80R13333 SMH-D
 
  By: Averitt S.B. No. 2001
 
 
 
   
 
A BILL TO BE ENTITLED
AN ACT
relating to the construction and operation of reservoirs, including
the assessment of a fee on the sale or lease of water impounded in a
reservoir to compensate the owners of property in the reservoir
site and the protection of the rights of owners or former owners of
property in a reservoir site.
       BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
       SECTION 1.  Chapter 11, Water Code, is amended by adding
Subchapter L to read as follows:
SUBCHAPTER L.  ROYALTY FEE ON SALE OR LEASE OF IMPOUNDED SURFACE
WATER
       Sec. 11.601.  ACQUISITION OF PROPERTY IN RESERVOIR SITE IN
EXCHANGE FOR ROYALTY FEE. The holder of a permit to impound surface
water in a reservoir may, with the agreement of the owner of real
property in the site of the reservoir, acquire the property in
exchange for a royalty fee as provided by this subchapter.
       Sec. 11.602.  PROVISION OF INFORMATION AND PAYMENT OF
ROYALTY FEE TO COMMISSION. The holder of a permit to impound
surface water in a reservoir annually shall:
             (1)  notify the commission of the name and address of
each person whose property the permit holder acquired to construct
the reservoir under an agreement under Section 11.601 and the
number of acres of real property acquired from the person under the
agreement; and
             (2)  pay to the commission a royalty fee in an amount
equal to 10 percent of the total revenue received by the permit
holder for the wholesale or retail sale or lease of the water
authorized to be impounded under the permit multiplied by a
fraction the numerator of which is the total number of acres of real
property acquired from all persons who entered into agreements
under Section 11.601 and the denominator of which is the total
number of acres of real property in the reservoir site acquired from
all property owners voluntarily, including under an agreement under
Section 11.601, or through the exercise of the power of eminent
domain.
       Sec. 11.603.  ALLOCATION OF ROYALTY FEE BY COMMISSION. Not
later than the 90th day after the date the royalty fee is submitted
under Section 11.602(2), the commission shall allocate the fee to
each person included in the notification under Section 11.602(1) in
the proportion that the number of acres of real property acquired
from the person under an agreement under Section 11.601 bears to the
total number of acres of real property acquired from all persons
under agreements under Section 11.601.
       Sec. 11.604.  ASSESSMENT OF FEE ON PERMIT HOLDER. The
commission may assess a holder of a permit to impound surface water
in a reservoir a fee in an amount necessary to administer this
subchapter.
       SECTION 2.  Section 16.051, Water Code, is amended by adding
Subsections (i) and (j) to read as follows:
       (i)  A person may not bring a cause of action under
Subsection (h) for a violation of Subsection (g) if the political
subdivision that violated that subsection acquired the fee title or
easement for the purpose of:
             (1)  providing retail public utility service, other
than water or wastewater service, to property in the reservoir
site; or
             (2)  allowing an owner of property in the reservoir
site to improve or develop the property.
       (j)  Notwithstanding Subsection (i), a political subdivision
affected by an action described by Subsection (i) may bring a cause
of action for a violation of Subsection (g) if the political
subdivision has complied with Section 16.143(a).
       SECTION 3.  Subchapter E, Chapter 16, Water Code, is amended
by adding Sections 16.143 through 16.146 to read as follows:
       Sec. 16.143.  INTENT TO CONSTRUCT RESERVOIR; ENCUMBRANCE
PAYMENT. (a) Before bringing a cause of action under Section
16.051(h), a political subdivision must:
             (1)  file with the commission a letter of intent to
construct a reservoir on the site affected by the violation of
Section 16.051(g); and
             (2)  offer to pay each owner of real property in the
reservoir site an encumbrance payment.
       (b)  An owner of real property to whom an encumbrance payment
is offered may reject the offer.
       (c)  An encumbrance payment must be paid annually to an owner
of real property in the reservoir site who has accepted the offer of
the payment until:
             (1)  the property is acquired for the reservoir; or
             (2)  the property is no longer in the reservoir site.
       (d)  An encumbrance payment must be in an amount that is not
less than 2.5 times the total amount of ad valorem taxes imposed in
the tax year that precedes the year in which the payment is made on
the property for which the payment is made.
       Sec. 16.144.  OPTION TO LEASE. (a)  A former owner of real
property that was acquired, voluntarily or through the exercise of
the power of eminent domain, for a reservoir is entitled to lease
the property from the person who acquired the property under terms
that allow the former owner to continue to use the property for its
existing use until physical construction of the reservoir begins.
       (b)  A former owner of real property used for agricultural
purposes is entitled to lease the property for not more than the
property's agricultural rental value.
       Sec. 16.145.  ENVIRONMENTAL MITIGATION. (a)  If a person
constructing a reservoir is required to mitigate the past, present,
or future adverse environmental effects arising from the
construction or operation of the reservoir or its related
facilities, the person shall, if authorized by the applicable
regulatory authority, attempt to mitigate those effects by offering
to contract with and pay an amount of money to an owner of real
property to maintain, control, hold, restore, enhance, develop, or
redevelop the property instead of acquiring or managing property
for that purpose.
       (b)  An owner of real property may reject an offer made under
Subsection (a).
       Sec. 16.146.  ELIGIBILITY TO PARTICIPATE IN GOVERNMENT
PROGRAMS. Property located in the site of a reservoir designated
under Section 16.051 continues to be eligible for any public
program for which it was eligible before the designation. A state
agency or political subdivision may not consider the fact that the
property is included in a site that has been designated as being of
unique value for the construction of a reservoir when determining
the property's eligibility to participate in a public program whose
term is not longer than the period before physical construction of
the reservoir will begin.
       SECTION 4.  This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution.  If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2007.