By Brown                                              S.B. No. 1444
         77R4196 MI-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the general powers and authority of water districts;
 1-3     providing a penalty.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1. Section 49.054(d), Water Code, is amended to read
 1-6     as follows:
 1-7           (d)  If the board appoints a director to serve as treasurer,
 1-8     that director is not subject to the investment officer training
 1-9     requirements of Chapter 2256 [Section 2256.007], Government Code,
1-10     unless the director is also appointed as the district's investment
1-11     officer under Chapter 2256, Government Code.
1-12           SECTION 2. Section 49.057(a), Water Code, is amended to read
1-13     as follows:
1-14           (a)  The board shall be responsible for the management of all
1-15     the affairs of the district. The district shall employ or contract
1-16     with all persons, firms, partnerships, corporations, or other
1-17     entities, public or private, deemed necessary by the board for the
1-18     conduct of the affairs of the district, including, but not limited
1-19     to, engineers, attorneys, financial advisors, operators,
1-20     bookkeepers, tax assessors and collectors, auditors, and
1-21     administrative staff.  The board may appoint an employee of a firm,
1-22     partnership, corporation, or other entity with which the district
1-23     has contracted to serve as the investment officer of the district
1-24     under Chapter 2256 [Section 2256.007], Government Code.
 2-1           SECTION 3. Section 49.060(a), Water Code, is amended to read
 2-2     as follows:
 2-3           (a)  A director is entitled to receive fees of office of not
 2-4     more than $150 [$100] a day for each day the director actually
 2-5     spends performing the duties of a director.  The fees of office may
 2-6     not exceed $6,000 per annum except for directors of a special water
 2-7     authority which is engaged in the distribution and sale of electric
 2-8     energy to the public.
 2-9           SECTION 4. Section 49.102, Water Code, is amended by adding a
2-10     new Subsection (i) and redesignating existing Subsection (i) as
2-11     Subsection (j) to read as follows:
2-12           (i)  A district, at an election required under Subsection
2-13     (a), may submit to the qualified voters of the district the
2-14     proposition of whether a plan as authorized by Section 49.351
2-15     should be implemented or entered into by the district.
2-16           (j)  The provisions of this section shall not be applicable
2-17     to any district exercising the powers of Chapter 375, Local
2-18     Government Code, or any district created by a special Act of the
2-19     legislature that does not require a confirmation election.
2-20           SECTION 5. Section 49.106, Water Code, is amended by adding
2-21     Subsection (e) to read as follows:
2-22           (e)  A district's authorization to issue bonds resulting from
2-23     an election held under this section, or any other law that allows
2-24     for the qualified voters of a district to authorize the issuance of
2-25     bonds by a district, remains in effect after the election unless
2-26     the district is dissolved or is annexed by another district.
2-27           SECTION 6. Section 49.107, Water Code, is amended by adding
 3-1     Subsection (g) to read as follows:
 3-2           (g)  Sections 26.04, 26.05, and 26.07, Tax Code, do not apply
 3-3     to a tax levied and collected under this section or an ad valorem
 3-4     tax levied and collected for the payment of the interest on and
 3-5     principal of bonds issued by a district.
 3-6           SECTION 7. Section 49.108, Water Code, is amended by adding
 3-7     Subsection (f) to read as follows:
 3-8           (f)  Sections 26.04, 26.05, and 26.07, Tax Code, do not apply
 3-9     to a tax levied and collected for payments made under a contract
3-10     approved in accordance with this section.
3-11           SECTION 8. Section 49.151(c), Water Code, is amended to read
3-12     as follows:
3-13           (c)  The board may [by resolution] allow disbursements of
3-14     district money to be transferred by federal reserve wire system.
3-15     The board by resolution may allow the wire transfers to accounts in
3-16     the name of the district or accounts not in the name of the
3-17     district.  If the wire transfer is to an account not in the name of
3-18     the district, the wire transfer instructions must be signed by at
3-19     least a majority of the directors.
3-20           SECTION 9. Section 49.155(a), Water Code, is amended to read
3-21     as follows:
3-22           (a)  The district may pay out of bond proceeds or other
3-23     available funds of the district all expenses of the district
3-24     authorized by this section, including expenses reasonable and
3-25     necessary to effect the issuance, sale, and delivery of bonds as
3-26     determined by the board, including, but not limited to, the
3-27     following:
 4-1                 (1)  interest during construction [not to exceed three
 4-2     years after acceptance of the project];
 4-3                 (2)  capitalized interest not to exceed three years'
 4-4     interest;
 4-5                 (3)  reasonable and necessary reserve funds not to
 4-6     exceed two years' interest on the bonds;
 4-7                 (4)  interest on funds advanced to the district;
 4-8                 (5)  financial advisor, bond counsel, attorney, and
 4-9     other consultant fees;
4-10                 (6)  paying agent, registrar, and escrow agent fees;
4-11                 (7)  right-of-way acquisition;
4-12                 (8)  underwriter's discounts or premiums;
4-13                 (9)  engineering fees, including surveying expenses and
4-14     plan review fees;
4-15                 (10)  commission and attorney general fees;
4-16                 (11)  printing costs;
4-17                 (12)  all organizational, administrative, and operating
4-18     costs during creation and construction periods;
4-19                 (13)  the cost of investigation and making plans,
4-20     including preliminary plans and associated engineering reports;
4-21                 (14)  land required for stormwater control;
4-22                 (15)  costs associated with requirements for federal
4-23     stormwater permits; and
4-24                 (16)  costs associated with requirements for endangered
4-25     species permits.
4-26           SECTION 10. Section 49.183(b), Water Code, is amended to read
4-27     as follows:
 5-1           (b)  Except for refunding bonds, or bonds sold to a state or
 5-2     federal agency, [after any bonds are finally approved and] before
 5-3     any bonds [they] are sold by a district, the board shall publish an
 5-4     appropriate notice of the sale:
 5-5                 (1)  at least one time not less than 10 days before the
 5-6     date of sale in a newspaper of general circulation in the county or
 5-7     counties in which the district is located; and
 5-8                 (2)  at least one time in one or more recognized
 5-9     financial publications of general circulation in the state as
5-10     approved by the state attorney general.
5-11           SECTION 11. Section 49.184, Water Code, is amended by adding
5-12     Subsection (f) to read as follows:
5-13           (f)  In any proceeding concerning the validity of the
5-14     creation of a district or the annexation of property by a district,
5-15     a certificate of ownership as certified by the central appraisal
5-16     district of the county or counties in which the property is located
5-17     creates a presumption of ownership, and additional proof of
5-18     ownership is not required unless there is substantial evidence in
5-19     the official deed records of the county in which the property is
5-20     located to rebut the presumption.  On request by a district, the
5-21     central appraisal district of the county or counties in which the
5-22     district is located shall furnish certificates of ownership and may
5-23     charge reasonable fees to recover the actual costs incurred in
5-24     preparing the certificates.
5-25           SECTION 12. Section 49.212, Water Code, is amended by
5-26     amending Subsection (a)  and adding Subsection (e) to read as
5-27     follows:
 6-1           (a)  A district may adopt and enforce all necessary charges,
 6-2     mandatory fees, or rentals, in addition to taxes, for providing or
 6-3     making available any district facility or service, including
 6-4     fire-fighting activities provided under Section 49.351.
 6-5           (e)  Chapter 2007, Government Code, does not apply to a tax
 6-6     levied, a standby fee imposed, or a charge, fee, or rental adopted
 6-7     or enforced by a district under this chapter, another chapter of
 6-8     this code, or Chapter 395, Local Government Code.
 6-9           SECTION 13. Section 49.218, Water Code, is amended by adding
6-10     a new Subsection (d), relettering existing Subsection (d) as
6-11     Subsection (f), and adding Subsections (e), (g), and (h) to read as
6-12     follows:
6-13           (d)  A district or water supply corporation may require a
6-14     service applicant, as a condition of service, to grant a permanent
6-15     recorded easement dedicated to the district or water supply
6-16     corporation that will provide a reasonable right of access and use
6-17     to allow the district or water supply corporation to construct,
6-18     install, maintain, replace, upgrade, inspect, and test any
6-19     facilities necessary to serve that applicant as well as other
6-20     customers of the district or water supply corporation.
6-21           (e)  As a condition of service to a new subdivision, a
6-22     district or water supply corporation may require a developer to
6-23     provide permanent recorded easements to and throughout the
6-24     subdivision sufficient to construct, install, maintain, replace,
6-25     upgrade, inspect, and test any facilities necessary to serve the
6-26     subdivision's anticipated service demands on full occupancy.
6-27           (f)  A district or water supply corporation may also lease
 7-1     property from others for its use on such terms and conditions as
 7-2     the board of the district or the board of directors of the water
 7-3     supply corporation may determine to be advantageous.
 7-4           (g)  A district or water supply corporation may issue bonds,
 7-5     notes, or other obligations to acquire property as authorized by
 7-6     this section.
 7-7           (h)  Property acquired under this section, or any other law
 7-8     allowing the acquisition of property by a district or water supply
 7-9     corporation, and owned by a district or water supply corporation is
7-10     not subject to assessments, charges, fees, or dues imposed by a
7-11     nonprofit corporation under Chapter 204, Property Code.
7-12           SECTION 14. Section 49.226, Water Code, is amended to read as
7-13     follows:
7-14           Sec. 49.226. SALE OR EXCHANGE OF REAL [SURPLUS LAND] OR
7-15     PERSONAL PROPERTY. (a)  Any personal property valued at more than
7-16     $300 or any land or interest in land owned by the district which is
7-17     found by the board to be surplus and is not needed by the district
7-18     may be sold under order of the board either by public or private
7-19     sale, or the land, interest in land, or personal property may be
7-20     exchanged for other land, interest in land, or personal property
7-21     needed by the district.  Except as provided in Subsection (b),
7-22     land, interest in land, or personal property must be exchanged for
7-23     like fair market value, which value may be determined by the
7-24     district.
7-25           (b)  Any property dedicated to or acquired by the district
7-26     without expending district funds may be abandoned or released to
7-27     the original grantor, the grantor's heirs, assigns, executors, or
 8-1     successors upon terms and conditions deemed necessary or
 8-2     advantageous to the district and without receiving compensation for
 8-3     such abandonment or release.  District property may also be
 8-4     abandoned, released, exchanged, or transferred to another district,
 8-5     municipality, county, countywide agency, or authority upon terms
 8-6     and conditions deemed necessary or advantageous to the district.
 8-7     Narrow strips of property resulting from boundary or surveying
 8-8     conflicts or similar causes, or from insubstantial encroachments by
 8-9     abutting property owners, or property of larger configuration that
8-10     has been subject to encroachments by abutting property owners for
8-11     more than 25 years may be abandoned, released, exchanged, or
8-12     transferred to such abutting owners upon terms and conditions
8-13     deemed necessary or advantageous to the district.  Chapter 272,
8-14     Local Government Code, does [shall] not apply to this section
8-15     [subsection].
8-16           (c)  Before either a public or a private sale of real
8-17     property [not required by the district], the district shall give
8-18     notice of the intent to sell by publishing notice once a week for
8-19     two consecutive weeks in one or more newspapers with general
8-20     circulation in the district.
8-21           (d)  If the district has outstanding bonds secured by a
8-22     pledge of tax revenues, the proceeds of the sale of property [not
8-23     required by the district] shall be applied to retire outstanding
8-24     bonds of the district [when required by the district's applicable
8-25     bond resolutions].
8-26           (e)  If the district does not have any outstanding bonds, the
8-27     proceeds derived from the sale of real or [the] personal property
 9-1     [or land not required by the district] may be used for any lawful
 9-2     purpose.
 9-3           SECTION 15. Subchapter H, Chapter 49, Water Code, is amended
 9-4     by adding Section 49.234 to read as follows:
 9-5           Sec. 49.234.  SEWER CONNECTIONS. (a)  A district may:
 9-6                 (1)  provide for a sanitary sewer system; and
 9-7                 (2)  require property owners to connect to the sewer
 9-8     system.
 9-9           (b)  If a property owner does not connect to the sewer
9-10     system, the district may:
9-11                 (1)  fix a lien against the owner's property;
9-12                 (2)  charge the cost of the connection to the owner as
9-13     a personal liability;
9-14                 (3)  terminate water service to the owner's property;
9-15     and
9-16                 (4)  impose a penalty on the owner.
9-17           SECTION 16. Section 49.271(c), Water Code, is amended to read
9-18     as follows:
9-19           (c)  The district may adopt minimum criteria for the
9-20     qualifications of bidders on its construction contracts and for
9-21     sureties issuing payment and performance bonds.  For construction
9-22     contracts over $25,000, the district shall require a person who
9-23     bids to submit a certified or cashier's check on a responsible bank
9-24     in the state equal to at least two percent of the total amount of
9-25     the bid, or a bid bond of at least two percent of the total amount
9-26     of the bid issued by a surety legally authorized to do business in
9-27     this state, as a good faith deposit to ensure execution of the
 10-1    contract.  If the successful bidder fails or refuses to enter into
 10-2    a proper contract with the district, or fails or refuses to furnish
 10-3    the payment and performance bonds [bond] required by law, the
 10-4    bidder forfeits the deposit.  The payment, performance, and bid
 10-5    bonding requirements of this subsection do not apply to a contract
 10-6    for the purchase of equipment, materials, or machinery not
 10-7    otherwise incorporated into a construction project.
 10-8          SECTION 17. Sections 49.273(i) and (j), Water Code, are
 10-9    amended to read as follows:
10-10          (i)  If changes in plans or specifications are necessary
10-11    after the performance of the contract is begun, or if it is
10-12    necessary to decrease or increase the quantity of the work to be
10-13    performed or of the materials, equipment, or supplies to be
10-14    furnished, the board may approve change orders making the changes.
10-15    The aggregate of the change orders may not increase the original
10-16    contract price by more than 10 percent.  Additional change [Change]
10-17    orders [to contracts] may be issued only as a result of
10-18    unanticipated conditions encountered during construction, repair,
10-19    or renovation or changes in regulatory criteria or to facilitate
10-20    project coordination with other political entities.
10-21          (j)  The board is not required to advertise or seek
10-22    competitive bids for the repair of district facilities if the scope
10-23    or extent of the repair work cannot be readily ascertained or if
10-24    the nature of the repair work does not readily lend itself to
10-25    competitive bidding [by the district's operator if the cost of the
10-26    repair is less than or equal to the advertising requirements of
10-27    this section].
 11-1          SECTION 18. Subchapter I, Chapter 49, Water Code, is amended
 11-2    by adding Section 49.279 to read as follows:
 11-3          Sec. 49.279.  PREVAILING WAGE RATES.  In addition to the
 11-4    alternative procedures provided by Section 2258.022, Government
 11-5    Code:
 11-6                (1)  a district located wholly or partially within one
 11-7    or more municipalities or within the extraterritorial jurisdiction
 11-8    of one or more municipalities may determine its prevailing wage
 11-9    rate for public works by adopting the prevailing wage rate of:
11-10                      (A)  one of the municipalities; or
11-11                      (B)  the county in which the district is located,
11-12    or if the county in which the district is located has not adopted a
11-13    wage rate, the prevailing wage rate of a county adjacent to the
11-14    county in which the district is located; and
11-15                (2)  a district not located wholly or partially within
11-16    the extraterritorial jurisdiction of a municipality may determine
11-17    the district's prevailing wage rate by adopting the prevailing wage
11-18    rate of the county in which the district is located or, if the
11-19    county in which the district is located has not adopted a wage
11-20    rate, the wage rate of a county adjacent to the county in which the
11-21    district is located.
11-22          SECTION 19. Section 49.302(b), Water Code, is amended to read
11-23    as follows:
11-24          (b)  A petition requesting the annexation of a defined area
11-25    signed by a majority in value of the owners of land in the defined
11-26    area, as shown by the tax rolls of the central appraisal district
11-27    of the county or counties in which such area is located, or signed
 12-1    by 50 landowners if the number of landowners is more than 50, shall
 12-2    describe the land by metes and bounds or by lot and block number if
 12-3    there is a recorded plat of the area and shall be filed with the
 12-4    secretary of the board.
 12-5          SECTION 20. Section 49.304(a), Water Code, is amended to read
 12-6    as follows:
 12-7          (a)  If the board determines that an exclusion hearing should
 12-8    be held as provided by Section 49.303(a) or (c), or if a written
 12-9    petition requesting an exclusion hearing is filed with the
12-10    secretary of the board as provided by [in] Section 49.303(b)
12-11    [49.303], the board shall give notice of the time and place of a
12-12    hearing to announce its own conclusions relating to land or other
12-13    property to be excluded and to receive petitions for exclusion of
12-14    land or other property.
12-15          SECTION 21. Subchapter J, Chapter 49, Water Code, is amended
12-16    by adding Section 49.315 to read as follows:
12-17          Sec. 49.315.  ADDING AND EXCLUDING LAND BEFORE CONFIRMATION.
12-18    (a)  A district may add or exclude land in accordance with this
12-19    subchapter:
12-20                (1)  after a district is created by order of the
12-21    commission or another governmental entity or by special Act of the
12-22    legislature; and
12-23                (2)  before a confirmation election is held as required
12-24    by Section 49.102.
12-25          (b)  If land is added or excluded as provided by this
12-26    section, the election to confirm the district required by Section
12-27    49.102 shall be to confirm the district as modified.
 13-1          SECTION 22. Section 49.327, Water Code, is amended to read as
 13-2    follows:
 13-3          Sec. 49.327.  ASSETS ESCHEAT TO STATE.  (a) Upon the
 13-4    dissolution of a district by the commission, all assets of the
 13-5    district shall escheat to the State of Texas.  The assets shall be
 13-6    administered by the comptroller and shall be disposed of in the
 13-7    manner provided by Chapter 74, Property Code.
 13-8          (b)  Title 6, Property Code, does not apply to any personal
 13-9    property held by a district that has not been dissolved by order of
13-10    the commission.
13-11          SECTION 23. Section 49.351, Water Code, is amended by
13-12    amending Subsections (a)-(c) and (g)-(j) and adding Subsection (l)
13-13    to read as follows:
13-14          (a)  A district providing potable water or sewer service to
13-15    household users may establish, operate, and maintain a fire
13-16    department to perform all fire-fighting activities within the
13-17    district as provided in this subchapter and may issue bonds or
13-18    impose a mandatory fee, with voter approval, [bonds] for financing
13-19    a plan approved in accordance with this section, [the establishment
13-20    of the fire department] including the construction and purchase of
13-21    necessary buildings, facilities, land, and equipment and the
13-22    provision of an adequate water supply.
13-23          (b)  After approval of the district electors of a plan to
13-24    operate, [or] jointly operate, or jointly fund the operation of a
13-25    fire department, and after complying with Subsections (g), (h), and
13-26    (i), the district or districts shall provide an adequate system and
13-27    water supply for fire-fighting purposes, may purchase necessary
 14-1    land, may construct and purchase necessary buildings, facilities,
 14-2    and equipment, and may employ or contract with a fire department to
 14-3    employ all necessary personnel including supervisory personnel to
 14-4    operate the fire department.
 14-5          (c)  Bonds [issued] for financing a plan approved in
 14-6    accordance with this section [establishment of the fire department]
 14-7    shall be authorized and may be issued, and a district shall be
 14-8    authorized to levy a tax to pay the principal of and interest on
 14-9    such bonds, as provided by law for authorization and issuance of
14-10    other bonds of the district.
14-11          (g)  A district or districts proposing to act jointly shall
14-12    develop a detailed plan for the establishment, operation, and
14-13    maintenance of the proposed department, including a detailed
14-14    presentation of all financial requirements.  If a district is
14-15    entering into a contract under Subsection (e), the district shall
14-16    develop a plan that describes [in detail] the contract and
14-17    [facilities and equipment to be devoted to service to the district
14-18    and all proposals for providing the service and that] includes a
14-19    presentation of the financial requirements under the contract.  A
14-20    plan required by this subsection may be included in a plan or
14-21    report otherwise required by this title for the creation of a
14-22    district or may be submitted to the commission for approval at any
14-23    time after the creation of the district.  [Before adoption of a
14-24    plan and any contract by the district, the board shall hold a
14-25    hearing at which any person residing in the district may present
14-26    testimony for and against the proposed plan and any proposed
14-27    contract.  Notice of the hearing and the place at which the plan
 15-1    and any contract may be examined shall be posted in two public
 15-2    places within the district at least 10 days before the date of the
 15-3    hearing.]
 15-4          (h)  If a plan was not approved by the commission at the time
 15-5    of the district's creation, after [After] adoption of the plan and
 15-6    any contract by the board, the plan and financial presentation,
 15-7    together with any contract and a written report in a form
 15-8    prescribed by the executive director describing existing fire
 15-9    departments and fire-fighting services available within 25 miles of
15-10    the boundaries of the district, shall be submitted to the executive
15-11    director for consideration by the commission under rules adopted by
15-12    the commission.  [Before approval or disapproval, the commission
15-13    shall hold a hearing.  Notice of the hearing before the commission
15-14    shall be posted by the board in at least two public places in the
15-15    district at least five days before the hearing.]  Before the
15-16    commission approves the application, it must find that it is
15-17    economically feasible for the district to implement the plan and
15-18    meet the provisions of any contract and shall take into
15-19    consideration in giving its approval the general financial
15-20    condition of the district and the economic feasibility of the
15-21    district carrying out the plan or meeting the obligations of the
15-22    contract.  A plan approved by the commission as part of the
15-23    creation of a district does not require further commission approval
15-24    unless the district materially alters the plan.
15-25          (i)  After approval of a plan by the commission, the district
15-26    shall submit to the electors of the district at the election to
15-27    approve bonds or to impose a mandatory fee for financing the plan,
 16-1    or if no bonds or fees are to be approved, at an election called
 16-2    for approval of the plan, which may be held in conjunction with an
 16-3    election required by Section 49.102, the proposition of whether or
 16-4    not the plan should be implemented or entered into by the district.
 16-5    The ballots at the election shall be printed, as applicable, to
 16-6    provide for voting for or against the proposition:  "The
 16-7    implementation of the plan for (operation/joint operation) of a
 16-8    fire department"; or "The plan and contract to provide
 16-9    fire-fighting services for the district."
16-10          (j)  [No funds of the district may be used to establish a
16-11    fire department, to enter into joint operation of a fire
16-12    department, or to contract for fire-fighting services without the
16-13    approval of a plan by the electors as provided in this section.
16-14    However, the district may use available funds for preparation of a
16-15    plan and any contract.]  The operation of a fire department or
16-16    provision of fire-fighting services is an essential public
16-17    necessity, and a district may discontinue any and all services,
16-18    including water and sewer service, to any person who fails to
16-19    timely pay fire department service fees or any other assessment
16-20    adopted by the district to support the fire department or the
16-21    provision of fire-fighting services.
16-22          (l)  Notwithstanding the requirements of Subsections (a)-(j),
16-23    a district providing potable water or sewer service to household
16-24    users may as part of its billing process collect from its customers
16-25    a voluntary contribution on behalf of organizations providing
16-26    fire-fighting activities to the district. A district that chooses
16-27    to collect a voluntary contribution under this subsection must give
 17-1    reasonable notice to its customers that the contribution is
 17-2    voluntary.  Water and sewer service may not be terminated as a
 17-3    result of failure to pay the voluntary contribution.
 17-4          SECTION 24. Chapter 49, Water Code, is amended by adding
 17-5    Subchapter N to read as follows:
 17-6                  SUBCHAPTER N.  RECREATIONAL FACILITIES
 17-7          Sec. 49.461.  POLICY AND PURPOSE. (a)  The legislature finds
 17-8    that:
 17-9                (1)  the provision of parks and recreational facilities
17-10    is necessary and desirable for the health and well-being of the
17-11    people of this state;
17-12                (2)  it is the policy of the state and the purpose of
17-13    this subchapter to encourage persons in districts to provide parks
17-14    and recreational facilities for their use and benefit;
17-15                (3)  within constitutional limitations, the power to
17-16    enact laws vested in the legislature by Section 1, Article III,
17-17    Texas Constitution, is supreme;
17-18                (4)  there is no constitutional inhibition that would
17-19    prohibit the legislature from authorizing districts to acquire,
17-20    own, develop, construct, improve, manage, operate, and maintain
17-21    parks and recreational facilities; and
17-22                (5)  the general legislative power alone is adequate to
17-23    support the enactment of this subchapter without reference to any
17-24    specific constitutional authorization.
17-25          (b)  This subchapter provides complete authority to a
17-26    district to develop and maintain recreational facilities.
17-27          Sec. 49.462.  DEFINITIONS.  In this subchapter:
 18-1                (1)  "Recreational facilities" means parks,
 18-2    landscaping, parkways, greenbelts, sidewalks, trails, public
 18-3    right-of-way beautification projects, and recreational equipment
 18-4    and facilities.  The term includes associated street and security
 18-5    lighting.
 18-6                (2)  "Develop and maintain" means to acquire, own,
 18-7    develop, construct, improve, manage, maintain, and operate.
 18-8          Sec. 49.463.  AUTHORIZATION OF RECREATIONAL FACILITIES.  In
 18-9    addition to the other purposes for which a district is created, a
18-10    district is created for the purpose of developing and maintaining
18-11    recreational facilities for the people in the district.  A district
18-12    may accomplish this purpose as provided in this subchapter.
18-13          Sec. 49.464.  ACQUISITION OF AND PAYMENT FOR RECREATIONAL
18-14    FACILITIES. (a)  A district may not issue bonds supported by ad
18-15    valorem taxes to pay for the development and maintenance of
18-16    recreational facilities.
18-17          (b)  Except as provided by Subsection (a), a district may
18-18    acquire recreational facilities and obtain funds to develop and
18-19    maintain them in the same manner as authorized elsewhere in this
18-20    code for the acquisition, development, and maintenance of other
18-21    district facilities.  A district may charge fees directly to the
18-22    users of recreational facilities and to water and wastewater
18-23    customers of the district to pay for all or part of the cost of
18-24    their development and maintenance.  To enforce payment of an unpaid
18-25    fee charged under this subsection, the district may:
18-26                (1)  seek legal restitution of the unpaid fee; and
18-27                (2)  refuse use of a recreational facility to the
 19-1    person who owes the unpaid fee.
 19-2          (c)  The district may not refuse use of facilities or
 19-3    services other than recreational facilities to enforce an unpaid
 19-4    fee.
 19-5          Sec. 49.465.  STANDARDS.  The board by rule shall establish
 19-6    standards for recreational facilities to be developed and
 19-7    maintained by a district and for the allocation of a district's
 19-8    funds for developing and maintaining recreational facilities in
 19-9    relation to a district's financial requirements for other purposes.
19-10    To prevent duplication of recreational facilities provided by other
19-11    governmental entities, rules adopted by the board under this
19-12    subsection must require a district, before developing recreational
19-13    facilities, to make findings that the size and location of the
19-14    facilities have been established in consideration of municipal or
19-15    county recreational facilities, whether existing or proposed, that
19-16    serve or will serve the area in which the district is located.
19-17          SECTION 25. Section 51.013(a), Water Code, is amended to read
19-18    as follows:
19-19          (a)  A petition requesting creation of a district shall be
19-20    signed by a majority of the persons who hold title to land in the
19-21    proposed district which represents a total value of more than 50
19-22    percent of the value of all the land in the proposed district as
19-23    indicated by the [county] tax rolls of the central appraisal
19-24    district.  If there are more than 50 persons holding title to land
19-25    in the proposed district, the petition is sufficient if signed by
19-26    50 of them.
19-27          SECTION 26. Subchapter D, Chapter 51, Water Code, is amended
 20-1    by adding Section 51.122 to read as follows:
 20-2          Sec. 51.122.  ADOPTING RULES AND REGULATIONS.  A district may
 20-3    adopt and enforce reasonable rules and regulations to:
 20-4                (1)  secure and maintain safe, sanitary, and adequate
 20-5    plumbing installations, connections, and appurtenances as
 20-6    subsidiary parts of the district's sanitary sewer system;
 20-7                (2)  preserve the sanitary condition of all water
 20-8    controlled by the district;
 20-9                (3)  prevent waste or the unauthorized use of water
20-10    controlled by the district;
20-11                (4)  regulate privileges on any land or any easement
20-12    owned or controlled by the district; or
20-13                (5)  provide and regulate a safe and adequate
20-14    freshwater distribution system.
20-15          SECTION 27. Chapter 51, Water Code, is amended by adding
20-16    Subchapter E to read as follows:
20-17                        SUBCHAPTER E.  ENFORCEMENT
20-18          Sec. 51.221.  PENALTY FOR VIOLATION OF REGULATION.  A person
20-19    who violates a regulation adopted by a district under this chapter
20-20    or other law commits an offense.  An offense under this section is
20-21    a Class C misdemeanor.
20-22          SECTION 28. Section 53.021, Water Code, is amended to read as
20-23    follows:
20-24          Sec. 53.021.  OFFICERS TO BE ELECTED.  In the election, five
20-25    supervisors [and the tax assessor and collector] are elected.
20-26          SECTION 29. Section 54.014, Water Code, is amended to read as
20-27    follows:
 21-1          Sec. 54.014.  PETITION.  When it is proposed to create a
 21-2    district, a petition requesting creation shall be filed with the
 21-3    commission.  The petition shall be signed by a majority in value of
 21-4    the holders of title of the land within the proposed district, as
 21-5    indicated by the [county] tax rolls of the central appraisal
 21-6    district.  If there are more than 50 persons holding title to the
 21-7    land in the proposed district, as indicated by the [county] tax
 21-8    rolls of the central appraisal district, the petition is sufficient
 21-9    if it is signed by 50 holders of title to the land.
21-10          SECTION 30. Section 54.236, Water Code, is amended to read as
21-11    follows:
21-12          Sec. 54.236.  STREET OR SECURITY LIGHTING.  Subject to the
21-13    provisions of this section, a district may purchase, install
21-14    [accept], operate, and maintain street lighting or security
21-15    lighting within public utility easements or public rights-of-way
21-16    within the boundaries of the district.  [Such street or security
21-17    lighting facilities must have been constructed by an owner or
21-18    developer of property within the district and must have been
21-19    required by a city as a condition to the city granting its consent
21-20    to the creation of the district pursuant to Section 54.016 of this
21-21    code.]  A district may not issue bonds supported by ad valorem
21-22    taxes to pay for the purchase, installation, [development] and
21-23    maintenance of street or security lighting.
21-24          SECTION 31. Section 54.772(1), Water Code, is amended to read
21-25    as follows:
21-26                (1)  "Recreational facilities" means parks,
21-27    landscaping, parkways, greenbelts, sidewalks, trails, public
 22-1    right-of-way beautification projects, and recreational equipment
 22-2    and facilities. The term includes associated street and security
 22-3    lighting.
 22-4          SECTION 32. Section 54.774(a), Water Code, is amended to read
 22-5    as follows:
 22-6          (a)  A district may not issue bonds supported by ad valorem
 22-7    taxes to pay for the development and maintenance of recreational
 22-8    facilities.
 22-9          SECTION 33. Section 57.092(a), Water Code, is amended to read
22-10    as follows:
22-11          (a)  The district may enter into all necessary and proper
22-12    contracts and employ all persons and means necessary to purchase,
22-13    acquire, build, construct, complete, carry out, maintain, protect,
22-14    and in case of necessity, add to and rebuild, all works and
22-15    improvements [within the district] necessary or proper to fully
22-16    accomplish a reclamation plan lawfully adopted for the district.
22-17          SECTION 34. Subchapter D, Chapter 57, Water Code, is amended
22-18    by adding Section 57.093 to read as follows:
22-19          Sec. 57.093.  ADOPTING RULES AND REGULATIONS.  A district may
22-20    adopt and enforce reasonable rules and regulations to:
22-21                (1)  preserve the sanitary condition of all water
22-22    controlled by the district;
22-23                (2)  prevent waste or the unauthorized use of water
22-24    controlled by the district; or
22-25                (3)  regulate privileges on any land or any easement
22-26    owned or controlled by the district.
22-27          SECTION 35. Subchapter Z, Chapter 402, Local Government Code,
 23-1    is amended by adding Section 402.908 to read as follows:
 23-2          Sec. 402.908.  SALE OF WATER OR SEWER SYSTEM.  A
 23-3    municipality, without an election, may sell to a water district
 23-4    operating under the authority of Section 59, Article XVI, Texas
 23-5    Constitution, a water or sewer system owned by the municipality.
 23-6          SECTION 36. Section 53.024, Water Code, is repealed.
 23-7          SECTION 37. This Act takes effect immediately if it receives
 23-8    a vote of two-thirds of all the members elected to each house, as
 23-9    provided by Section 39, Article III, Texas Constitution.  If this
23-10    Act does not receive the vote necessary for immediate effect, this
23-11    Act takes effect September 1, 2001.