By Bernsen S.B. No. 1641 77R6831 MI-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to financial assistance for water development projects to 1-3 offset the effects of interbasin transfers. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Subchapter C, Chapter 11, Water Code, is amended 1-6 by adding Section 11.0855 to read as follows: 1-7 Sec. 11.0855. INTERBASIN TRANSFER OFFSET FEE. (a) As a 1-8 condition of any authorization for an interbasin transfer of 1-9 surface water, the parties to the contract for the interbasin 1-10 transfer must pay, in addition to any other fees prescribed by law, 1-11 an annual interbasin transfer offset fee. 1-12 (b) The amount of the interbasin transfer offset fee is an 1-13 amount equal to $2 per acre-foot of surface water transferred 1-14 annually out of the basin of origin under the contract for the 1-15 interbasin transfer. If either the basin of origin or the 1-16 receiving basin undertakes a water conservation or water 1-17 development project approved by the board, the board may reduce the 1-18 fee to $1 per acre-foot of water transferred annually. 1-19 (c) The contract for the interbasin transfer must: 1-20 (1) specify whether the fee imposed by this section 1-21 will be paid by: 1-22 (A) the party from the receiving basin; 1-23 (B) the party from the basin of origin; or 1-24 (C) both parties, in individual amounts 2-1 specified in the contract; 2-2 (2) provide that: 2-3 (A) no loss will occur in the basin of origin; 2-4 or 2-5 (B) an impact statement must be prepared to 2-6 examine the basin of origin's ability to meet the demands of the 2-7 next 100 years; and 2-8 (3) if an impact statement prepared under Subdivision 2-9 (2)(B) shows that the basin of origin cannot meet its projected 2-10 future needs, provide that: 2-11 (A) the basin of origin set aside a quantity of 2-12 water sufficient to meet projected future needs; or 2-13 (B) the receiving basin make available to the 2-14 basin of origin a quantity of water sufficient to meet that basin's 2-15 projected future needs. 2-16 (d) The interbasin transfer offset fee shall be paid 2-17 annually to the board in a manner and at the time prescribed by the 2-18 board. Fees collected under this section shall be deposited to the 2-19 credit of the interbasin transfer offset fund. 2-20 (e) The board by rule may: 2-21 (1) establish due dates, schedules, and procedures for 2-22 the assessment and collection of the fees; and 2-23 (2) provide for the assessment of penalties for late 2-24 payment of fees and the assessment of interest for the late payment 2-25 of fees or penalties in amounts not to exceed rates established for 2-26 delinquent taxes under Sections 111.060 and 111.061, Tax Code. 2-27 SECTION 2. Chapter 17, Water Code, is amended by adding 3-1 Subchapter M to read as follows: 3-2 SUBCHAPTER M. INTERBASIN TRANSFER OFFSET FUND 3-3 Sec. 17.1001. DEFINITION. In this subchapter, "fund" means 3-4 the interbasin transfer offset fund. 3-5 Sec. 17.1002. INTERBASIN TRANSFER OFFSET FUND. (a) The 3-6 interbasin transfer offset fund is a special account in the state 3-7 treasury. 3-8 (b) The fund consists of: 3-9 (1) fees collected and deposited to the fund under 3-10 Section 11.0855; and 3-11 (2) penalties collected for unpaid fees due under 3-12 Section 11.0855 and interest accrued on the unpaid fees or 3-13 penalties. 3-14 Sec. 17.1003. USE OF FUND. Money in the fund may be used 3-15 only by the board to provide financial assistance under this 3-16 subchapter. 3-17 Sec. 17.1004. FINANCIAL ASSISTANCE. (a) The board may 3-18 provide financial assistance to a river authority, political 3-19 subdivision, or other water supplier to pay for the construction of 3-20 a water development project, including a reservoir, desalination 3-21 plant, or major conservation project, to offset the loss of surface 3-22 water from a basin of origin in an interbasin transfer. Financial 3-23 assistance under this section may include the award of grants. 3-24 (b) The board by rule shall establish eligibility standards 3-25 and procedures for awarding and administering the financial 3-26 assistance authorized by this section and may establish priorities 3-27 among types of projects eligible for assistance. 4-1 (c) An applicant for financial assistance under this 4-2 subchapter must submit a preliminary proposal for the proposed 4-3 water development project to the board at the time and in the 4-4 manner prescribed by board rule. 4-5 (d) In considering applications, the board shall consider 4-6 the perceived need for the proposed project in the basin of origin, 4-7 the contribution of the project to the public good, and the 4-8 demonstrated experience and competence of the applicant in carrying 4-9 out projects of the type proposed. 4-10 Sec. 17.1005. ADVISORY COMMITTEE. (a) The Interbasin 4-11 Transfer Offset Fund Advisory Committee consists of: 4-12 (1) the presiding officer of the standing committee of 4-13 the house of representatives having primary jurisdiction over 4-14 matters relating to natural resources; 4-15 (2) the presiding officer of the standing committee of 4-16 the senate having primary jurisdiction over matters relating to 4-17 natural resources; and 4-18 (3) two members of each house to be appointed by the 4-19 presiding officer of the appropriate committee. 4-20 (b) The advisory committee shall recommend to the board when 4-21 and for what projects money in the fund may be spent. 4-22 (c) The board may not spend money in the fund without first 4-23 consulting the advisory committee. 4-24 SECTION 3. (a) This Act takes effect September 1, 2001. 4-25 (b) The change in law made by Section 11.0855, Water Code, 4-26 as added by this Act, applies only to parties to a contract for an 4-27 interbasin transfer that is entered into on or after September 1, 5-1 2001.