TO:	Honorable Robert Puente, Chair, House Committee on Natural Resources
FROM:	John S. O'Brien, Director, Legislative Budget Board
IN RE:	HB2367 by McReynolds (Relating to the creation of the Somerset Municipal Utility District No. 2; providing authority to impose a tax and issue bonds; granting the power of eminent domain.), As Introduced

The Legislative Budget Board, in cooperation with the Texas Water Development Board (TWDB) and the Texas Commission on Environmental Quality (TCEQ), has determined that:

The bill creates Somerset Municipal Utility District No. 2 of San Jacinto County (District) with the powers and duties of a municipal utility district under Water Code Chapters 49 and 54. The purpose of the District includes: providing works and projects under powers conferred by Article XVI, Section 59 of the Texas Constitution to benefit the property within the District and the power of eminent domain. The bill does not include the names of temporary directors.  The District is subject to confirmation election by the voters.
 

1)   Population - The detailed description of the proposed boundaries does not allow staff to develop precise population estimates.  The 2000 Census population of San Jacinto County was 22,246, with 9,985 living in areas identified in the 2007 State Water Plan as “County-Other” (outside cities of more than 500 and established water utility districts).  The total county population is projected to increase to 32,541 by 2020, the County-Other population is projected to increase to 13,379.
 
2)   Location - The proposed district is located within San Jacinto County.

3)  Comments on Powers/Duties Different from Similar Types of Districts-    The District will have road powers.  The District may be divided into multiple districts.  If the District has not been confirmed before September 1, 2009, then the District is dissolved on September 1, 2009.
 
4)  Overlapping Services-     The stated boundaries form a closure.  There is insufficient information provided in the bill to determine if the District overlaps any water supply or sewer‑service corporations, investor‑owned utilities, or local water districts or authorities.  An area map containing at least two references points (major road names, road intersections) and the proposed district’s geographic location mapped within San Jacinto County is needed to complete overlapping service check. A metes and bounds description (preferably with the source Abstract listed) is needed.  The District may overlap: CCN Nos. 12983 and 20899 (Monarch Utilities 1 LP); CCN No. 10126 (Point Blank & Stephens Creek Water Supply Corporation); and Registration No. N0040 (Oak Water Association).
 
5)  TCEQ's Supervision-     As with general law districts, the TCEQ will have general supervisory authority, including bond review authority and review of financial reports.

6)  Water Use- 88 percent of San Jacinto County water use in 2004 was for municipal purposes, with most of the remainder for livestock.   96 percent of the municipal water use comes from groundwater sources.