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A BILL TO BE ENTITLED
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AN ACT
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relating to the authority of certain municipalities to establish an |
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economic development program to promote the construction of |
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small-scale electric generating facilities. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 380, Local Government Code, is amended |
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by adding Section 380.005 to read as follows: |
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Sec. 380.005. ECONOMIC DEVELOPMENT PROGRAMS FOR |
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CONSTRUCTION OF SMALL-SCALE ELECTRIC GENERATING FACILITIES. (a) |
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This section applies only to a municipality that is located in a |
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region subject to retail customer choice under Section 39.102, |
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Utilities Code, whether or not the municipality has opted for |
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customer choice. For purposes of this subsection, a municipality |
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includes an area that: |
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(1) has been annexed by the municipality for limited |
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purposes; or |
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(2) is in the extraterritorial jurisdiction of the |
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municipality. |
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(b) In this section, "small-scale electric generating |
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facility" means: |
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(1) a central electric generating station with a |
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capacity of no more than 50 megawatts; or |
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(2) a distributed electric generation facility with a |
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capacity of no more than five megawatts that supplies at least 50 |
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percent of the electricity it generates to on-site end-use |
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consumption. |
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(c) The governing body of a municipality may establish and |
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provide for the administration of one or more programs, including |
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programs for making loans and grants of public money and providing |
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personnel and services of the municipality, to promote the |
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construction of small-scale electric generating facilities. The |
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programs authorized under this section serve the public purposes of |
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promoting state and local economic development and providing |
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benefits to municipalities in procuring electricity and may also |
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serve the public purposes of reducing unemployment or |
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underemployment and contributing to the state's need for reliable |
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electricity during periods of peak demand. Before establishing a |
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program under this section, the municipality shall enact an |
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ordinance or adopt a resolution that finds that the program will |
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serve one or more of the public purposes specified in this |
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subsection. |
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(d) Notwithstanding any other law: |
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(1) a municipality that establishes or administers a |
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program under this section is not required, as a result of |
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establishing or administering the program, to register or obtain a |
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certificate under Section 39.351, 39.352, or 39.355, Utilities |
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Code; and |
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(2) the owner of a distributed electric generation |
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facility constructed pursuant to a program authorized under this |
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section is not required, as a result of owning the facility, to |
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register under Section 39.351, Utilities Code. |
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(e) A municipality may, under a contract with a developer, |
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provide the proceeds of municipal bonds or other obligations of the |
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municipality to the developer for the purpose of constructing a |
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small-scale electric generating facility. The funds provided to a |
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developer under this section: |
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(1) may not exceed 50 percent of the cost of |
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construction of the facility; and |
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(2) must be derived from any source lawfully available |
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to the municipality under its charter or other law, other than from |
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the proceeds of bonds or other obligations of the municipality |
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payable from ad valorem taxes. |
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(f) A program established under this section shall require |
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the execution of a contract with the municipality to participate in |
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the program. A contract entered into under a program established |
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under this section: |
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(1) must contain provisions to protect and advance the |
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interests of the municipality, including: |
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(A) provisions to protect the municipality |
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against the failure by the developer or owner of the small-scale |
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electric generating facility to perform in accordance with the |
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contract, which may include the authority for the municipality to |
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impose a lien against the property of the developer or owner; and |
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(B) requirements that the developer or owner of |
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the small-scale electric generating facility provide electricity |
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to the municipality at a certain price and under terms that enable |
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the municipality to share in the proceeds from the sale of |
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electricity or ancillary services by the facility; |
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(2) must be supported by a report that demonstrates |
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that the expected benefits to the municipality's future budgets, |
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grid reliability, or state or local economic development during the |
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life of the contract are expected to justify the distribution of |
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funds to the developer of the small-scale electric generating |
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facility by the municipality under the contract; and |
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(3) must be approved in accordance with the provisions |
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of the municipality's charter. |
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SECTION 2. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2013. |