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78R13549 QS-F


By:  Puente                                                       H.B. No. 3586

Substitute the following for H.B. No. 3586:                                   

By:  Geren                                                    C.S.H.B. No. 3586


A BILL TO BE ENTITLED
AN ACT
relating to powers and duties of the Edwards Aquifer Authority to manage and protect the Edwards Aquifer, the board of directors of the Edwards Aquifer Authority, and revenue bonding authority. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Section 1.01, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended to read as follows: Sec. 1.01. FINDINGS AND DECLARATION OF POLICY. The legislature finds that the Edwards Aquifer and its contributory and recharge zones are [is] a unique and complex hydrogeologic [hydrological] system, with diverse economic and social interests dependent on the aquifer for water supply. In keeping with that finding, the Edwards Aquifer and its contributory and recharge zones are [is] declared to be a distinctive natural resource in this state, a unique aquifer, and not an underground stream. To sustain these diverse interests and that natural resource, a special regional management district is required for the effective control of the resource and activities that may jeopardize it in order to protect the water quality of the aquifer, terrestrial and aquatic life, [domestic and] municipal, industrial, irrigation, and domestic water supplies, the operation of existing economic activities [industries], and the economic development of the state. Use of water in the authority [district] for beneficial purposes requires that all reasonable measures be taken to conserve groundwater withdrawn from the Edwards Aquifer and protect the quality of groundwater in the Edwards Aquifer [be conservative in water use]. SECTION 2. Section 1.03, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended by adding Subdivision (28) to read as follows: (28) "Recharge facility" means a dam, reservoir, treatment facility, transmission facility, or other recharge project, and associated facilities, structures, or works. SECTION 3. Section 1.07, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended to read as follows: Sec. 1.07. OWNERSHIP OF UNDERGROUND WATER. The ownership and rights of the owner of the land and the owner's lessees and assigns, including holders of recorded liens or other security interests in the land, in underground water and the contract rights of any person who purchases water for the provision of potable water to the public or for the resale of potable water to the public for any use are recognized. However, action taken pursuant to this Act may not be construed as depriving or divesting the owner or the owner's lessees and assigns, including holders of recorded liens or other security interests in the land, of these ownership rights or as impairing the contract rights of any person who purchases water for the provision of potable water to the public or for the resale of potable water to the public for any use, subject to the rules adopted by the authority or a district exercising the powers provided by Chapter 36 [52], Water Code. The legislature intends that just compensation be paid if implementation of this article causes a taking of private property or the impairment of a contract in contravention of the Texas or federal constitution. SECTION 4. Section 1.08(a), Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended to read as follows: (a) The authority has all of the powers, rights, and privileges necessary to manage, conserve, preserve, and protect the aquifer and to increase the recharge of, and prevent the waste or pollution of water in, the aquifer. The authority has all of the rights, powers, privileges, authority, functions, and duties provided by the general law of this state, including Chapters 36, 49, and [50,] 51, [and 52,] Water Code, applicable to an authority created under Article XVI, Section 59, of the Texas Constitution. This article prevails over any provision of general law that is in conflict or inconsistent with this article regarding the area of the authority's jurisdiction. SECTION 5. Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended by adding Section 1.081 to read as follows: Sec. 1.081. WATER QUALITY. (a) The authority may adopt and enforce rules to protect and preserve the quality of water in the aquifer, including rules to prevent the pollution of the aquifer. (b) The authority shall adopt rules regarding the control of fires in the recharge zone in consultation with fire departments and fire marshals with jurisdiction over the recharge zone in order to protect the water quality of the aquifer. SECTION 6. Section 1.09, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended by adding Subsection (i) to read as follows: (i) To be eligible to be elected or appointed as a voting member of the board, a person must have resided continuously in the single-member election district from which the person seeks to be elected or appointed for six months immediately preceding the following date: (1) for a candidate for election, the 60th day before the general election date; or (2) for a candidate for appointment, the date the appointment is made. SECTION 7. Section 1.11, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended by amending Subsection (f) and adding Subsection (i) to read as follows: (f) The authority may contract with a person who uses water from the aquifer for the authority or that person to own, finance, design, construct, operate, or [own, finance, and] maintain water supply facilities. [Management fees or special fees may not be used for purchasing or operating these facilities. For the purpose of this subsection, "water supply facility" includes a dam, reservoir, treatment facility, transmission facility, or recharge project.] (i) The authority by rule shall determine the extent to which permit holders may use programs to reduce or eliminate fees or taxes under Chapters 311 and 312, Tax Code. SECTION 8. Section 1.14, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended by amending Subsections (b)-(f) and (h) and adding Subsections (f-1) and (f-2) to read as follows: (b) Except as provided by Subsections (d), (f), and (h) of this section and Section 1.26 of this article, beginning January 1, 2008 [for the period ending December 31, 2007], the amount of permitted withdrawals from the aquifer under regular permits may not exceed 450,000 acre-feet of water for each calendar year. (c) Except as provided by Subsections (d), (f), and (h) of this section and Section 1.26 of this article, beginning January 1, 2010 [for the period beginning January 1, 2008], the amount of permitted withdrawals from the aquifer under regular permits may not exceed 400,000 acre-feet of water for each calendar year. (d) If, through studies and implementation of water management strategies, including conservation, springflow augmentation, diversions downstream of the springs, reuse, supplemental recharge, conjunctive management of surface and subsurface water, and drought management plans, programs, practices, procedures, or methods, the authority determines that the amount of water available for permitting under Subsection (b) or (c) of this section should be changed to more effectively accomplish the purposes of this article [additional supplies are available from the aquifer], the authority, in consultation with appropriate state and federal agencies, shall [may] review and, by order, change the amount of water available for permitting under Subsection (b) or (c) of this section. Beginning September 1, 2006, and every four years thereafter, the authority shall determine whether the amount of water available for permitting under Subsection (b) or (c) of this section should be changed. If the goals of Subsection (a) have not all been met, the authority shall by March 1 of the succeeding year implement new requirements to ensure compliance with Subsection (a). [may increase the maximum amount of withdrawals provided by this section and set a different maximum amount of withdrawals.] (e) The authority may [not] allow withdrawals from the aquifer through wells drilled after June 1, 1993, only if the withdrawal is made: (1) under the transfer of a regular, term, emergency, monitoring, or recharge recovery permit; (2) under a transfer of interim authorization; or (3) from an exempt well [except additional water as provided by Subsection (d) and then on an interruptible basis]. (f) The authority shall authorize withdrawals under initial regular permits on an uninterruptible basis as follows: (1) for the San Antonio pool, if [If] the level of the aquifer is equal to or greater than 650 feet above mean sea level as measured at Well J-17; and (2) for the Uvalde pool, if [, the authority may authorize withdrawal from the San Antonio pool, on an uninterruptible basis, of permitted amounts. If] the level of the aquifer is equal to or greater than 845 feet at Well J-27 [, the authority may authorize withdrawal from the Uvalde pool, on an uninterruptible basis, of permitted amounts]. (f-1) Under Section 1.26 of this article the authority may interrupt withdrawals under initial regular permits as follows: (1) for the San Antonio pool, if the level of the aquifer is less than 650 feet above mean sea level as measured at Well J-17; and (2) for the Uvalde pool, if the level of the aquifer is less than 845 feet at Well J-27. (f-2) Under Section 1.26 of this article, the [The] authority shall require interruptions in [limit the additional] withdrawals, or require implementation of programs, practices, procedures, or methods under Subsection (h) of this section, to protect [to ensure that] springflows at the Comal Springs and San Marcos Springs [are not affected] during demand management and critical period management [drought] conditions. (h) By [To accomplish the purposes of this article, by] June 1, 2005 [1994], under Section 1.26 of this article the authority [, through a program,] shall implement and enforce water management programs, practices, procedures, or [and] methods to ensure that, not later than December 31, 2012, the continuous minimum springflows of the Comal Springs and the San Marcos Springs are maintained to protect endangered and threatened species to the extent required by federal law. The authority from time to time as appropriate may revise the programs, practices, procedures, or [and] methods. To meet this requirement, the authority shall require: (1) phased reductions in the amount of water that may be used or withdrawn by existing users or categories of other users; or (2) implementation of alternative management programs, practices, procedures, or [and] methods. SECTION 9. Section 1.15(b), Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended to read as follows: (b) Except as provided by Sections 1.17, [and] 1.33, and 1.331 of this article, a person may not withdraw water from the aquifer or begin construction of a well or other works designed for the withdrawal of water from the aquifer without obtaining a permit from the authority. SECTION 10. Section 1.16(e), Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended to read as follows: (e) To the extent water is available for permitting under Sections 1.14(b) or (d), the board shall issue an [the] existing user a regular permit for withdrawal of an amount of water equal to the user's maximum beneficial use of water without waste during any one calendar year of the historical period. If an existing [a water] user does not have historical use for a full year, then the authority shall set the user's maximum beneficial use of water without waste as the [issue a permit for withdrawal based on an] amount of water that would normally be beneficially used without waste for the intended purpose for a calendar year. (e-1) If the total amount of water determined to have been beneficially used without waste under Subsection (e) of this section [this subsection] exceeds 450,000 acre-feet of water for each calendar year [the amount of water available for permitting], the authority shall proportionately adjust the amount of water authorized for withdrawal under regular [the] permits [proportionately] to meet 450,000 acre-feet of water for each calendar year [the amount available for permitting]. (e-2) Except as provided by Section 1.21(c) of this article, after the authority makes a proportional adjustment under Subsection (e-1) of this section, the authority shall restore the amount of water authorized for withdrawal under a regular permit to the following minimum amounts: (1) for an [An] existing irrigation user, [shall receive a permit for not less than] two acre-feet a year for each acre of land the user actually irrigated in any one calendar year during the historical period; or (2) for an [. An] existing user who has operated a well for three or more years during the historical period, [shall receive a permit for at least] the average amount of water withdrawn annually during the historical period. SECTION 11. The heading of Section 1.21, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended to read as follows: Sec. 1.21. [PERMIT] RETIREMENT OF REGULAR PERMITS. SECTION 12. Section 1.21, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended by amending Subsection (c) and adding Subsection (d) to read as follows: (c) If, before [on or after] January 1, 2008, the aggregate [overall] volume of water authorized to be withdrawn from the aquifer under regular permits is greater than 450,000 [400,000] acre-feet a year or greater than the adjusted amount determined under Subsection (d) of Section 1.14 of this article, not later than October 1, 2007, the board shall issue an order to be effective on January 1, 2008, proportionately adjusting the [maximum] authorized withdrawal amount of each regular permit [shall be immediately reduced by an equal percentage] as is necessary to reduce aggregate authorized withdrawals under regular permits [overall maximum demand] to 450,000 [400,000] acre-feet a year or the adjusted amount, as appropriate[. The amount reduced may be restored, in whole or in part, as other appropriate measures are implemented that maintain overall demand at or below the appropriate amount]. (d) If, before January 1, 2010, the aggregate volume of water authorized to be withdrawn from the aquifer under regular permits is greater than 400,000 acre-feet a year or greater than the adjusted amount determined under Section 1.14(d) of this article, the board, not later than October 1, 2009, shall issue an order to be effective January 1, 2010, proportionally adjusting the authorized withdrawal amount of each regular permit as is necessary to reduce aggregate authorized withdrawals under regular permits to 400,000 acre-feet a year or the adjusted amount, as appropriate. SECTION 13. Section 1.26, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended to read as follows: Sec. 1.26. DEMAND MANAGEMENT AND CRITICAL PERIOD MANAGEMENT PLAN. (a) The authority shall prepare and coordinate implementation of a plan for demand management and critical period management [on or before September 1, 1995]. The mechanisms must: (1) distinguish between discretionary use and nondiscretionary use; (2) require reductions of all discretionary use to the maximum extent feasible; (3) require utility pricing, to the maximum extent feasible, to limit discretionary use by the customers of water utilities; and (4) require reduction of nondiscretionary use by permitted or contractual users, to the extent further reductions are necessary, in the reverse order of the following water use preferences: (A) municipal, domestic, and livestock; (B) industrial and crop irrigation; and (C) residential landscape irrigation[; [(D) recreational and pleasure; and [(E) other uses that are authorized by law]. (b) The board shall adopt measures to ensure that authorized withdrawals made under regular permits are reduced to 350,000 acre-feet a year if the following conditions are met: (1) for the San Antonio pool, the level of the aquifer must be less than 627 feet above mean sea level as measured at Well J-17; or (2) for the Uvalde pool, the level of the aquifer must be less than 842 feet above mean sea level as measured at Well J-27. (c) The board shall adopt the demand management and critical period plan required under this section not later than September 1, 2004. (d) Subsection (b) of this section and this subsection expire January 1, 2008. SECTION 14. Section 1.28, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended by amending Subsection (b) and adding Subsection (b-1) to read as follows: (b) The authority may issue revenue bonds to finance: (1) the purchase of land; (2) [or] the purchase, construction, or installation of facilities or equipment, including recharge dams and associated facilities, structures, or works; or (3) the retirement of permits or applications for initial regular permits under Section 1.21 of this article by compensating permit holders or applicants as provided by Section 1.21(c) of this article. (b-1) The authority may not allow for any person to construct, acquire, or own facilities for transporting groundwater out of Uvalde County or Medina County. SECTION 15. Section 1.29, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended by amending Subsections (a)-(e), (h), and (i) and adding Subsection (a-1) to read as follows: (a) The cost of [reducing withdrawals or] permit retirements under Section 1.21(c) of this article for the period beginning January 1, 2008, must be borne[: [(1)] solely by users of the aquifer. (a-1) The cost of permit retirements under Section 1.21(d) of this article for the period beginning January 1, 2010, must be borne equally by holders of initial regular permits and downstream surface water rights holders. [for reducing withdrawals from the level on the effective date of this article to 450,000 acre-feet a year, or the adjusted amount determined under Subsection (d) of Section 1.14 of this article for the period ending December 31, 2007; and [(2) equally by aquifer users and downstream water rights holders for permit retirements from 450,000 acre-feet a year, or the adjusted amount determined under Subsection (d) of Section 1.14 of this article for the period ending December 31, 2007, to 400,000 acre-feet a year, or the adjusted amount determined under Subsection (d) of Section 1.14 of this article, for the period beginning January 1, 2008.] (b) The authority shall assess, bill, and collect equitable aquifer management fees based on aquifer use under the water management plan to finance its administrative expenses and programs authorized under this article. Aquifer management fees may additionally be used for the repayment of revenue bonds issued by the authority under Section 1.28 of this article. Each water district governed by Chapter 36 [52], Water Code, that is within the authority's boundaries may contract with the authority to pay expenses of the authority through taxes in lieu of user fees to be paid by water users in the district. The contract must provide that the district will pay an amount equal to the amount that the water users in the district would have paid through user fees. The authority may not collect a total amount of fees and taxes that is more than is reasonably necessary for the administration of the authority. (c) The authority shall also assess, bill, and collect a [an equitable] special fee assessed equally on a per acre-foot basis [based] on initial regular permits without regard to use [permitted aquifer water rights] to be used only to finance the retirement of initial regular permits from 450,000 [rights necessary] to 400,000 acre-feet a year, or the adjusted amount determined under Section 1.14(d) of this article [meet the goals provided by Section 1.21 of this article]. Fees assessed on holders of initial regular permits by the [The] authority under this subsection may not exceed one-half of the cost of permit retirements from 450,000 to 400,000 acre-feet a year, or the adjusted amount, for the period beginning January 1, 2010 [shall set the equitable special fees on permitted aquifer users at a level sufficient to match the funds raised from the assessment of equitable special fees on downstream water rights holders]. (d) The commission shall assess, and the authority shall bill and collect, equitable special fees on all downstream surface water rights holders in the Guadalupe River Basin to be used solely to finance the retirement of initial regular permits from 450,000 to 400,000 acre-feet a year, or the adjusted amount determined under Section 1.14(d) of this article [aquifer rights necessary to meet the goals provided by Section 1.21 of this article]. Fees assessed under this subsection may not exceed one-half of the cost of permit retirements from 450,000 [acre-feet a year, or the adjusted amount determined under Subsection (d) of Section 1.14 of this article, for the period ending December 31, 2007,] to 400,000 acre-feet a year for the period beginning January 1, 2010 [2008]. The authority shall report to the commission the estimated costs of the retirements. The amount of fees assessed under this subsection shall be determined in accordance with rules adopted by the commission for fees under the South Texas watermaster program with adjustments as necessary to ensure that fees are equitable between users, including priority and nonpriority hydroelectric users. A downstream surface water rights holder shall pay fees assessed under this subsection to the authority. A fee may not be assessed by the commission under this subsection on contractual deliveries of water stored in Canyon Lake that may be diverted downstream of the San Marcos Springs or Canyon Dam. A person or entity making a contractual sale of water stored upstream of Canyon Dam may not establish a systemwide rate that requires purchasers of upstream-stored water to pay the special fee assessed under this subsection. (e) In developing an equitable fee structure under this section, the authority may establish different fee rates on a per acre-foot basis for different types of use. The fees must be equitable between types of uses. The fee rate for agricultural use shall be based on the volume of water withdrawn and may not be more than $2 per acre-foot. The authority shall assess the fees on the amount of water a permit holder is authorized to withdraw under the permit. This subsection does not apply to the assessment of the equitable special fee to retire initial regular permits under Subsection (b) of this section. (h) Special fees collected under Subsection (c) or (d) of this section may not be used to finance recharge facilities [a surface water supply reservoir project]. (i) The authority shall provide money as necessary, but not to exceed five percent of the money collected under Subsection (b) [(d)] of this section, to finance the South Central Texas Water Advisory Committee's administrative expenses and programs authorized under this article. SECTION 16. Section 1.33(a), Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended to read as follows: (a) A well [that produces 25,000 gallons of water a day or less] for domestic or livestock use is exempt from metering requirements if the well: (1) was installed and in operation not later than September 1, 2003, and is capable of producing a maximum of 25,000 gallons of water a day; or (2) is capable of producing a maximum of 10,000 gallons of water a day. SECTION 17. Article 1, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended by adding Section 1.331 to read as follows: Sec. 1.331. EXEMPTION FOR FEDERAL FACILITIES; TRANSFER OF OWNERSHIP OF APPLICATION. (a) Federal facilities, which are immune from regulation under the doctrine of sovereign immunity, are exempt from the requirements of this article and any rules adopted under it. (b) A person may obtain an initial regular permit based on an application voluntarily filed by a federal facility if, before September 1, 2003, the authority approves the transfer of ownership of the application for an initial regular permit from the federal facility to the person seeking the permit. SECTION 18. Section 1.34, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended by amending Subsections (a) and (c) and adding Subsection (d) to read as follows: (a) Water withdrawn from the aquifer may [must] be used only within the boundaries of: (1) the authority; or (2) the geographic area subject to a certificate of convenience and necessity that extends within and beyond the boundaries of the authority, provided that the majority of that geographic area is within the boundaries of the authority and the certificate is held by an original regular permit holder or a wholesale customer of that permit holder. (c) A permit holder may transfer a regular permit [lease permitted water rights, but a holder of a permit for irrigation use may not lease more than 50 percent of the irrigation rights initially permitted. The user's remaining irrigation water rights must be used in accordance with the original permit and must pass with transfer of the irrigated land]. (d) An irrigation permit may be transferred to any owner, point of withdrawal, place of use, or purpose of use, except that 50 percent of the groundwater withdrawal amount initially permitted may be used only for irrigation. SECTION 19. Section 1.43, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended to read as follows: Sec. 1.43. CREATION OF UNDERGROUND WATER CONSERVATION DISTRICT. An underground water conservation district may be created in any county affected by this article as provided by Subchapter B, Chapter 36 [52], Water Code. SECTION 20. Section 1.45(a), Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, is amended to read as follows: (a) The authority may own, finance, design, construct, [build or] operate, and maintain recharge dams and associated facilities, structures, or works in the contributing or recharge area of the aquifer if the recharge is made to increase the yield of the aquifer and the recharge project does not impair senior water rights or vested riparian rights. SECTION 21. Section 1.094(c), Sections 1.21(a) and (b), and Section 1.34(b), Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, are repealed. SECTION 22. Regardless of the original deadline for filing declarations of historical use, the Edwards Aquifer Authority shall process all declarations filed before 4:30 p.m. on February 16, 1997, as if the declarations were timely filed. SECTION 23. Transfers that are effective before the effective date of this Act, that are approved by the Edwards Aquifer Authority, that have not been rescinded, and that are not subject to pending litigation are hereby validated. SECTION 24. The change in law made by this Act to Section 1.34, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, applies only to a transfer effective on or after the effective date of this Act. The change in law made by this Act to Section 1.34, Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, does not affect the validity of a transfer effective before the effective date of this Act. A transfer effective before the effective date of this Act is governed by the provisions of Chapter 626, Acts of the 73rd Legislature, Regular Session, 1993, and the rules of the Edwards Aquifer Authority in effect at the time the transfer became effective. SECTION 25. This Act takes effect immediately if it receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, this Act takes effect September 1, 2003.