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A BILL TO BE ENTITLED
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AN ACT
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relating to allowing a water and sewer utility to assess a utility |
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facilities construction and improvement charge to recover certain |
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costs associated with certain construction and improvement |
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projects. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter F, Chapter 13, Water Code, is amended |
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by adding Section 13.193 to read as follows: |
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Sec. 13.193. UTILITY FACILITIES CONSTRUCTION AND |
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IMPROVEMENT CHARGE. (a) Notwithstanding any other provision of |
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this chapter, a utility may assess a utility facilities |
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construction and improvement charge to recover the depreciation and |
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return on investment of a utility facilities construction and |
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improvement project that: |
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(1) is completed and placed into service between two |
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consecutive statements of intent to change the utility's rates or |
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tariff filed under Section 13.187; and |
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(2) serves the utility's certificated service area, |
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including a facility used for: |
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(A) the production, transmission, storage, |
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distribution, or provision of potable or recycled water to the |
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public; or |
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(B) the collection, transportation, treatment, |
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or disposal of sewage. |
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(b) The commission by rule shall require a utility that |
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proposes to assess a utility facilities construction and |
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improvement charge under this section: |
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(1) to file a tariff establishing a just and |
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reasonable manner for calculating the charge; and |
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(2) to receive the executive director's approval of |
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the tariff. |
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(c) In adopting rules under Subsection (b), the commission |
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shall ensure that: |
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(1) not later than the 60th day before a utility's |
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proposed inclusion of a charge or a proposed increase of a charge in |
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a tariff under this section, the utility submits to the executive |
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director for review of a project's eligibility a written notice |
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that contains: |
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(A) the amount of the proposed charge or increase |
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of a charge; |
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(B) the proposed implementation date for the |
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charge or increase of a charge; |
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(C) a list of completed, eligible capital |
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projects, and related depreciation and return on investment for |
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which the utility seeks reimbursement through the charge or |
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increase of a charge; and |
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(D) a calculation of the projected total annual |
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increase in revenue due to the charge or increase of a charge; |
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(2) the total amount the utility is authorized to |
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recover annually through a charge assessed under this section and |
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the amount the utility actually recovers are subject to annual |
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audit by the executive director; |
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(3) the amount of the charge the utility requests |
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authorization to assess is based on the amount necessary to ensure |
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that the charge yields a rate of return on invested capital that is |
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equal to: |
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(A) the rate of return approved for the utility |
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in the utility's most recent approved base rate or tariff change |
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application filed under Section 13.187; or |
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(B) the rate of return proposed by the utility, |
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if the rates in the utility's most recent base rate or tariff change |
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application were approved by settlement; |
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(4) the cumulative annual amount the utility proposes |
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to recover from the charge does not exceed an amount equal to 10 |
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percent of the utility's annual revenue; |
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(5) the utility does not implement an increase under |
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this section more often than twice every calendar year; |
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(6) the charge is applied to each customer included in |
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the tariff; |
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(7) the utility provides to each customer written |
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notice of the charge on the initial tariff filing that proposes to |
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implement the charge; and |
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(8) the charge is subject to a true-up or |
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reconciliation at the utility's next rate case filed under Section |
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13.187. |
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(d) Notwithstanding any other provision of this code, the |
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implementation of a utility facilities construction and |
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improvement charge or an increase in a utility facilities |
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construction and improvement charge is not subject to a contested |
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case hearing under Chapter 2001, Government Code. |
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(e) This section does not apply to a utility that has in |
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place a negotiated stay-out agreement on September 1, 2011. |
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SECTION 2. The changes in law made by Section 13.193, Water |
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Code, as added by this Act, apply only to a project that is |
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completed and placed into service on or after the effective date of |
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this Act. A project that is completed and placed into service before |
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the effective date of this Act is subject to the law in effect at |
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that time, and that law is continued in effect for that purpose. |
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SECTION 3. The Texas Commission on Environmental Quality |
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shall adopt rules consistent with Section 13.193, Water Code, as |
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added by this Act, not later than December 1, 2011. |
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SECTION 4. This Act takes effect September 1, 2011. |