Amend CSSB 1952 (House Committee Printing) in PART 8 of the 
bill by adding the following appropriately numbered ARTICLE to PART 
8 and renumbering subsequent ARTICLES in PART 8 accordingly:

ARTICLE __.  REGULATORY FLEXIBILITY AND REGULATORY STRUCTURE
	SECTION __.  Subchapter D, Chapter 5, Water Code, is amended 
by adding Sections 5.135 and 5.136 to read as follows:
	Sec. 5.135.  REGULATORY FLEXIBILITY.  (a)  The commission by 
order may exempt an applicant from a requirement of a statute or 
commission rule regarding the control or abatement of pollution if 
the applicant proposes to control or abate pollution by an 
alternative method or by applying an alternative standard that is:
		(1)  as protective of the environment and the public 
health as the method or standard prescribed by the statute or 
commission rule that would otherwise apply; and
		(2)  not inconsistent with federal law.                                
	(b)  The commission may not exempt an applicant under this 
section unless the applicant can demonstrate to the commission that 
the applicant's proposed project will result in a level of 
protection of environmental quality that is equal to or greater 
than the level of protection afforded by existing standards.
	(c)  The commission by rule shall specify the procedure for 
obtaining an exemption under this section.
	(d)  The commission's order must describe the alternative 
method or standard and must condition the exemption on compliance 
with the method or standard as the order prescribes.
	(e)  The commission by rule may establish a reasonable fee 
for applying for an exemption under this section.
	(f)  The violation of an order issued under this section is 
punishable as if it were a violation of the statute or rule from 
which the order grants an exemption.
	(g)  The commission may not exempt an applicant from a 
requirement of a statute or regulation regarding the storing, 
handling, processing, or disposing of low-level radioactive 
materials.
	(h)  In implementing the program of regulatory flexibility 
authorized by this section, the commission shall:
		(1)  endorse alternative methods that will comply with 
legal requirements and impose the least onerous restrictions on 
business, including economic benefit; and
		(2)  work to achieve consistent and predictable results 
for the regulated community and shorter waits for permit issuance.
	Sec. 5.136.  STRATEGICALLY DIRECTED REGULATORY STRUCTURE.  
(a)  The commission may develop a strategically directed regulatory 
structure that is designed to use innovative programs to provide 
enhanced environmental benefit and reward compliance performance.
	(b)  The strategically directed regulatory structure may 
offer incentives based on a person's compliance performance and any 
voluntary measures undertaken by the person to improve 
environmental quality.
	(c)  An innovative program offered as part of a strategically 
directed regulatory structure must:
		(1)  provide incentives to a person in return for 
benefits to the environment that exceed benefits that would result 
from compliance with applicable legal requirements under the 
commission's jurisdiction; and
		(2)  be consistent with other law and any requirement 
necessary to maintain federal program authorization.