Amend CSHB 2876 by adding the following appropriately 
numbered SECTIONS to read as follows and renumbering subsequent 
SECTIONS accordingly:
	SECTION __.  Section 13.182, Water Code, is amended by 
adding Subsection (e) to read as follows:
	(e)  Except as provided by Section 13.4133, a utility may not 
implement a rate change concerning which a hearing is set under 
Section 13.187 until the date on which the regulatory authority 
issues a final decision on the change.
	SECTION __.  Section 13.187, Water Code, is amended by 
amending Subsections (a), (c), (d), (e), (f), (k), (l), (m), (n), 
and (o) and adding Subsections (e-1), (n-1), and (n-2) to read as 
follows:
	(a)  A utility may not make changes in its rates except by 
delivering a statement of intent to each ratepayer and with the 
regulatory authority having original jurisdiction at least 120 [60] 
days before the proposed effective date of the proposed change.  The 
proposed effective date of the new rates must be the first day of a 
billing period, and the new rates may not apply to service received 
before the proposed effective date of the new rates.  The statement 
of intent must include:
		(1)  the information required by the regulatory 
authority's rules;          
		(2)  a billing comparison regarding the existing water 
rate and the new water rate computed for the use of:
			(A)  3,000 gallons of water;                                          
			(B)  5,000 gallons of water;                                          
			(C)  10,000 gallons of water; and                                     
			(D) [(B)]  30,000 gallons of water; and              
		(3)  a billing comparison regarding the existing sewer 
rate and the new sewer rate computed for the use of 5,000 gallons 
and 10,000 gallons, unless the utility proposes a flat rate for 
sewer services; and
		(4)  the proposed effective date and the deadline by 
which customers must file any protests of the proposed rates, 
provided that the protest period concludes 90 days after the 
statement of intent is provided to the ratepayers.
	(c)  When the statement of intent is delivered, the utility 
shall file with the regulatory authority an application to change 
rates.  The application must include information the regulatory 
authority requires by rule.  If the utility fails to provide within 
a reasonable time after the application is filed the necessary 
documentation or other evidence that supports the costs and 
expenses that are shown in the application, the regulatory 
authority may disallow the nonsupported costs or expenses.
	(d)  If the application or the statement of intent is not 
substantially complete or does not comply with the regulatory 
authority's rules, it may be rejected and the proposed effective 
date of the rate change may be suspended until a properly completed 
application is accepted by the regulatory authority and a proper 
statement of intent is provided.  The commission may also suspend 
the proposed effective date of any rate change if the utility does 
not have a certificate of public convenience and necessity or a 
completed application for a certificate or to transfer a 
certificate pending before the commission or if the utility is 
delinquent in paying the assessment and any applicable penalties or 
interest required by Section 5.701(n) [of this code].
	(e)  The regulatory authority shall set a hearing on the 
proposed rate increase if [If], before the 91st day after the 
[effective] date the statement of intent was provided to the 
authority and each ratepayer under Subsection (a) [of the rate 
change], the regulatory authority receives a complaint from any 
affected municipality, or from the lesser of 1,000 or 10 percent of 
the ratepayers of the utility over whose rates the regulatory 
authority has original jurisdiction.  A hearing under this 
subsection must be set not later than the 120th day after the date 
the statement of intent was provided.  The[, the] regulatory 
authority must provide notice to the utility and any affected 
municipality that a hearing is being set on the proposed rate 
increase [shall set the matter for hearing].
	(e-1)  If the regulatory authority receives a complaint from 
any affected municipality, or from the lesser of 1,000 or 10 percent 
of the ratepayers of the utility over whose rates the regulatory 
authority has original jurisdiction, the regulatory authority 
shall, not later than the 120th day after the date the utility files 
with the regulatory authority an application to change rates and 
delivers a statement of intent to each ratepayer, hold a public 
meeting to receive public comments on the proposed rate change.  The 
regulatory authority may hold the public meeting in any location 
the regulatory authority determines is appropriate.  The regulatory 
authority may require the utility to publish notice of the public 
meeting at least once in the newspaper of largest circulation in 
each county in which affected ratepayers are located.  The notice 
must state:
		(1)  the time, location, and nature of the public 
meeting; and       
		(2)  a description, including a telephone number, of 
the manner in which a person may contact the regulatory authority 
for further information.
	(f)  The regulatory authority may set the matter for hearing 
on its own motion at any time within 120 days after the [effective] 
date the statement of intent was provided to the authority and each 
ratepayer under Subsection (a) [of the rate change].  If more than 
half of the ratepayers of the utility receive service in a county 
with a population of more than 2.5 million, the hearing must be held 
at a location in that county.
	(k)  If the regulatory authority sets the matter for
[receives at least the number of complaints from ratepayers 
required for the regulatory authority to set] a hearing under 
Subsection (e), the regulatory authority shall:
		(1)  [may,] pending the hearing and a decision, suspend 
the date the rate change would otherwise be effective until the date 
the regulatory authority issues a final decision on the matter; and
		(2)  fix interim rates as provided by Subsection (l).  
[The proposed rate may not be suspended for longer than:
		[(1)  90 days by a local regulatory authority; or            
		[(2)  150 days by the commission.]                           
	(l)  If the regulatory authority sets the matter for a 
hearing, the regulatory authority shall, not later than the 120th 
day after the date the statement of intent is filed, [At any time 
during the pendency of the rate proceeding the regulatory authority 
may] fix interim rates to remain in effect until a final 
determination is made on the proposed rate.  The interim rates shall 
be based on the information contained in the rate change 
application and may not be lower than the rates on the utility's 
approved tariff immediately before filing the notice of intent to 
change the rates.  If the regulatory authority is the commission, 
the executive director shall set the interim rates.
	(m)  If the regulatory authority sets a final rate that is 
lower than the interim rate, the utility shall refund or credit the 
difference between the interim rate and the final rate plus 
interest as determined by the regulatory authority unless otherwise 
agreed to by the parties to the rate proceeding.  If the regulatory 
authority sets a final rate that is higher than the interim rate, 
the utility shall be allowed to collect the difference between the 
interim rate and final rate unless otherwise agreed to by the 
parties to the rate proceeding.
	(n)  Except as provided by Subsection (o) [For good cause 
shown], the regulatory authority must make a final determination on 
the rates not later than:
		(1)  if the determination is made by a local regulatory 
authority, 150 days after the date the interim rates are 
established; or
		(2)  if the determination is made by the commission, 
305 days after the effective date the interim rates are established
[may at any time during the proceeding require the utility to refund 
money collected under a proposed rate before the rate was suspended 
or an interim rate was established to the extent the proposed rate 
exceeds the existing rate or the interim rate].
	(n-1)  If the regulatory authority does not make the 
determination within the deadline provided by Subsection (n), the 
proposed rates are automatically approved.
	(n-2)  Notwithstanding Subsection (n-1), the deadline for 
making a determination under Subsection (n) may be extended by the 
agreement of all parties to the rate proceeding.  A hearing shall be 
conducted in a timely manner to allow the commission to make its 
final determination on the proposed rates.
	(o)  If a local regulatory authority representing a 
municipality with a population of 1.7 million or more establishes 
interim rates under Subsection (l) [other than the commission] 
establishes interim rates or an escrow account], the local
regulatory authority must make a final determination on the rates 
not later than the first anniversary of the effective date of the 
interim rates [or escrowed rates] or the rates are automatically 
approved as requested by the utility.  The local regulatory 
authority may extend the period during which the rates are 
suspended by two days for each day a hearing exceed 15 days. If the 
local regulatory authority does not make a final determination on 
the proposed rate before the expiration of the applicable 
suspension period, the proposed rate shall be considered approved. 
The approval is subject to the local regulatory authority's 
continuation of a hearing in progress.
	SECTION __.  Subsections (i) and (j), Section 13.187, Water 
Code, are repealed.
	SECTION __.  The changes in law made to Sections 13.182 and 
13.187, Water Code, by this Act apply only to a statement of intent 
filed on or after the effective date of this Act.  A rate change to 
which a statement of intent filed before the effective date of this 
Act applies is governed by the law in effect on the date the 
statement was filed, and that law is continued in effect for that 
purpose.