S.B. No. 1935
AN ACT
relating to the law governing the Brazos River Authority and the law
governing the Lower Colorado River Authority.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The Water Code is amended by adding Title 6 to
read as follows:
TITLE 6. SURFACE WATER AUTHORITIES
SUBTITLE A. GENERAL PROVISIONS
CHAPTER 201. GENERAL PROVISIONS
Sec. 201.001. DEFINITION. In this title, "commission"
means the Texas Commission on Environmental Quality.
[Chapters 202 to 220 reserved for expansion]
SUBTITLE B. LOCAL LAW SURFACE WATER AUTHORITIES
CHAPTER 221. BRAZOS RIVER AUTHORITY
Sec. 221.001. CREATION. (a) A conservation and
reclamation district to be known as the "Brazos River Authority" is
created. The authority is a river authority, a governmental
agency, a municipality, and a body politic and corporate.
(b) The authority is created under and is essential to
accomplish the purposes of Section 59, Article XVI, Texas
Constitution.
(c) The authority may exercise the powers expressly granted
by Section 59, Article XVI, Texas Constitution, to districts
created to conserve, control, and utilize to beneficial service the
storm waters and floodwaters of the rivers and streams of the state,
as well as those powers that may be contemplated and implied by the
purposes of that provision of the constitution and that are
conferred by general law and the provisions of this chapter. In
addition, the authority may discover, develop, and produce
groundwater in the Brazos River basin for the use of its customers.
(d) The authority may exercise all the rights and powers of
an independent governmental agency, a municipality, and a body
politic and corporate to formulate plans deemed essential to its
operation and for its administration in the control, storing,
preservation, and distribution for all useful purposes of the storm
waters and floodwaters of the Brazos River and its tributary
streams.
(e) The authority may exercise the same authority and power
of control and regulation over the storm waters and floodwaters of
the Brazos River and its tributaries as may be exercised by the
state, subject to the provisions of the constitution and the acts of
the legislature.
Sec. 221.002. DEFINITIONS. In this chapter:
(1) "Authority" means the Brazos River Authority.
(2) "Board" means the board of directors of the
authority.
(3) "Director" means a member of the board.
Sec. 221.003. TERRITORY. The territory of the authority
comprises the watershed of the Brazos River, as determined by rule
of the Texas Water Development Board, except the portions lying
within Freestone, Leon, and Madison counties.
Sec. 221.004. POWERS. (a) The authority may exercise, in
addition to all the general powers vested by the constitution and
statutes in a governmental agency and body politic and corporate
for the greatest practicable measure of conservation and beneficial
utilization of storm waters, floodwaters, and unappropriated flow
waters, the powers of control and employment of the floodwaters,
storm waters, unappropriated flow waters, and groundwater of the
authority in the manner and for the purposes provided by this
section.
(b) The authority may provide, through all practical and
legal means, for the control and the coordination of the regulation
of the waters of the watershed of the Brazos River and its tributary
streams as a unit.
(c) The authority may provide, by adequate organization and
administration, for the preservation of the equitable rights of the
people of the different sections of the watershed area in the
beneficial use of storm waters, floodwaters, and unappropriated
flow waters of the Brazos River and its tributary streams.
(d) The authority may provide for storing, controlling, and
conserving storm waters, floodwaters, and unappropriated flow
waters of the Brazos River and its tributaries, preventing the
escape of those waters without the maximum of public service,
preventing the devastation of lands by recurrent overflows, and
protecting life and property in the watershed area from
uncontrolled floodwaters.
(e) The authority may provide for the conservation of waters
essential for the domestic uses of the people of the watershed of
the Brazos River and its tributaries, including all necessary water
supplies for municipalities.
(f) The authority may provide for the irrigation of lands in
the watershed of the Brazos River and its tributary streams where
irrigation is required for agricultural purposes, or may be
considered helpful to more profitable agricultural production, and
provide for the equitable distribution of storm waters,
floodwaters, and unappropriated flow waters to the regional
potential requirements for all uses. Plans and works provided by
the authority, and works provided under the authorization of the
authority, should give primary consideration to the necessary and
potential needs for water by or within the areas constituting the
watershed of the Brazos River and its tributary streams.
(g) The authority may provide for the better encouragement
and development of drainage systems and provisions for drainage of
lands in the valleys of the Brazos River and its tributary streams
needing drainage for profitable agricultural production and
drainage for other lands in the watershed area of the authority
requiring drainage for the most advantageous use.
(h) The authority may provide for the conservation of all
soils against destructive erosion and for the prevention of
increased flood danger caused by destructive soil erosion.
(i) The authority may provide for controlling and making
available for employment floodwaters, storm waters, and
unappropriated flow waters in the development of commercial and
industrial enterprises in all sections of the watershed area of the
authority.
(j) The authority may provide for the control, storage, and
employment of floodwaters, storm waters, and unappropriated flow
waters in the development and distribution of hydroelectric power,
where this use may be economically coordinated with other and
superior uses and subordinated to the uses declared by law to be
superior.
(k) The authority may provide for each purpose for which
floodwaters, storm waters, and unappropriated flow waters, when
controlled and conserved, may be used in the performance of a useful
service as contemplated and authorized by the provisions of the
constitution and the public policy it declares.
(l) The authority may provide for the development of
groundwater and may make groundwater available for use for
domestic, municipal, irrigation, commercial, and industrial
purposes.
(m) This chapter does not confer on the authority any power
under Chapter 36 to regulate the groundwater of other landowners.
(n) When producing groundwater, the authority is subject to
all laws, regulations, and rules relating to groundwater, including
the rules of a groundwater conservation district and the Central
Carrizo-Wilcox Coordinating Council.
(o) The authority may not transport or assist in the
transport of groundwater pumped in the basin outside the Brazos
River basin.
Sec. 221.005. LIMITATION OF AUTHORITY; STATE SUPERVISION.
The powers and duties granted to the authority by this chapter are
subject to all legislative declarations of public policy in the
maximum utilization of the storm waters, floodwaters, and
unappropriated flow waters of the Brazos River watershed and
developed groundwater of the Brazos River basin for the purposes
for which the authority is created, as expressed and indicated in
this chapter, and subject to the continuing rights of supervision
by the state.
Sec. 221.006. DAMS AND RESERVOIRS; WATER SUPPLY CONTRACTS.
(a) The authority may construct, acquire, equip, acquire storage
rights at, and operate dams and reservoirs that, in the opinion of
the board, are useful in carrying out the powers conferred on the
authority by this chapter, regardless of whether a dam is designed
to serve a single purpose or multiple purposes.
(b) The authority may provide water supply lines and water
purification and pumping facilities.
(c) The authority may execute contracts with municipalities
in the state substantially in the manner prescribed by Section
402.020, Local Government Code, for districts organized or created
under Section 59, Article XVI, Texas Constitution, and may execute
water supply contracts with other users of water.
Sec. 221.007. PRIORITY OF RIGHTS. This chapter does not
change any existing priority of right under the laws of this state
to the use of waters of this state, including any rights of
municipalities that maintain and use storage structures in the bed
of the Brazos River or its tributaries.
Sec. 221.008. BOND PROVISIONS. (a) Bonds may be:
(1) sold for cash, at public or private sale, and at
the price the board determines;
(2) issued on the terms the board determines in
exchange for property of any kind, real, personal, or mixed, or any
interest in property, that the board determines necessary or
convenient for any corporate purpose; or
(3) issued to refund bonds issued at any time under
authority of this chapter.
(b) Bonds must be authorized by resolution of the board.
(c) A resolution authorizing bonds may contain provisions
that are part of the contract between the authority and the
purchasers and subsequent holders of the bonds:
(1) reserving the right to redeem the bonds at the
time, in the amount, and at the price provided;
(2) providing for the setting aside of sinking funds
or reserve funds and the regulation and disposition of those funds;
(3) pledging, to secure the payment of the principal
of and interest on the bonds and the sinking fund or reserve fund
payments agreed to be made with respect to the bonds, all or any
part of the gross or net revenues subsequently received by the
authority with respect to the property, real, personal, or mixed,
to be acquired or constructed with the bonds or with proceeds of the
bonds, or all or any part of the gross or net revenues subsequently
received by the authority from any source;
(4) prescribing the purposes to which the bonds or any
bonds later issued, or the proceeds of the bonds, may be applied;
(5) agreeing to set and collect rates and charges
sufficient to produce revenues that are adequate to pay the items
specified in any resolution or resolutions authorizing any bonds,
and prescribing the use and disposition of all revenues;
(6) prescribing limitations on the issuance of
additional bonds and on all agreements that may be made with the
purchasers and successive holders of the bonds;
(7) relating to the construction, extension,
improvement, operation, maintenance, depreciation, replacement,
and repair of the properties of the authority and the carrying of
insurance on all or any part of the property covering loss or damage
or loss of use and occupancy resulting from specified risks;
(8) establishing the procedure, if any, by which, if
the authority so desires, the terms of any contract with the
bondholders may be amended or abrogated, the amount of bonds the
holders of which must consent to such amendment or abrogation, and
the manner in which the consent is evidenced;
(9) providing for the execution and delivery by the
authority to a bank or trust company authorized by law to accept
trusts, or to the United States or any office or agency of the
United States, of indentures or agreements authorized to be made
with or for the benefit of the bondholders and any other provisions
contained in the indentures or agreements; and
(10) making other provisions, not inconsistent with
this chapter, that the board approves.
Sec. 221.009. BOARD OF DIRECTORS; BONDS; QUORUM; OFFICERS.
(a) The board consists of 21 members. Members of the board and
their successors serve staggered terms of six years and until their
successors are designated and have qualified. The terms of seven
members of the board expire on February 1 of each odd-numbered year.
(b) The governor shall appoint the directors at large with
the advice and consent of the senate. Within 60 days after
appointment, each director shall take and subscribe an oath of
office similar to the oaths administered to county commissioners
and shall execute bond in the amount of $5,000, payable to the
authority. The premium on the bond shall be paid by the authority.
The bond, after being recorded in the official bond records of the
county in which the authority maintains its office, shall be
deposited with a depository selected and approved for the deposit
of the funds of the authority.
(c) A vacancy occurring on the board shall be filled by
appointment of the governor with the advice and consent of the
senate.
(d) Eleven members of the board constitute a quorum to
transact business.
(e) The governor shall designate a director as the presiding
officer of the board to serve in that capacity at the pleasure of
the governor. The board shall elect from among its members an
assistant presiding officer and a secretary. The board shall
appoint a treasurer. The treasurer shall furnish a bond in an
amount equal to 75 percent of the amount of money estimated to be on
hand during the year, not to exceed $100,000.
Sec. 221.010. CREATION OF MASTER DISTRICT; WATER CONTROL
AND IMPROVEMENT DISTRICT. A master district is created having all
the powers, duties, and functions, and subject to applicable and
practicable procedures for those districts, to accomplish the
purposes of this chapter, as provided by Chapter 49 and the
provisions of this code applicable to water control and improvement
districts.
Sec. 221.011. BOND ELECTION REQUIRED. The authority may
not issue bonds or incur any form of continuing obligation or
indebtedness payable from ad valorem taxes for purposes of
effecting improvements comprehended in the plan of organization and
administration of the authority, or incur any indebtedness in the
form of a continuing charge on lands or other physical properties
within the authority, unless the proposition has been submitted to
the qualified voters of the authority, or in appropriate cases the
qualified voters of a defined area within the authority, and is
approved by a majority of the electors voting on the proposition.
Sec. 221.012. ADDITIONAL POWERS AND DUTIES. (a) The
authority is a district and a river authority as defined by Chapter
30. All the provisions of Chapter 30 are applicable to the
authority.
(b) As used in this section:
(1) "Person" means any individual, partnership,
corporation, public utility, or other private entity or any public
agency.
(2) "Public agency" means an authority, district,
municipality or other political subdivision, joint board, or other
public agency created and operating under the laws of this state and
any entity created to operate or act on behalf of a public agency.
(c) The authority and all persons may enter into contracts
with each other, in any manner and on terms to which the parties
agree, with respect to any power, function, facility, or service
that the authority is authorized by law to provide or finance.
Public agencies may use and pledge any available revenues for and in
the payment of amounts due under a contract as an additional source
of payment of the contract and may covenant with respect to
available revenues to assure the availability of the revenues when
required. In this subsection, "revenues" does not mean or include
revenues from ad valorem taxes levied and collected by a public
agency or the proceeds from the sale or refunding of bonds of a
public agency that are to be wholly or partially paid from ad
valorem taxes levied and collected by the public agency unless the
use or pledge of the tax revenues or bond proceeds is approved by
the qualified voters of the public agency at an election called for
the purpose of levying taxes or issuing or refunding bonds, or both,
for the purpose of using or pledging their revenues or proceeds
under contracts entered into under this subsection.
(d) A public agency may set, charge, and collect fees,
rates, charges, rentals, and other amounts for a service or
facility provided by a utility operated by the public agency, or
provided under or in connection with a contract with the authority,
from the inhabitants of the authority or from any users or
beneficiaries of the utility, service, or facility, including:
(1) water charges;
(2) sewage charges;
(3) solid waste disposal system fees and charges,
including garbage collection or handling fees; and
(4) other fees or charges.
(e) A public agency may use and pledge the fees, rates,
charges, rentals, and other amounts authorized by Subsection (c) to
make payments to the authority required under a contract with the
authority and may covenant to do so in amounts sufficient to make
all or any part of the payments to the authority when due. If the
parties agree in the contract, the payments shall constitute an
expense of operation of any facility or utility operated by the
public agency.
(f) The authority, acting through the board, may carry out
any activities and acquire, purchase, construct, own, operate,
maintain, repair, improve, or extend and may lease or sell, on terms
and conditions, including rentals or sale prices, on which the
parties agree, all works, improvements, facilities, plants,
buildings, structures, equipment, and appliances, and all real and
personal property, or any interest in real or personal property,
related to the works, improvements, facilities, plants, buildings,
structures, equipment, and appliances, that are incident to or
necessary in carrying out or performing any power or function of the
authority under this section.
(g) The authority may issue bonds with respect to the
acquisition, purchase, construction, maintenance, repair,
improvement, and extension of works, improvements, facilities,
plants, buildings, structures, appliances, and property for the
purpose of exercising any of its powers and functions under this
section in the manner provided by this chapter or any other
applicable law.
(h) The authority may issue revenue bonds to pay for the
costs of feasibility studies for proposed projects of the
authority, including engineering, planning and design, and
environmental studies. The authority may include in any revenue
bond issue the funds to operate and maintain, for a period not to
exceed two years after completion, the facilities acquired or
constructed through the revenue bond issue.
(i) If bonds issued by the authority recite that they are
secured by a pledge of payments under a contract, a copy of the
contract and the proceedings relating to the contract may be
submitted to the attorney general along with the bonds. If the
attorney general finds that the bonds have been authorized and the
contract has been made and entered into in accordance with law, the
attorney general shall approve the bonds and the contract, and
after the approval, the bonds and the contract are incontestable in
any court or other forum for any reason and are valid and binding in
accordance with their terms and provisions for all purposes.
(j) The provisions of Chapters 618, 1201, 1204, 1207, and
1371, Government Code, are applicable to bonds issued by the
authority.
(k) This section is wholly sufficient authority for the
issuance of bonds, the execution of contracts, and the performance
of other acts and procedures authorized by this section by the
authority and all persons, including public agencies, without
reference to any other provision of law or any restriction or
limitation contained in those provisions, except as specifically
provided by this section. To the extent of any conflict or
inconsistency between this section and any other law, including any
charter of a home-rule municipality, this section shall prevail and
control. The authority and all persons, including public agencies,
may use any law not in conflict with this section to the extent
convenient or necessary to carry out any power or authority,
expressed or implied, granted by this section.
Sec. 221.013. DISPOSITION OF PROPERTY. (a) Nothing in
this chapter shall be construed as authorizing the authority, and
it is not authorized, to mortgage or otherwise encumber any of its
property of any kind, real, personal, or mixed, or any interest in
property, or to acquire any property or interest subject to a
mortgage or conditional sale; provided, however, that this section
shall not be construed as preventing the pledging of the revenues of
the authority as provided by this chapter.
(b) Nothing in this chapter shall be construed as
authorizing the sale, release, or other disposition of property of
any kind, real, personal, or mixed, or any interest in property, by
the authority or through any court proceedings or otherwise;
provided, however, that the authority may sell for cash any
property or interest if the board by affirmative vote of 11 of its
members determines that the property or interest is not necessary
to the business of the authority and approves the terms of the sale.
Except by sale as expressly authorized by this section, authority
property or interest may not come into the ownership or control,
directly or indirectly, of any person, firm, or corporation other
than a public authority created under the laws of the state.
(c) All authority property is exempt from forced sale, and
nothing in this chapter authorizes the sale of any of the property
of the authority under a judgment rendered in a suit, and a sale of
that kind is prohibited.
(d) Notwithstanding any restrictions or provisions in this
section or in this chapter, the authority, acting by a majority vote
of the board, may construct or purchase, from any person, firm, or
corporation (referred to in this subsection as "customer") with
which the authority has contracted to sell hydroelectric power,
transmission lines and other property used or to be used by the
customer for the transmission of or in connection with power
purchased or to be purchased from the authority. The authority may
lease all or any portion of that property to the customer for all or
a portion of the time during the term of the hydroelectric power
purchase contract. The lease may contain provisions that are valid
and enforceable giving the lessee the right to purchase from the
authority all or any portion of the property at or within the time
specified in the lease and for a price and on terms and conditions
specified in the lease; provided, however, that the price may not be
less than the depreciated value, determined in the manner
prescribed in the lease, plus one percent of the original cost of
the property.
Sec. 221.014. ACQUISITION OF PROPERTY; EMINENT DOMAIN.
(a) The authority may acquire by purchase, lease, or gift or in any
other manner and may maintain, use, and operate property of any
kind, real, personal, or mixed, or any interest in property, within
or outside the boundaries of the authority, necessary or convenient
to the exercise of the powers, rights, privileges, and functions
conferred on the authority by this chapter.
(b) The authority may acquire, by purchase, condemnation,
or otherwise, any property the board determines necessary to make
effectual and practicable the construction and operation of all
works, improvements, and services that are planned ultimately to be
provided by the authority to accomplish any of the purposes for
which the authority was created. The acquisition or condemnation
may be either of the fee simple title or of a lesser title or an
easement only, within the discretion of the board; provided,
however, that a person may not be deprived of any defense available
under the general law of eminent domain; and provided, further,
that the authority may not acquire or operate a steam generating
plant for the production and sale of electric energy and, except for
the purpose of acquiring the necessary area below or above the
anticipated high-water line of a reservoir, may not condemn any
property of a rural electrification cooperative or other
corporations engaged in the generation or sale of electric energy
to the public.
(c) The authority may exercise the power of eminent domain
for the purpose of acquiring by condemnation property of any kind,
real, personal, or mixed, or any interest in property, within or
outside the boundaries of the authority, other than property or an
interest in property outside the boundaries of the authority owned
by any body politic, that is necessary or convenient to the exercise
of the powers, rights, privileges, and functions conferred on the
authority by this chapter, in the manner provided by general law
with respect to condemnation or, at the option of the authority, in
the manner provided by statutes relative to condemnation by
districts organized under general law under Section 59, Article
XVI, Texas Constitution.
(d) In condemnation proceedings being prosecuted by the
authority, the authority is not required to give bond for appeal or
bond for cost.
(e) The authority may overflow and inundate any public lands
and public property and may require the relocation of roads and
highways in the manner and to the extent permitted to districts
organized under general law under Section 59, Article XVI, Texas
Constitution.
(f) If the authority, in the exercise of the power of
eminent domain or power of relocation or any other power granted
under this chapter, makes necessary the relocation, raising,
rerouting, changing the grade, or altering the construction of any
highway, railroad, electric transmission line, or pipeline, all
necessary relocation, raising, rerouting, changing of grade, or
alteration of construction shall be accomplished at the sole
expense of the authority.
Sec. 221.015. CONTRACTS, GRANTS, AND LOANS. (a) The board
may negotiate and contract with the federal government or with any
of its agencies for grants, loans, and advancements from the United
States for the furtherance of any purpose set forth in this chapter.
(b) The authority may receive and accept grants, loans, or
allotments from the United States and others for furtherance of any
of the purposes set forth in this chapter.
(c) An opinion from the attorney general as to whether a
grant, loan, or allotment has been received by the authority from
the United States or others shall be authority for the action of any
person charged with any duty contingent on such grant, loan, or
allotment.
Sec. 221.016. RULES. The board may make all necessary rules
for the government and control of the authority not inconsistent
with the constitution and laws of the state.
Sec. 221.017. USE OF BRAZOS RIVER AND TRIBUTARIES. In the
prosecution of the plans for which the authority has been created
for the storing, controlling, conserving, and distributing for
useful purposes of the storm waters, floodwaters, and
unappropriated flow waters of the Brazos River watershed and
developed groundwater from the Brazos River basin for the use of its
customers, the authority may use the bed and banks of the Brazos
River and its tributary streams for any and all purposes necessary
to the accomplishment of the plans of the authority.
Sec. 221.018. DEFAULT PROCEDURES. (a) A resolution
authorizing the issuance of bonds and any indenture or agreement
entered into under the resolution may include provisions regarding
a default on the:
(1) payment of the interest on any bonds as the
interest becomes due and payable;
(2) payment of the principal of any bonds as they
become due and payable, whether at maturity, by call for
redemption, or otherwise; or
(3) performance of an agreement made with the
purchasers or successive holders of any bonds.
(b) If a default described by Subsection (a) has occurred
and has continued for a period, if any, prescribed by the resolution
authorizing the issuance of the bonds, the trustee under an
indenture entered into with respect to the bonds authorized by the
resolution, or, if there is no indenture, a trustee appointed in the
manner provided in the resolution by the holders of 25 percent in
aggregate principal amount of the bonds authorized by the
resolution and then outstanding may, and on the written request of
the holders of 25 percent in aggregate principal amount of the bonds
authorized by the resolution and then outstanding shall, in the
trustee's own name but for the equal and proportionate benefit of
the holders of all the bonds, and with or without having possession
of the bonds:
(1) by mandamus or other suit, action, or proceeding
at law or in equity, enforce all rights of the bondholders;
(2) bring suit on the bonds or the appurtenant
coupons;
(3) by action or suit in equity, require the board to
act as if it were the trustee of an express trust for the
bondholders;
(4) by action or suit in equity, enjoin any acts or
things that may be unlawful or in violation of the rights of the
bondholders; or
(5) after such notice to the board as the resolution
may provide, declare the principal of all of the bonds due and
payable, and if all defaults have been made good, then with the
written consent of the holders of 25 percent in aggregate principal
amount of the bonds then outstanding, annul the declaration and its
consequences; provided, however, that the holders of more than a
majority in principal amount of the bonds authorized by the
resolution and then outstanding shall, by written instrument
delivered to the trustee, have the right to direct and control any
and all actions taken or to be taken by the trustee under this
section.
(c) A resolution, indenture, or agreement relating to bonds
may provide that in a suit, action, or proceeding under this
section, the trustee, whether or not all of the bonds have been
declared due and payable and with or without possession of any of
the bonds, is entitled as of right to the appointment of a receiver
who may enter and take possession of all or part of the properties
of the authority, operate and maintain the properties, and set,
collect, and receive rates and charges sufficient to provide
revenues adequate to pay the items specified in the resolution
authorizing bonds and the costs and disbursements of the suit,
action, or proceeding and apply that revenue in conformity with
this chapter and the resolution authorizing the bonds.
(d) In a suit, action, or proceeding by a trustee or
receiver, if any, under this section, counsel fees and expenses of
the trustee and of the receiver, if any, constitute taxable
disbursements, and all costs and disbursements allowed by the court
shall be a first charge on any revenue pledged to secure the payment
of the bonds.
(e) Subject to the provisions of the constitution, the
courts of McLennan County have jurisdiction of a suit, action, or
proceeding under this section by a trustee on behalf of the
bondholders and of all proceedings involved in the suit, action, or
proceeding.
(f) In addition to the powers specifically provided by this
section, the trustee has all powers necessary or appropriate for
the exercise of the powers specifically provided or incident to the
general representation of the bondholders in the enforcement of
their rights.
Sec. 221.019. LIMITED LIABILITY FOR AQUATIC HERBICIDE
APPLICATION. (a) In this section, "commercially licensed aquatic
herbicide applicator" means a person who holds a commercial
applicator license issued by the Department of Agriculture under
Chapter 76, Agriculture Code, that authorizes the application of
aquatic herbicides.
(b) Except as provided by Chapter 12, Parks and Wildlife
Code, an authority employee holding a noncommercial aquatic
herbicide applicator license or a commercially licensed aquatic
herbicide applicator working under contract with the authority is
not liable for damages in excess of $2 million for personal injury,
property damage, or death resulting from the application by the
applicator of aquatic herbicide in compliance with applicable law
and the terms of the license or permit.
CHAPTER 222. LOWER COLORADO RIVER AUTHORITY
Sec. 222.001. CREATION. (a) A conservation and
reclamation district to be known as the "Lower Colorado River
Authority" is created. The authority is a governmental agency and a
body politic and corporate.
(b) The authority is created under and is essential to
accomplish the purposes of Section 59, Article XVI, Texas
Constitution, including the control, storing, preservation, and
distribution of the waters of the Colorado River and its
tributaries within the boundaries of the authority for irrigation,
generation of electric energy and power, and other useful purposes;
the reclamation and irrigation of arid, semiarid, and other lands
needing irrigation; the development of parks on lands owned or
acquired by the authority; and the conservation and development of
the forests, water, and electric power in this state.
(c) Nothing in this chapter or in any other law shall be
construed as authorizing the authority to levy or collect taxes or
to create any indebtedness payable out of taxes or in any way to
pledge the credit of this state.
Sec. 222.002. DEFINITIONS. In this chapter:
(1) "Authority" means the Lower Colorado River
Authority.
(2) "Board" means the board of directors of the
authority.
(3) "Director" means a member of the board.
Sec. 222.003. TERRITORY. The authority consists of the
territory included within the boundaries of the counties of Blanco,
Burnet, Llano, Travis, Bastrop, Fayette, Colorado, Wharton, San
Saba, and Matagorda.
Sec. 222.004. POWERS AND DUTIES. (a) Except as expressly
limited by this chapter, the authority has all the powers, rights,
privileges, and functions conferred by general law on any district
or districts created under Section 59, Article XVI, Texas
Constitution.
(b) The authority may control, store, and preserve, within
the boundaries of the authority, the waters of the Colorado River
and its tributaries and the lands of the authority for any useful
purpose and may use, distribute, and sell those waters, within the
boundaries of the authority or within the boundaries of the
watershed that contributes inflow to the Colorado River below the
intersection of Coleman, Brown, and McCulloch counties, for any
such purpose.
(c) The authority may develop and generate water power and
electric energy within the boundaries of the authority and may
distribute and sell water power and electric energy, within or
outside the boundaries of the authority.
(d) Within the boundaries of the authority, the authority
may prevent or aid in the prevention of damage to person or property
from the waters of the Colorado River and its tributaries.
(e) Within the boundaries of the authority, the authority
may forest and reforest and aid in the foresting and reforesting of
the watershed area of the Colorado River and its tributaries, and
the authority may prevent and aid in the prevention of soil erosion
and floods within the watershed area.
(f) The authority may acquire by purchase, lease, or gift or
in any other manner provided by law and may maintain, use, and
operate property of any kind, real, personal, or mixed, or any
interest in property, within or outside the boundaries of the
authority that is necessary or convenient to the exercise of the
powers, rights, privileges, and functions conferred on the
authority by this chapter.
(g) The authority may acquire by condemnation property of
any kind, real, personal, or mixed, or any interest in property,
within or outside the boundaries of the authority, other than
property or an interest in property outside the boundaries of the
authority owned by a body politic, that is necessary or convenient
to the exercise of the powers, rights, privileges, and functions
conferred on the authority by this chapter. The authority shall
exercise the condemnation power in the manner provided by general
law with respect to condemnation or, at the option of the authority,
in the manner provided by state law relating to condemnation by
districts organized under general law under Section 59, Article
XVI, Texas Constitution.
(h) Subject to the provisions of this chapter, the authority
may sell or otherwise dispose of property of any kind, real,
personal, or mixed, or any interest in the property, that is not
necessary to the conduct of the business of the authority.
(i) The authority may overflow and inundate within the
boundaries of the authority any public lands and public property
and may require the relocation of roads, pipelines, transmission
lines, railroads, cemeteries, and highways in the manner and to the
extent permitted to districts organized under general law under
Section 59, Article XVI, Texas Constitution.
(j) The authority may construct, extend, improve, maintain,
and reconstruct, cause to be constructed, extended, improved,
maintained, and reconstructed, and use and operate facilities of
any kind necessary or convenient to the exercise of its powers,
rights, privileges, and functions.
(k) The authority may sue and be sued in its corporate name.
(l) The authority may adopt and use a corporate seal.
(m) The authority may make bylaws for the management and
regulation of its affairs.
(n) The authority may appoint officers, agents, and
employees, prescribe their duties, and set their compensation.
(o) The authority may make contracts and execute
instruments necessary or convenient to the exercise of the powers,
rights, privileges, and functions conferred on the authority by
this chapter or permitted by general law.
(p) The authority may borrow money for its corporate
purposes on notes or other written evidence of indebtedness for a
period not to exceed five years as may be authorized from time to
time by an affirmative vote of 12 members of the board and repay the
loans or indebtedness from the proceeds of bonds of the authority at
the next bond offering. The authority may borrow money and accept
grants from the United States, this state, or any corporation or
agency created or designated by the United States or this state and,
in connection with the loan or grant, may enter into an agreement
that the United States, this state, or the corporation or agency
requires. The authority may make and issue negotiable bonds for
money borrowed in the manner provided by Sections 222.013 and
222.014 or other general law. This chapter does not authorize the
issuance of any bonds, notes, or other evidences of indebtedness of
the authority except as specifically provided by this chapter or
other general law.
(q) The authority may provide for the study, correcting, and
control of both artificial and natural pollution, including
organic, inorganic, and thermal, of all groundwater or surface
water of the Colorado River and its tributaries within the
boundaries of the authority. The authority may adopt by ordinance
rules with regard to the pollution, both artificial and natural,
and possesses police power to enforce its rules. The authority may
provide a reasonable penalty for the violation of any rule. The
penalty is cumulative of any penalties fixed by the general law of
this state. A penalty under this subsection may not exceed the
limit for penalties provided by Section 49.004. An ordinance
enacted under this section may not be adopted in any county or
counties outside the existing boundaries of the authority.
(r) As a necessary aid to the conservation, control,
preservation, purification, and distribution of surface waters and
groundwater of the Colorado River and its tributaries within the
boundaries of the authority, the authority may construct, own,
operate, maintain, or otherwise provide sewage gathering,
treatment, and disposal services, including waste disposal
services, and may make contracts regarding those services with the
United States, this state, counties, municipalities, and others.
The authority shall charge the actual cost of those services.
(s) The authority may develop and manage parks,
recreational facilities, and natural science laboratories and may
promote the preservation of fish and wildlife within the boundaries
of the authority. The authority may negotiate contracts with any
county, municipality, municipal corporation, person, firm,
corporation, nonprofit organization, or state or federal agency for
the operation and maintenance of any such park, recreational
facility, or natural science laboratory. The preservation of fish
and wildlife shall be in accordance with the rules of the Parks and
Wildlife Commission. Notwithstanding any other provisions of this
chapter, the board may charge and collect reasonable entrance,
gate, or use fees for the development, management, and use of parks
and recreational facilities developed in whole or in part by the
authority.
(t) The authority may enter into agreements authorized by
Chapter 163, Utilities Code, to acquire, install, construct,
operate, enlarge and make additions to, and own and operate
electric power and energy generating facilities as provided by that
chapter, in joint ownership with others, either as cotenants or
under any other arrangements that are approved by a three-fourths
vote of the statutory membership of the board. In accordance with
and subject to the terms of the agreements, if any, the authority
may sell or otherwise dispose of any or all of its interest in the
jointly owned electric power and generating facilities. This
subsection does not apply to generating facilities or other
property wholly owned by the authority.
(u) The authority may do any and all other acts or things
necessary or convenient, including controlling the use of the
surface of a lake or island located in the lake developed by the
authority and levying a charge for the commercial use of the lake or
island, to the exercise of all powers, rights, privileges,
authority, or functions conferred on the authority by the
constitution, this chapter, or any law.
(v) The authority may enter into contracts with this state
through the Texas Building and Procurement Commission providing for
direct sale by the authority of electrical power to this state for
use in buildings or other facilities owned, leased, or rented by
this state in Travis County.
Sec. 222.005. LIMITATIONS OF AUTHORITY. (a) The authority
may not use for irrigation purposes any water under any permit or
permits acquired from any other company or person unless the use is
expressly authorized and granted to the authority by the commission
or its predecessor agency under authority of law. In considering
subsequent applications by the authority, the commission shall at
all times consider the needs of the people living within and on
lands lying within the watershed of the Colorado River and its
tributaries above the authority.
(b) Notwithstanding any rights or permits issued by the
commission or its predecessor agency that are held or acquired by
the authority, the impounding and use of the floodwaters of the
Colorado River or its tributaries for the generation of
hydroelectric power by the authority or anyone who may succeed to
the rights and privileges conferred on the authority by this
chapter are subject to the rights of a person, municipal
corporation, or body politic that, under legal grant of authority,
is impounding and putting to beneficial use the waters if the
person, municipal corporation, or body politic:
(1) has received a permit for the use from the
commission, or its predecessor agency; or
(2) is permitted by law to impound water for the
purposes described by this subsection.
(c) Nothing in this chapter shall be construed to require a
municipal corporation or body politic to surrender to the authority
any rights described by this section to which it may be legally
entitled.
(d) This chapter may not be construed to subject to
condemnation by the authority or any successor, or by anyone who may
succeed to the rights and privileges conferred on the authority by
this chapter, any waters:
(1) impounded or to be impounded within or outside the
authority under any law authorizing water to be impounded or under
any permits granted to a municipal corporation or body politic; or
(2) impounded or permitted to be impounded or used
outside the authority under permits legally granted to any person.
(e) Nothing in this chapter shall be construed as depriving
any person or municipality of the right, legally granted, to
impound the waters of the Colorado River or its tributaries for
authorized beneficial uses or as repealing any law granting those
rights to persons and municipalities.
(f) The rights of the authority to impound or use or sell the
waters of the Colorado River and its tributaries for the generation
of hydroelectric power are subordinate and inferior to the rights
of:
(1) municipalities situated within the boundaries of
the authority to build dams and impound floodwaters solely for
municipal purposes;
(2) municipalities and bodies politic within the
watershed of the Colorado River outside the authority to build dams
or impound floodwaters for municipal purposes; and
(3) bodies politic within the watershed of the
Colorado River to build dams and impound the floodwaters within the
watershed of the Colorado River and its tributaries for domestic
purposes inside and outside the boundaries of the authority.
(g) The title to any rights, properties, licenses,
franchises, or permits acquired by the authority shall be subject
to the limitations imposed by Subsection (f).
Sec. 222.006. BOARD OF DIRECTORS. (a) The powers, rights,
privileges, and functions of the authority shall be exercised by
the board. The board shall consist of 15 directors and shall
include at least one director from each of the counties named in
Section 222.003 except Travis County, which shall have two
directors. Three directors shall be appointed at large from the
counties served with electric power, other than the counties
included in Section 222.003.
(b) A director appointed at large may not serve for a period
of more than six consecutive years. A county other than a county
included in Section 222.003 may not be represented on the board for
more than six consecutive years. A county other than Travis County
may not have two directors for a period greater than six consecutive
years.
(c) All directors shall be appointed by the governor with
the advice and consent of the senate for staggered terms of six
years, with five members' terms expiring on February 1 of each
odd-numbered year.
(d) Each director must be a resident and freehold property
taxpayer of the county from which the director is appointed and must
have been a resident and taxpayer of that county for not less than
the two years preceding the director's appointment. Not more than
two directors may be residents of the same county.
(e) A person is not eligible for appointment as a director
if the person has, during the three years preceding the person's
appointment, been employed by an electric power and light company,
a telephone company, or any other utility company.
(f) At the expiration of the term of a director, a successor
shall be appointed by the governor with the advice and consent of
the senate. Each director shall hold office until the expiration of
the term for which the director was appointed and until a successor
has been appointed and has qualified, unless removed sooner as
provided by this section.
(g) A director may be removed by the governor for
inefficiency, neglect of duty, or misconduct in office after at
least 30 days' written notice of the charges against the director
and an opportunity to be heard in person or by counsel at a public
hearing.
(h) The governor shall appoint a person to fill a vacancy on
the board for the unexpired term.
(i) Each director shall qualify by taking the official oath
of office prescribed by the constitution or general laws of the
state.
(j) Each director is entitled to receive fees of office of
not more than $150 per day and reimbursement of actual expenses
incurred in accordance with Chapter 49. However, no director may be
paid per diem in excess of 150 days in any one calendar year.
(k) Eight directors constitute a quorum at any meeting and,
except as otherwise provided by this chapter or in the bylaws, all
action may be taken by the affirmative vote of a majority of the
directors present at any meeting, except that bonds, notes, or
other evidence of indebtedness are subject to the requirements of
Sections 222.004(p) and 222.013(f), and no amendment of the bylaws
shall be valid unless authorized or ratified by the affirmative
vote of at least eight directors, unless otherwise specifically
provided by this chapter.
(l) The board is a state board as contemplated by Section
30a, Article XVI, Texas Constitution.
Sec. 222.007. OFFICERS; GENERAL MANAGER; EMPLOYEES.
(a) The governor shall designate a director as the presiding
officer of the board to serve in that capacity at the pleasure of
the governor. The board shall elect one of their number as an
assistant presiding officer.
(b) The board shall select a secretary, who shall keep true
and complete records of all proceedings of the board. Until the
appointment of a secretary or in the event of the secretary's
absence or inability to act, the board shall select a secretary pro
tempore.
(c) The board shall select a general manager. The general
manager is the chief executive officer of the authority.
(d) The board shall select a treasurer, who may also hold
the office of secretary.
(e) The officers described in Subsections (b)-(d) have the
powers and duties, hold office for the term, and are subject to
removal in the manner as may be provided in the bylaws.
(f) The board shall set the compensation of the officers.
The board may appoint the officers described in Subsections
(b)-(d), agents, and employees, may set their compensation and term
of office and the method by which they may be removed, and may
delegate to them the power and duties it determines proper.
Sec. 222.008. DISBURSEMENT OF FUNDS; SURETY BONDS.
(a) The money of the authority may be disbursed only by checks,
drafts, orders, or other instruments signed by the persons
authorized by the bylaws or a resolution concurred in by no fewer
than a majority of all the directors.
(b) The general manager, the treasurer, and all other
officers, agents, and employees of the authority charged with the
collection, custody, or payment of any funds of the authority must
give bond conditioned on the faithful performance of their duties
and an accounting for all funds and property of the authority coming
into their hands.
(c) The bonds must be in a form and amount, and with a surety
company authorized to do business in this state, approved by the
board.
(d) The premiums on the bonds shall be paid by the authority
and charged as an operating expense.
Sec. 222.009. OFFICE; RECORDS. (a) The domicile of the
authority is in the city of Austin, Travis County, where the
authority shall maintain its principal office in the charge of the
general manager.
(b) The authority shall keep complete and accurate accounts
conforming to approved methods of bookkeeping.
(c) The accounts and all contracts, documents, and records
of the authority shall be kept at the principal office. The
accounts and contracts shall be open to public inspection at all
reasonable times.
(d) The board shall cause to be made and completed, within
90 days after the end of each fiscal year, an audit of the books of
account and financial records of the authority for that fiscal
year. The audit shall be made by an independent certified public
accountant or firm of certified public accountants.
(e) Copies of a written report of the audit certified by the
accountant or accountants must be placed and kept on file with the
commission, with the comptroller, and at the principal office of
the authority, and be open to public inspection at all reasonable
times.
Sec. 222.010. CONFLICT OF INTEREST. The provisions of
Chapter 171, Local Government Code, apply to conflicts of interest
in the award of authority contracts.
Sec. 222.011. RATES AND CHARGES. (a) The board shall
establish and collect rates and other charges for the sale or use of
water, water connections, power, electric energy, or other services
sold, furnished, or supplied by the authority. The fees and charges
must be reasonable and nondiscriminatory and sufficient to produce
revenues adequate to:
(1) pay all expenses necessary to the operation and
maintenance of the properties and facilities of the authority;
(2) pay the interest on and principal of all bonds
issued under this chapter as the interest and principal become due
and payable;
(3) pay the principal and interest on any legal debt
created by the authority;
(4) pay all sinking fund and reserve fund payments
agreed to be made with respect to bonds and payable out of those
revenues, as the payments become due and payable; and
(5) fulfill the terms of any agreements made with the
bondholders or with any person on their behalf.
(b) Out of the revenues that may be received in excess of
those required for the purposes specified in Subsection (a), the
board may:
(1) establish a reasonable depreciation and emergency
fund;
(2) retire, by purchase and cancellation or
redemption, bonds issued under this chapter; or
(3) apply the excess revenues to any corporate
purpose.
(c) The rates and charges of the authority may not be in
excess of what is necessary to fulfill the obligations imposed on
the authority by this chapter or other law. Nothing in this chapter
shall be construed as depriving this state of its power to regulate
and control fees or charges to be collected for the use of water,
water connections, power, electric energy, or other service;
provided, however, that this state pledges to and agrees with the
purchasers and successive holders of the bonds and other written
evidence of indebtedness issued under this chapter that this state
will not limit or alter the power vested in the authority to
establish and collect fees and charges that will produce revenues
sufficient to pay the items specified in Subsection (a), or in any
way impair the rights or remedies of creditors or bondholders, or of
any person on their behalf, until the bonds and other written
evidence of indebtedness, together with the interest on the bonds
or indebtedness and the interest on unpaid installments of interest
and all costs and expenses in connection with any action or
proceedings by or on behalf of the bondholders and all other
obligations of the authority in connection with the bonds are fully
met and discharged.
Sec. 222.012. PAYMENT OF DEBTS. Any indebtedness,
liability, or obligation of the authority for the payment of money,
however entered into or incurred and whether arising from contract,
implied contract, or otherwise, is payable solely:
(1) out of revenues received by the authority with
respect to its properties, subject to any prior lien on the revenues
conferred by any resolution or resolutions adopted as provided by
this chapter authorizing the issuance of bonds; or
(2) if the board so determines, out of the proceeds of
sale by the authority of bonds payable solely from those revenues.
Sec. 222.013. ISSUANCE OF BONDS. (a) The authority may
issue bonds from time to time and for any purpose authorized by this
chapter or other general law. If bonds of the authority are issued,
except as otherwise provided under general law, the bonds:
(1) when sold, shall be sold for cash at public sale to
the highest and best bidder, as determined by the board, and the
interest cost of the money received for the bonds shall be computed
to maturity in accordance with the method prescribed by the board in
connection with the sale of the bonds;
(2) may be issued, on terms determined by the board in
exchange for property of any kind, real, personal, or mixed, or any
interest in property that the board determines necessary or
convenient for any corporate purposes, provided that any property
acquired through the exchange of bonds is certified in writing
before the exchange as being of a value equal to or in excess of the
par value of the bonds by an independent appraisal that is to be
kept on file by the authority as a public record, with a copy filed
with the state auditor;
(3) may be issued in exchange for like principal
amounts of other obligations of the authority, matured or
unmatured; or
(4) may be sold to this state or any agency of this
state, the United States, or any agency or corporation created or
designated by this state or the United States in exchange for cash
equal in amount to the principal amount of the bonds sold and the
interest cost of the money received for the bonds, computed to
maturity in accordance with standard bond tables in general use by
banks and insurance companies, as determined by the board.
(b) The proceeds from the sale of the bonds shall be
deposited in one or more banks or trust companies and shall be paid
out under terms and conditions not in conflict with the provisions
of this chapter or other general law that are agreed on between the
authority and the purchasers of the bonds.
(c) The proceeds of the bonds and any net operating revenues
derived from the sale of electric power or water that may be
available after paying the interest on outstanding bonds and the
principal amount of the bonds and after setting aside sufficient
funds for working capital, including a reasonable amount for
contingencies, and setting aside funds for reserves to secure
payment of principal of and interest on outstanding bonds, shall be
used:
(1) to build and construct dams or other structures
within the authority, on the Colorado River and its tributaries,
for the impounding and storage of floodwater and surface water;
(2) to purchase and install in the dams on the Colorado
River hydroelectric generators and other related facilities for the
generation of hydroelectric power;
(3) for the construction of additional lines and the
purchase and installation of additional equipment the board
considers necessary or expedient to enable the authority to
continue to meet the demand for electric power in the areas within
the authority directly served by its transmission lines and
distribution systems on January 1, 1975, and other areas within the
service area served by the authority on January 1, 1975, that cannot
receive comparable service from any other power source and to
provide electric power to this state as provided by Section
222.004; provided, however, that no steam generating capacity shall
be installed by the authority, except that the authority may
acquire, install, construct, enlarge and make additions to, and
operate one or more steam generating plants, the sum of whose
aggregate capacity may not be more than 5,000 megawatts, to be
located within the boundaries of either one or more of Colorado,
Fayette, Bastrop, Travis, Blanco, Burnet, Llano, or San Saba
counties and to be utilized for the purpose of serving the area
directly served by the authority's transmission lines and
distribution systems on January 1, 1975, and to provide electric
power to this state as provided by Section 222.004;
(4) to own or acquire an interest in one or more steam
generating plants at any location within or outside the authority,
if the plant or plants are owned in conjunction with one or more
other utilities, public, private, or municipal, provided that an
interest owned or acquired by the authority shall be utilized for
the sole purpose of providing electric power and energy only in the
areas within the authority directly served by its transmission
lines and distribution systems as they existed on January 1, 1975;
(5) for the purpose of building dams, levees, or other
flood control structures between the city of Austin and the mouth of
the Colorado River that are considered necessary and desirable by
the board and for acquiring or installing facilities necessary to
supply water for irrigation and other useful purposes within the
counties composing the authority; and
(6) in aid of any soil conservation or soil
reclamation projects within the authority that the board determines
to be in the public interest.
(d) Nothing in this section shall be construed as
establishing priorities as to uses of water that are contrary to the
general laws of this state with reference to the water uses.
(e) Except as otherwise provided by general law, proceeds of
bonds sold by the authority, and any net operating revenues that the
board determines are not needed to carry out the projects set out in
Subsections (c)(1), (2), and (3), to the extent not required by an
outstanding trust indenture to be used to redeem outstanding bonds,
shall be placed in a general revenue fund of the authority. Dams
built on the Colorado River or on its tributaries shall be used for
the purpose of impounding and storing floodwaters and surface
waters.
(f) Bonds shall be authorized by resolution of the board
concurred in by at least 12 of the members.
(g) Bonds shall bear the date or dates, mature at the time or
times, bear interest at the rates, payable annually or
semiannually, be in the denominations, be in the form, either
coupon or registered, carry the registration privileges as to
principal only or as to both principal and interest and as to
exchange of coupon bonds for registered bonds or vice versa and
exchange of bonds of one denomination for bonds of other
denominations, be executed in the manner, and be payable at the
place or places within or outside this state that the resolution may
provide.
(h) A resolution authorizing bonds may contain provisions
that are part of the contract between the authority and the holder
of the bonds from time to time:
(1) reserving the right to redeem the bonds at the time
or times, in the amounts, and at the prices, not exceeding 105
percent of the principal amount of the bonds, plus accrued
interest, as may be provided;
(2) providing for the setting aside of interest and
sinking funds or reserve funds and the regulation and disposition
of those funds;
(3) pledging, to secure the payment of the principal
of and interest on the bonds and of the sinking fund or reserve fund
payments agreed to be made with respect to the bonds, all or any
part of the gross or net revenues received by the authority with
respect to the property, real, personal, or mixed, acquired or
constructed or to be acquired or constructed with the bonds or the
proceeds of the bonds, or all or any part of the gross or net
revenues previously or thereafter received by the authority from
any source;
(4) prescribing the purposes to which the bonds or any
bonds issued later are to be applied;
(5) agreeing to set and collect rates and charges
sufficient to produce revenues adequate to pay the items specified
in Section 222.011(a) and prescribing the use and disposition of
all revenues;
(6) prescribing limitations on the issuance of
additional bonds and on the agreements that may be made with the
purchasers and successive holders of the bonds;
(7) relating to the construction, extension,
improvement, reconstruction, operation, maintenance, and repair of
the properties of the authority and the carrying of insurance on all
or any part of the properties covering loss or damage or loss of use
and occupancy resulting from specified risks;
(8) setting the procedure, if any, by which, if the
authority so desires, the terms of a contract with the bondholders
may be amended or abrogated, the amount of bonds whose holders must
consent to that amendment or abrogation, and the manner in which the
consent may be given;
(9) providing for the execution and delivery by the
authority, to a bank or trust company authorized by law to accept
trusts, of indentures and agreements for the benefit of the
bondholders setting forth all of the agreements authorized by this
chapter to be made with or for the benefit of the bondholders and
other provisions that are customary in those kinds of indentures or
agreements; and
(10) making other provisions, not inconsistent with
this chapter or other general law, that the board approves,
provided that an agreement, contract, or commitment may not be made
that, under any contingency, could or would result in the United
States government or any of its agencies or bureaus claiming the
right or privilege of controlling or managing the properties and
facilities of the authority or the control or disposition of the
water of the Colorado River or its tributaries; provided, however,
that nothing in this chapter shall be construed as limiting or
restricting the rights or powers as set out in Section 222.014 in
the event of a default on the part of the authority; and provided
further that nothing in this chapter is intended to prohibit
compliance with existing federal regulations, if compliance with
those regulations is done on the advice and approval of the attorney
general.
Sec. 222.014. DEFAULT PROCEDURES. (a) A resolution
authorizing the issuance of bonds and any indenture or agreement
entered into under the resolution may include provisions regarding
a default on:
(1) the payment of the interest on the bonds as the
interest becomes due and payable;
(2) the payment of the principal of the bonds as they
become due and payable, whether at maturity, by call for
redemption, or otherwise; or
(3) the performance of an agreement made with the
purchasers or successive holders of any bonds.
(b) If a default described by Subsection (a) has occurred
and has continued for a period, if any, prescribed by the resolution
authorizing the issuance of the bonds, the trustee under an
indenture entered into with respect to the bonds authorized by the
resolution, or, if there is no indenture, a trustee appointed in the
manner provided in the resolution by the holders of 25 percent in
aggregate principal amount of the bonds authorized by the
resolution and then outstanding, shall, in the trustee's own name
but for the equal and proportionate benefit of all of the
bondholders, and with or without having possession of the bonds:
(1) by mandamus or other suit, action, or proceeding
at law or in equity, enforce all rights of the bondholders,
including the requirements of Section 222.011;
(2) bring suit on the bonds or the appurtenant
coupons;
(3) by action or suit in equity, require the authority
to act as if it were the trustee of an express trust for the
bondholders;
(4) by action or suit in equity, enjoin any acts or
things that may be unlawful or in violation of the rights of the
bondholders; or
(5) after such notice to the authority as the
resolution may provide, declare the principal of all of the bonds
due and payable, and if all defaults have been made good, then with
the written consent of the holders of 25 percent in aggregate
principal amount of the bonds then outstanding, annul the
declaration and its consequences; provided, however, that the
holders of more than a majority in principal amount of the bonds
authorized by the resolution and then outstanding shall, by written
instrument delivered to the trustee, have the right to direct and
control any and all action taken or to be taken by the trustee under
this section.
(c) A resolution, indenture, or agreement relating to bonds
may provide that in a suit, action, or proceeding under this
section, the trustee, whether or not all of the bonds have been
declared due and payable and with or without possession of any of
the bonds, is entitled as of right to the appointment of a receiver
who may enter and take possession of all or any part of the
properties of the authority, operate and maintain the properties,
and set, collect, and receive rates and charges sufficient to
provide revenues adequate to pay the items set forth in Section
222.011(a) and the costs and disbursements of the suit, action, or
proceeding and apply the revenues in conformity with this chapter
and the resolution authorizing the bonds.
(d) In a suit, action, or proceeding by a trustee under this
section, the reasonable fees, counsel fees, and expenses of the
trustee or the receiver, if any, constitute taxable disbursements,
and all costs and disbursements allowed by the court shall be a
first charge on any revenues pledged to secure the payment of the
bonds.
(e) Subject to the provisions of the constitution, the
courts of Travis County have jurisdiction of a suit, action, or
proceeding under this section by a trustee on behalf of the
bondholders and of all property involved in the suit, action, or
proceeding.
(f) In addition to the powers specifically provided by this
section, the trustee has all powers necessary or appropriate for
the exercise of the powers specifically provided or incident to the
general representation of the bondholders in the enforcement of
their rights.
Sec. 222.015. AUDIT. The authority is subject to the audit
provisions of Subchapter G, Chapter 49.
Sec. 222.016. AUTHORITY AS CONSERVATION AND RECLAMATION
DISTRICT. (a) The authority shall manage and use its facilities,
the water impounded by its dams on the Colorado River or its
tributaries, and any available net operating revenues to
accomplish, to the extent possible, the purposes included in
Section 59(a), Article XVI, Texas Constitution, that are enumerated
in the provisions of this chapter or other general law, and the
authority shall market electric power that, in the opinion of the
board, will not be immediately needed by the authority, under
contracts and on conditions that will best enable the authority to
pay its operating expenses, meet its outstanding financial
obligations as they mature, supply the increasing demand for
electric power in the area dependent on its systems for electric
service on April 28, 1975, and assure, to the extent possible, an
adequate supply of water for irrigation and other useful purposes,
as it is needed in the various counties comprising the authority.
(b) When bonds are to be issued to finance in whole or in
part water-impounding facilities, before approving the bonds the
attorney general shall be furnished a resolution from the
commission or its successor agency certifying that the authority
possesses the necessary water right authorizing it to impound or
otherwise appropriate the waters to be utilized by the project.
Sec. 222.017. BONDS AS NEGOTIABLE INSTRUMENTS. Bonds
issued by the authority under this chapter or other general law are
negotiable instruments under the laws of this state.
Sec. 222.018. ADDITIONAL POWERS RELATING TO CONTRACTS,
RULES, AND REGULATIONS. The authority may, but without intending
by this provision to limit any powers of the authority as granted to
it by this chapter or other general law, enter into and carry out
contracts or establish or comply with rules and regulations
concerning labor and materials and other related matters in
connection with any project or projects as the authority considers
desirable or as requested by the United States, this state, or any
corporation or agency created, designated, or established by the
United States or this state that may assist in the financing of the
project or projects.
Sec. 222.019. PURCHASE OF BONDS. The authority may, out of
any funds available for the purpose, purchase bonds issued by it at
a price not exceeding the redemption price applicable at the time of
the purchase, or if the bonds are not redeemable, at a price not
exceeding the principal amount of the bonds plus accrued interest.
All bonds purchased in this manner shall be canceled.
Sec. 222.020. DISPOSITION OF PROPERTY. (a) Nothing in
this chapter shall be construed as authorizing the authority, and
the authority is not authorized, to mortgage or otherwise encumber
any of its property of any kind, real, personal, or mixed, or any
interest in such property, or to acquire any property or interest
subject to a mortgage or conditional sale, provided that this
section may not be construed as preventing the pledging of the
revenues of the authority as authorized by this chapter.
(b) Nothing in this chapter shall be construed as
authorizing the sale of any property or interest by the authority or
by any receiver of any of its properties or through any court
proceeding or otherwise, unless, by the affirmative vote of
three-fourths of its statutory membership, the board has determined
that the property or interest is not necessary or convenient or of
beneficial use to the business of the authority and has approved the
terms of the sale. Except by sale as expressly authorized in this
section, authority property or interest may not come into the
ownership or control, directly or indirectly, of any person, firm,
or corporation other than a public authority created under the laws
of this state or a nonprofit corporation created by the authority
under Chapter 152.
(c) The limitations on the sale of property of the authority
in this section do not and are not intended to preclude the
authority from selling any interest owned or held by the authority
in any jointly owned electric power and generating facilities
constructed, or to be constructed, under Section 222.004(t),
provided that the sale of an ownership interest in a joint project
is provided for and in conformance with any contract with other
owners regarding the electric power and energy generating
facilities.
(d) All authority property is exempt from forced sale, and
nothing in this chapter shall be construed to authorize the sale of
any of the property of the authority under a judgment rendered in a
suit, and a sale of that kind is prohibited.
Sec. 222.021. PROPERTY AGREEMENTS WITH CITY OF AUSTIN.
Nothing in this chapter prohibits the authority from owning
property in conjunction with, acquiring property from, or selling
property to the City of Austin, on terms and conditions to which the
authority and the city agree. The authority may acquire property
from the City of Austin subject to repurchase agreements, or other
terms and conditions as are agreed on between the authority and the
city, and may enter into any contractual relations with the city
respecting property that the parties agree on.
Sec. 222.022. PROPERTY USEFUL IN THE PRODUCTION OR
UTILIZATION OF ELECTRIC ENERGY. This chapter does not prohibit or
restrict the sale, lease, or other disposition, to an electric
cooperative, municipality, nonprofit corporation created by the
authority under Chapter 152, or other governmental agency or body
politic and corporate of this state, of any property acquired or
constructed by the authority and incidental to or used or useful in
the generation, production, transmission, distribution, or sale of
electric energy. The authority may pledge the proceeds of a sale
under this section to the same extent and in the same manner in
which it is authorized to pledge its revenues.
Sec. 222.023. PUBLIC ACCESS. (a) The authority may not
prevent the public use of its lands for recreational purposes and
fishing except at such points where, in the opinion of the board,
the use would interfere with the proper conduct of the business of
the authority or would interfere with the lawful use of the
property. A lease of authority lands, except one expressly
permitted by Section 222.022, is not lawful unless it provides for
free public use of the lands for recreational purposes and fishing.
(b) All public rights-of-way traversing the areas flooded
or to be flooded by the impounded waters shall remain open as a way
of free public passage to and from the lakes created, and a charge
may not be made to the public for the right to engage in fishing or
boating on or swimming in those lakes.
(c) If any citizen of this state or of the United States
advises the attorney general that this section has not been
complied with, the attorney general may, after investigation of the
complaint and notice to the authority, institute the proper legal
proceedings, if any are required, to require the authority or its
successor to comply with this section.
(d) If any of the authority's land bordering the lakes to be
created under this chapter is sold by the authority, the authority
shall retain in each tract a strip 20 feet wide abutting the
high-water line of the lake for the purpose of passage and use by
the public for public sports and amusements; provided, however,
that this subsection does not apply to any sales of land by the
authority to any state or federal agency to be used for game or fish
sanctuaries or preserves or for game or fish propagation purposes.
Sec. 222.024. BONDS EXEMPT FROM TAXATION. All bonds and
interest on the bonds issued under the provisions of this chapter
are exempt from taxation, except inheritance taxes, by this state
or by any municipal corporation, county, or other political
subdivision or taxing district of this state.
Sec. 222.025. SOURCE OF AUTHORITY. (a) This chapter,
without reference to other statutory provisions, constitutes full
authority for the authorization and issuance of bonds under this
chapter, and no other act or law regarding the authorization or
issuance of obligations or the deposit of the proceeds of
obligations, or in any way impeding or restricting the carrying out
of the acts authorized by this chapter shall be construed as
applying a limitation to any proceedings taken under or acts done
under this chapter.
(b) Nothing in this chapter shall prevent the authority from
issuing bonds under any applicable general law of this state,
provided, however, that no bonds are issued that would be in
conflict with Section 222.024.
Sec. 222.026. BONDS AS INVESTMENTS AND SECURITY FOR
DEPOSITS. (a) All authority bonds are legal and authorized
investments for individuals, partnerships, profit and nonprofit
corporations, banks, savings banks, trust companies, building and
loan associations, savings and loan associations, insurance
companies, fiduciaries, trustees, and guardians and for the sinking
funds of municipalities, counties, school districts, or other
political corporations or subdivisions of this state.
(b) The bonds are eligible to secure the deposit of all
public funds of this state and any public funds of municipalities,
counties, school districts, or other political corporations or
subdivisions of this state and are lawful and sufficient security
for those deposits to the extent of their par value when accompanied
by all unmatured coupons.
Sec. 222.027. CONSTRUCTION. (a) This chapter and all of
its terms and provisions shall be liberally construed to carry out
the purposes set forth in this chapter.
(b) Nothing in this chapter affects the meaning of Section
222.011, formerly Section 9, Chapter 74, Acts of the 64th
Legislature, Regular Session, 1975, as it existed prior to the
adoption of this chapter, except where specifically amended.
Sec. 222.028. AUTHORITY POWERS IN LAMPASAS COUNTY.
Notwithstanding any other provision of this chapter, the authority
may exercise all powers within Lampasas County that it may
otherwise exercise within the 10 counties specified in Section
222.003, except that the authority may not provide water or
wastewater services in the portion of Lampasas County outside the
Colorado River watershed without the consent of the Brazos River
Authority.
Sec. 222.029. ADDITIONAL SPECIFIC POWERS. (a) Notwithstanding
any other provision of this chapter, the authority:
(1) may purchase, construct, acquire, own, operate,
repair, improve, or extend any facility necessary or convenient to
provide water services in Williamson County in cooperation with
another special district, a municipality, or another governmental
entity;
(2) may not provide water services in the watershed of
the Brazos River unless the authority obtains in writing the
consent of the Brazos River Authority before the services are
provided; and
(3) may transfer surface water from the authority to a
place in Williamson County that is outside the watershed of the
Colorado River only if the transfer is made to:
(A) a municipality that was a water customer of
the authority on May 20, 1997, and located in the watersheds of both
the Colorado River and the Brazos River; or
(B) a person or entity that pays for the surface
water in an amount sufficient to pay both the authority's
applicable water rate and an additional charge to pay the costs of
mitigating any adverse effects of the transfer of surface water to
Williamson County from the Colorado River watershed, and provided
the transfer results in no net loss of water to the Colorado River
watershed as determined by the board.
(b) Notwithstanding the amounts of surface water
transferred by the authority to municipalities in accordance with
Subsection (a)(3)(A), the volume of surface water authorized for
transfer by the authority in accordance with Subsection (a)(3)(B)
may not exceed 25,000 acre-feet per year, it being the intent of the
legislature that the authority not be the sole provider of surface
water to Williamson County.
(c) The authority shall determine the amount of the
additional charge under Subsection (a)(3)(B). The additional
charge may not be less than 10 percent of the authority's applicable
rate for surface water to be transferred. The authority shall
deposit any money the authority receives from the additional
charge, and may deposit any other money as the board determines,
into a separate fund designated as the agricultural water
conservation fund. The authority may use money from the
agricultural water conservation fund only for the development of
water resources or other water use strategies to replace or offset
the amount of surface water to be transferred to Williamson County,
including the development and implementation of methods, programs,
and strategies relating to groundwater resources, reuse,
conservation, and other opportunities to reduce the reliance on
surface water for agricultural irrigation, provided that the
methods, programs, and strategies take into consideration the
surface water and groundwater needs of the affected Colorado River
basin users.
(d) Before its determination of the use of money from the
agricultural water conservation fund, the authority shall consult
with an advisory committee representing agricultural irrigation
interests that is appointed by the county judges of Matagorda,
Wharton, and Colorado counties. The board's determination of the
additional charge is not subject to review or modification by any
regulatory agency or independent reviewing authority. Water
resources developed or conserved through the additional charge may
be acquired from any source inside or outside the boundaries of the
authority and shall be used to benefit the water service areas of
the authority's irrigation operations.
Sec. 222.030. PROVISION OF WATER TO MUNICIPALITY OUTSIDE
COLORADO RIVER BASIN. (a) This section applies notwithstanding
any other provision of this chapter or other law.
(b) In this section and Section 222.031:
(1) "Municipality" includes a municipally owned
utility.
(2) "Water service area" means the area in which the
authority is authorized to use, distribute, and sell water on
January 1, 2001.
(c) Subject to the limitations and restrictions in this
section, the authority may enter into a written contract with a
municipality located outside the water service area to distribute
and sell water to the municipality.
(d) In addition to the authority's applicable water rate,
the authority shall charge a municipality a surcharge determined by
the board according to the terms of the contract to enable the
authority to develop and manage water resources sufficient to
address the projected needs of the authority's water service area
and the needs of the municipality to the extent agreed in the
contract. The contract must provide that the surcharge be
sufficient to allow the authority to recover all capital
construction costs incurred by the authority under this section.
The board's determination of the surcharge is not subject to review
or modification by any regulatory agency or administrative
authority.
(e) The use or reservation of water under a contract
authorized by this section may extend for a base period of not more
than 50 years. A contract may provide an option to renew for not
more than an additional 30 years. An option to renew must require
that the municipality progressively reduce the amount of water
reserved or used by the municipality during the last 10 years of the
renewal term and require that the rate paid by the municipality
immediately increase by a factor of five if the municipality does
not make the required reduction. A contract must provide that the
municipality is not entitled to further reservation, use, or
delivery of water from the authority at the conclusion of the
contract.
(f) A contract authorized by this section must require that
the then current rate paid by the municipality immediately increase
by a factor of five if:
(1) the municipality initiates legal proceedings in a
court or regulatory agency to obtain:
(A) an increase in the amount of surface water
taken by the municipality under this section; or
(B) an extension of either the base or renewal
periods under Subsection (e); or
(2) the authority is compelled by any authority to
reserve, sell, or make available to the municipality more than
150,000 acre-feet of water per year or to reserve, sell, or make
available to the municipality water beyond the base and renewal
periods under Subsection (e).
(g) The contract must provide that within the water service
area the authority must own any personal property, fixtures, or
appurtenances that are used for making available, diverting, or
delivering water to a municipality under a contract authorized by
this section.
(h) Water to be provided under a contract authorized by this
section may not be diverted from the Colorado River at diversion
points located on the reservoirs that, on May 16, 2001, are owned
and operated by the authority upstream of Mansfield Dam. Water to
be provided under a contract authorized by this section may be
diverted only from off-channel reservoirs built downstream of
Mansfield Dam after May 16, 2001.
(i) The authority may not provide water to a municipality
under a contract authorized by this section unless the authority
demonstrates, through its water management plan, to the commission
that the authority will operate its water supply system in
conjunction with the water resources management efforts
contemplated by the contract to:
(1) increase the average lake levels of Lake Buchanan
and Lake Travis by at least 6 feet and 18 feet, respectively, above
the average lake levels of those lakes during times when those lakes
would have been operating at less than 90 percent of conservation
capacity without those efforts; and
(2) increase the average lake levels of Lake Buchanan
and Lake Travis during a repeat of the drought of record at least 10
feet and 20 feet, respectively, above the average lake levels of
those lakes during a repeat of the drought of record without those
efforts.
(j) As a requirement of the authority's water management
plan, the authority shall submit annually to the commission data
and a report demonstrating that the authority has operated its
water supply system in accordance with the provisions of this
section. The data shall include a tabulation that compares actual
recorded lake levels with lake levels that would have occurred
without the water resources management efforts contemplated by a
contract authorized by this section. The commission shall review
the data and report submitted by the authority and shall certify, in
writing made available to the public, whether the authority has
complied with the provisions of this section.
(k) The authority may sell no more than a total of 150,000
acre-feet of water in any year under contracts authorized by this
section.
(l) This section does not authorize:
(1) the authority to pump water to the municipality
directly from the Colorado River;
(2) the authority to sell its surface water rights to
any person or entity for use outside the water service area; or
(3) a sale or lease of water other than as specifically
authorized by this section.
(m) The authority may not sell groundwater to a municipality
under this section.
(n) The authority may not contract to distribute or sell
water under this section unless the board finds, after providing an
opportunity for public input, that the contract:
(1) will protect and benefit the lower Colorado River
watershed and the authority's water service area, including
municipal, industrial, agricultural, recreational, and
environmental interests;
(2) is consistent with regional water plans filed with
the Texas Water Development Board on or before January 5, 2001;
(3) will ensure that the beneficial inflows remaining
after any water diversions will be adequate to maintain the
ecological health and productivity of the Matagorda Bay system;
(4) will provide for instream flows no less protective
than those included in the authority's Water Management Plan for
the Lower Colorado River Basin, as approved by the commission;
(5) will ensure that, before any water is delivered
under the contract, the municipality has prepared a drought
contingency plan and has developed and implemented a water
conservation plan that will result in the highest practicable
levels of water conservation and efficiency achievable within the
jurisdiction of the municipality;
(6) provides for a broad public and scientific review
process designed to ensure that all information that can be
practicably developed is considered in establishing beneficial
inflow and instream flow provisions; and
(7) will benefit stored water levels in the
authority's existing reservoirs.
(o) A municipality that buys water from the authority under
a contract authorized by this section may not resell that water
outside the boundaries of the regional water planning area in which
the municipality is located, as those boundaries are designated by
the Texas Water Development Board as of January 5, 2001.
(p) Nothing in this section shall exempt the authority or
any municipality from the permitting requirements of state and
federal law.
Sec. 222.031. AUTHORITY OF MUNICIPALITY TO CONTRACT FOR
WATER. Section 222.030 constitutes full authority for a
municipality or municipally owned utility to enter into a contract
with the authority under that section. The payments made under a
contract authorized by that section are operation and maintenance
expenses of the municipality's utility system. A municipality or
municipally owned utility that enters into a contract under that
section may use proceeds from the sale of its revenue bonds to make
any such payments.
SECTION 2. (a) The following laws relating to the Brazos
River Authority are repealed:
(1) Chapter 13, Special Laws, Acts of the 41st
Legislature, 2nd Called Session, 1929;
(2) Chapter 3, Acts of the 43rd Legislature, 4th
Called Session, 1934;
(3) Sections 6 and 7, Chapter 19, General Laws, Acts of
the 44th Legislature, Regular Session, 1935; and
(4) Chapter 368, Acts of the 44th Legislature, 1st
Called Session, 1935.
(b) The following laws relating to the Lower Colorado River
Authority are repealed:
(1) Chapter 7, Acts of the 43rd Legislature, 4th
Called Session, 1934; and
(2) Section 2, Chapter 132, Acts of the 77th
Legislature, Regular Session, 2001.
(c) This Act does not:
(1) limit the powers granted to the Brazos River
Authority or the Lower Colorado River Authority by any other law; or
(2) impliedly repeal any laws granting powers to the
Brazos River Authority or the Lower Colorado River Authority.
SECTION 3. As soon as practicable on or after the effective
date of this Act, the governor shall designate from the members of
each board the presiding officers of the Brazos River Authority and
the Lower Colorado River Authority. The governor may designate as
the presiding officer of a board the person serving in that capacity
immediately before the effective date of this Act. A person serving
as the presiding officer of a board immediately before the
effective date of this Act shall continue to serve in that capacity
until the person's successor has been designated.
SECTION 4. This Act takes effect September 1, 2003.
______________________________ ______________________________
President of the Senate Speaker of the House
I hereby certify that S.B. No. 1935 passed the Senate on
May 14, 2003, by a viva-voce vote.
______________________________
Secretary of the Senate
I hereby certify that S.B. No. 1935 passed the House on
May 28, 2003, by a non-record vote.
______________________________
Chief Clerk of the House
Approved:
______________________________
Date
______________________________
Governor