the election shall be made, and all notices of the
742-16   election shall be given in the same mode and manner as required by
742-17   general law for bond elections in water control and improvement
742-18   districts.
742-19         (c)  If a majority of the qualified voters participating in
742-20   the election vote in favor of the tax, the board may levy the
742-21   amount, or an amount not to exceed the amount, of tax specified in
742-22   the petition and order calling the election, provided the amount of
742-23   the tax does not exceed 50 cents per $100 valuation.  The tax
742-24   authorized to be levied may be used to accomplish the purposes for
742-25   which the authority is created or may be pledged, without the
742-26   necessity of another election, to the payment of tax bonds for such
 743-1   purposes in accordance with the general law governing water control
 743-2   and improvement districts.  The tax bonds must mature within 40
 743-3   years of their date.  Other limitations of this chapter do not
 743-4   apply to the amount of bonds to be issued by the authority provided
 743-5   the bonds and the interest on the bonds may be paid within the
 743-6   limits of the tax authorized.  The bonds shall be issued in
 743-7   conformity with the law governing water control and improvement
 743-8   districts except as modified by the provisions of this chapter.
 743-9         (d)  If taxes are levied, the values of the property in the
743-10   authority shall be the same values that are shown on the county tax
743-11   rolls, and the provisions of the general law with reference to
743-12   water control and improvement districts shall govern the
743-13   appointment, qualification, and duties of the authority's tax
743-14   assessor.
743-15         Sec. 277.011.  BOND ELECTIONS.  (a)  If the constitution or
743-16   this chapter requires a bond proposition to be approved by a
743-17   majority of the qualified voters voting at an election called for
743-18   that purpose before bonds or other obligations may be issued or
743-19   taxes levied, the election must be called and held and notice must
743-20   be given as required by this section.
743-21         (b)  An election to authorize the issuance of bonds is not
743-22   required if:
743-23               (1)  the bonds to be issued are payable from revenues
743-24   of a system or facilities of the authority and the board finds and
743-25   determines that the proceeds of the bonds proposed to be issued
743-26   will provide less than $2 million for the purpose of acquiring land
 744-1   or acquiring or constructing the facilities, excluding the cost of
 744-2   issuance, interest during construction, and any initial deposit
 744-3   from those proceeds to a reserve fund; and
 744-4               (2)  the proceeds of the bonds will be used to:
 744-5                     (A)  acquire land or an interest in land and to
 744-6   construct or acquire new facilities in the nature of a new project
 744-7   or undertaking for the authority, subject to the limitation that
 744-8   with respect to a new project or undertaking for the authority only
 744-9   one series of bonds may be issued to provide for the project unless
744-10   additional bonds are approved at an election by a majority of the
744-11   participating qualified voters;
744-12                     (B)  provide funds for repairs, expansion, and
744-13   improvement of the existing facilities of the authority; or 
744-14                     (C)  provide for the completion of construction
744-15   of a project for which the authority has previously issued bonds
744-16   approved at an election.
744-17         (c)  Except as provided by Subsection (b), bonds may not be
744-18   issued by the authority unless an election is held in the authority
744-19   to approve issuance of the bonds and the issuance of the bonds is
744-20   approved by a majority of the qualified voters voting at the
744-21   election.  The board must issue the order calling the election not
744-22   less than 15 or more than 90 days before the date the election is
744-23   to be held.
744-24         (d)  Notice of an election under Subsection (c) must be given
744-25   by posting a copy of the notice of election in at least three
744-26   public places within the authority at least 14 days before the date
 745-1   of the election and by publishing the notice at least once a week
 745-2   for two consecutive weeks in a newspaper with general circulation
 745-3   in the authority, the date of the first publication to be at least
 745-4   14 days before the election.
 745-5         Sec. 277.012.  APPLICABILITY OF OTHER LAW.  (a)  The
 745-6   authority is a conservation and reclamation district under Section
 745-7   59, Article XVI, Texas Constitution, and shall conserve and develop
 745-8   the natural resources of this state within the authority.  The
 745-9   authority may exercise the powers necessary to accomplish each of
745-10   the rights and duties specified in Section 59, Article XVI, Texas
745-11   Constitution, as provided by Chapters 49, 50, 51, and 54.  The
745-12   authority may construct or acquire those projects that the board
745-13   determines are needed and incident to or related to the performance
745-14   of those rights and duties.
745-15         (b)  The authority is a district under Chapter 30, and that
745-16   chapter applies to the authority except to the extent that Chapter
745-17   30 conflicts with this chapter, in which case this chapter
745-18   prevails.  All cities, public agencies, and other political
745-19   subdivisions are authorized to contract with the authority in any
745-20   manner authorized by Chapter 30, provided that any city may
745-21   contract with the authority in the manner authorized by Section
745-22   30.030(c).  The authority and all cities, public agencies, and
745-23   other political subdivisions contracting with the authority have
745-24   all of the rights and authority relating to the control, storage,
745-25   preservation, transmission, treatment, and disposition of storm
745-26   water, floodwater, water of rivers and streams, and groundwater
 746-1   that are granted, permitted, and authorized by Chapter 30.
 746-2         Sec. 277.013.  POWER TO BORROW MONEY.  (a)  The authority may
 746-3   borrow money for any corporate purpose or combination of corporate
 746-4   purposes pursuant to the methods and procedures specifically
 746-5   provided by this chapter or by general law.
 746-6         (b)  The board, without the necessity of an election, may
 746-7   borrow money on negotiable notes of the authority to be paid solely
 746-8   from the revenues of the authority derived from the ownership of
 746-9   all or a designated part of the authority's works, plant,
746-10   improvements, facilities, equipment, or water rights, after
746-11   deduction of the reasonable cost of maintaining and operating the
746-12   facilities.
746-13         (c)  A note or notes issued under this section may not exceed
746-14   $55 million in the aggregate.
746-15         (d)  The notes may mature over a term of not more than 40
746-16   years and bear interest at a rate of not more than 10 percent.
746-17         (e)  The notes may be first or subordinate lien notes within
746-18   the discretion of the board, but no obligation may be a charge on
746-19   the property of the authority or on the taxes levied or collected
746-20   by the authority, but shall be a charge on the revenues pledged for
746-21   the payment of the obligation.  No part of the obligation may be
746-22   paid from the taxes levied or collected by the authority.
746-23         (f)  Section 49.153 does not apply to any revenue note issued
746-24   by the authority.
746-25         Sec. 277.014.  VALIDITY OF BONDS.  If bonds or refunding
746-26   bonds have been approved by the attorney general, registered by the
 747-1   comptroller, and issued by the authority, the bonds or refunding
 747-2   bonds are negotiable, legal, valid, and binding obligations of the
 747-3   authority and are incontestable for any cause.
 747-4         Sec. 277.015.  EMINENT DOMAIN.  If the authority, in the
 747-5   exercise of the power of eminent domain or police power or any
 747-6   other power, requires the relocation, raising, lowering, rerouting,
 747-7   change in grade, or alteration in construction of any railroad,
 747-8   electric transmission, telegraph, or telephone lines, conduits,
 747-9   poles, properties, or facilities, or pipelines, all such
747-10   relocation, raising, lowering, rerouting, changes in grade, or
747-11   alteration of construction shall be accomplished at the sole
747-12   expense of the authority.  In this section, "sole expense" means
747-13   the actual cost of relocation, raising, lowering, rerouting, change
747-14   in grade, or alteration of construction in providing comparable
747-15   replacement without enhancement of the facilities, after deducting
747-16   the net salvage value derived from the old facility.
747-17         Sec. 277.016.  CERTAIN MUNICIPAL ANNEXATION PROVISIONS NOT
747-18   APPLICABLE.  The authority is created notwithstanding any
747-19   conflicting provisions of Section 212.003, Local Government Code,
747-20   and Chapters 42 and 43, Local Government Code, and those provisions
747-21   have no application to the authority.
747-22         Sec. 277.017.  AUTHORITY DEPOSITORY.  The board shall select
747-23   a bank or trust company in the state to act as depository of the
747-24   proceeds of the bonds or revenues derived from the operation of the
747-25   facilities of the authority.  The depository shall furnish
747-26   indemnity bonds or pledge securities or meet other requirements as
 748-1   determined by the board.  The authority may select one or more
 748-2   depositories.
 748-3         Sec. 277.018.  ADDITIONAL SPECIFIC POWERS.  (a)  The
 748-4   authority has the right, power, privilege, function, and authority
 748-5   to control, develop, store, and preserve the waters and floodwaters
 748-6   of the Upper Guadalupe River and its tributaries within or outside
 748-7   the boundaries of the authority for any beneficial or useful
 748-8   purpose; to purchase, acquire, build, construct, improve, extend,
 748-9   reconstruct, repair, and maintain all dams, structures, waterworks
748-10   systems, sanitary or storm sewer or drainage or irrigation systems,
748-11   buildings, waterways, pipelines, distribution systems, ditches,
748-12   lakes, ponds, reservoirs, plants, and recreational facilities for
748-13   public use and any other facilities or equipment in aid of such
748-14   purposes; to purchase or acquire the necessary sites, easements,
748-15   rights-of-way, land, or other properties necessary for those
748-16   purposes; and to do anything, by any practical means, that may be
748-17   necessary to the exercise of all of the rights, powers, privileges,
748-18   functions, and authority of the authority.  The authority may sell
748-19   water and other services.
748-20         (b)  As a necessary aid to the conservation, control,
748-21   preservation, and distribution of the waters and floodwaters of the
748-22   Upper Guadalupe River and its tributaries for beneficial use, the
748-23   authority may construct, own, and operate sewage gathering,
748-24   transmission, and disposal services, may charge for those services,
748-25   and may make contracts with municipalities and others in reference
748-26   to those services.
 749-1         Sec. 277.019.  ISSUANCE OF BONDS.  (a)  In addition to the
 749-2   powers and purposes authorized by other statutory provisions
 749-3   pertaining to water control and improvement districts created under
 749-4   Section 59, Article XVI, Texas Constitution, the authority may
 749-5   issue any kind of bonds or refunding bonds for any purposes
 749-6   provided by this chapter and may provide and make payment for the
 749-7   bonds and for necessary expenses in connection with the bonds.
 749-8         (b)  Bonds or refunding bonds may be sold at a price and
 749-9   under terms determined by the board.  Bonds and refunding bonds may
749-10   be sold at a private or public sale but may not be sold for less
749-11   than 95 percent of their face value.  The authority may exchange
749-12   bonds or refunding bonds for property or facilities acquired by
749-13   purchase or in payment of the contract price of work done or
749-14   materials furnished or services furnished for the use and benefit
749-15   of the authority, but such exchange or payment may not be on a
749-16   basis of less than 95 percent of the face value of the bonds or
749-17   refunding bonds exchanged or used for payment as provided by this
749-18   subsection.
749-19         Sec. 277.020.  DISSOLUTION OF AUTHORITY NOT REQUIRED.  The
749-20   provisions of Sections 51.781-51.783 or any other statutory
749-21   provisions pertaining to the calling of a hearing for the
749-22   determination of the dissolution of a district where a bond
749-23   election has failed shall not apply to the authority, and the
749-24   authority shall continue to exist and have full power to function
749-25   and operate regardless of the outcome of a bond election.  On the
749-26   failure of a bond election, a subsequent bond election may be
 750-1   called after the expiration of 30 days from the date of the bond
 750-2   election that failed.
 750-3         Sec. 277.021.  NOTICE OF ELECTIONS.  Notice of all elections
 750-4   may be signed by either the president or the secretary of the
 750-5   authority.
 750-6         Sec. 277.022.  ELECTION RETURNS.  The returns of all
 750-7   elections may be canvassed by the board at any time within seven
 750-8   days after an election or as soon thereafter as reasonably
 750-9   practicable.
750-10         Sec. 277.023.  EXEMPTION FROM TAXATION.  The accomplishment
750-11   of the purposes of this chapter will benefit the people of this
750-12   state and improve their properties and industries, and the
750-13   authority in carrying out the purposes of this chapter will be
750-14   performing an essential public function under Section 59, Article
750-15   XVI, Texas Constitution, and shall not be required to pay any tax
750-16   or assessment on a project or any part of a project under this
750-17   chapter or on any purchases made by the authority, and the bonds
750-18   issued under this chapter and the transfer of and income from the
750-19   bonds, including the profits made on the sale of the bonds, shall
750-20   at all times be free from taxation within the state.
750-21         Sec. 277.024.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
750-22   DEPOSITS.  Bonds and refunding bonds of the authority are legal,
750-23   eligible, and authorized investments for banks, savings and loan
750-24   associations, insurance companies, fiduciaries, trustees, and
750-25   guardians and for the sinking funds of cities, towns, villages,
750-26   counties, school districts, or other political corporations or
 751-1   subdivisions of the state.  The bonds and refunding bonds are
 751-2   eligible to secure deposits of all public funds of cities, towns,
 751-3   villages, counties, school districts, or other political
 751-4   corporations or subdivisions of the state, and the bonds are lawful
 751-5   and sufficient security for such deposits to the extent of their
 751-6   face value when accompanied by all unmatured coupons.
 751-7         Sec. 277.025.  TRANSFERS; SEVERABILITY.  (a)  All files and
 751-8   records of the authority pertaining to control, management, and
 751-9   operation of the district are transferred to the authority on the
751-10   effective date of this chapter.
751-11         (b)  All real and personal property, leases, rights,
751-12   licenses, permits, contracts, staff, and obligations of the
751-13   authority, including any revenue notes issued prior to the
751-14   effective date of this chapter, shall be transferred to the
751-15   authority on the effective date of this chapter.
751-16         (c)  All unobligated and unexpended funds of the authority
751-17   shall be transferred to the authority on the effective date of this
751-18   chapter.
751-19         (d)  A rule or regulation adopted by the authority before the
751-20   effective date of this chapter is, on the effective date of this
751-21   chapter a rule or regulation of the authority and remains in effect
751-22   until amended or repealed by the authority.
751-23         (e)  The provisions of this chapter are severable.  If any
751-24   section, subsection, provision or part of this chapter should be
751-25   held invalid, it shall not affect the validity of the remaining
751-26   portions of this chapter.
 752-1       CHAPTER 278.  UPPER NECHES RIVER MUNICIPAL WATER AUTHORITY
 752-2         Sec. 278.001.  CREATION.  (a)  A conservation and reclamation
 752-3   district to be known as the "Upper Neches River Municipal Water
 752-4   Authority" is created.  The authority is a governmental agency and
 752-5   body politic and corporate.
 752-6         (b)  The authority is created under and is essential to
 752-7   accomplish the purposes of Section 59, Article XVI, Texas
 752-8   Constitution.
 752-9         (c)  The authority may exercise all rights, powers,
752-10   privileges, and functions as provided in this chapter and as may be
752-11   contemplated and implied by Section 59, Article XVI, Texas
752-12   Constitution, as well as those conferred by the general laws of the
752-13   state relating to water control and improvement districts except
752-14   where such laws are in conflict with the provisions of this
752-15   chapter.
752-16         Sec. 278.002.  DEFINITIONS.  In this chapter:
752-17               (1)  "Authority" means the Upper Neches River Municipal
752-18   Water Authority.
752-19               (2)  "Board" means the board of directors of the
752-20   authority.
752-21               (3)  "Director" means a member of the board.
752-22         Sec. 278.003.  TERRITORY.  The area of the authority
752-23   comprises all territory contained within the corporate limits of
752-24   the city of Palestine, Anderson County, and no defect or
752-25   irregularity in the boundaries of that city or in any of the
752-26   proceedings relating to the annexation of territory to that city
 753-1   shall ever affect the authority or any of its rights, powers,
 753-2   privileges, or functions, it being affirmatively found and
 753-3   determined by the legislature that all of the territory within the
 753-4   limits of the city of Palestine, Anderson County, as well as all
 753-5   other territory which later may be brought into the authority as
 753-6   provided by Sections 278.007 and 278.008 shall comprise the
 753-7   authority and that all of such territory will benefit from the
 753-8   improvements and facilities to be constructed, acquired, or
 753-9   otherwise furnished under this chapter.
753-10         Sec. 278.004.  BOARD OF DIRECTORS.  (a)  The powers of the
753-11   authority shall be exercised by a board of directors.  The
753-12   directors shall be appointed by the governor with the advice and
753-13   consent of the senate.
753-14         (b)  Directors are appointed for staggered terms of six
753-15   years, with one-third of the directors' terms expiring on February
753-16   1 of each odd-numbered year.  Directors serve until their
753-17   successors are appointed and have qualified.  Any vacancy on the
753-18   board is filled by the governor as provided by this section.
753-19         (c)  Three directors shall be appointed to the board from the
753-20   city of Palestine, Anderson County.
753-21         (d)  If the city of Tyler, Smith County, becomes a part of
753-22   the authority by annexation as provided by Sections 278.007 or
753-23   278.008, a number of directors shall be appointed to the board from
753-24   that city equal to the combined number of directors appointed from
753-25   all other cities then members of the authority, and if the
753-26   membership of the board is increased after the entry of the city of
 754-1   Tyler by the addition of directors from any other area, the number
 754-2   of directors from the city of Tyler shall be increased so that the
 754-3   number shall always equal one-half of the entire membership of the
 754-4   board.
 754-5         (e)  If the city of Athens, Henderson County, becomes a part
 754-6   of the authority by annexation as provided by Sections 278.007 or
 754-7   278.008, three directors shall be appointed to the board from that
 754-8   city.
 754-9         (f)  The additional directors to which the city of Tyler and
754-10   the city of Athens are entitled shall be appointed by the governor
754-11   with the advice and consent of the senate, with their respective
754-12   initial terms staggered and of such duration as will permit the
754-13   appointment of their successors at the same time as successors of
754-14   the other members then comprising the board, with one-third of the
754-15   number of directors to which each city is entitled to be appointed
754-16   from that city for each term.  The governor, with the advice and
754-17   consent of the senate, shall appoint all successors to the
754-18   directors.
754-19         Sec. 278.005.  QUALIFICATIONS OF BOARD MEMBERS.  (a)  To be
754-20   qualified for appointment to the board, a person must be a
754-21   qualified voter and property-owning taxpayer in the city from which
754-22   the person is appointed.
754-23         (b)  A member of the governing body or an employee of a city
754-24   from which the person is appointed is not eligible to serve on the
754-25   board.
754-26         (c)  Each director shall subscribe the constitutional oath of
 755-1   office and give bond for the faithful performance of the director's
 755-2   duties in the amount of $5,000.
 755-3         Sec. 278.006.  BOARD:  ACTION; DUTIES; QUORUM; COMPENSATION;
 755-4   EXPENSES.  (a)  The board shall perform official actions by
 755-5   resolution.  Two-thirds of the members of the board constitutes a
 755-6   quorum for the transaction of any and all business of the
 755-7   authority.  A majority vote of those present shall be sufficient in
 755-8   all official actions including final passage and enactment of all
 755-9   resolutions.
755-10         (b)  The board shall hold regular meetings at least once
755-11   every three months.  The date of the meeting is to be established
755-12   in the authority's bylaws or by resolution of the board.
755-13         (c)  The president or any two members of the board may call
755-14   special meetings as may be necessary in the administration of the
755-15   business of the authority; provided, however, that at least five
755-16   days before the date of the meeting, the secretary shall mail
755-17   notice of the meeting to the address that each director has on file
755-18   with the secretary.  Notice of special meetings may be waived in
755-19   writing by any director.
755-20         (d)  Each director is entitled to receive fees of office and
755-21   reimbursement of expenses as provided by Chapter 49.
755-22         (e)  The board shall elect from among its members a president
755-23   of the authority.  The president is the chief executive officer of
755-24   the authority and shall preside at the meetings of the board and
755-25   perform all other functions incident to the office.
755-26         (f)  The board shall elect from among its members a vice
 756-1   president.  The vice president shall act as president in case of
 756-2   the inability, absence, or failure of the president to act.
 756-3         (g)  The board shall elect a secretary, who may or may not be
 756-4   chosen from among the members of the board.  The secretary shall be
 756-5   charged with the duty of seeing that all books and records of the
 756-6   authority are properly kept.
 756-7         Sec. 278.007.  ADDITIONAL TERRITORY MAY BE ADDED.  (a)  Other
 756-8   territory may be annexed to the authority as provided in this
 756-9   section and Section 278.008.
756-10         (b)  A petition for annexation must:
756-11               (1)  be signed by 50 or a majority of the qualified
756-12   voters of the territory to be annexed who own taxable property in
756-13   the territory to be annexed and have duly rendered the property for
756-14   taxation to the city or county;
756-15               (2)  be filed with the board; and
756-16               (3)  describe the territory to be annexed by metes and
756-17   bounds or by other appropriate description, unless the territory is
756-18   the same as that of a city or town, in which event it shall be
756-19   sufficient to state that the territory to be annexed is the same as
756-20   that contained within the city or town.
756-21         (c)  If the board finds that the petition is signed by the
756-22   required number of qualified persons and otherwise complies with
756-23   Subsection (b), that the annexation would be to the interest of the
756-24   territory to be annexed and the authority, and that the authority
756-25   will be able to render service to the territory to be annexed, the
756-26   board shall call an election in the territory to be annexed for the
 757-1   purpose of submitting the proposition of whether the territory
 757-2   shall be annexed to the authority; provided, however, that if
 757-3   either the city of Tyler, Smith County, or the city of Athens,
 757-4   Henderson County, files a petition for annexation to the authority
 757-5   in the manner provided in this section, the petition shall be
 757-6   granted and the city filing the petition shall be entitled to
 757-7   annexation, subject to the other provisions of this section.
 757-8         (d)  Because railroad right-of-way, transmission lines, and
 757-9   other property of electric, telephone, telegraph, and gas utilities
757-10   that are not situated within the defined limits of an incorporated
757-11   city or town will not benefit from the improvements, works, and
757-12   facilities that the authority is authorized to construct, railroad
757-13   right-of-way, transmission lines, or other property of electric,
757-14   telephone, telegraph, or gas utilities may not be annexed to the
757-15   authority unless the right-of-way, transmission lines, or other
757-16   property of electric, telephone, telegraph, and gas utilities is
757-17   contained within the limits of an incorporated city or town annexed
757-18   to the authority.
757-19         (e)  Notice of the election, stating the date and places for
757-20   holding the election, the proposition to be voted on, and the
757-21   conditions under which the territory may be annexed, or making
757-22   reference to the resolution of the board for that purpose, must be
757-23   published once a week for two consecutive weeks in a newspaper
757-24   published in the territory to be annexed and designated by the
757-25   board.  The first publication must appear at least 14 days before
757-26   the date of the election.  If no newspaper is published in the
 758-1   territory to be annexed, it shall be sufficient if notices are
 758-2   posted at three public places in the territory to be annexed and
 758-3   published at the times provided by this subsection in a newspaper
 758-4   having general circulation in the territory.
 758-5         (f)  Only qualified electors who reside in the territory to
 758-6   be annexed shall be qualified to vote in the election on the
 758-7   proposition for annexation.  As in the case of other elections to
 758-8   be held under this chapter, the returns of the annexation election
 758-9   shall be made to the board.
758-10         (g)  The board shall canvass the returns of the election and
758-11   adopt a resolution declaring the results.  If the resolution shows
758-12   that a majority of the votes cast are in favor of annexation, the
758-13   board shall enter an order annexing the territory to the authority,
758-14   and the annexation shall be incontestable except in the manner and
758-15   within the time for contesting elections under the Election Code.
758-16   A certified copy of the order shall be recorded in the deed records
758-17   of the county in which the annexed territory is situated.
758-18         Sec. 278.008.  ANNEXATION OF TERRITORY AFTER BONDS OR TAXES
758-19   APPROVED.  (a)  If, before calling an election for the annexation
758-20   of territory, the authority to levy ad valorem taxes has been voted
758-21   in the authority, if bonds or other obligations supported wholly or
758-22   in part by ad valorem taxes have been issued and are outstanding,
758-23   or if bonds or other obligations so supported have been voted but
758-24   remain unsold, the procedure for annexation and the results of the
758-25   procedure shall be as provided by this section.
758-26         (b)  On receipt of the petition for annexation as provided by
 759-1   Sections 278.007(b) and (c), the board shall by appropriate
 759-2   resolution or order call an election to be held in the territory to
 759-3   be annexed and shall issue and publish notices as provided by
 759-4   Section 278.007(e).
 759-5         (c)  The persons eligible to vote at the election shall be
 759-6   qualified electors who reside in the territory to be annexed.
 759-7         (d)  In calling the election in the territory to be annexed,
 759-8   the board shall submit as one joint proposition to be voted on in
 759-9   the territory the question of whether the territory shall be
759-10   annexed and whether it shall assume its pro rata share of any ad
759-11   valorem taxes previously voted, of any bonds or other obligations
759-12   of the authority supported in whole or in part by ad valorem taxes
759-13   then outstanding and unpaid, and of any bonds or other obligations
759-14   so supported that have been voted but that remain unissued and
759-15   unsold.
759-16         (e)  If the joint proposition submitted under Subsection (d)
759-17   receives a majority of the votes cast in the territory to be
759-18   annexed, the board shall enter an order or resolution annexing the
759-19   territory and declaring the assumption by the territory annexed of
759-20   ad valorem taxes and tax-supported bonds issued or authorized, and
759-21   the annexation and assumption shall be incontestable except in the
759-22   manner and within the time for contesting elections under the
759-23   Election Code.
759-24         Sec. 278.009.  ASSUMPTION OF DEBT; TAXES.  (a)  After
759-25   territory is added to the authority, the board may call an election
759-26   over the entire authority for the purpose of determining whether
 760-1   the entire authority as enlarged shall assume the taxes and
 760-2   tax-supported obligations then outstanding and in force, and, in
 760-3   the case of bonds, those voted but not yet sold, and whether ad
 760-4   valorem taxes shall be levied on all taxable property within the
 760-5   authority as enlarged for the payment of the obligations and bonds,
 760-6   unless that proposition was favorably voted along with the
 760-7   annexation election and becomes lawfully binding on the territory
 760-8   annexed.
 760-9         (b)  Notice of the elections provided for in this section
760-10   must be given and the elections must be held in the same manner as
760-11   elections for the issuance of bonds as provided by this chapter.
760-12         Sec. 278.010.  GENERAL MANAGER; EMPLOYEES.  (a)  The board
760-13   may employ and determine the compensation of a general manager for
760-14   the authority and may delegate to the general manager full power
760-15   and authority to manage and operate the affairs of the authority,
760-16   subject only to orders of the board.  The board may also employ and
760-17   determine the compensation of such other employees as it considers
760-18   appropriate to the proper conduct of the authority's affairs,
760-19   including engineers, technical experts, attorneys, and assistants
760-20   to the authority's officers including the general manager.  The
760-21   board may remove any employee.
760-22         (b)  The general manager is the official treasurer of the
760-23   authority and has charge of its funds.  The general manager shall
760-24   see that the funds are safely kept and shall account for the funds
760-25   to the board.  The general manager shall give bond in an amount
760-26   required by the board, but in no event shall the amount be less
 761-1   than $50,000.
 761-2         Sec. 278.011.  DISBURSEMENT OF FUNDS.  The funds of the
 761-3   authority shall be disbursed only on checks, drafts, orders, or
 761-4   other instruments signed by the persons authorized by the bylaws
 761-5   and resolutions of the board.
 761-6         Sec. 278.012.  CITIES AND TOWNS MAY GIVE FINANCIAL AID TO
 761-7   AUTHORITY.  In consideration of the fact that the authority may be
 761-8   incurring obligations and making expenditures, before funds are
 761-9   available to pay such obligations and expenditures, for the purpose
761-10   of providing funds needed to procure necessary engineering surveys
761-11   and the collection and compilation of data relating to general
761-12   conditions influencing the determination of the character and
761-13   extent of the improvements, works, and facilities essential to the
761-14   accomplishment of the purposes of the authority, any city or town
761-15   situated within the authority may expend funds or use its services
761-16   for such engineering surveys and data.  Any city or town situated
761-17   within the authority may appropriate money from its general funds
761-18   or such other funds as may be legally available for the purpose and
761-19   donate and contribute money to the authority, and the authority may
761-20   contract with any such city or town to repay money advanced as a
761-21   loan to the authority.
761-22         Sec. 278.013.  AUTHORITY OFFICE; RECORDS.  A regular office
761-23   shall be established and maintained for the conduct of the
761-24   authority's business at a location to be determined by the board.
761-25   The board shall keep a true and full account of the proceedings of
761-26   its meetings and shall maintain its records in a secure manner.
 762-1         Sec. 278.014.  ACCOUNT RECORDS; AUDITS.  (a)  The board shall
 762-2   keep complete and accurate accounts conforming to approved methods
 762-3   of bookkeeping.  The accounts and all contracts, documents, and
 762-4   records of the authority shall be kept at the authority's principal
 762-5   office and shall be open to public inspection at all reasonable
 762-6   times.
 762-7         (b)  Within 90 days after the end of each calendar year, the
 762-8   books of account and financial records of the authority for the
 762-9   preceding calendar year shall be audited by an independent
762-10   certified public accountant.  Copies of the written report of the
762-11   audit, certified to by the accountant, shall be placed and kept on
762-12   file at the office of the authority and shall be open to public
762-13   inspection at all reasonable times.
762-14         Sec. 278.015.  AUTHORITY DEPOSITORY; METHOD OF SELECTION.
762-15   (a)  The board shall designate one or more banks within the
762-16   authority to serve as depository for the funds of the authority.
762-17   All funds of the authority shall be deposited in the depository
762-18   bank or banks except funds pledged to pay bonds, which shall be
762-19   deposited with the trustee bank or paying agent named in the bond
762-20   proceedings and to the extent provided for in those proceedings.
762-21   To the extent that funds in the depository bank and the trustee
762-22   bank are not insured by the Federal Deposit Insurance Corporation
762-23   the funds shall be secured in the manner provided by law for the
762-24   security of county funds.
762-25         (b)  Before designating a depository bank or banks, the board
762-26   shall issue a notice stating the time and place the board will meet
 763-1   to designate a depository bank or banks and inviting the banks in
 763-2   the authority to submit applications to be designated depositories.
 763-3   The notice must be published one time in a newspaper or newspapers
 763-4   published in the authority as specified by the board at least 10
 763-5   days before the date of the board meeting.
 763-6         (c)  At the time mentioned in the notice, the board shall
 763-7   consider the applications and the management and condition of the
 763-8   banks filing them and shall designate as depositories the bank or
 763-9   banks which offer the most favorable terms and conditions for the
763-10   handling of the funds of the authority and which the board finds
763-11   have proper management and are in condition to warrant handling the
763-12   funds of the authority.
763-13         (d)  If no acceptable applications are received by the time
763-14   stated in the notice, the board shall designate some bank or banks
763-15   within or outside the authority on such terms and conditions as it
763-16   finds advantageous to the authority.
763-17         (e)  The term of service for depositories shall be prescribed
763-18   by the board.
763-19         Sec. 278.016.  POWERS AND DUTIES.  (a)  In addition to the
763-20   powers granted water control and improvement districts by general
763-21   law and in addition to the powers otherwise provided by this
763-22   chapter, the authority may exercise the powers, rights, privileges,
763-23   and functions provided by this section.
763-24         (b)  The authority may store, control, conserve, protect,
763-25   distribute, and utilize storm waters and floodwaters and
763-26   unappropriated flow waters of the Neches River and such portions of
 764-1   its tributaries as are located within Smith, Cherokee, Anderson,
 764-2   and Henderson counties, except that portion of the drainage area of
 764-3   Flat Creek in Henderson County which lies west of presently
 764-4   designated Farm-to-Market Road 607 leading from LaRue through
 764-5   Leagueville to Brownsboro, by construction of a dam or dams across
 764-6   that river and its tributaries within the counties or as otherwise
 764-7   provided by the applicable provisions of this code in order that
 764-8   the escape of any such waters, without first obtaining from them
 764-9   the maximum of public benefit, may be prevented in so far as it is
764-10   feasible and practicable within the means of the authority, except
764-11   that the authority may not build a dam or dams outside the
764-12   boundaries of Smith, Cherokee, Anderson, and Henderson counties.
764-13         (c)  The authority may acquire and develop underground
764-14   sources of water in such instances and to such extent as the board
764-15   may consider necessary and feasible in the conduct of its business
764-16   and affairs, but only within Smith, Cherokee, Anderson, and
764-17   Henderson counties.  The authority may acquire by purchase,
764-18   contract, lease, gift, or any other lawful manner and may develop
764-19   all facilities within Smith, Cherokee, Anderson, and Henderson
764-20   counties considered necessary or useful for the purpose of
764-21   diverting, storing, controlling, conserving, protecting,
764-22   distributing, processing, and utilizing surface water or
764-23   groundwater and the transportation of such water for municipal,
764-24   domestic, industrial, and other useful purposes permitted by law.
764-25   The authority may not acquire any water rights in or exercise any
764-26   control over the water in that portion of the drainage area of Flat
 765-1   Creek in Henderson County that lies west of Farm-to-Market Road 607
 765-2   leading from LaRue through Leagueville to Brownsboro.
 765-3         (d)  The authority may acquire by purchase, construction,
 765-4   lease, or gift or in any other lawful manner and may maintain, use,
 765-5   and operate property of any kind, real, personal, or mixed, or any
 765-6   interest in property, within and outside the boundaries of the
 765-7   authority necessary to the exercise of the powers, rights,
 765-8   privileges, and functions possessed by the authority under this
 765-9   chapter.
765-10         (e)  The authority may acquire by condemnation to the extent
765-11   and in the manner set forth and permitted by general law, including
765-12   Chapter 21, Property Code, any property or right in property
765-13   necessary to be acquired by the authority with respect to any
765-14   project that it is lawfully empowered to provide and that has been
765-15   approved by the commission or a predecessor agency under the
765-16   provisions of general law including the provisions of Sections
765-17   49.181 and 49.182; provided, however, that the authority may not
765-18   condemn any property or right in property that is owned by any
765-19   other political subdivision, city, or town of this state; and
765-20   provided further, that the authority may not condemn any property
765-21   lying outside of Smith, Cherokee, Anderson, and Henderson counties
765-22   except for the purpose of constructing necessary transportation
765-23   facilities to a purchaser of water from the authority.
765-24         (f)  The authority may sell or otherwise dispose of excess
765-25   property of any kind, real, personal, or mixed, or any interest in
765-26   property not necessary to the operation of the authority; provided,
 766-1   however, that in those cases in which the board considers the value
 766-2   of such property to be in excess of $1,000, the property shall be
 766-3   sold only after advertisement and competitive bidding.
 766-4         (g)  The authority may require the relocation of roads and
 766-5   highways in the manner and to the extent permitted by general law
 766-6   to districts organized under Section 59, Article XVI, Texas
 766-7   Constitution.  The actual cost of relocation of any roads,
 766-8   highways, or railroads or electrical highlines, pipelines,
 766-9   telephone and telegraph lines, or other utility lines in
766-10   furtherance of the purposes of this chapter and any damage incurred
766-11   in changing and adjusting the lines and grades of railroads or
766-12   highways or roads shall be paid by the authority.
766-13         (h)  The authority may make contracts and execute all
766-14   instruments necessary or convenient to the exercise of the powers,
766-15   rights, privileges, and functions of the authority.
766-16         (i)  The authority may make or cause to be made surveys and
766-17   engineering investigations for the information of the authority to
766-18   facilitate the accomplishment of the purposes for which it is
766-19   created.
766-20         (j)  The authority may borrow money for its corporate
766-21   purposes and may borrow money and accept grants, gratuities, or
766-22   other support from the United States or the state or from any
766-23   corporation or agency created or designated by the United States or
766-24   the state and, in connection with any such loan, grant, or other
766-25   support, may enter into such arrangement with the United States or
766-26   the state, or such corporation or agency of either, as the
 767-1   authority may consider advisable.
 767-2         (k)  The authority may make and issue negotiable bonds for
 767-3   funds borrowed in the manner and to the extent provided by this
 767-4   chapter and may contract in any manner required by law with regard
 767-5   to loans, grants, or other support received from the United States
 767-6   or the state or from any corporation or agency of either.
 767-7         (l)  The authority may make such contracts in the issuance of
 767-8   bonds as are considered necessary to ensure the marketability of
 767-9   the bonds.
767-10         (m)  The authority may sue or be sued in its corporate name.
767-11         (n)  The authority may adopt, use, and alter a corporate
767-12   seal.
767-13         (o)  The authority may make bylaws for the management and
767-14   regulation of its affairs.
767-15         (p)  The authority may set and collect charges and rates for
767-16   water services furnished by it and may impose penalties for failure
767-17   to pay such charges and rates when due.
767-18         (q)  The authority may cooperate with and enter into
767-19   contracts with cities, persons, firms, corporations, and public
767-20   agencies for the purpose of supplying and selling them water for
767-21   municipal, domestic, industrial, and other useful purposes
767-22   permitted by law; provided, however, that cities and areas
767-23   constituting the authority shall be accorded priority in the
767-24   allocation of the authority's available water, and the board shall
767-25   prescribe rules to effectuate this provision.  A contract described
767-26   by this section may be on such terms and for such time as the
 768-1   parties may agree, and it may provide that it shall continue in
 768-2   effect until the authority's bonds specified in the contract and
 768-3   refunding bonds issued in lieu of the bonds are fully paid.  If the
 768-4   authority pledges the proceeds of water contracts with its
 768-5   constituent cities to the payment of any bonds supported in whole
 768-6   or in part by revenues and issued by the authority to finance the
 768-7   construction of a water supply or transportation facility for such
 768-8   cities, the authority shall not be obligated to construct or
 768-9   otherwise provide the facility to any constituent city that, for
768-10   any reason, fails to enter into such contract.  If the authority
768-11   enters into a contract with the United States government or any of
768-12   its agencies for a source of water supply or for the furnishing of
768-13   any facilities necessary or useful to the authority in carrying out
768-14   its purposes, the contract entered into under authority of this
768-15   subsection may provide that the contract shall continue until the
768-16   authority has fully discharged all obligations incurred by it under
768-17   the terms of its contract with the United States government or its
768-18   agencies.
768-19         (r)  The authority may contract with any city, district, or
768-20   governmental agency, including the United States government or any
768-21   of its agencies, for the rental or leasing of or for the operation
768-22   of their water production, water supply, and water filtration or
768-23   purification and water supply facilities for such consideration as
768-24   may be mutually agreeable.
768-25         (s)  The authority may purchase water or a water supply from
768-26   any person, firm, corporation, or public agency or from the United
 769-1   States government or any of its agencies.
 769-2         (t)  The authority may operate and maintain, with the consent
 769-3   of the governing body of any city or town located within the
 769-4   authority, any works, plants, or facilities of the city or town
 769-5   deemed necessary to the accomplishment of the purposes for which
 769-6   the authority is created.
 769-7         (u)  The authority may levy, assess, and collect ad valorem
 769-8   taxes to provide funds necessary to construct or acquire, maintain,
 769-9   and operate improvements, works, plants, and facilities deemed
769-10   essential and beneficial to the authority on a favorable majority
769-11   vote of the qualified electors voting at an election held for that
769-12   purpose within the authority and may also, when so authorized,
769-13   levy, assess, and collect taxes to provide funds adequate to defray
769-14   the cost of the maintenance, operation, and administration of the
769-15   authority.  Elections for the voting of such taxes shall be ordered
769-16   by the board and shall be held and conducted as provided by this
769-17   chapter for elections for the issuance of bonds and the levy of
769-18   taxes in support of the bonds.  When so levied such taxes, as well
769-19   as taxes authorized by this chapter to be levied in support of bond
769-20   indebtedness, constitute a lien on the property against which such
769-21   taxes are levied and assessed, and limitations shall not bar the
769-22   collection and enforcement thereof.
769-23         (v)  The authority may do any and all acts or things
769-24   necessary to the exercise of the powers, rights, privileges, or
769-25   functions conferred on the authority or permitted by any other law.
769-26         Sec. 278.017.  CONSTRUCTION OR PURCHASE CONTRACTS.  A
 770-1   contract requiring an expenditure of more than $25,000 shall not be
 770-2   made until after publication of a notice to bidders once each week
 770-3   for two weeks before the awarding of the contract.  The notice is
 770-4   sufficient if it states the time and place when and where the bids
 770-5   will be opened and the general nature of the work to be done or the
 770-6   material, equipment, or supplies to be purchased and states when
 770-7   and on what terms copies of the plans and specifications may be
 770-8   obtained.  The publication shall be in a newspaper published in the
 770-9   authority as designated by the board.
770-10         Sec. 278.018.  BOND ISSUANCE.  (a)  For the purpose of
770-11   providing a source or sources of water supply for its cities or
770-12   towns and other users of water for municipal, domestic, and other
770-13   useful purposes permitted by law and for the purpose of carrying
770-14   out any other power or authority conferred by this chapter, the
770-15   authority may issue and sell negotiable bonds to be payable from
770-16   the net operating income and revenues of the authority received
770-17   from any or all of its properties, as the board may determine, or
770-18   from ad valorem taxes, or from both such revenues and taxes as are
770-19   pledged by the board; provided, however, that without limiting in
770-20   any way the amount of revenue-supported bonds that may be
770-21   authorized, issued, and sold by the authority for any authorized
770-22   purpose, the amount of bonds that the authority may issue and sell
770-23   supported in whole or in part by ad valorem taxes shall never
770-24   exceed the total principal amount of $6.5 million.  All or any
770-25   portion of the limited amount may be issued and sold by the
770-26   authority for the purpose of providing funds with which to acquire
 771-1   and construct the authority's Blackburn Crossing Project; to wit, a
 771-2   dam and reservoir at or near the point on the Neches River commonly
 771-3   known and referred to in the area as "Blackburn Crossing."  On
 771-4   completion of the ultimate acquisition and construction of the
 771-5   Blackburn Crossing Project in accordance with plans and
 771-6   specifications of the authority's engineers approved by the board,
 771-7   including provisions for all property of every kind and character,
 771-8   real, personal, or mixed, or any interest in property, necessary or
 771-9   convenient for the full development of that project and including
771-10   any additions or modifications approved by the board and the
771-11   commission, no further bonds supported in whole or in part by ad
771-12   valorem taxes shall be issued or sold for any purpose.  The
771-13   authority is empowered to acquire and construct the Blackburn
771-14   Crossing Project in phases or stages and all decisions in this
771-15   respect rest with the board.  Within the limitations provided by
771-16   this section, the board is authorized to submit to elections and to
771-17   issue and sell all or any part of the bonds required to accomplish
771-18   the ultimate acquisition and construction of the Blackburn Crossing
771-19   Project at any stage of construction or development.
771-20         (b)  Bonds must be authorized by resolution of the board,
771-21   bear the date or dates, mature at the time or times, and bear
771-22   interest at the rate or rates as the board determines.  The bonds
771-23   shall be signed by the president and attested by the secretary and
771-24   shall have the seal of the authority impressed on the bonds.  Bonds
771-25   may be sold at prices and under terms determined by the board to be
771-26   the most advantageous and reasonably obtainable; provided, however,
 772-1   that the interest cost to the authority, calculated by use of
 772-2   standard bond interest tables currently in use by insurance
 772-3   companies and investment houses, may not exceed six percent per
 772-4   year.  Within the discretion of the board, bonds may be made
 772-5   callable and subject to redemption prior to their maturity at the
 772-6   times and prices as may be prescribed in the authorizing
 772-7   resolution.  Interest on all bonds shall be payable annually or
 772-8   semiannually within the discretion of the board.  Bonds may be
 772-9   issued in one or more than one series and from time to time as
772-10   required in carrying out the purposes of this chapter.  The bonds
772-11   must be in the form, either coupon or registered, must carry the
772-12   registration privileges as to principal only or as to both
772-13   principal and interest and as to exchange of coupon bonds for
772-14   registered bonds, or vice versa, and exchange of bonds of one
772-15   denomination for bonds of other denominations, and must be payable
772-16   at the place or places within or outside of this state as the board
772-17   determines and prescribes in the resolution authorizing the bonds.
772-18         (c)  Bonds may be secured by a pledge of all or part of the
772-19   net revenues of the authority, of the net revenues of one or more
772-20   contracts made before or after the bonds are issued, or of other
772-21   revenues in the manner specified by resolution of the board.  A
772-22   pledge may reserve the right, under conditions specified in the
772-23   pledge, to issue additional bonds that will be on a parity with or
772-24   subordinate to the bonds being issued.  In this section, "net
772-25   revenues" means the gross revenues of the authority less the amount
772-26   necessary to pay the cost of maintaining and operating the
 773-1   authority and its properties.
 773-2         (d)  If bonds are issued payable wholly or partially from ad
 773-3   valorem taxes, the board shall levy a tax sufficient to pay the
 773-4   bonds and the interest on the bonds as the bonds and interest
 773-5   become due, but the rate of the tax for any year may be set after
 773-6   giving consideration to the money received from the pledged
 773-7   revenues available for the payment of principal and interest to the
 773-8   extent and in the manner permitted by the resolution authorizing
 773-9   the issuance of the bonds.
773-10         (e)  If bonds or any other contract payable from revenues are
773-11   issued or entered into, the board shall set by contract, with all
773-12   cities, persons, firms, corporations, or public agencies that
773-13   contract with the board for a water supply or water facilities,
773-14   rates or compensation for water sold and services furnished by the
773-15   authority sufficient to pay the expenses of operating and
773-16   maintaining the authority and its facilities and to pay all such
773-17   obligations incurred by the authority as they mature, including
773-18   reserve and other funds as may be provided for the bonds or other
773-19   contracts under the terms of the bonds or contracts and as may be
773-20   provided in the resolution of the board pertaining to the bonds or
773-21   contracts.
773-22         (f)  From the proceeds of the sale of bonds, the authority
773-23   may set aside an amount for the payment of interest expected to
773-24   accrue during construction and a reserve interest and sinking fund,
773-25   which provisions shall be made in the resolution authorizing the
773-26   bonds.  Proceeds from the sale of bonds may also be used for the
 774-1   payment of all expenses necessarily incurred in accomplishing the
 774-2   purposes for which the authority is created, including expenses of
 774-3   issuing and selling the bonds.  Pending the use of bond proceeds
 774-4   for the purpose for which the bonds were issued, the board may
 774-5   invest the proceeds in obligations of the United States government.
 774-6         (g)  In the event of a default in the payment of principal of
 774-7   or interest on bonds payable wholly or partially from revenues of
 774-8   the authority, any court of competent jurisdiction in this state
 774-9   may, on petition of the holders of 25 percent of the outstanding
774-10   bonds of the issue in default, appoint a receiver with authority to
774-11   collect and receive all income of the authority except taxes, to
774-12   employ and discharge agents and employees of the authority, to take
774-13   charge of the authority's funds on hand (except funds received from
774-14   taxes, unless commingled), and to manage the proprietary affairs of
774-15   the authority without consent or hindrance by the board.  The
774-16   receiver may also be authorized to sell or make contracts for the
774-17   sale of water or to renew the contracts with the approval of the
774-18   court appointing the receiver.
774-19         (h)  Bonds issued by the authority under this chapter are
774-20   negotiable instruments under the laws of this state.
774-21         (i)  Before bonds are sold by the authority, a certified copy
774-22   of the proceedings for the issuance of the bonds, including the
774-23   form of the bonds, together with any other information that the
774-24   attorney general may require, shall be submitted to the attorney
774-25   general, and if the attorney general finds that the bonds have been
774-26   issued in accordance with the law, the attorney general shall
 775-1   approve the bonds and execute a certificate of approval, which
 775-2   shall be filed in the office of the comptroller and be recorded in
 775-3   a record kept for that purpose.  No bonds shall be issued until the
 775-4   bonds have been registered by the comptroller, who shall register
 775-5   the bonds if the attorney general has filed with the comptroller
 775-6   the certificate approving the bonds and the proceedings for the
 775-7   issuance of the bonds as provided in this section.  If the bonds or
 775-8   the proceedings pertaining to the bonds recite that the bonds are
 775-9   secured by a pledge of the proceeds of a contract previously made
775-10   between the authority and a city, district, or other user, a copy
775-11   of the contract and proceedings of the contracting parties shall be
775-12   submitted to the attorney general with the bond record, and if the
775-13   bonds have been duly authorized and the contract has been made in
775-14   compliance with law, the attorney general shall approve the bonds
775-15   and contract, and the bonds shall then be registered by the
775-16   comptroller.  When approved as provided by this subsection, the
775-17   bonds and the contract are valid and binding and are incontestable
775-18   for any cause.  If the authority has issued bonds, including
775-19   interim or temporary bonds, or has contracted with the United
775-20   States government or with the state, or with any corporation or
775-21   agency of either, in connection with the financing of its works or
775-22   facilities, the authority may validate the bonds or contract by
775-23   suit in the manner and with the same effect as provided by Sections
775-24   51.423-51.431.
775-25         (j)  Pending the issuance of definitive bonds, the authority
775-26   may issue and deliver interim or temporary bonds.  The interim or
 776-1   temporary bonds issued may be redeemed with the proceeds of the
 776-2   definitive bonds, or the definitive bonds may be issued and
 776-3   delivered in exchange for and in substitution of the interim or
 776-4   temporary bonds.  After the exchange and substitution, the
 776-5   authority shall file proper certificates with the comptroller as to
 776-6   the exchange, substitution, and cancellation.  The certificates
 776-7   shall be recorded by the comptroller.
 776-8         Sec. 278.019.  REFUNDING BONDS.  (a)  The board may issue
 776-9   refunding bonds for the purpose of refunding any outstanding bonds
776-10   authorized by this chapter and interest on the bonds without the
776-11   necessity of an election.  Refunding bonds may be issued to refund
776-12   more than one series of outstanding bonds, and in the case of bonds
776-13   secured in whole or in part by net revenues, the authority may
776-14   combine the pledges for the outstanding bonds for the security of
776-15   the refunding bonds and may secure the refunding bonds by other or
776-16   additional revenues.
776-17         (b)  The provisions of this chapter with reference to the
776-18   issuance of other bonds and their approval by the attorney general
776-19   and the rights and remedies of the holders shall be applicable to
776-20   refunding bonds.  Refunding bonds shall be registered by the
776-21   comptroller on surrender and cancellation of the bonds to be
776-22   refunded, but in lieu of that procedure, the resolution authorizing
776-23   the issuance of the refunding bonds may provide that the bonds
776-24   shall be sold and the proceeds of the sale deposited in the bank
776-25   where the original bonds are payable, in which case the refunding
776-26   bonds may be issued in an amount sufficient to pay the interest on
 777-1   the original bonds to their option date or maturity date, and the
 777-2   comptroller shall register the refunding bonds without concurrent
 777-3   surrender and cancellation of the original bonds.
 777-4         Sec. 278.020.  TRUST INDENTURE FOR BONDS.  (a)  Bonds,
 777-5   including refunding bonds, authorized by this chapter that are not
 777-6   payable wholly from ad valorem taxes may be additionally secured by
 777-7   a trust indenture under which the trustee may be a bank with trust
 777-8   powers located either within or outside the state.  The trust
 777-9   indenture or mortgage may include provisions for a lien on all or
777-10   any part of the physical properties of the authority, and
777-11   franchises, easements, water rights and appropriation permits,
777-12   leases, contracts, and all rights appurtenant to the properties,
777-13   vesting in the trustee power to sell the properties for payment of
777-14   the indebtedness, power to operate the properties, and all other
777-15   powers and authority for the further security of the bonds.
777-16         (b)  The trust indenture, regardless of the existence of a
777-17   deed of trust lien, may contain any provisions prescribed by the
777-18   board for the security of the bonds and the preservation of the
777-19   trust estate, including provision for amendment or modification of
777-20   the indenture and the issuance of bonds to replace lost or
777-21   mutilated bonds secured by the indenture.
777-22         (c)  A purchaser under a sale under a deed of trust lien,
777-23   where one is given, shall be the owner of the properties,
777-24   facilities, and rights purchased and shall have the right to
777-25   maintain and operate the properties, facilities, and rights during
777-26   the period prescribed by the trust indenture.
 778-1         (d)  The authority may not issue bonds secured by a deed of
 778-2   trust or mortgage on any properties previously acquired unless the
 778-3   proposition for the issuance of the bonds is authorized by election
 778-4   in the manner provided in this chapter for the authorization of
 778-5   bonds secured in whole or in part by ad valorem taxes.
 778-6         Sec. 278.021.  BOND ELECTIONS.  (a)  Bonds payable wholly
 778-7   from the authority's net revenues or from the proceeds of any water
 778-8   contract or by any means other than ad valorem taxes may be issued
 778-9   pursuant to a resolution of the board without the necessity of a
778-10   hearing or election.
778-11         (b)  Bonds payable wholly or partially from ad valorem taxes,
778-12   except refunding bonds, shall not be issued unless authorized by an
778-13   election at which only the qualified voters who reside in the
778-14   authority shall be qualified to vote and a majority of the votes
778-15   cast at the election is in favor of the issuance of the bonds.
778-16         (c)  Bond elections may be called by the board without a
778-17   petition.  The resolution calling the election shall specify the
778-18   time and places of holding the election, the purpose for which the
778-19   bonds are to be issued, the maximum amount, maximum maturity, and
778-20   maximum interest rate of the bonds, the form of the ballot, and the
778-21   presiding judge for each voting place.  The presiding judge serving
778-22   at each voting place shall appoint the necessary assistant judges
778-23   and clerks for holding the election.  Notice of the election must
778-24   be given by publishing a substantial copy of the resolution calling
778-25   the election in a newspaper or newspapers of general circulation in
778-26   each city contained in the authority once each week for three
 779-1   consecutive weeks.  The first publication must be at least 21 days
 779-2   before the date of the election.
 779-3         (d)  The returns of the bond election must be made to and
 779-4   canvassed by the board.
 779-5         (e)  The Election Code applies to bond elections held under
 779-6   this section except as otherwise provided by this chapter.
 779-7         Sec. 278.022.  EXCLUSION OF LAND OR OTHER PROPERTY NOT
 779-8   REQUIRED.  The provisions of Subchapter J, Chapter 49, or other
 779-9   general laws relating to the exclusion of lands or other property
779-10   from a water control and improvement district shall not be
779-11   applicable to the authority.
779-12         Sec. 278.023.  CONTRACTS WITH UNITED STATES OR ITS AGENCIES;
779-13   ELECTIONS.  (a)  The authority may contract with the United States
779-14   government or any of its agencies under the federal reclamation
779-15   laws for the construction, operation, and maintenance of any work
779-16   or facility by which water may be supplied and distributed to the
779-17   authority or under any act of congress providing or permitting the
779-18   contract and shall have all the rights, powers, privileges, and
779-19   authority granted water improvement districts and water control and
779-20   improvement districts under the general laws of the state with
779-21   regard to such contracts.  Any contract entered into shall reserve
779-22   to the authority all water rights that it may obtain under permits
779-23   granted by the commission and shall provide that title to all
779-24   facilities constructed under the terms of the contract shall pass
779-25   to the authority or its designee or designees on payment to the
779-26   United States government of all obligations incurred in connection
 780-1   with the project.
 780-2         (b)  If a proposed contract between the authority and the
 780-3   United States government or any of its agencies would obligate the
 780-4   authority to make payments wholly or partially from ad valorem
 780-5   taxes, the contract may not be entered into unless authorized by an
 780-6   election at which only the qualified voters who reside in the
 780-7   authority shall be qualified to vote and a majority of the votes
 780-8   cast at the election is in favor of the execution of the contract.
 780-9   All procedures prescribed in Section 278.021 relating to the voting
780-10   of bonds supported in whole or in part by ad valorem taxes apply to
780-11   the voting of contracts under this section.
780-12         (c)  If the authority enters into a contract with the United
780-13   States government or any of its agencies as provided by this
780-14   section, no subsequent alteration in the organization of the
780-15   authority shall be effected and no proceedings for the exclusion of
780-16   any area of the authority shall be undertaken under the provisions
780-17   of any law until the alteration or exclusion has received the
780-18   approval of the United States government or its contracting agency.
780-19         Sec. 278.024.  AUTHORITY TO ACQUIRE AND OWN WATER PERMITS.
780-20   The authority may acquire and own water appropriation permits
780-21   directly from the commission.  On application filed in compliance
780-22   with the provisions of Chapter 11 relating to acquisition of water
780-23   appropriation permits the commission may grant to the authority
780-24   permits to take unappropriated water of the Neches River in Texas
780-25   and its tributaries.
780-26         Sec. 278.025.  BONDS AS INVESTMENTS AND SECURITY FOR
 781-1   DEPOSITS.  (a)  All bonds of the authority are legal and authorized
 781-2   investments for banks, savings banks, trust companies, building and
 781-3   loan associations, savings and loan associations, insurance
 781-4   companies, fiduciaries, trustees, and guardians, for the sinking
 781-5   funds of cities, towns, villages, counties, school districts, or
 781-6   other political subdivisions of the state, and for public funds of
 781-7   the state or its agencies including the state permanent school
 781-8   fund.
 781-9         (b)  Authority bonds are eligible to secure the deposit of
781-10   public funds of the state and of public funds of cities, towns,
781-11   villages, counties, school districts, or other political
781-12   subdivisions or corporations of the state.  The bonds are lawful
781-13   and sufficient security for the deposits to the extent of the value
781-14   of the bonds if the bonds are accompanied by all unmatured coupons.
781-15         Sec. 278.026.  BONDS EXEMPT FROM TAXATION.  The
781-16   accomplishment of the purposes of this chapter is for the benefit
781-17   of the people of this state and for the improvement of their
781-18   properties and industry, and the authority, in carrying out the
781-19   purposes of this chapter, will be performing an essential public
781-20   function under the constitution and shall not be required to pay
781-21   any tax or assessment on a project or any part of a project under
781-22   this chapter.  The bonds or other obligations issued under this
781-23   chapter and the transfer of and income from the bonds, including
781-24   the profits on the sale of the bonds, shall at all times be free
781-25   from taxation by the state or by any municipal corporation, county,
781-26   or other political subdivision or taxing district of the state.
 782-1         Sec. 278.027.  TAXATION.  Before the issuance of bonds or the
 782-2   execution of a contract payable wholly or partially from ad valorem
 782-3   taxes, the board shall appoint a tax assessor and collector and a
 782-4   board of equalization and shall cause taxes to be assessed,
 782-5   valuations to be equalized, and tax rolls to be prepared.  The
 782-6   board may also appoint deputies to assist the tax assessor and
 782-7   collector in such manner and for such period as the board may
 782-8   order.  Where applicable and not in conflict with this section, the
 782-9   general laws relating to water control and improvement districts
782-10   with reference to tax assessors and collectors, boards of
782-11   equalization, tax rolls, and the levy and collection of taxes and
782-12   delinquent taxes shall be applicable to the authority, except that
782-13   the board of equalization, to be appointed each year by the board,
782-14   shall consist of one member residing in each city contained in the
782-15   authority.  All taxes to be levied, assessed, and collected by the
782-16   authority shall be on an ad valorem basis, and all provisions of
782-17   the general laws pertaining to the levy, assessment, and collection
782-18   of ad valorem taxes by water control and improvement districts,
782-19   including the enforcement of those provisions and the processes for
782-20   the collection of delinquent taxes provided in the provisions,
782-21   shall be applicable to the authority.
782-22         Sec. 278.028.  ADOPTION OF RULES AND REGULATIONS.  The board
782-23   may adopt and promulgate all reasonable rules and regulations to
782-24   secure, maintain, and preserve the sanitary condition of all water
782-25   in and to flow into any reservoir owned by the authority, or which
782-26   it may control by contract or otherwise, to prevent the waste or
 783-1   the unauthorized use of water, and to regulate residence, hunting,
 783-2   fishing, boating, and camping, and all recreational and business
 783-3   privileges, along or around any reservoir or any body of land or
 783-4   easement owned or controlled by the authority.
 783-5         Sec. 278.029.  RECREATIONAL FACILITIES.  The authority may
 783-6   establish or otherwise provide for public parks and recreation
 783-7   facilities and may acquire land adjacent to any reservoir in which
 783-8   the authority owns water storage rights to provide for the parks or
 783-9   facilities; provided, however, that no money received from taxation
783-10   or from bonds payable wholly or partially from taxation shall be
783-11   used to provide the parks or facilities.  The authority may
783-12   contract for the lease of lands acquired by the authority for
783-13   recreation or concession purposes under terms determined by the
783-14   board.
783-15         Sec. 278.030.  VOTING PLACES.  For all elections conducted
783-16   under the provisions of this chapter, the voting places shall be
783-17   determined by the board for each election; provided, however, that
783-18   one or more voting places shall be designated for each constituent
783-19   city or town and for each separate area not located within a city
783-20   or town comprising a part of the authority.
783-21         Sec. 278.031.  TERRITORY DETACHED FROM OTHER DISTRICT OR
783-22   AUTHORITY.  The authority created by this chapter shall be in
783-23   addition to all districts or authorities into which the state has
783-24   been previously divided, and the territory of the authority
783-25   existing at any time under the provisions of this chapter is
783-26   declared to be detached from all other districts or authorities
 784-1   established under Section 59, Article XVI, Texas Constitution.  The
 784-2   authority has the power and right to coordinate its plans with any
 784-3   other conservation, reclamation, or other district previously
 784-4   created with powers provided by Section 59, Article XVI, Texas
 784-5   Constitution, and shall have full authority, power, and right to
 784-6   enter into joint undertakings for the purposes for which the
 784-7   districts are created; provided, however, that all such acts must
 784-8   be approved by a majority of the board of directors of each
 784-9   district or authority involved.
784-10         Sec. 278.032.  BONDS OF OFFICERS AND EMPLOYEES.  All bonds
784-11   required to be given by officers and employees of the authority
784-12   shall be executed by a surety company authorized to do business in
784-13   the state.  The authority may pay the premiums on the bonds.
784-14         Sec. 278.033.  GENERAL LAWS APPLICABLE WHERE NOT IN CONFLICT.
784-15   (a)  All powers conferred by the general laws of this state
784-16   pertaining to water control and improvement districts shall be
784-17   applicable to the authority to the extent that those powers are not
784-18   in conflict with the provisions of this chapter.
784-19         (b)  Nothing in this chapter shall be construed to violate
784-20   any provision of the federal or state constitutions, and all acts
784-21   done under this chapter shall be done in conformity with those
784-22   constitutions, whether or not expressly provided in this chapter.
784-23   If any procedure under this chapter is held by any court to violate
784-24   either constitution, the authority may by resolution provide an
784-25   alternative procedure conforming to the constitutions.
784-26         Sec. 278.034.  BOND NOT REQUIRED.  The authority shall not be
 785-1   required to give a cost or supersedeas bond or to pay a cost
 785-2   deposit on any appeal from the judgment of any court of this state.
 785-3         Sec. 278.035.  AUTHORITY DECLARED ESSENTIAL.  The legislature
 785-4   declares that the enactment of this chapter is in fulfillment of a
 785-5   duty conferred on the legislature by Section 59, Article XVI, Texas
 785-6   Constitution, which provides that the legislature is empowered to
 785-7   pass laws appropriate in the preservation and conservation of the
 785-8   natural resources of the state; that the authority created in this
 785-9   chapter is essential to the accomplishment of the purposes of
785-10   Section 59, Article XVI, Texas Constitution; and that this chapter
785-11   concerns and addresses a subject in which the state at large is
785-12   interested.  The terms and provisions of this chapter are to be
785-13   liberally construed in order to carry out the purposes set forth in
785-14   this chapter.
785-15         Sec. 278.036.  SCOPE OF AUTHORITY.  The exercise of all
785-16   powers granted to the authority under this chapter pertaining to
785-17   the construction and operation of its facilities, including the
785-18   authority's right of eminent domain, shall be limited only as
785-19   provided by Section 278.016(e).
785-20        CHAPTER 279.  WEST CENTRAL TEXAS MUNICIPAL WATER DISTRICT
785-21         Sec. 279.001.  CREATION.  (a)  A conservation and reclamation
785-22   district to be known as the "West Central Texas Municipal Water
785-23   District" is created.  The district is a governmental agency and a
785-24   body politic and corporate.
785-25         (b)  The district is created under and is essential to
785-26   accomplish the purposes of Section 59, Article XVI, Texas
 786-1   Constitution.
 786-2         Sec. 279.002.  DEFINITIONS.  In this chapter:
 786-3               (1)  "Board" means the board of directors of the
 786-4   district.
 786-5               (2)  "Director" means a member of the board.
 786-6               (3)  "District" means the West Central Texas Municipal
 786-7   Water District.
 786-8         Sec. 279.003.  BOUNDARIES.  (a)  The boundaries of the
 786-9   district include all the territory within the boundaries of the
786-10   cities of Abilene, Albany, Anson, and Breckenridge on January 1,
786-11   1985.  A defect in the definition of the boundaries of any of those
786-12   cities does not affect the validity of the district or any of its
786-13   powers or duties.
786-14         (b)  The legislature finds that all territory within the
786-15   boundaries of the district does and will benefit from the present
786-16   and contemplated improvements, works, and facilities of the
786-17   district.
786-18         (c)  The district may only annex territories as provided by
786-19   Sections 279.007 and 279.008.
786-20         Sec. 279.004.  BOARD OF DIRECTORS.  (a)  All powers of the
786-21   district shall be exercised by a board of directors.  Each director
786-22   is appointed by majority vote of the governing body of the city in
786-23   which the director resides.
786-24         (b)  The number of directors to be appointed from each city
786-25   in the district shall be governed by the population of the city,
786-26   with:
 787-1               (1)  each city having a population of 10,000 or less
 787-2   appointing two directors; and
 787-3               (2)  each city having a population of more than 10,000
 787-4   appointing two directors plus one director for each 10,000
 787-5   population or part of 10,000 population over 10,000, provided,
 787-6   however, that no city shall appoint more than one-half of the
 787-7   members of the board.
 787-8         (c)  In May of each year the governing body of each city that
 787-9   is entitled to appoint more than one director shall appoint not
787-10   less than one director for a two-year term beginning June 1 of that
787-11   year.  The first director from any city annexed to the district
787-12   that is entitled to only one director may be appointed for a term
787-13   ending on a May 31 not more than two years from the date of
787-14   appointment.
787-15         (d)  Each director serves for a term of office as provided by
787-16   this section and until a successor is appointed and has qualified.
787-17         (e)  A director must reside in and own taxable property in
787-18   the city from which the director is appointed.  A member of a
787-19   governing body of a city or an employee of a city is not eligible
787-20   to serve as a director.
787-21         (f)  A director shall subscribe the constitutional oath of
787-22   office and shall give bond for the faithful performance of the
787-23   director's duties in the amount of $5,000, the cost of which shall
787-24   be paid by the district.
787-25         (g)  A majority of the members of the board constitutes a
787-26   quorum.
 788-1         (h)  If a director moves from the city from which the
 788-2   director is appointed, the governing body of the city shall appoint
 788-3   a successor for the unexpired term.
 788-4         Sec. 279.005.  FEES.  Except as otherwise provided by Section
 788-5   49.060 or other applicable law, each director is entitled to the
 788-6   following compensation:
 788-7               (1)  a fee not to exceed $50 for attending each board
 788-8   or committee meeting; and
 788-9               (2)  a fee not to exceed $50 per day for each day
788-10   devoted to the business of the district, other than attendance at a
788-11   board or committee meeting, and reimbursement for actual expenses
788-12   incurred in attending to district business provided that such
788-13   service and expense are expressly approved by the board.
788-14         Sec. 279.006.  OFFICERS; EMPLOYEES; SEAL.  (a)  The board
788-15   shall elect from among its members a president and a vice president
788-16   of the district and other officers as in the judgment of the board
788-17   are necessary.
788-18         (b)  The president is the chief executive officer of the
788-19   district and the presiding officer of the board and has the same
788-20   right to vote as any other director.
788-21         (c)  The vice president shall perform all duties and exercise
788-22   all powers conferred by this chapter on the president when the
788-23   president is absent or fails or declines to act except the
788-24   president's right to vote.
788-25         (d)  The board shall appoint a secretary and a treasurer who
788-26   may or may not be members of the board and may combine those
 789-1   offices.  The treasurer must give bond in such amount as may be
 789-2   required by the board.  The bond must be conditioned on the
 789-3   treasurer accounting for all money that comes into the treasurer's
 789-4   custody as treasurer of the district.
 789-5         (e)  The board shall appoint necessary engineers, attorneys,
 789-6   and other employees and employ a general manager.  The general
 789-7   manager may employ and discharge employees.
 789-8         (f)  The board shall adopt a seal for the district.
 789-9         Sec. 279.007.  ANNEXATION OF TERRITORY IN CERTAIN COUNTIES.
789-10   (a)  Other territory situated within the counties of Taylor, Jones,
789-11   Shackelford, and Stephens may be annexed to the district as
789-12   provided by this section.
789-13         (b)  A petition for annexation must:
789-14               (1)  be signed by 50 or a majority, whichever number is
789-15   less, of the qualified voters of the territory to be annexed who
789-16   own taxable property in the territory being annexed and who have
789-17   duly rendered the property to the city, if situated within a city
789-18   or town, or county for taxation;
789-19               (2)  be filed with the board; and
789-20               (3)  describe the territory to be annexed by metes and
789-21   bounds or otherwise unless the territory is the same as that
789-22   contained in a city or town, in which event it shall be sufficient
789-23   to state that the territory to be annexed is that which is
789-24   contained within the city or town.
789-25         (c)  If the board finds that the petition complies with and
789-26   is signed by the number of qualified persons required under
 790-1   Subsection (b), that the annexation would be to the interest of the
 790-2   territory to be annexed and the district, and that the district
 790-3   will be able to supply water to the territory to be annexed, or
 790-4   cause water to be supplied to the territory to be annexed, the
 790-5   board shall adopt a resolution stating the conditions, if any,
 790-6   under which territory may be annexed to the district and requesting
 790-7   the commission to annex the territory to the district.  The
 790-8   resolution shall be conclusive of the legal sufficiency of the
 790-9   petition and the qualifications of the signers of the petition.  A
790-10   certified copy of the resolution and of the petition shall be filed
790-11   with the commission.
790-12         (d)  The commission shall adopt a resolution declaring its
790-13   intention to call an election in the territory to be annexed for
790-14   the purpose of submitting the proposition of whether the territory
790-15   shall be annexed to the district.  The commission shall set a time
790-16   and place for a hearing to be held by the commission on the
790-17   question of whether the territory to be annexed will benefit from
790-18   the improvements, works, and facilities then owned or operated or
790-19   contemplated to be owned or operated by the district or by the
790-20   other functions of the district.  A railroad right-of-way that is
790-21   not situated within the defined limits of an incorporated city or
790-22   town will not benefit from the improvements, works, and facilities
790-23   that the district is authorized to construct.  A railroad
790-24   right-of-way may not be annexed to the district unless the
790-25   right-of-way is contained within the limits of an incorporated city
790-26   or town that has been annexed to the district.
 791-1         (e)  Notice of the adoption of the resolution stating the
 791-2   time and place of the hearing and addressed to the citizens and
 791-3   owners of property in the territory to be annexed must be published
 791-4   one time in a newspaper designated by the commission at least 10
 791-5   days before the date of the hearing.  The notice must describe the
 791-6   territory to be annexed in the same manner in which it is required
 791-7   or permitted by this chapter to be described in the petition.
 791-8         (f)  All interested persons may appear at the hearing and
 791-9   offer evidence for or against the intended annexation.  The hearing
791-10   may proceed in the order and under the rules prescribed by the
791-11   commission and may be recessed from time to time.  If, at the
791-12   conclusion of the hearing, the commission finds that all the lands
791-13   in the territory to be annexed will benefit from the present or
791-14   contemplated improvements, works, or facilities of the district,
791-15   the commission shall adopt a resolution calling an election in the
791-16   territory to be annexed stating the date and place or places for
791-17   holding the election and appointing a presiding judge for each
791-18   voting place who shall appoint the necessary assistant judges and
791-19   clerks to assist in holding the election.
791-20         (g)  Notice of the election, stating the date of the
791-21   election, the proposition to be voted on and the conditions under
791-22   which the territory shall be qualified to be annexed, or making
791-23   reference to the resolution of the board for that purpose, and the
791-24   place or places for holding the election, shall be published one
791-25   time in a newspaper designated by the commission at least 10 days
791-26   before the date set for the election.
 792-1         (h)  Only qualified voters who reside in the territory to be
 792-2   annexed may vote in the election.  Returns of the election shall be
 792-3   made to the commission.
 792-4         (i)  The board shall canvass the returns of the election and
 792-5   certify the returns to the commission, which shall then adopt a
 792-6   resolution declaring the results of the election.  If the
 792-7   resolution shows that a majority of the votes cast are in favor of
 792-8   annexation the commission shall enter an order annexing the
 792-9   territory to the district, and the annexation shall be
792-10   incontestable except in the manner and within the time for
792-11   contesting elections under the Election Code.  A certified copy of
792-12   the order shall be recorded in the deed records of the county in
792-13   which the annexed territory is situated.
792-14         (j)  The commission, in calling the election on the
792-15   proposition for annexation of territory, may include as a part of
792-16   the same proposition a proposition for the assumption of its part
792-17   of the tax-supported bonds of the district then outstanding and
792-18   those voted but not yet sold and for the levy of an ad valorem tax
792-19   on taxable property in the annexed territory along with the tax in
792-20   the rest of the district for the payment of the bonds.
792-21         (k)  After territory is added to the district, the board may
792-22   call an election over the entire district for the purpose of
792-23   determining whether the entire district as enlarged shall assume
792-24   the tax-supported bonds then outstanding and those voted but not
792-25   yet sold and whether an ad valorem tax shall be levied on all
792-26   taxable property within the district as enlarged for the payment of
 793-1   the bonds, unless the proposition is voted along with the
 793-2   annexation election and becomes lawfully binding on the territory
 793-3   annexed.  The election shall be called and held in the same manner
 793-4   as elections for the issuance of bonds as provided by this chapter.
 793-5         (l)  If no newspaper is published in the territory to be
 793-6   annexed, the notices shall be posted at three public places in the
 793-7   territory.
 793-8         Sec. 279.008.  TERRITORY ANNEXED BY DISTRICT CITIES.
 793-9   (a)  Territory annexed to any city contained in the district may be
793-10   annexed to the district as provided by this section.
793-11         (b)  At any time after final passage of an ordinance or
793-12   resolution annexing territory to a city contained in the district,
793-13   the board may issue a notice of a hearing on the question of
793-14   annexing the territory or any part of the territory.  The notice is
793-15   sufficient if it states the date and place of the hearing and:
793-16               (1)  describes the area proposed to be annexed; or
793-17               (2)  makes reference to the annexation ordinance of the
793-18   city.
793-19         (c)  The notice must be published one time in a newspaper
793-20   having general circulation in the city that made the annexation.
793-21   The notice must be published at least 10 days before the date set
793-22   for the hearing.
793-23         (d)  If, at the hearing, the board finds that the territory
793-24   proposed to be annexed will benefit from the water supply afforded
793-25   or to be afforded by the district, the board shall adopt a
793-26   resolution annexing the territory to the district.
 794-1         Sec. 279.009.  APPOINTMENT OF ADDITIONAL DIRECTORS FOLLOWING
 794-2   ANNEXATION.  (a)  If the territory of a city is annexed to the
 794-3   district, the governing body of the city shall appoint the number
 794-4   of directors or additional directors to which it is entitled under
 794-5   Section 279.004.
 794-6         (b)  If the territory of a city is annexed to the district
 794-7   and directors or additional directors are appointed under
 794-8   Subsection (a), and the annexation and appointment entitle another
 794-9   city within the district to appoint one or more additional
794-10   directors, the governing body of such other city shall appoint the
794-11   number of additional directors to which the city is entitled under
794-12   Section 279.004.
794-13         (c)  If, under Subsection (a) or (b), the governing body of a
794-14   city shall appoint only one director, the director shall be
794-15   appointed for a term ending on the May 31 next following the date
794-16   of appointment.  If the city appoints two or more directors,
794-17   one-half of such directors shall be appointed for a term ending on
794-18   the May 31 next following the date of their appointment and the
794-19   remaining directors so appointed shall serve for a term ending on
794-20   the second May 31 following the date of their appointment.
794-21         (d)  A city with a population of less than 2,000 annexed by
794-22   the district may not appoint a director as long as the city has a
794-23   population of less than 2,000.
794-24         Sec. 279.010.  WATER APPROPRIATION PERMITS.  The district may
794-25   obtain appropriation permits from the commission through
794-26   appropriate hearings as provided by Chapter 11.
 795-1         Sec. 279.011.  DAMS AND OTHER FACILITIES FOR IMPOUNDING,
 795-2   PROCESSING, OR TRANSPORTING WATER.  (a)  The district may acquire
 795-3   or construct, within or outside the boundaries of the district,
 795-4   dams and all works, plants, and other facilities necessary or
 795-5   useful for the purpose of impounding, processing, and transporting
 795-6   water to cities and others for municipal, domestic, industrial, and
 795-7   mining purposes.
 795-8         (b)  The size of a dam and reservoir shall be determined by
 795-9   the board, taking into consideration probable future increases in
795-10   water requirements.
795-11         (c)  The size of a dam shall not be limited by the amount of
795-12   water initially authorized by the commission or a predecessor
795-13   agency of the commission to be impounded in the dam.
795-14         (d)  A dam or other facility for impounding water may not be
795-15   constructed until the plan for the facility is approved by the
795-16   commission.
795-17         Sec. 279.012.  POWERS AND DUTIES.  (a)  In this section,
795-18   "person" means:
795-19               (1)  an individual, partnership, corporation, or other
795-20   private entity; and
795-21               (2)  a public agency, including an authority, district,
795-22   city, town, or other political subdivision, joint board, or other
795-23   public agency created and operating under the laws of this state.
795-24         (b)  The district has the additional specific powers provided
795-25   by this section.
795-26         (c)  The district may acquire, construct, finance, or
 796-1   otherwise provide any kind or type of water facilities, water
 796-2   pollution control facilities, waste disposal facilities, and air
 796-3   pollution control facilities in any area:
 796-4               (1)  within the Clear Fork of the Brazos River
 796-5   watershed and its tributaries;
 796-6               (2)  within Jones, Shackelford, Stephens, and Taylor
 796-7   counties; and
 796-8               (3)  inside or outside the boundaries of the areas
 796-9   described in Subdivisions (1) and (2) with respect to water
796-10   facilities designed primarily to serve inhabitants within those
796-11   areas except as otherwise limited by this section.
796-12         (d)  The district may exercise all powers granted to a
796-13   district or a river authority created and operating under Section
796-14   59, Article XVI, Texas Constitution, by Chapter 383, Health and
796-15   Safety Code, Chapter 1371, Government Code, Chapter 30, and any
796-16   other general law relating to the powers and facilities provided by
796-17   this subsection and Subsection (c).
796-18         (e)  If the district creates a nonprofit corporation to act
796-19   on its behalf under the Development Corporation Act of 1979
796-20   (Article 5190.6, Vernon's Texas Civil Statutes), the corporation
796-21   may exercise its powers with respect to projects within the area
796-22   described by Subsection (c).
796-23         (f)  The district and any persons may contract, on terms and
796-24   conditions to which the parties may agree, with respect to any
796-25   power, function, or duty of the district, including those granted
796-26   in this section.  The district and those persons who are parties to
 797-1   the contract may execute appropriate documents and instruments in
 797-2   connection with the contract.
 797-3         (g)  The district may issue bonds with respect to any of its
 797-4   powers including those powers granted by this section in the manner
 797-5   provided by Section 279.017.  The district may issue bonds to
 797-6   provide funds to enable the district to pay for costs of
 797-7   engineering design and studies, surveying, title research,
 797-8   appraisals, options on real or personal property, and other related
 797-9   activities in connection with planning and implementing various
797-10   proposed projects or improvements and to provide funds to operate
797-11   and maintain any facilities.
797-12         (h)  The district may invest its funds, including bond
797-13   proceeds, in any manner or in any securities determined by the
797-14   board.
797-15         (i)  In addition to all other powers granted by this chapter
797-16   or by any other law, the district may undertake and carry out
797-17   activities, enter into contracts, loan agreements, leases, or
797-18   installment sales agreements, acquire, purchase, construct, own,
797-19   operate, maintain, repair, improve, or extend, and loan, lease,
797-20   sell, or otherwise dispose of qualifying works, improvements,
797-21   facilities, plants, buildings, structures, equipment, appliances,
797-22   real and personal property or any interest in that property, and
797-23   money or bond proceeds, at any location within the area described
797-24   in Subsection (c), or at any location outside that area with
797-25   respect to facilities that are designed primarily to serve
797-26   inhabitants within that area on the terms and conditions, including
 798-1   loan payments, rentals, sale price, or installment sale payments,
 798-2   to which the parties may agree.  To qualify under this subsection,
 798-3   works, improvements, facilities, plants, buildings, structures,
 798-4   equipment, appliances, real and personal property or any interest
 798-5   in that property, or money or bond proceeds must be incident,
 798-6   helpful, or necessary to:
 798-7               (1)  provide for the development, drilling, control,
 798-8   storage, preservation, transmission, treatment, distribution, and
 798-9   use of groundwater, storm water, floodwater, and the water of
798-10   rivers and streams for municipal, domestic, electric energy or
798-11   power, industrial, irrigation, oil flooding, mining, agricultural,
798-12   commercial, flood control, and all other beneficial purposes;
798-13               (2)  supply water for municipal, domestic, electric
798-14   energy or power, industrial, irrigation, oil flooding, mining,
798-15   agricultural, commercial, and all other beneficial uses and
798-16   purposes;
798-17               (3)  collect, transport, process, treat, dispose of,
798-18   and control all waste, including all municipal, domestic,
798-19   industrial, agricultural, recreational, and other waste, whether in
798-20   fluid, solid, or composite state;
798-21               (4)  control, abate, or reduce all types of pollution,
798-22   including air pollution and water pollution;
798-23               (5)  reclaim and provide drainage and drainage systems
798-24   for land;
798-25               (6)  establish or otherwise provide for public parks
798-26   and recreation facilities; and
 799-1               (7)  facilitate the carrying out of any power, duty, or
 799-2   function of the district.
 799-3         (j)  The legislature finds that the purposes listed in
 799-4   Subsection (i) are for the conservation and development of the
 799-5   natural resources of the state within the meaning of Section 59,
 799-6   Article XVI, Texas Constitution.
 799-7         (k)  The district is considered to be a district and a river
 799-8   authority for the purposes of Chapters 362 and 383, Health and
 799-9   Safety Code, and Chapter 30, except that if there is a conflict
799-10   between a provision of one of those chapters and this chapter, this
799-11   chapter prevails.
799-12         (l)  Chapter 1371, Government Code, applies to the district.
799-13         (m)  Any person may contract with the district in any manner
799-14   authorized by this chapter, Chapters 362 and 383, Health and Safety
799-15   Code, and Chapter 30 with respect to water, waste, pollution
799-16   control, or any other facilities and services provided by the
799-17   district.
799-18         (n)  A public agency may contract with the district and may
799-19   determine, agree, and pledge that all or any part of its payments
799-20   under the contract are payable from the source described in Section
799-21   30.030(c), subject only to the authorization of the contract,
799-22   pledge, and payments by a majority vote of the governing body of
799-23   the public agency.  A public agency may use and pledge any other
799-24   available revenues or resources for and to the payment of amounts
799-25   due under a contract, as an additional or the sole source of
799-26   payment, and may covenant in that respect to assure the
 800-1   availability of the revenues and resources when required.
 800-2         (o)  If bonds issued by the district recite that they are
 800-3   secured by a pledge of revenues from a contract, a copy of the
 800-4   contract and the proceedings relating to the contract shall be
 800-5   submitted to the attorney general along with the bonds under
 800-6   Section 279.021.  If the attorney general finds that the bonds have
 800-7   been authorized and the contract has been entered into in
 800-8   accordance with law, the attorney general shall approve the bonds
 800-9   and the contract.  After the bonds and the contract are approved by
800-10   the attorney general, they are incontestable in any court or other
800-11   forum for any reason and are valid and binding in accordance with
800-12   their terms and provisions for all purposes.
800-13         (p)  A public agency may set, charge, and collect fees,
800-14   rates, charges, rentals, and other amounts for any service or
800-15   facility provided by a utility operated by it, or provided pursuant
800-16   to or in connection with a contract with the district, from its
800-17   inhabitants or from users or beneficiaries of the utility, service,
800-18   or facility, including:
800-19               (1)  water charges;
800-20               (2)  sewage charges;
800-21               (3)  waste disposal system fees and charges, including
800-22   garbage collection or handling fees; and
800-23               (4)  other fees or charges.
800-24         (q)  A public agency may use and pledge the fees authorized
800-25   by Subsection (p) to make payments to the district required under a
800-26   contract with the district and may covenant to do so in amounts
 801-1   sufficient to make all or any part of the payments to the district
 801-2   when due.  If the parties agree in the contract, these payments
 801-3   constitute an expense of operation of any facility or utility
 801-4   operated by the public agency, provided, however, that no agreement
 801-5   may be made that would violate the United States or Texas
 801-6   constitutions.
 801-7         (r)  This section is wholly sufficient authority within
 801-8   itself for the exercise of the powers, the issuance of the bonds,
 801-9   the execution of contracts, and the performance of the other acts
801-10   and procedures authorized by this section by the district and all
801-11   persons, including public agencies, without reference to any other
801-12   law or any restrictions or limitations contained in any other law,
801-13   except as specifically provided.  To the extent of any conflict or
801-14   inconsistency between this section and any other law, including any
801-15   home-rule city charter, this section prevails and controls.  The
801-16   district and all persons, including public agencies, are entitled
801-17   to use any other law that is not in conflict with this section to
801-18   the extent convenient or necessary to carry out any power or
801-19   authority, express or implied, granted by this section.
801-20         (s)  This section does not compel any person, including any
801-21   public agency, to secure water, sewer service, or any other service
801-22   from the district except under a voluntarily executed contract.
801-23         (t)  Special facility projects to acquire and construct
801-24   separate projects on behalf of a contracting party that are
801-25   self-liquidating and do not constitute a part of the district's
801-26   system may be undertaken only after board approval.  None of the
 802-1   district's assets may be encumbered for the special facility
 802-2   projects described by this subsection other than the facilities
 802-3   that are a part of the special facility project.  None of a member
 802-4   city's assets may be encumbered for the special facility projects
 802-5   described by this subsection unless the encumbrance is approved by
 802-6   the governing body of the city.
 802-7         Sec. 279.013.  ACQUISITION OF PROPERTY; CONSTRUCTION OF
 802-8   FACILITIES.  The district may acquire land and construct, lease, or
 802-9   otherwise acquire all works, plants, and other facilities necessary
802-10   or useful for the purpose of exercising the powers and purposes of
802-11   the district including diverting, further impounding or storing
802-12   water, developing underground sources of water, and processing and
802-13   transporting the water to cities and others for municipal,
802-14   domestic, industrial, and mining purposes inside or outside the
802-15   boundaries of the district.  Subject to the terms of any deed of
802-16   trust issued by the district, the district may sell, trade, or
802-17   otherwise dispose of any real or personal property considered by
802-18   the board not to be needed for district purposes.
802-19         Sec. 279.014.  EMINENT DOMAIN.  For the purpose of carrying
802-20   out a power or authority conferred by this chapter the district may
802-21   acquire land and other property and easements inside or outside the
802-22   boundaries of the district, including land needed for the reservoir
802-23   and dam and flood easements above the probable high-water line
802-24   around the reservoirs, by condemnation in the manner provided by
802-25   Chapter 21, Property Code.  The district is a municipal corporation
802-26   within the meaning of Section 21.021(c), Property Code.  The amount
 803-1   and character of interest in land, other property, or easements to
 803-2   be acquired shall be determined by the board.
 803-3         Sec. 279.015.  RELOCATION OF FACILITIES.  If the district, in
 803-4   the exercise of the power of eminent domain, the power of
 803-5   relocation, or any other power granted under this chapter, makes
 803-6   necessary the relocation, raising, rerouting, changing of grade, or
 803-7   altering the construction of any highway, railroad, electric
 803-8   transmission line, telephone or telegraph properties and
 803-9   facilities, or pipeline, all such necessary relocation, raising,
803-10   rerouting, changing of grade, or alteration of construction shall
803-11   be accomplished at the sole expense of the district.
803-12         Sec. 279.016.  AWARD OF CONSTRUCTION CONTRACT.  (a)  All
803-13   construction contracts made or awarded by the board which require
803-14   an aggregate expenditure of more than $25,000 shall be made in
803-15   accordance with the provisions of Subchapter I, Chapter 49, and
803-16   other applicable laws.
803-17         (b)  Except as otherwise provided by law, a construction
803-18   contract requiring an expenditure of more than $25,000 may be made
803-19   after publication of a notice to bidders once each week for at
803-20   least two weeks before awarding the contract.  The notice is
803-21   sufficient if it states the time and place when and where the bids
803-22   will be opened, the general nature of the work to be done, or the
803-23   material, equipment, or supplies to be purchased and states where
803-24   and the terms on which copies of the plans and specifications for
803-25   the project may be obtained.  Publication of the notice must be in
803-26   a newspaper published in the district and designated or approved by
 804-1   the board.
 804-2         Sec. 279.017.  BONDS.  (a)  For the purpose of providing a
 804-3   source of water supply for cities and other users for municipal,
 804-4   domestic, industrial, and mining purposes, as authorized by this
 804-5   chapter, and for the purpose of carrying out any other power or
 804-6   authority conferred by this chapter, the district may issue
 804-7   negotiable bonds payable from revenues or taxes or both revenues
 804-8   and taxes of the district as pledged by resolution of the board.
 804-9   Pending the issuance of definitive bonds, the board may authorize
804-10   the delivery of negotiable interim bonds or notes, eligible for
804-11   exchange or substitution by use of the definitive bonds.
804-12         (b)  Bonds must be authorized by resolution of the board,
804-13   issued in the name of the district, signed by the president or vice
804-14   president, and attested by the secretary and shall bear the seal of
804-15   the district.  The signature of the president or the secretary may
804-16   be printed or lithographed on the bonds with the approval of the
804-17   president or secretary.  The seal of the district may be impressed
804-18   on the bonds or may be printed or lithographed on the bonds.
804-19         (c)  Bonds mature serially or otherwise in not to exceed 40
804-20   years and may be sold at a price and under terms determined by the
804-21   board to be the most advantageous reasonably obtainable; provided,
804-22   however, that all bonds issued by the district shall comply with
804-23   the provisions of Title 9, Government Code, and the effective
804-24   interest rate on the bonds shall not exceed the maximum rate
804-25   provided in Chapter 1204, Government Code, or other applicable law.
804-26         (d)  Bonds may be issued in more than one series and from
 805-1   time to time as required for carrying out the purposes of this
 805-2   chapter.
 805-3         (e)  Bonds may be secured by a pledge of all or part of the
 805-4   net revenues of the district, of the net revenues of any one or
 805-5   more contracts made before or after the bonds are issued, or of
 805-6   other revenues or income specified by resolution of the board or in
 805-7   the trust indenture.  A pledge may reserve the right, under
 805-8   conditions specified in the pledge, to issue additional bonds to be
 805-9   on a parity with or subordinate to the bonds being issued.  In this
805-10   subsection, the term "net revenues" means the gross revenues of the
805-11   district less the amount necessary to pay the cost of maintaining
805-12   and operating the district and its properties.
805-13         (f)  The district may issue bonds payable from ad valorem
805-14   taxes to be levied on all taxable property in the district or may
805-15   issue bonds secured by and payable from both those taxes and the
805-16   revenues of the district.  If bonds are issued payable wholly or
805-17   partially from ad valorem taxes, the board shall levy a tax
805-18   sufficient to pay bonds and the interest on the bonds as the bonds
805-19   and interest become due.  The rate of the tax for any year may be
805-20   set after giving consideration to the money received from the
805-21   pledged revenues available for payment of principal and interest to
805-22   the extent and in the manner permitted by the resolution
805-23   authorizing the issuance of the bonds.
805-24         (g)  If bonds payable wholly from revenues are issued, the
805-25   board shall set, and from time to time revise the rates of
805-26   compensation for water sold and services rendered by the district
 806-1   sufficient to pay the expense of operating and maintaining the
 806-2   facilities of the district and to pay bonds as they mature and the
 806-3   interest as it accrues and to maintain the reserve and other funds
 806-4   as provided in the resolution authorizing the bonds.  If bonds
 806-5   payable partially from revenues are issued, the board shall set,
 806-6   and from time to time revise, the rate of compensation for water
 806-7   sold and services rendered by the district sufficient to assure
 806-8   compliance with the resolution authorizing the bonds.
 806-9         (h)  From the proceeds of the sale of the bonds, the district
806-10   may set aside an amount for the payment of interest expected to
806-11   accrue during construction and for a reserve interest and sinking
806-12   fund, and this provision may be made in the resolution authorizing
806-13   the bonds.  Proceeds from the sale of the bonds may also be used
806-14   for the payment of all expenses necessarily incurred in
806-15   accomplishing the purpose for which the district is created,
806-16   including expenses of issuing and selling the bonds.  The proceeds
806-17   from the sale of the bonds may be temporarily invested in direct
806-18   obligations of, or obligations whose principal and interest are
806-19   unconditionally guaranteed by, the United States government,
806-20   Federal Intermediate Credit Banks, Federal Land Banks, the Federal
806-21   National Mortgage Association, Federal Home Loan Banks, or Banks
806-22   for Cooperatives.
806-23         (i)  In the event of a default or a threatened default in the
806-24   payment of the principal of or interest on bonds payable wholly or
806-25   partially from revenues, any court of competent jurisdiction may,
806-26   on petition of the holders of outstanding bonds, appoint a receiver
 807-1   with authority to collect and receive all income of the district
 807-2   except taxes, employ and discharge agents and employees of the
 807-3   district, take charge of the district's funds on hand, except funds
 807-4   received from taxes unless commingled, and manage the proprietary
 807-5   affairs of the district without consent or hindrance by the
 807-6   directors.  The receiver may also be authorized to sell or make
 807-7   contracts for the sale of water or renew the contracts with the
 807-8   approval of the court appointing the receiver.  The court may vest
 807-9   the receiver with other powers and duties the court finds necessary
807-10   for the protection of the holders of the bonds.  The resolution
807-11   authorizing the issuance of the bonds or the trust indenture
807-12   securing them may limit or qualify the rights of less than all of
807-13   the outstanding bonds payable from the same source to institute or
807-14   prosecute any litigation affecting the district's property or
807-15   income.
807-16         Sec. 279.018.  REFUNDING BONDS.  (a)  The district may issue
807-17   refunding bonds for the purpose of refunding any outstanding bonds
807-18   authorized by this chapter and any interest on the bonds.  The
807-19   refunding bonds may be issued to refund more than one series of
807-20   outstanding bonds and may combine the pledges for the outstanding
807-21   bonds for the security of the refunding bonds, and the refunding
807-22   bonds may be secured by other or additional revenues and mortgage
807-23   liens.
807-24         (b)  The provisions of this chapter regarding the issuance by
807-25   the district of other bonds, the security for the bonds, the
807-26   approval of the bonds by the attorney general, and the remedies of
 808-1   the holders shall be applicable to refunding bonds.  Refunding
 808-2   bonds shall be registered by the comptroller on surrender and
 808-3   cancellation of the bonds to be refunded, but in lieu of that
 808-4   process, the resolution authorizing the issuance of the refunding
 808-5   bonds may provide that the refunding bonds shall be sold and the
 808-6   proceeds of the sale deposited in the bank where the original bonds
 808-7   are payable, in which case the refunding bonds may be issued in an
 808-8   amount sufficient to pay the principal of and the interest on the
 808-9   original bonds to their option date or maturity date, and the
808-10   comptroller shall register the refunding bonds without concurrent
808-11   surrender and cancellation of the original bonds.
808-12         Sec. 279.019.  TRUST INDENTURE FOR BONDS.  (a)  Bonds,
808-13   including refunding bonds, authorized by this chapter, not payable
808-14   wholly from ad valorem taxes, may be additionally secured by a
808-15   trust indenture under which the trustee may be a bank having trust
808-16   powers situated either within or outside the state.  The bonds,
808-17   within the discretion of the board, may be additionally secured by
808-18   a deed of trust or mortgage lien on physical properties of the
808-19   district and all franchises, easements, water rights, appropriation
808-20   permits, leases, contracts, and all rights appurtenant to the
808-21   properties, vesting in the trustee power to sell the properties for
808-22   payment of the indebtedness, power to operate the properties, and
808-23   all other powers and authority for the further security of the
808-24   bonds.
808-25         (b)  The trust indenture, regardless of the existence of the
808-26   deed of trust or mortgage lien on the properties, may:
 809-1               (1)  contain any provisions prescribed by the board for
 809-2   the security of the bonds and the preservation of the trust estate;
 809-3               (2)  make provision for amendment or modification of
 809-4   the trust indenture and the issuance of bonds to replace lost or
 809-5   mutilated bonds;
 809-6               (3)  condition the right to expend district money or
 809-7   sell district property on approval of a registered professional
 809-8   engineer selected as provided in the trust indenture; and
 809-9               (4)  make provision for the investment of funds of the
809-10   district.
809-11         (c)  A purchaser under a sale under a deed of trust lien,
809-12   where one is given, shall be the absolute owner of the properties,
809-13   facilities, and rights so purchased and shall have the right to
809-14   maintain and operate the properties, facilities, and rights.
809-15         Sec. 279.020.  BOND ELECTIONS.  (a)  Bonds payable wholly or
809-16   partially from ad valorem taxes, except refunding bonds, shall not
809-17   be issued unless authorized by an election at which only the
809-18   qualified voters who reside in the district are eligible to vote
809-19   and unless a majority of the votes cast in each city contained in
809-20   the district are in favor of the issuance of the bonds.  If a
809-21   majority of the votes cast in a city contained in the district are
809-22   against the issuance of the bonds, the board may adopt a resolution
809-23   detaching the territory of the city from the district if the board
809-24   finds that it is in the best interest of the district to issue the
809-25   bonds payable wholly or partially from taxes, but no territory may
809-26   be detached from the district after the issuance of bonds that are
 810-1   payable from revenues or taxes or both.  Bonds not payable wholly
 810-2   or partially from ad valorem taxes may be issued without an
 810-3   election.
 810-4         (b)  An election for the issuance of bonds payable wholly or
 810-5   partly from ad valorem taxes may be called by the board without a
 810-6   petition.  The resolution calling the election shall specify the
 810-7   time and location of the election, the purpose for which the bonds
 810-8   are to be issued, the maximum amount of the bonds, the maximum
 810-9   maturity of the bonds, the form of the ballot, and the presiding
810-10   judge for each voting place.  The presiding judge serving at each
810-11   voting place shall appoint one assistant judge and at least two
810-12   clerks to assist in holding the election.  Notice of the election
810-13   shall be given by publishing a substantial copy of the resolution
810-14   in one newspaper published in each city contained in the district
810-15   for two consecutive weeks.  The first publication must be at least
810-16   21 days before the date of the election.  In a city in which no
810-17   newspaper is published, notice shall be given by posting a copy of
810-18   the resolution in three public places.
810-19         (c)  The returns of the election shall be made to and
810-20   canvassed by the board.
810-21         (d)  The Election Code shall be applicable to elections held
810-22   under this section of this law except as otherwise provided by this
810-23   chapter.
810-24         Sec. 279.021.  APPROVAL AND REGISTRATION OF BONDS.  After any
810-25   bonds, including refunding bonds, are authorized by the district,
810-26   the bonds and the record relating to their issuance shall be
 811-1   submitted to the attorney general for examination as to the
 811-2   validity of the bonds and the record.  If the bonds recite that
 811-3   they are secured by a pledge of the proceeds of a contract
 811-4   previously made between the district and a city or other
 811-5   governmental agency, authority, or district, a copy of the contract
 811-6   and the proceedings of the city or other governmental agency,
 811-7   authority, or district authorizing the contract shall also be
 811-8   submitted to the attorney general.  If the bonds have been
 811-9   authorized and if the contract has been made in accordance with the
811-10   constitution and laws of the state, the attorney general shall
811-11   approve the bonds and the contract and the bonds shall then be
811-12   registered by the comptroller.  After the approval and
811-13   registration, the bonds and the contracts, if any, are valid and
811-14   binding and are incontestable for any cause.
811-15         Sec. 279.022.  WATER SUPPLY CONTRACTS.  The district may
811-16   contract with cities and others for the purpose of supplying water
811-17   to them.  The district may also contract with a city for the rental
811-18   or leasing of or for the operation of the water production, water
811-19   supply, water filtration or purification, and water supply
811-20   facilities of the city on the consideration the district and the
811-21   city may agree.  The contract may be on the terms and for the time
811-22   the parties may agree, and the contract may provide that it shall
811-23   continue in effect until bonds specified in the contract and
811-24   refunding bonds issued in lieu of those bonds are paid.
811-25         Sec. 279.023.  DISTRICT DEPOSITORY.  (a)  The board shall
811-26   designate one or more banks within the district to serve as
 812-1   depository for the funds of the district.  All funds of the
 812-2   district shall be deposited in the depository bank or banks, except
 812-3   that funds pledged to pay bonds may be deposited with the trustee
 812-4   bank named in the trust agreement and funds shall be remitted to
 812-5   the bank of payment for the payment of the principal of and
 812-6   interest on bonds.  To the extent that funds in the depository
 812-7   banks and the trustee bank are not insured by the Federal
 812-8   Depository Insurance Corporation, the funds shall be secured in the
 812-9   manner provided by law for the security of county funds.
812-10         (b)  Before designating a depository bank or banks, the board
812-11   shall issue a notice stating the time and place when and where the
812-12   board will meet to designate the depository or depositories and
812-13   inviting the banks in the district to submit applications to be
812-14   designated depositories.  The term of service for depositories
812-15   shall be prescribed by the board.  The notice of the meeting must
812-16   be published one time in a newspaper or newspapers published in the
812-17   district and specified by the board.
812-18         (c)  At the time mentioned in the notice of the meeting, the
812-19   board shall consider the applications and the management and
812-20   condition of the banks filing the applications and shall designate
812-21   as depositories the bank or banks that offer the most favorable
812-22   terms and conditions for the handling of the funds of the district
812-23   and that the board finds have proper management and are in
812-24   condition to warrant handling of district funds.  Membership on the
812-25   board of an officer or director of a bank shall not disqualify the
812-26   bank from being designated as depository.
 813-1         (d)  If no applications are received by the time stated in
 813-2   the notice of the meeting, the board shall designate a bank or
 813-3   banks within or outside the district on terms and conditions the
 813-4   board finds advantageous to the district.
 813-5         Sec. 279.024.  POWERS RELATING TO WATER ACQUISITION.  The
 813-6   district may acquire water appropriation permits from owners of
 813-7   permits.  The district may lease or acquire rights in and to
 813-8   storage and storage capacity in any reservoir constructed or to be
 813-9   constructed by any person, firm, corporation, or public agency or
813-10   from the United States government or any of its agencies.  The
813-11   district may purchase or make contracts for the purchase of water
813-12   or a water supply from any person, firm, corporation, or public
813-13   agency or from the United States government or any of its agencies.
813-14         Sec. 279.025.  BONDS AS INVESTMENTS AND SECURITY FOR
813-15   DEPOSITS.  (a)  All bonds of the district are legal and authorized
813-16   investments for banks, savings banks, trust companies, building and
813-17   loan associations, savings and loan associations, insurance
813-18   companies, fiduciaries, trustees, and guardians and for the sinking
813-19   fund of cities, towns, villages, counties, school districts, or
813-20   other political corporations or subdivisions of the state.
813-21         (b)  District bonds are eligible to secure the deposit of
813-22   public funds of the state and cities, towns, villages, counties,
813-23   school districts, or other political corporations or subdivisions
813-24   of the state.  The bonds are lawful and sufficient security for the
813-25   deposits to the extent of the value of the bonds when accompanied
813-26   by all unmatured coupons appurtenant to the bonds.
 814-1         Sec. 279.026.  TAX EXEMPTION.  The accomplishment of the
 814-2   purposes stated in this chapter is for the benefit of the people of
 814-3   the state and for the improvement of properties and industries of
 814-4   the people of the state, and the district, in carrying out the
 814-5   purposes of this chapter, will be performing an essential public
 814-6   function under the constitution and shall not be required to pay
 814-7   any tax or assessment on a project or any part of a project under
 814-8   this chapter.  The bonds issued as provided by this chapter and the
 814-9   transfer of and income from the bonds, including the profits made
814-10   on the sale of the bonds, shall at all times be free from taxation
814-11   within the state.
814-12         Sec. 279.027.  LEVYING, ASSESSMENT, EQUALIZATION, RENDITION,
814-13   AND COLLECTION OF TAXES.  (a)  Taxes throughout the district shall
814-14   be equitably distributed as required by Section 59, Article XVI,
814-15   Texas Constitution, and to that end, the board shall appoint an
814-16   assessor and collector of taxes and shall annually appoint a board
814-17   of equalization.  Members of the board of equalization shall be
814-18   persons whom the board finds to be specially qualified to pass on
814-19   valuation of taxable property.  The board of equalization shall
814-20   consist of four members with not more than one member being a
814-21   resident in any one city in the district, unless the board finds
814-22   that it cannot appoint from one or more of the cities a qualified
814-23   member who will serve on the board of equalization.  A majority of
814-24   the board of equalization constitutes a quorum.  General laws
814-25   applicable to water control and improvement districts with
814-26   reference to tax assessors and collectors and boards of
 815-1   equalization apply to the district except as otherwise provided in
 815-2   this chapter.
 815-3         (b)  The board may enter into a contract with a city, county
 815-4   appraisal district, or other taxing authority within the district
 815-5   to perform valuation, appraisal, collection, and other services
 815-6   related to assessment and collection of taxes by the district.
 815-7         (c)  The board may also contract with a city in the district
 815-8   for the collection of district taxes levied on taxable property in
 815-9   and adjacent to the city and within the district or may contract
815-10   with a county for collection of taxes in the part of the district
815-11   within the county.
815-12         (d)  All taxes levied by the board are due and payable on the
815-13   first day of October of the year in which the taxes are levied and
815-14   shall be paid on or before January 31 of the following year.
815-15         (e)  All taxes that have not been paid by the last day of
815-16   January shall become delinquent on the first day of February of
815-17   each year, and the delinquent taxes shall constitute a lien on the
815-18   property as provided by Section 59, Article XVI, Texas
815-19   Constitution, although the owner is unknown or the property is
815-20   listed in the name of a person who is not the actual owner, or
815-21   although the ownership is changed.
815-22         (f)  Each year that taxes are delinquent a penalty equal to
815-23   six percent of the amount of the taxes shall be added to the total
815-24   amount due.
815-25         (g)  The board may adopt a split tax payment plan to conform
815-26   to the plan in effect in a city with which the district makes a tax
 816-1   equalization and collection contract, and the board shall make the
 816-2   split tax payment plan effective in any other city contained in the
 816-3   district on request of the governing body of the city.
 816-4         (h)  General laws applicable to water control and improvement
 816-5   districts with reference to levy, assessment, and collection of ad
 816-6   valorem taxes and to the enforced collection of delinquent taxes
 816-7   apply to the district.
 816-8         Sec. 279.028.  ADDITIONAL POWERS.  (a)  The board may provide
 816-9   for the study, correcting, and control of both artificial and
816-10   natural pollution of all water in and to flow into a reservoir
816-11   owned by the district, may adopt and promulgate all reasonable
816-12   regulations to secure, maintain, and preserve the sanitary
816-13   condition of all water in and to flow into a reservoir owned by the
816-14   district, to prevent the waste or the unauthorized use of the
816-15   water, and to protect the reservoir from the inflow of salt and
816-16   other chemicals, and may regulate residence, hunting, fishing,
816-17   boating, and camping, and all recreational and business privileges,
816-18   along or around the reservoir or a stream contributing water to its
816-19   reservoir or a body of land or easement owned by the district.
816-20         (b)  The district may prescribe reasonable penalties for the
816-21   breach of a rule or regulation of the district, which penalties
816-22   shall not exceed a fine of more than $200, imprisonment for not
816-23   more than 30 days, or both a fine and imprisonment.  The penalties
816-24   are in addition to any other penalties provided by the laws of the
816-25   state and may be enforced by complaints filed in the appropriate
816-26   court of jurisdiction.  A rule or regulation that provides a
 817-1   penalty for the violation of a rule or a regulation is not
 817-2   effective or enforceable unless the district has published a
 817-3   substantive statement of the particular rule or regulation and the
 817-4   penalty for its violation once a week for two consecutive weeks in
 817-5   the county in which the reservoir is situated or in any county in
 817-6   which it is partly situated.  The substantive statement must be as
 817-7   condensed as possible to afford sufficient notice of the act
 817-8   forbidden by the rule or regulation.  A single notice may embrace a
 817-9   number of rules or regulations.  The notice must state that breach
817-10   of the rule or regulation will subject the violator to a penalty
817-11   and that the full text of the rule or regulation is on file in the
817-12   principal office of the district, where it may be read by any
817-13   interested person.  Five days after the second publication of the
817-14   required notice, the rule or regulation shall be in effect, and
817-15   ignorance of the rule or regulation does not constitute a defense
817-16   to a prosecution for the enforcement of a penalty.  The courts
817-17   shall take judicial notice of rules and regulations authorized by
817-18   this subsection, and the rules and regulations shall be considered
817-19   similar in nature to a valid penal ordinance of a city.
817-20         (c)  The district may employ and constitute its own peace
817-21   officers.  An officer of the district or another duly constituted
817-22   peace officer may make arrests when necessary to prevent or abate
817-23   the commission of an offense against the rules or regulations of
817-24   the district or state laws if the offense or threatened offense
817-25   occurs on land, water, or easement owned or controlled by the
817-26   district.  An authorized officer may make an arrest at any place
 818-1   where an offense is being committed involving injury or detriment
 818-2   to any property owned or controlled by the district.
 818-3         (d)  Except as otherwise provided in this chapter, the
 818-4   district is vested with all the rights, powers, and privileges
 818-5   conferred by the general laws of the state applicable to water
 818-6   control and improvement districts created under authority of
 818-7   Section 59, Article XVI, Texas Constitution, including Chapters 49
 818-8   and 51.
 818-9         Sec. 279.029.  RECREATIONAL FACILITIES.  The district may
818-10   establish or otherwise provide for public parks and recreation
818-11   facilities and may acquire land for those purposes.   No money
818-12   received from taxation or from bonds payable wholly or partially
818-13   from taxation shall be used to provide for the parks or facilities
818-14   nor shall the right of eminent domain be extended for such
818-15   purposes.
818-16         Sec. 279.030.  CONFLICTS.  Nothing in this chapter shall be
818-17   interpreted as repealing or modifying:
818-18               (1)  the law creating the Brazos River Authority,
818-19   amendments to the law, or supplemental laws, including the master
818-20   plan previously adopted by the Brazos River Authority; or
818-21               (2)  Section 11.024, which provides for priorities of
818-22   the use of water.
818-23           CHAPTER 280.  WHITE RIVER MUNICIPAL WATER DISTRICT
818-24         Sec. 280.001.  CREATION.  (a)  A conservation and reclamation
818-25   district to be known as the "White River Municipal Water District"
818-26   is created.  The district is a governmental agency and a body
 819-1   politic and corporate.
 819-2         (b)  The district is created under and is essential to
 819-3   accomplish the purposes of Section 59, Article XVI, Texas
 819-4   Constitution.
 819-5         Sec. 280.002.  DEFINITIONS.  In this chapter:
 819-6               (1)  "Board" means the board of directors of the
 819-7   district.
 819-8               (2)  "Director" means a member of the board.
 819-9               (3)  "District" means the White River Municipal Water
819-10   District.
819-11         Sec. 280.003.  TERRITORY.  The district contains all of the
819-12   territory contained in the boundaries of the city of Spur in
819-13   Dickens County, the cities of Crosbyton and Ralls in Crosby County,
819-14   and the city of Post in Garza County, as the boundaries of each
819-15   city are set forth in ordinances passed before May 15, 1957;
819-16   provided, however, that no invalidity of any of those ordinances or
819-17   the fixing of the boundaries as set out in those ordinances shall
819-18   affect the boundaries of the territory contained in the district;
819-19   the legislature finds and determines that all of the territory and
819-20   taxable property contained within the boundaries set forth in the
819-21   ordinances will benefit from the works and improvements of the
819-22   district and that the territory described in the ordinances shall
819-23   be contained within the district whether lawfully contained within
819-24   any of the cities or not.
819-25         Sec. 280.004.  BOARD OF DIRECTORS.  (a)  All powers of the
819-26   district shall be exercised by a board of directors.  Each director
 820-1   serves for a term of two years.
 820-2         (b)  In December of each year the governing body of each city
 820-3   contained in the district shall appoint a director or directors to
 820-4   succeed the director or directors from the city whose term or terms
 820-5   are about to expire.  Any vacancy shall be filled for the unexpired
 820-6   term by the governing body of the appropriate city.  Three
 820-7   directors shall be appointed by the governing body of each city
 820-8   contained in the district, and each director shall reside in the
 820-9   city from which the director is appointed.
820-10         (c)  Each director serves for a term of office as provided by
820-11   this section and until a successor is appointed and has qualified.
820-12         (d)  A director must reside in and own taxable property in
820-13   the city from which the director is appointed.  A member of a
820-14   governing body of a city or an employee of a city is not eligible
820-15   to serve as a director.
820-16         (e)  A director shall subscribe the constitutional oath of
820-17   office and shall give bond for the faithful performance of the
820-18   director's duties in the amount of $5,000, the cost of which shall
820-19   be paid by the district.
820-20         (f)  A majority of the members of the board constitutes a
820-21   quorum.
820-22         (g)  If a director moves from the city from which the
820-23   director is appointed or otherwise ceases to be a director, the
820-24   governing body of the city shall appoint a successor director for
820-25   the unexpired term.
820-26         Sec. 280.005.  DIRECTOR FEES.  (a)  Each director is entitled
 821-1   to receive a fee not to exceed $20 for attending each meeting of
 821-2   the board; provided, however, that no more than $40 is paid to a
 821-3   director for meetings held in any one calendar month.
 821-4         (b)  Each director is entitled to receive a fee not to exceed
 821-5   $20 per day for each day devoted to the business of the district
 821-6   and reimbursement for actual expenses incurred in attending to
 821-7   district business if such service and expense are expressly
 821-8   approved by the board.
 821-9         Sec. 280.006.  OFFICERS; EMPLOYEES; SEAL.  (a)  The board
821-10   shall elect from among its members a president and a vice president
821-11   of the district, and other officers the board considers necessary.
821-12         (b)  The president is the chief executive officer of the
821-13   district and the presiding officer of the board and has the same
821-14   right to vote as any other director.
821-15         (c)  The vice president shall perform all duties and exercise
821-16   all powers conferred by this chapter on the president when the
821-17   president is absent or fails or declines to act, except the
821-18   president's right to vote.
821-19         (d)  The board shall appoint a secretary and a treasurer who
821-20   may or may not be members of the board, and it may combine those
821-21   offices.  The treasurer shall give bond in an amount required by
821-22   the board.  The bond shall be conditioned on the treasurer's
821-23   faithfully accounting for all funds that come into the person's
821-24   custody as treasurer of the district.
821-25         (e)  The board shall appoint necessary engineers, attorneys,
821-26   and other employees and shall employ a general manager.  The power
 822-1   to employ and discharge employees may be conferred on the general
 822-2   manager.
 822-3         (f)  The board shall adopt a seal for the district.
 822-4         Sec. 280.007.  ANNEXATION OF TERRITORY IN CERTAIN COUNTIES.
 822-5   (a)  Other territory situated within the counties of Dickens,
 822-6   Crosby, and Garza may be annexed to the district as provided by
 822-7   this section.
 822-8         (b)  A petition for annexation must:
 822-9               (1)  be signed by 50 or a majority, whichever number is
822-10   less, of the qualified voters of the territory to be annexed who
822-11   own taxable property and who have duly rendered the same to the
822-12   city, if situated within a city or town, or county for taxation;
822-13               (2)  be filed with the board; and
822-14               (3)  describe the territory to be annexed by metes and
822-15   bounds or otherwise unless the territory is the same as that
822-16   contained in a city or town, in which event it shall be sufficient
822-17   to state that the territory to be annexed is that contained within
822-18   the city or town.
822-19         (c)  If the board finds that the petition complies with and
822-20   is signed by the number of qualified persons required under
822-21   Subsection (b), that the annexation would be in the interest of the
822-22   territory to be annexed and the district, and that the district
822-23   will be able to supply water to the territory to be annexed or
822-24   cause water to be supplied to the territory to be annexed, the
822-25   board shall adopt a resolution stating the conditions, if any,
822-26   under which the territory may be annexed to the district and
 823-1   requesting the commission to annex the territory to the district.
 823-2   The resolution shall be conclusive of the legal sufficiency of the
 823-3   petition and the qualifications of the signers.  A certified copy
 823-4   of the resolution and the petition shall be filed with the
 823-5   commission.
 823-6         (d)  The commission shall adopt a resolution declaring its
 823-7   intention to call an election in the territory to be annexed for
 823-8   the purpose of submitting the proposition of whether the territory
 823-9   shall be annexed to the district.  The commission shall set a time
823-10   and place for a hearing to be held by the commission on the
823-11   question of whether the territory to be annexed will benefit from
823-12   the improvements, works, and facilities then owned or operated or
823-13   contemplated to be owned or operated by the district or will
823-14   benefit from the other functions of the district.  Railroad
823-15   right-of-way that is not situated within the defined limits of an
823-16   incorporated city or town will not benefit from the improvements,
823-17   works, and facilities that the district is authorized to construct.
823-18   Railroad right-of-way may not be annexed to the district unless the
823-19   right-of-way is contained within the limits of an incorporated city
823-20   or town that has been annexed to the district.
823-21         (e)  Notice of the adoption of the resolution stating the
823-22   time and place of the hearing addressed to the citizens and owners
823-23   of property in the territory to be annexed shall be published one
823-24   time in a newspaper designated by the commission at least 10 days
823-25   before the date of the hearing.  The notice must describe the
823-26   territory to be annexed in the same manner in which it is required
 824-1   or permitted by this chapter to be described in the petition.
 824-2         (f)  All interested persons may appear at the hearing and
 824-3   offer evidence for or against the intended annexation.  The hearing
 824-4   may proceed in the order and under the rules as may be prescribed
 824-5   by the commission and may be recessed from time to time.  If, at
 824-6   the conclusion of the hearing, the commission finds that lands in
 824-7   the territory to be annexed will benefit from the present or
 824-8   contemplated improvements, works, or facilities of the district,
 824-9   the commission shall adopt a resolution calling an election in the
824-10   territory to be annexed stating the date of and the place or places
824-11   for holding the election and appointing a presiding judge for each
824-12   voting place, who shall appoint the necessary assistant judges and
824-13   clerks to assist in holding the election.
824-14         (g)  Notice of the election, stating the date of the
824-15   election, the proposition to be voted on, and the conditions under
824-16   which the territory may be annexed, or making reference to the
824-17   resolution of the board for that purpose, and the place or places
824-18   for holding the election, shall be published one time in a
824-19   newspaper designated by the commission at least 10 days before the
824-20   date set for the election.
824-21         (h)  Only qualified electors who reside in the territory to
824-22   be annexed may vote in the election.  Returns of the election shall
824-23   be made to the commission.
824-24         (i)  The commission shall canvass the returns of the election
824-25   and adopt an order declaring the results.  If the order shows that
824-26   a majority of the votes cast are in favor of annexation, the
 825-1   commission shall annex the territory to the district, and the
 825-2   annexation is incontestable except in the manner and within the
 825-3   time for contesting elections under the Election Code.  A certified
 825-4   copy of the order shall be recorded in the deed records of the
 825-5   county in which the annexed territory is situated.
 825-6         (j)  In calling the election on the proposition for the
 825-7   annexation of territory, the commission may include as a part of
 825-8   the same proposition a proposition for:
 825-9               (1)  the assumption of the territory's part of the
825-10   tax-supported bonds of the district then outstanding and those
825-11   previously voted but not yet sold; and
825-12               (2)  the levy of an ad valorem tax on taxable property
825-13   in the territory to be annexed along with the tax in the rest of
825-14   the district for the payment of the bonds.
825-15         (k)  After territory is added to the district, the board may
825-16   call an election over the entire district for the purpose of
825-17   determining whether the entire district as enlarged shall assume
825-18   the tax-supported bonds then outstanding and those voted but not
825-19   yet sold and whether an ad valorem tax shall be levied on all
825-20   taxable property within the district as enlarged for the payment of
825-21   the bonds, unless the proposition has been voted along with the
825-22   annexation election and becomes lawfully binding on the territory
825-23   annexed.  The election shall be called and held in the same manner
825-24   as elections for the issuance of bonds as provided by this chapter.
825-25         (l)  If no newspaper is published in the territory to be
825-26   annexed, the notices required by this section shall be posted at
 826-1   three public places in the territory.
 826-2         Sec. 280.008.  ANNEXATION OF CERTAIN MUNICIPAL TERRITORY.
 826-3   (a)  Territory annexed to a city contained in the district may be
 826-4   annexed to the district as provided by this section.
 826-5         (b)  At any time after final passage of an ordinance or
 826-6   resolution annexing territory to a city contained in the district,
 826-7   the board may issue a notice of a hearing on the question of
 826-8   annexing the territory or any part of the territory.  The notice is
 826-9   sufficient if it states the date and place of the hearing and:
826-10               (1)  describes the area proposed to be annexed; or
826-11               (2)  makes reference to the annexation ordinance of the
826-12   city.
826-13         (c)  The notice must be published one time in a newspaper
826-14   having general circulation in the city that made the annexation.
826-15   The publication must be at least 10 days before the date set for
826-16   the hearing.
826-17         (d)  If, at the hearing, the board finds that the territory
826-18   to be annexed will benefit from the water supply afforded or to be
826-19   afforded by the district, the board shall adopt a resolution
826-20   annexing the territory to the district.
826-21         Sec. 280.009.  APPOINTMENT OF DIRECTORS IN ANNEXED TERRITORY.
826-22   If the territory of a city is annexed to the district, the
826-23   governing body of the city shall appoint three directors.  The term
826-24   of one appointee shall expire on the following May 31 and the term
826-25   of the other two appointees shall expire on May 31 a year later.
826-26   Thereafter the directors shall be appointed as provided in Section
 827-1   280.004.
 827-2         Sec. 280.010.  WATER APPROPRIATION PERMITS.  The district may
 827-3   obtain appropriation permits from the commission through
 827-4   appropriate hearings as provided by Chapter 11.  Thereafter the
 827-5   permit, either on application of the district or on the initiative
 827-6   of the commission, may be modified by the commission, after an
 827-7   appropriate hearing, to increase or decrease the amount of water
 827-8   that may be appropriated, and after considering the amount of water
 827-9   that may be stored by the district to meet fluctuating demands,
827-10   either on application by the district or by its own action, the
827-11   commission shall redetermine the maximum amount of water that the
827-12   district may store in its reservoir.  In making this determination,
827-13   the commission shall consider the needs of the cities and others
827-14   that purchase water from the district.
827-15         Sec. 280.011.  AUTHORITY TO IMPOUND AND TRANSPORT WATER;
827-16   COMMISSION APPROVAL.  (a)  The district may acquire or construct,
827-17   within or outside the boundaries of the district but not outside
827-18   any county in which the district is located, dams and all works,
827-19   plants, and other facilities necessary or useful for the purpose of
827-20   impounding, processing, and transporting water to cities and others
827-21   for municipal, domestic, industrial, and mining purposes.
827-22         (b)  The size of a dam and reservoir shall be determined by
827-23   the board, taking into consideration probable future increases in
827-24   water requirements.
827-25         (c)  The size of a dam shall not be limited by the amount of
827-26   water initially authorized by the commission or a predecessor
 828-1   agency of the commission to be impounded in the reservoir.
 828-2         (d)  A dam or other facility for impounding water may not be
 828-3   constructed until the plan for the project is approved by the
 828-4   commission.
 828-5         Sec. 280.012.  ACQUISITION AND DISPOSITION OF PROPERTY.
 828-6   (a)  The district may acquire land, within or outside the
 828-7   boundaries of the district but not outside any county in which the
 828-8   district is located, and may construct, lease, or otherwise acquire
 828-9   all works, plants, and other facilities necessary or useful for the
828-10   purpose of diverting, further impounding or storing, processing,
828-11   and transporting water to cities and others for municipal,
828-12   domestic, industrial, and mining purposes.
828-13         (b)  Subject to the terms of any deed of trust issued by the
828-14   district, the district may sell, trade, or otherwise dispose of any
828-15   real or personal property determined by the board not to be needed
828-16   for district purposes.
828-17         Sec. 280.013.  EMINENT DOMAIN.  (a)  For the purpose of
828-18   carrying out any power or authority conferred by this chapter, the
828-19   district may acquire by condemnation in the manner provided by
828-20   Chapter 21, Property Code, the fee simple title to land and other
828-21   property and easements, including land needed for the reservoir and
828-22   dam and flood easements above the probable high-water line around
828-23   the reservoir, within or outside the boundaries of the district but
828-24   not outside any county in which the district is located.
828-25         (b)  The district is a municipal corporation within the
828-26   meaning of Section 21.021(c), Property Code, except that the
 829-1   district may not condemn any property owned by any other political
 829-2   subdivision, city, or town.
 829-3         (c)  As against persons, firms, and corporations, or their
 829-4   receivers or trustees, who have the power of eminent domain, the
 829-5   fee title may not be condemned, and the district may condemn only
 829-6   an easement.
 829-7         (d)  In accordance with the provisions of this section, the
 829-8   amount and character of interest in land, other property, and
 829-9   easements to be acquired shall be determined by the board.
829-10         (e)  The district has the power conferred by Section 49.221
829-11   with reference to making surveys and attending to other business of
829-12   the district.
829-13         (f)  If the district, in the exercise of the power of eminent
829-14   domain or power of relocation or any other power granted under this
829-15   chapter, makes necessary the relocation, raising, rerouting,
829-16   changing the grade, or altering the construction of any highway,
829-17   railroad, electric transmission line, telephone or telegraph
829-18   properties and facilities, or pipelines, all such necessary
829-19   relocation, raising, rerouting, changing of grade, or alteration of
829-20   construction shall be accomplished at the sole expense of the
829-21   district.
829-22         Sec. 280.014.  CONTRACTS; BIDS.  A construction contract
829-23   requiring an expenditure of more than $25,000 may only be made
829-24   after publication of a notice to bidders once each week for two
829-25   weeks before the contract is awarded.  The notice is sufficient if
829-26   it states the time and location the bids will be opened, states the
 830-1   general nature of the work to be done or the material, equipment,
 830-2   or supplies to be purchased, and states where and on what terms
 830-3   copies of the plans and specifications may be obtained.  The
 830-4   publication shall be in a newspaper published in the district and
 830-5   designated or approved by the board.
 830-6         Sec. 280.015.  ISSUANCE OF BONDS.  (a)  For the purpose of
 830-7   providing a source of water supply for cities and other users for
 830-8   municipal, domestic, industrial, mining, and oil flooding purposes
 830-9   as authorized by this chapter and for the purpose of carrying out
830-10   any other power or authority conferred by this chapter, the
830-11   district may issue negotiable bonds to be payable from such
830-12   revenues or taxes, or both revenues and taxes, of the district as
830-13   are pledged by resolution of the board.  Pending the issuance of
830-14   definitive bonds, the board may authorize the delivery of
830-15   negotiable interim bonds or notes that are eligible for exchange or
830-16   substitution by the definitive bonds.
830-17         (b)  Bonds must be authorized by resolution of the board.
830-18   The bonds shall be issued in the name of the district, signed by
830-19   the president or vice president, and attested by the secretary and
830-20   shall bear the seal of the district.  The signatures of the
830-21   president or of the secretary or of both may be printed or
830-22   lithographed on the bonds if authorized by the board, and the seal
830-23   of the district may be impressed on the bonds or may be printed or
830-24   lithographed on the bonds.
830-25         (c)  Bonds must mature, serially or otherwise, in not to
830-26   exceed 40 years and may be sold at a price and under terms
 831-1   determined by the board to be the most advantageous reasonably
 831-2   obtainable, provided that the interest cost to the district,
 831-3   including the discount, if any, calculated by use of standard bond
 831-4   interest tables currently in use by insurance companies and
 831-5   investment houses does not exceed six percent per year.  Within the
 831-6   discretion of the board, bonds may be made callable prior to
 831-7   maturity at such times and prices as may be prescribed in the
 831-8   resolution authorizing the bonds and may be made registrable as to
 831-9   principal or as to both principal and interest.
831-10         (d)  Bonds may be issued in more than one series and from
831-11   time to time as required for carrying out the purposes of this
831-12   chapter.
831-13         (e)  Bonds may be secured by a pledge of all or part of the
831-14   net revenues of the district, of the net revenues of one or more
831-15   contracts made before or after the bonds are issued, or of other
831-16   revenues or income specified by resolution of the board or in the
831-17   trust indenture.  A pledge may reserve the right, under conditions
831-18   specified in the pledge, to issue additional bonds that will be on
831-19   a parity with or subordinate to the bonds being issued.  In this
831-20   section, "net revenues" means the gross revenues and income of the
831-21   district from all sources less the amount necessary to pay the cost
831-22   of maintaining and operating the district and its properties.
831-23         (f)  The district may issue bonds payable from ad valorem
831-24   taxes to be levied on all taxable property in the district and may
831-25   issue bonds secured by and payable from both such taxes and the
831-26   revenues of the district.  If bonds are issued payable wholly or
 832-1   partially from ad valorem taxes, the board shall levy a tax
 832-2   sufficient to pay the bonds and the interest on the bonds as the
 832-3   bonds and interest become due.  The rate of the tax for any year
 832-4   may be set after giving consideration to the money received from
 832-5   the pledged revenues available for payment of principal and
 832-6   interest to the extent and in the manner permitted by the
 832-7   resolution authorizing the issuance of the bonds.
 832-8         (g)  If bonds payable wholly from revenues are issued, the
 832-9   board shall set, and from time to time revise, rates of
832-10   compensation for water sold and services rendered by the district
832-11   sufficient to pay the expense of operating and maintaining the
832-12   facilities of the district and to pay the bonds as they mature and
832-13   the interest as it accrues and to maintain the reserve and other
832-14   funds as provided in the resolution authorizing the bonds.  If
832-15   bonds payable partially from revenues are issued, the board shall
832-16   set, and from time to time revise, rates of compensation for water
832-17   sold and services rendered by the district sufficient to assure
832-18   compliance with the resolution authorizing the bonds.
832-19         (h)  From the proceeds of the sale of the bonds, the district
832-20   may set aside an amount for the payment of interest expected to
832-21   accrue during construction and for a reserve interest and sinking
832-22   fund, and such provision may be made in the resolution authorizing
832-23   the bonds.  Proceeds from the sale of the bonds may also be used
832-24   for the payment of all expenses necessarily incurred in
832-25   accomplishing the purposes for which the district is created,
832-26   including the expenses of issuing and selling the bonds.  The
 833-1   proceeds from the sale of the bonds may be temporarily invested in
 833-2   direct obligations of the United States government maturing in not
 833-3   more than one year from the date of investment.
 833-4         (i)  In the event of a default or a threatened default in the
 833-5   payment of principal or interest on bonds payable wholly or
 833-6   partially from revenues, any court of competent jurisdiction may,
 833-7   on petition of the holders of outstanding bonds, appoint a receiver
 833-8   with authority to collect and receive all income of the district
 833-9   except taxes, employ and discharge agents and employees of the
833-10   district, take charge of the district's funds on hand (except funds
833-11   received from taxes, unless commingled), and manage the proprietary
833-12   affairs of the district without consent or hindrance by the board.
833-13   The receiver may also be authorized to sell or make contracts for
833-14   the sale of water or renew the contracts with the approval of the
833-15   court appointing the receiver.  The court may vest the receiver
833-16   with other powers and duties the court finds necessary for the
833-17   protection of the holders of the bonds.  The resolution authorizing
833-18   the issuance of the bonds or the trust indenture securing them may
833-19   limit or qualify the rights of less than all of the outstanding
833-20   bonds payable from the same source to institute or prosecute any
833-21   litigation affecting the district's property or income.
833-22         Sec. 280.016.  REFUNDING BONDS.  (a)  The district may issue
833-23   refunding bonds for the purpose of refunding outstanding bonds
833-24   authorized by this chapter and interest on the bonds.  Refunding
833-25   bonds may be issued to refund more than one series of outstanding
833-26   bonds and combine the pledges for the outstanding bonds for the
 834-1   security of the refunding bonds, and refunding bonds may be secured
 834-2   by other or additional revenues and mortgage liens.
 834-3         (b)  The provisions of this chapter regarding the issuance by
 834-4   the district of other bonds, their security, their approval by the
 834-5   attorney general, and the remedies of the holders shall be
 834-6   applicable to refunding bonds.  Refunding bonds shall be registered
 834-7   by the comptroller on surrender and cancellation of the bonds to be
 834-8   refunded, but in lieu of that procedure, the resolution authorizing
 834-9   the issuance of the refunding bonds may provide that the refunding
834-10   bonds shall be sold and the proceeds of the sale deposited in the
834-11   bank where the original bonds are payable, in which case the
834-12   refunding bonds may be issued in an amount sufficient to pay the
834-13   principal of and the interest on the original bonds to their option
834-14   date or maturity date, and the comptroller shall register the
834-15   refunding bonds without concurrent surrender and cancellation of
834-16   the original bonds.
834-17         Sec. 280.017.  TRUST INDENTURE; DEED OF TRUST OR MORTGAGE
834-18   LIEN.  (a)  Bonds, including refunding bonds, authorized by this
834-19   chapter that are not payable wholly from ad valorem taxes may be
834-20   additionally secured by a trust indenture under which the trustee
834-21   may be a bank with trust powers located either within or outside
834-22   the state.  The bonds may, within the discretion of the board, be
834-23   additionally secured by a deed of trust or mortgage lien on
834-24   physical properties of the district and all franchises, easements,
834-25   water rights and appropriation permits, leases and contracts, and
834-26   rights appurtenant to the properties, vesting in the trustee power
 835-1   to sell the properties for the payment of the indebtedness, power
 835-2   to operate the properties, and all other powers and authority for
 835-3   the further security of the bonds.
 835-4         (b)  The trust indenture, regardless of the existence of a
 835-5   deed of trust or mortgage lien on the properties, may:
 835-6               (1)  contain any provisions prescribed by the board for
 835-7   the security of the bonds and the preservation of the trust estate;
 835-8               (2)  make provision for amendment or modification of
 835-9   the trust indenture and the issuance of bonds to replace lost or
835-10   mutilated bonds;
835-11               (3)  condition the right to expend district money or
835-12   sell district property upon approval of a registered professional
835-13   engineer selected as provided in the trust indenture; and
835-14               (4)  make provision for the investment of funds of the
835-15   district.
835-16         (c)  A purchaser under a sale under a deed of trust lien,
835-17   where one is given, is the absolute owner of the properties,
835-18   facilities, and rights purchased and has the right to maintain and
835-19   operate the properties, facilities, and rights.
835-20         Sec. 280.018.  BONDS PAYABLE FROM AD VALOREM TAXES; ELECTION.
835-21   (a)  Bonds payable wholly or partially from ad valorem taxes,
835-22   except refunding bonds, may not be issued unless authorized by an
835-23   election at which only the qualified voters who reside in the
835-24   district are allowed to vote and a majority of the votes cast in
835-25   each city contained in the district are in favor of the issuance of
835-26   the bonds.  If a majority of the votes cast in any city contained
 836-1   in the district are against the issuance of the bonds, the board
 836-2   may adopt a resolution detaching the territory of the city from the
 836-3   district if the board finds that it is in the best interest of the
 836-4   district to issue bonds payable wholly or partially from taxes, but
 836-5   no territory shall be detached from the district after the issuance
 836-6   of bonds that are payable from revenues or taxes or both.  Bonds
 836-7   not payable wholly or partially from ad valorem taxes may be issued
 836-8   without an election.
 836-9         (b)  An election for the authorization of bonds may be called
836-10   by the board without a petition.  The resolution calling the
836-11   election must specify the time and places of holding the election,
836-12   the purpose for which the bonds are to be issued, the maximum
836-13   amount of the bonds, the maximum maturity of the bonds, the form of
836-14   the ballot, and the presiding judge for each voting place.  The
836-15   presiding judge serving at each voting place shall appoint one
836-16   assistant judge and at least two clerks to assist in holding the
836-17   election.  Notice of the election shall be given by publishing a
836-18   substantial copy of the notice in a newspaper published in each
836-19   city contained in the district for two consecutive weeks.  The
836-20   first publication must be at least 21 days before the date of the
836-21   election.  In a city in which no newspaper is published, notice
836-22   shall be given by posting a copy of the resolution in three public
836-23   places.
836-24         (c)  The returns of the election shall be made to and
836-25   canvassed by the board.
836-26         (d)  Elections held under this section shall be governed by
 837-1   the Election Code except as otherwise provided by this chapter.
 837-2         Sec. 280.019.  BOND APPROVAL AND REGISTRATION.  After bonds,
 837-3   including refunding bonds, are authorized by the district, the
 837-4   bonds and the record relating to their issuance shall be submitted
 837-5   to the attorney general for examination as to the validity of the
 837-6   bonds.  If the bonds recite that they are secured by a pledge of
 837-7   the proceeds of a contract previously made between the district and
 837-8   a city or other governmental agency, authority, or district, a copy
 837-9   of the contract and the proceedings of the city or other
837-10   governmental agency, authority, or district authorizing the
837-11   contract shall also be submitted to the attorney general.  If the
837-12   bonds have been authorized and any contracts have been made in
837-13   accordance with the constitution and laws of the state, the
837-14   attorney general shall approve the bonds and the contracts and the
837-15   bonds then shall be registered by the comptroller.  After their
837-16   approval, the bonds and the contracts, if any, are valid and
837-17   binding and are incontestable for any cause.
837-18         Sec. 280.020.  CONTRACTS WITH CITIES AND OTHERS.  The
837-19   district may enter into contracts with cities and others for
837-20   supplying water to them.  The district may also contract with a
837-21   city for the rental or leasing of, or for the operation of, the
837-22   water production, water supply, and water filtration or
837-23   purification and water supply facilities of the city for the
837-24   consideration the district and the city agree on.  The contract may
837-25   be on the terms and for the time as the parties may agree, and the
837-26   contract may provide that it shall continue in effect until bonds
 838-1   specified in the contract and refunding bonds issued in lieu of
 838-2   those bonds are paid.
 838-3         Sec. 280.021.  DISTRICT DEPOSITORY.  (a)  The board shall
 838-4   designate one or more banks within the district to serve as
 838-5   depository for the funds of the district.  All funds of the
 838-6   district shall be deposited in the depository bank or banks, except
 838-7   that funds pledged to pay bonds may be deposited with the trustee
 838-8   bank named in the trust agreement and except that funds shall be
 838-9   remitted to the bank of payment for the payment of principal of and
838-10   interest on bonds.  To the extent that funds in the depository
838-11   banks and the trustee bank are not insured by the Federal Deposit
838-12   Insurance Corporation, the funds shall be secured in the manner
838-13   provided by law for the security of county funds.
838-14         (b)  Before designating a depository bank or banks, the board
838-15   shall issue a notice stating the time and place the board will meet
838-16   to designate the depository or depositories and inviting the banks
838-17   in the district to submit applications to be designated
838-18   depositories.  The notice must be published one time in a newspaper
838-19   or newspapers published in the district and specified by the board.
838-20         (c)  At the time stated in the notice, the board shall
838-21   consider the applications and the management and condition of the
838-22   banks filing them and shall designate as depositories the bank or
838-23   banks that offer the most favorable terms and conditions for the
838-24   handling of the funds of the district and that the board finds have
838-25   proper management and are in condition to warrant the handling of
838-26   district funds.  Membership on the board of an officer or director
 839-1   of a bank does not disqualify that bank from being designated as a
 839-2   depository.
 839-3         (d)  If no applications are received by the time stated in
 839-4   the notice, the board shall designate a bank or banks within or
 839-5   outside the district on terms and conditions the board determines
 839-6   are advantageous to the district.
 839-7         (e)  The term of service for depositories shall be prescribed
 839-8   by the board.
 839-9         Sec. 280.022.  WATER APPROPRIATION PERMITS; ACQUISITION OF
839-10   STORAGE CAPACITY AND WATER.  The district may acquire water
839-11   appropriation permits from owners of permits.  The district may
839-12   lease or acquire rights in and to storage and storage capacity in
839-13   any reservoir constructed or to be constructed by any person, firm,
839-14   corporation, or public agency or from the United States government
839-15   or any of its agencies.
839-16         Sec. 280.023.  BONDS ELIGIBLE FOR INVESTMENT AND TO SECURE
839-17   DEPOSITS.  (a)  Bonds of the district are legal and authorized
839-18   investments for banks, savings banks, trust companies, building and
839-19   loan associations, savings and loan associations, insurance
839-20   companies, fiduciaries, trustees, and guardians and for the sinking
839-21   funds of cities, towns, villages, counties, school districts, or
839-22   other political corporations or subdivisions of the state.
839-23         (b)  The bonds are eligible to secure the deposit of all
839-24   public funds of the state and all public funds of cities, towns,
839-25   villages, counties, school districts, or other political
839-26   corporations or subdivisions of the state.  Bonds are lawful and
 840-1   sufficient security for the deposits to the extent of their value
 840-2   when accompanied by all unmatured coupons.
 840-3         Sec. 280.024.  BONDS EXEMPT FROM TAXATION.  The
 840-4   accomplishment of the purposes stated in this chapter is for the
 840-5   benefit of the people of the state and for the improvement of their
 840-6   properties and industries, and the district, in carrying out the
 840-7   purposes of this chapter will be performing an essential public
 840-8   function under Section 59, Article XVI, Texas Constitution.  The
 840-9   district may not be required to pay any tax or assessment on the
840-10   project or any part of the project, and the bonds issued under this
840-11   chapter and the transfer of and income from the bonds, including
840-12   profits made on the sale of the bonds, shall at all times be free
840-13   from taxation within the state.
840-14         Sec. 280.025.  TAX ROLLS.  (a)  The tax rolls of the cities
840-15   situated within the district as created and within annexed
840-16   territory shall constitute the tax rolls of the district until
840-17   assessments and tax rolls are made by the district.
840-18         (b)  Before the sale and delivery of district bonds that are
840-19   payable wholly or partially from ad valorem taxes, the board shall
840-20   appoint a tax assessor and collector and a board of equalization
840-21   and shall cause taxes to be assessed, valuations to be equalized,
840-22   and tax rolls to be prepared.  General laws applicable to water
840-23   control and improvement districts with reference to tax assessors
840-24   and collectors, boards of equalization, tax rolls, and the levy and
840-25   collection of taxes and delinquent taxes shall be applicable to the
840-26   district, except that the board of equalization, to be appointed
 841-1   each year by the board, shall consist of one member residing in
 841-2   each city contained in the district.
 841-3         Sec. 280.026.  ADOPTION OF REGULATIONS; PENALTIES;
 841-4   ENFORCEMENT.  (a)  The board may adopt and promulgate all
 841-5   reasonable regulations to secure, maintain, and preserve the
 841-6   sanitary condition of all water in and to flow into any reservoir
 841-7   owned by the district to prevent the waste or unauthorized use of
 841-8   water and to regulate residence, hunting, fishing, boating, and
 841-9   camping and all recreational and business privileges along or
841-10   around any reservoir or any body of land or easement owned by the
841-11   district.
841-12         (b)  The district may prescribe a reasonable penalty for the
841-13   breach of a regulation of the district, not to exceed a fine of
841-14   $200 or imprisonment for 30 days, or both the fine and
841-15   imprisonment.  The penalty shall be in addition to any other
841-16   penalties provided by the laws of the state and may be enforced by
841-17   complaints filed in the appropriate court of jurisdiction;
841-18   provided, however, that no rule or regulation that provides a
841-19   penalty for a violation of the rule or regulation shall be in
841-20   effect, as to enforcement of the penalty, until five days after the
841-21   district has caused a substantive statement of the rule or
841-22   regulation and the penalty for the violation to be published once a
841-23   week for two consecutive weeks in the county in which the reservoir
841-24   is situated or in any county in which it is partly situated.  The
841-25   substantive statement to be published must be as condensed as is
841-26   possible to afford sufficient notice as to the act forbidden by the
 842-1   rule or regulation.  A single notice may embrace any number of
 842-2   regulations.  The notice must provide the information that breach
 842-3   of the regulation or regulations will subject the violator to the
 842-4   imposition of a penalty.  The notice must also state that the full
 842-5   text of the regulations is on file in the principal office of the
 842-6   district and may be read by any interested person.  Five days after
 842-7   the second publication of the notice required by this section, the
 842-8   advertised regulation shall be in effect, and ignorance of the
 842-9   regulation is not a defense to prosecution for the enforcement of a
842-10   penalty.  After the required publication, the rules and regulations
842-11   authorized by this section shall judicially be known to the courts
842-12   and shall be considered similar in nature to a valid penal
842-13   ordinance of a city.
842-14         (c)  A duly constituted peace officer may make arrests when
842-15   necessary to prevent or stop the commission of any offense against
842-16   the regulations of the district or against the laws of the state,
842-17   when the offense or threatened offense occurs on any land, water,
842-18   or easement owned or controlled by the district, or may make an
842-19   arrest at any place in the case of an offense involving injury or
842-20   detriment to any property owned or controlled by the district.
842-21         Sec. 280.027.  PARKS AND RECREATION FACILITIES.  The district
842-22   may establish or otherwise provide for public parks and recreation
842-23   facilities and may acquire land for such purposes within or outside
842-24   the district but not outside any county in which the district is
842-25   located; provided, however, that no money received from taxation or
842-26   from bonds payable wholly or partially from taxation may be used
 843-1   for such purposes, and the right of eminent domain may not be
 843-2   extended for such purposes.
 843-3         Sec. 280.028.  EFFECT ON PRIORITY OF WATER USE.  Nothing in
 843-4   this Act shall be interpreted as amending or repealing Section
 843-5   11.024, which provides for priorities of the use of water.
 843-6         SECTION 2.  Subtitle A, Title 2, Water Code, is amended by
 843-7   adding Chapter 9 to read as follows:
 843-8                CHAPTER 9.  TEXAS WATER ADVISORY COUNCIL
 843-9         Sec. 9.001.  DEFINITION.  In this chapter:
843-10               (1)  "Authority" means an entity listed in Section
843-11   9.010(b).
843-12               (2)  "Board" means the governing body of an authority.
843-13               (3)  "Commission" means the Texas Natural Resource
843-14   Conservation Commission.
843-15               (4)  "Council" means the Texas Water Advisory Council.
843-16         Sec. 9.002.  CREATION AND MEMBERSHIP.  (a)  The council is
843-17   composed of 11 members as follows:
843-18               (1)  the chairman, or a board member designated by the
843-19   chairman, of the Texas Water Development Board;
843-20               (2)  the chairman, or a commissioner designated by the
843-21   chairman, of the commission;
843-22               (3)  the chairman, or a commissioner designated by the
843-23   chairman, of the Parks and Wildlife Commission;
843-24               (4)  the commissioner of agriculture;
843-25               (5)  the Commissioner of the General Land Office;
843-26               (6)  two members of the house of representatives
 844-1   appointed by the speaker of the house of representatives;
 844-2               (7)  one member of the senate appointed by the
 844-3   lieutenant governor; and
 844-4               (8)  three members of the general public appointed by
 844-5   the governor.
 844-6         (b)  Council members may not delegate council participation
 844-7   or council duties to staff.
 844-8         Sec. 9.003.  TERMS.  (a)  Except for the commissioner of
 844-9   agriculture, council members who are officials of state agencies
844-10   serve terms as determined by the chairman of each agency.
844-11         (b)  Council members who are members of the general public
844-12   serve staggered six-year terms with the term of one member expiring
844-13   August 31 of each odd-numbered year.
844-14         (c)  Council members may be reappointed to serve additional
844-15   terms.
844-16         (d)  A vacancy on the council shall be filled by appointment
844-17   by the original appointing authority for the unexpired term.
844-18         Sec. 9.004.  OFFICERS OF THE COUNCIL.  (a)  The governor
844-19   shall appoint a council member as the chair of the council for a
844-20   two-year term expiring May 31 of each even-numbered year.
844-21         (b)  The council shall have a secretary of the council who
844-22   shall serve at the pleasure of the council and be accountable only
844-23   to the council.
844-24         Sec. 9.005.  COUNCIL STAFF.  On request by the council, the
844-25   commission and the Texas Water Development Board shall provide any
844-26   staff other than the secretary of the council necessary to assist
 845-1   the council in the performance of its duties.
 845-2         Sec. 9.006.  MEETINGS.  (a)  The council shall meet at least
 845-3   once in each calendar quarter.  Six members shall constitute a
 845-4   quorum sufficient to conduct meetings and the business of the
 845-5   council.
 845-6         (b)  The council is subject to Chapters 551 and 2001,
 845-7   Government Code.
 845-8         Sec. 9.007.  COMPENSATION OF MEMBERS.  (a)  Members of the
 845-9   council shall serve without compensation but may be reimbursed by
845-10   legislative appropriation for actual and necessary expenses related
845-11   to the performance of council duties.
845-12         (b)  Reimbursements under Subsection (a) shall be subject to
845-13   the approval of the chair.
845-14         Sec. 9.008.  POWERS AND DUTIES OF COUNCIL.  (a)  The council
845-15   shall:
845-16               (1)  heighten the level of dialogue on significant
845-17   water policy issues and, in an advisory role only, strive to
845-18   provide focus and guidance on state water policy initiatives,
845-19   including:
845-20                     (A)  promoting flexibility and incentives for
845-21   water desalination, brush control, regionalization, weather
845-22   modification projects, and public-private partnerships relating to
845-23   water projects;
845-24                     (B)  promoting adequate financing for surface
845-25   water and groundwater projects;
845-26                     (C)  development of water conservation and
 846-1   drought management projects;
 846-2                     (D)  implementation of approved regional and
 846-3   state water plans;
 846-4                     (E)  encouraging commonality of technical data
 846-5   and information such as joint agency studies, freshwater inflow
 846-6   recommendations, surface water and groundwater availability models,
 846-7   and instream flow recommendations developed by the Parks and
 846-8   Wildlife Department, the commission, and the Texas Water
 846-9   Development Board; and
846-10                     (F)  encouraging the use of supplemental
846-11   environmental projects for water infrastructure needs and enhancing
846-12   the aquatic environment and habitat in enforcement proceedings at a
846-13   state agency or political subdivision;
846-14               (2)  encourage the enhancement and coordination of
846-15   state, interstate, and international efforts to improve
846-16   environmental quality and living conditions along the Texas-Mexico
846-17   border;
846-18               (3)  coordinate a unified state position on federal and
846-19   international water issues; and
846-20               (4)  advise the Texas Water Development Board on
846-21   developing criteria based on need for prioritizing the funding of
846-22   projects in the state water plan.
846-23         (b)  The council may not:
846-24               (1)  promulgate rules;
846-25               (2)  regulate water use, water quality, or any other
846-26   aspect of water resource management;
 847-1               (3)  plan or construct water resource projects, or have
 847-2   such projects planned or constructed;
 847-3               (4)  grant or loan any funds for the construction of
 847-4   water resource projects;
 847-5               (5)  establish water resource management standards or
 847-6   otherwise usurp the authority of or infringe upon the duties,
 847-7   responsibilities, or powers of local, regional, or state water
 847-8   management entities, including groundwater districts, river
 847-9   authorities and compacts, regional water planning groups, or member
847-10   agencies of the council; or
847-11               (6)  consider or discuss any specific permit or project
847-12   or recommendation for a project.
847-13         Sec. 9.009.  REPORT.  Not later than December 1 of each
847-14   even-numbered year, the council shall submit a report to the
847-15   governor, lieutenant governor, and speaker of the house of
847-16   representatives and to the senate and house standing committees
847-17   with primary responsibility over water resource management and
847-18   financing.  The report shall include findings of the council made
847-19   in the periodic reviews of authorities during the preceding
847-20   two-year period and any other findings and recommendations the
847-21   council considers necessary.
847-22         Sec. 9.010.  REVIEW OF AUTHORITIES.  (a)  On a five-year
847-23   cycle, the council shall review authorities based on the
847-24   administrative policies provided by Section 9.012 and performance
847-25   standards described in Section 9.011.  The reviews shall be
847-26   conducted of groups described in Subsection (b), with group 1 being
 848-1   reviewed at the council's first quarterly meeting of the five-year
 848-2   period and group 2 being reviewed at the council's third quarterly
 848-3   meeting of the period.  The council shall continue in numerical
 848-4   order to review one group at every other quarterly meeting until
 848-5   all ten groups have been reviewed and then shall recommence the
 848-6   cycle.
 848-7         (b)  Authorities shall be reviewed under Subsection (a) in
 848-8   the following groups:
 848-9               (1)  in group 1, Northeast Texas Municipal Water
848-10   District, Titus County Fresh Water Supply District No. 1, and
848-11   Franklin County Water District;
848-12               (2)  in group 2, Angelina and Neches River Authority,
848-13   Lower Neches Valley Authority, Sabine River Authority, and Upper
848-14   Neches River Municipal Water Authority;
848-15               (3)  in group 3, Red River Authority of Texas, Sulphur
848-16   River Municipal Water District, and Sulphur River Basin Authority;
848-17               (4)  in group 4, San Jacinto River Authority, Gulf
848-18   Coast Water Authority, and North Harris County Regional Water
848-19   Authority;
848-20               (5)  in group 5, North Texas Municipal Water District,
848-21   Tarrant Regional Water District, Trinity River Authority of Texas,
848-22   and Dallas County Utility and Reclamation District;
848-23               (6)  in group 6, Brazos River Authority, West Central
848-24   Texas Municipal Water District, and North Central Texas Municipal
848-25   Water Authority;
848-26               (7)  in group 7, Guadalupe-Blanco River Authority,
 849-1   Lavaca-Navidad River Authority, Lower Colorado River Authority, and
 849-2   Upper Guadalupe River Authority;
 849-3               (8)  in group 8, Nueces River Authority, San Antonio
 849-4   River Authority, and Bexar-Medina-Atascosa Counties Water Control
 849-5   and Improvement District No. 1;
 849-6               (9)  in group 9, Colorado River Municipal Water
 849-7   District, Central Colorado River Authority, and Upper Colorado
 849-8   River Authority; and
 849-9               (10)  in group 10, Canadian River Municipal Water
849-10   Authority, Mackenzie Municipal Water Authority, and White River
849-11   Municipal Water District.
849-12         (c)  The council may not review an authority under this
849-13   section more than once every five years.  The council may, however,
849-14   request an authority that has been reviewed to provide follow-up
849-15   information on any specific item or issue raised during the initial
849-16   review.
849-17         (d)  The council, on request by an authority, may modify the
849-18   review schedule in order to have the flexibility in scheduling the
849-19   review, if needed, to be more responsive to particular
849-20   circumstances, changing conditions, or time-sensitive conflicts.
849-21         Sec. 9.011.  PERFORMANCE STANDARDS.  (a)  Before its
849-22   five-year review under Section 9.010, the authority shall report to
849-23   the council a self-assessment of its performance associated with
849-24   the following:
849-25               (1)  how the authority is achieving its stated mission
849-26   and goals, including an identification of any barriers that exist
 850-1   in achieving the mission and goals;
 850-2               (2)  how the authority is providing service to its
 850-3   customers, including mechanisms the authority provides to encourage
 850-4   input from the public and its customers;
 850-5               (3)  how the authority is addressing issues raised by
 850-6   its most recent management audit, including its administrative
 850-7   policies; and
 850-8               (4)  the authority's role in the regional water
 850-9   planning process.
850-10         (b)  The authority's report to the council under this section
850-11   shall include recommendations related to:
850-12               (1)  any interregional issues the authority has
850-13   identified as problematic and any potential solutions to those
850-14   issues; and
850-15               (2)  solutions to any barriers the authority determines
850-16   are interfering with the successful implementation of the approved
850-17   regional water plan or state water plan.
850-18         Sec. 9.012.  ADMINISTRATIVE POLICIES FOR AUTHORITIES.  The
850-19   commission shall expand the applicability of its rules under 30
850-20   T.A.C. Chapter 292 to include all the authorities subject to this
850-21   title.  The commission shall provide the council with copies of the
850-22   most recent information provided by each authority in accordance
850-23   with its administrative rules.
850-24         Sec. 9.013.  GIFTS AND GRANTS.  The council may accept gifts
850-25   and grants from any source to carry out the purposes of this
850-26   chapter.  The use of gifts and grants other than legislative
 851-1   appropriations is subject only to limitations contained in the gift
 851-2   or grant.
 851-3         Sec. 9.014.  FUNDING.  (a)  The interagency water policy
 851-4   account is a special account in the general revenue fund.
 851-5         (b)  The interagency water policy account consists of
 851-6   legislative appropriations, gifts and grants received under Section
 851-7   9.013, and other money required by law to be deposited in the
 851-8   account.
 851-9         (c)  Funds in the interagency water policy account may be
851-10   used only as provided by this chapter.
851-11         Sec. 9.015.  CONTINUING RIGHT OF SUPERVISION.  Nothing in
851-12   this chapter shall affect the continuing right of supervision over
851-13   authorities by the commission as provided by Section 12.081.
851-14         Sec. 9.016.  PUBLIC PARTICIPATION.  The council shall
851-15   encourage public input to the council in the exercise of its powers
851-16   and duties as specified in Section 9.008, its preparation of the
851-17   report described in Section 9.009, and its review of authorities
851-18   under Sections 9.010 and 9.011.
851-19         Sec. 9.017.  APPLICATION OF OTHER LAWS.  Nothing in this
851-20   chapter is intended to extend provisions of the Government Code,
851-21   the Local Government Code, or other law to a river authority or
851-22   water district to which such provisions do not otherwise apply.
851-23         SECTION 3.  Subchapter F, Chapter 49, Water Code, is amended
851-24   by adding Section 49.187 to read as follows:
851-25         Sec. 49.187.  REVENUE BONDS OF SURFACE WATER AUTHORITIES.
851-26   (a)  In this section:
 852-1               (1)  "Person" means any individual, partnership,
 852-2   corporation, public utility, or other private entity or any public
 852-3   agency.
 852-4               (2)  "Public agency" means any authority, district,
 852-5   city, town, or other political subdivision, joint board, or other
 852-6   public agency created pursuant to and operating under the laws of
 852-7   the state.
 852-8         (b)  A surface water authority and all persons are authorized
 852-9   to contract with each other in any manner and on terms as to which
852-10   the parties may agree with respect to any power, function,
852-11   facilities, or services which an authority is authorized by law to
852-12   provide or finance.  All public agencies are authorized to use and
852-13   pledge any available revenues for and in the payment of amounts due
852-14   under the contracts as an additional source or sources of payment
852-15   of the contracts or as the sole source or sources of payment of the
852-16   contracts and may covenant with respect to available revenues so as
852-17   to assure the availability of these revenues when required.  The
852-18   term "revenues" as used in this subsection does not mean or include
852-19   revenues from ad valorem taxes levied and collected by a public
852-20   agency or the proceeds from the sale or refunding of bonds of a
852-21   public agency that are to be wholly or partially paid from ad
852-22   valorem taxes levied and collected by the public agency unless the
852-23   use or pledge of the tax revenues or bond proceeds are approved by
852-24   the qualified voters of the public agency at an election called for
852-25   the purpose of levying taxes or issuing or refunding bonds or both
852-26   for the purpose of using or pledging their revenues or proceeds
 853-1   under contracts entered into under this subsection.
 853-2         (c)  Each public agency is authorized to fix, charge, and
 853-3   collect fees, rates, charges, rentals, and other amounts for any
 853-4   services or facilities provided by any utility operated by it or
 853-5   provided pursuant to or in connection with any contract with a
 853-6   surface water authority from its inhabitants or from any users or
 853-7   beneficiaries of any utility, services, or facilities, including
 853-8   specifically water charges, sewage charges, solid waste disposal
 853-9   system fees and charges, including garbage collection or handling
853-10   fees, and other fees or charges and to use and pledge same to make
853-11   payments to an authority required under the contract and may
853-12   covenant to do so in amounts sufficient to make all or any part of
853-13   the payments to an authority when due.  The payments shall, if the
853-14   parties agree in the contract, constitute an expense of operation
853-15   of any facilities or utility operated by the public agency.
853-16         (d)  A surface water authority, acting through its governing
853-17   body, is authorized to undertake and carry out any activities and
853-18   to acquire, purchase, construct, own, operate, maintain, repair,
853-19   improve, or extend and to lease or sell on terms and conditions,
853-20   including rentals or sale prices, on which the parties may agree
853-21   any and all works, improvements, facilities, plants, buildings,
853-22   structures, equipment, and appliances and all real and personal
853-23   property or any interest in real or personal property related
853-24   thereto that are incident to or necessary in carrying out or
853-25   performing any power or function of an authority under this
853-26   section.
 854-1         (e)  A surface water authority is authorized to issue bonds
 854-2   with respect to the acquisition, purchase, construction,
 854-3   maintenance, repair, improvement, and extension of works,
 854-4   improvements, facilities, plants, buildings, structures,
 854-5   appliances, and property for the purpose of exercising any of its
 854-6   powers and functions under this section in the manner provided by
 854-7   this section or any other applicable law.  An authority is further
 854-8   authorized to issue revenue bonds to pay for the costs of
 854-9   feasibility studies for proposed projects of an authority,
854-10   including engineering, planning and design, and environmental
854-11   studies.  An authority is authorized to include in any revenue bond
854-12   issue the funds to operate and maintain for a period not to exceed
854-13   two years after completion of the facilities acquired or
854-14   constructed through the revenue bond issue.  If any bonds issued by
854-15   an authority recite that they are secured by a pledge of payments
854-16   under any contract, a copy of the contract and the proceedings
854-17   relating to the contract may be submitted to the attorney general
854-18   along with the bonds, and if the attorney general finds that the
854-19   bonds have been authorized and the contract or contracts has or
854-20   have been made and entered into in accordance with law, then the
854-21   attorney general shall approve the bonds and the contract or
854-22   contracts, and after the approval, the bonds and the contract or
854-23   contracts shall be incontestable in any court or other forum for
854-24   any reason and shall be valid and binding in accordance with its or
854-25   their terms and provisions for all purposes.  The provisions of
854-26   Chapters 618, 1201, 1204, 1207, and 1371, Government Code, are
 855-1   applicable to bonds issued by an authority.
 855-2         (f)  This section is wholly sufficient authority within
 855-3   itself for the issuance of the bonds, the execution of contracts,
 855-4   and the performance of the other acts and procedures authorized in
 855-5   this section by a surface water authority and all persons,
 855-6   including specifically public agencies, without reference to any
 855-7   other provisions of law or any restrictions or limitations
 855-8   contained therein, except as in this section specifically provided;
 855-9   and in any case, to the extent of any conflict or inconsistency
855-10   between any provisions of this section and any other provisions of
855-11   law, including any home-rule city charter, this section shall
855-12   prevail and control; provided, however, that an authority and all
855-13   persons, including specifically public agencies, shall have the
855-14   right to use any other provisions of law not in conflict with the
855-15   provisions of this section to the extent convenient or necessary to
855-16   carry out any power or authority, express or implied, granted by
855-17   this section.
855-18         SECTION 4.  The following laws are repealed:
855-19               (1)  Chapter 605, Acts of the 63rd Legislature, Regular
855-20   Session, 1973, Chapter 370, Acts of the 73rd Legislature, Regular
855-21   Session, 1993, and Chapter 544, Acts of the 74th Legislature,
855-22   Regular Session, 1995 (Bexar-Medina-Atascosa Counties Water Control
855-23   and Improvement District No. 1);
855-24               (2)  Chapter 268, Acts of the 55th Legislature, Regular
855-25   Session, 1957, and Chapter 414, Acts of the 57th Legislature,
855-26   Regular Session, 1961 (Tarrant Regional Water District);
 856-1               (3)  Chapter 221, Acts of the 60th Legislature, Regular
 856-2   Session, 1967 (Titus County Fresh Water Supply District No. 1);
 856-3               (4)  Chapter 97, Acts of the 44th Legislature, Regular
 856-4   Session, 1935 (Angelina and Neches River Authority);
 856-5               (5)  Chapter 13, Special Laws, Acts of the 41st
 856-6   Legislature, 2nd Called Session, 1929 (Brazos River Authority);
 856-7               (6)  Chapter 243, Acts of the 53rd Legislature, Regular
 856-8   Session, 1953 (Canadian River Municipal Water Authority);
 856-9               (7)  Chapter 338, General Laws, Acts of the 44th
856-10   Legislature, Regular Session, 1935 (Central Colorado River
856-11   Authority);
856-12               (8)  Chapter 340, Acts of the 51st Legislature, Regular
856-13   Session, 1949 (Colorado River Municipal Water District);
856-14               (9)  Chapter 628, Acts of the 68th Legislature, Regular
856-15   Session, 1983 (Dallas County Utility and Reclamation District);
856-16               (10)  Chapter 719, Acts of the 59th Legislature,
856-17   Regular Session, 1965 (Franklin County Water District);
856-18               (11)  Chapter 75, Acts of the 43rd Legislature, 1st
856-19   Called Session, 1933 (Guadalupe-Blanco River Authority);
856-20               (12)  Chapter 712, Acts of the 59th Legislature,
856-21   Regular Session, 1965 (Gulf Coast Water Authority);
856-22               (13)  Chapter 186, Acts of the 50th Legislature,
856-23   Regular Session, 1947 (Lavaca-Navidad River Authority);
856-24               (14)  Chapter 7, Acts of the 43rd Legislature, 4th
856-25   Called Session, 1934 (Lower Colorado River Authority);
856-26               (15)  Chapter 63, Acts of the 43rd Legislature, 1st
 857-1   Called Session, 1933 (Lower Neches Valley Authority);
 857-2               (16)  Chapter 277, Acts of the 59th Legislature,
 857-3   Regular Session, 1965 (Mackenzie Municipal Water Authority);
 857-4               (17)  Chapter 86, Acts of the 55th Legislature, Regular
 857-5   Session, 1957 (North Central Texas Municipal Water Authority);
 857-6               (18)  Chapter 1029, Acts of the 76th Legislature,
 857-7   Regular Session, 1999 (North Harris County Regional Water
 857-8   Authority);
 857-9               (19)  Chapter 62, Acts of the 52nd Legislature, Regular
857-10   Session, 1951 (North Texas Municipal Water District);
857-11               (20)  Chapter 78, Acts of the 53rd Legislature, Regular
857-12   Session, 1953 (Northeast Texas Municipal Water District);
857-13               (21)  Chapter 427, Acts of the 44th Legislature, 1st
857-14   Called Session, 1935 (Nueces River Authority);
857-15               (22)  Chapter 279, Acts of the 56th Legislature,
857-16   Regular Session, 1959 (Red River Authority of Texas);
857-17               (23)  Chapter 110, Acts of the 51st Legislature,
857-18   Regular Session, 1949 (Sabine River Authority);
857-19               (24)  Chapter 9, page 1083, Special Laws, Acts of the
857-20   46th Legislature, Regular Session, 1939 (San Antonio River
857-21   Authority);
857-22               (25)  Chapter 426, Acts of the 45th Legislature,
857-23   Regular Session, 1937 (San Jacinto River Authority);
857-24               (26)  Chapter 3, Acts of the 69th Legislature, 1st
857-25   Called Session, 1985 (Sulphur River Basin Authority);
857-26               (27)  Chapter 212, Acts of the 54th Legislature,
 858-1   Regular Session, 1955 (Sulphur River Municipal Water District);
 858-2               (28)  Section 1 and Sections 2(a)-1 through 31, Chapter
 858-3   518, Acts of the 54th Legislature, Regular Session, 1955 (Trinity
 858-4   River Authority of Texas);
 858-5               (29)  Chapter 126, Acts of the 44th Legislature,
 858-6   Regular Session, 1935 (Upper Colorado River Authority);
 858-7               (30)  Chapter 5, page 1062, Special Laws, Acts of the
 858-8   46th Legislature, Regular Session, 1939 (Upper Guadalupe River
 858-9   Authority);
858-10               (31)  Chapter 412, Acts of the 53rd Legislature,
858-11   Regular Session, 1953 (Upper Neches River Municipal Water
858-12   Authority);
858-13               (32)  Chapter 66, Acts of the 54th Legislature, Regular
858-14   Session, 1955 (West Central Texas Municipal Water District);
858-15               (33)  Chapter 221, Acts of the 55th Legislature,
858-16   Regular Session, 1957 (White River Municipal Water District).
858-17         SECTION 5.  The Texas Water Advisory Council shall review the
858-18   first group described under Section 9.010, Water Code, as added by
858-19   this Act, at the third quarterly meeting held by the council.
858-20         SECTION 6.  (a)  The change in law made by Section 1 of this
858-21   Act shall not affect the application of the provisions of Subtitle
858-22   A, Title 9, Government Code, to any district or authority created
858-23   under Section 59, Article XVI, or Section 52, Article III, Texas
858-24   Constitution, and subject to Title 6, Water Code, as added by this
858-25   Act, or to the bonds of any such district or authority if the
858-26   provisions applied to the district or authority or to the bonds
 859-1   immediately before the effective date of this Act.
 859-2         (b)  The change in law made by Section 1 of this Act shall
 859-3   not affect the terms, requirements, or procedures applicable to any
 859-4   bonds issued before the effective date of this Act of any district
 859-5   or authority created under Section 59, Article XVI, or Section 52,
 859-6   Article III, Texas Constitution, and subject to Title 6, Water
 859-7   Code, as added by this Act.  Such bonds are governed by the law in
 859-8   effect immediately before the effective date of this Act, and that
 859-9   law continues in effect as to those bonds for that purpose.
859-10         SECTION 7.  Nothing in this Act affects the term of office of
859-11   a member of a board of directors subject to Title 6, Water Code, as
859-12   added by this Act, who is serving on the board of directors on the
859-13   effective date of this Act.
859-14         SECTION 8.  (a)  A transition or saving provision of a law
859-15   codified by this Act applies to the codified law to the same extent
859-16   as it applied to the original law.
859-17         (b)  The repeal of a transition or saving provision by this
859-18   Act does not affect the application of the provision to the
859-19   codified law.
859-20         (c)  In this section, "transition provision" includes any
859-21   temporary provision providing for a special situation in the
859-22   transition period between the existing law and the establishment or
859-23   implementation of the new law.
859-24         SECTION 9.  This Act takes effect September 1, 2001.