By:  Garza                                                        H.B. No. 3469



A BILL TO BE ENTITLED

AN ACT

relating to the collection of electric franchise fees by certain 
municipalities and counties.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Subchapter A, Chapter 33, Utilities Code, is 
amended by adding Section 33.009 to read as follows:
	Sec. 33.009.  LIMITATION ON MUNICIPAL FRANCHISE FEES.  (a)  
This section applies only to a municipality that is located in a 
county that has a population of less than 48,000 and that borders 
the United Mexican States.
	(b)  Notwithstanding any other law, including Section 
33.008, a municipality to which this section applies may not impose 
on an electric utility, transmission and distribution utility, 
municipally owned utility, or electric cooperative a charge for the 
use of a municipal street, alley, or public way to deliver 
electricity to a retail customer unless the retail customer resides 
in that municipality.
	SECTION 2.  Subchapter C, Chapter 181, Utilities Code, is 
amended by adding Section 181.048 to read as follows:
	Sec. 181.048.  FRANCHISE CHARGES BY COUNTY.  (a)  This 
section applies only to a county that has a population of less than 
48,000 and that borders the United Mexican States.
	(b)  Notwithstanding any other law, a county to which this 
section applies may impose on an electric utility, transmission and 
distribution utility, municipally owned utility, or electric 
cooperative, as appropriate, that provides distribution service 
within the unincorporated areas of the county a reasonable charge 
for the use of a county street, alley, or public way to deliver 
electricity to a retail customer who resides in an unincorporated 
area of the county.
	(c)  A franchise charge authorized by this section shall be 
considered a reasonable and necessary operating expense of each 
electric utility, transmission and distribution utility, 
municipally owned utility, or electric cooperative that is subject 
to a charge under this section.  The charge shall be included in the 
nonbypassable delivery charges that a customer's retail electric 
provider must pay under Section 39.107 to the utility serving the 
customer.
	SECTION 3.  This Act takes effect September 1, 2003.