78R3808 JJT-D
By: Shapleigh S.B. No. 326
A BILL TO BE ENTITLED
AN ACT
relating to the regulation of certain sales of water to be
transported by pipeline.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 13, Water Code, is amended by adding
Subchapter O to read as follows:
SUBCHAPTER O. REGULATION OF CERTAIN SALES OF WATER TO BE
TRANSPORTED BY PIPELINE
Sec. 13.551. APPLICABILITY. (a) This subchapter applies
only to the sale of raw or potable groundwater or surface water if
the water, before or after the sale, is to be transported by
pipeline:
(1) 50 miles or more; or
(2) from one river basin in this state to another river
basin in this state.
(b) This subchapter applies to a sale of water by an
individual or a business entity.
Sec. 13.552. POWER TO ENSURE COMPLIANCE; RATE REGULATION.
The commission has all authority and power of the state to ensure
that persons who supply or receive water the sale of which is
subject to this subchapter comply with their obligations under this
subchapter. For this purpose, the commission may:
(1) fix and regulate the rates for sales of that water;
and
(2) adopt rules for determining:
(A) the classification of customers and
services; and
(B) the applicability of rates.
Sec. 13.553. JUST AND REASONABLE RATES. The commission
shall ensure that the rate for water sold under this subchapter is
just and reasonable.
Sec. 13.554. FIXING OVERALL REVENUES. In fixing the rate
for a sale of water under this subchapter, the commission shall fix
the seller's revenues at a level that will:
(1) permit the seller a reasonable opportunity to earn
a reasonable return on the seller's invested capital used and
useful in supplying water to the purchaser over and above the
seller's reasonable and necessary operating expenses; and
(2) preserve the financial integrity of the seller.
Sec. 13.555. FAIR RETURN. The commission may not prescribe
any rate for a sale of water under this subchapter that will yield
more than a fair return on the invested capital used and useful in
supplying water to the purchaser.
Sec. 13.556. UNREASONABLE PREFERENCE OR PREJUDICE AS TO
RATES OR SERVICES. (a) A person who supplies water the sale of
which is subject to this subchapter may not make or grant any
unreasonable preference or advantage to any person within any
classification or subject any person within any classification to
any unreasonable prejudice or disadvantage.
(b) A person who supplies water the sale of which is subject
to this subchapter may not establish or maintain any unreasonable
differences as to rates for water either as between localities or as
between classes of service.
Sec. 13.557. EQUALITY OF RATES AND SERVICES. (a) A person
who supplies water the sale of which is subject to this subchapter
may not directly or indirectly by any device or in any manner
charge, demand, collect, or receive from any person a greater or
lesser compensation for any water supplied by the person than that
prescribed in the person's schedule of rates as properly applied to
the person to whom the water is supplied.
(b) A person may not knowingly receive or accept water from
a person for a compensation greater or less than that prescribed in
the supplier's schedule of rates as properly applied to the person
to whom the water is supplied.
Sec. 13.558. DISCRIMINATION; RESTRICTION ON COMPETITION.
(a) A person who supplies water the sale of which is subject to this
subchapter may not discriminate against any person who provides
water in competition with the person or engage in any other practice
that tends to restrict or impair that competition.
(b) A person who supplies water the sale of which is subject
to this subchapter by a pipeline owned or operated by the person:
(1) shall receive and transport water delivered to the
person by other water suppliers and perform the person's other
related duties without discrimination; and
(2) may not:
(A) discriminate in the transportation of water
the sale of which is subject to this subchapter among or against
other water suppliers with regard to facilities provided, services
rendered, or rates charged under the same or similar circumstances;
or
(B) discriminate in the transportation of water
produced or purchased by the person directly or indirectly.
(c) A person may refuse to transport:
(1) raw water in a pipeline owned or operated by the
person if the pipeline is being used to transport potable water; or
(2) potable water in a pipeline owned or operated by
the person if the pipeline is being used to transport raw water.
Sec. 13.559. CERTIFICATE OF CONVENIENCE AND NECESSITY.
(a) A person may not supply to another person water the sale of
which is subject to this subchapter unless the person supplying the
water obtains from the commission a certificate that the present or
future public convenience and necessity require that the water be
supplied.
(b) In determining whether to grant a certificate of public
convenience and necessity, the commission shall ensure that the
person supplying the water possesses the financial, managerial, and
technical capability to provide continuous and adequate service.
Sec. 13.560. CONTINUOUS AND ADEQUATE SERVICE. A person
that possesses or is required to possess a certificate of public
convenience and necessity issued under Section 13.559 shall render
continuous and adequate service.
Sec. 13.561. APPROVAL OF WATER SUPPLY CONTRACT. A contract
to supply water the sale of which is subject to this subchapter is
enforceable only if the contract is approved by the commission
after public notice and hearing.
SECTION 2. This Act applies only to a contract to supply
water that is entered into on or after the effective date of this
Act.
SECTION 3. 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.