By: Cyrier H.B. No. 3161

A BILL TO BE ENTITLED

AN ACT

relating to prioritizing groundwater production.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 36.122, Water Code, is amended to read as follows:

Sec. 36.122. EXPORT [TRANSFER] OF GROUNDWATER OUT OF DISTRICT. (a) Prior to exporting [If an application for a permit or an amendment to a permit under Section 36.113 proposes the transfer of] groundwater outside of a district's boundaries, the exporting person must first obtain a permit from the district-[may also consider the provisions of this section in determining whether to grant or deny the permit or permit amendment].

(b) A district may promulgate rules requiring a person to obtain a permit or an amendment to a permit [under Section 36.113] from the district for the export [transfer] of groundwater out of the district to:

(1) increase, on or after March 2, 1997, the amount of groundwater to be exported [transferred] under a continuing arrangement in effect before that date; or

(2) export [transfer] groundwater out of the district on or after March 2, 1997, under a new arrangement.

(c) Except as provided in Section 36.113(e) and subsection (l), the district may not impose more restrictive permit conditions on exporters [transporters] than the district imposes on existing in-district users.

(d) The district may impose a reasonable fee for processing an application under this section. The fee may not exceed fees that the district imposes for processing other applications under Section 36.113. An application filed to comply with this section shall be considered and processed under the same procedures as other applications for permits under Section 36.113 and shall be combined with applications filed to obtain a permit for in-district groundwater [water] use under Section 36.113 from the same applicant.

(e) The district may impose a reasonable fee or surcharge for an export fee using one of the following methods:

(1) a fee negotiated between the district and the exporter [transporter];

(2) a rate not to exceed the equivalent of the district's tax rate per hundred dollars of valuation for each thousand gallons of groundwater exported [water transferred] out of the district or 2.5 cents per thousand gallons of water, if the district assesses a tax rate of less than 2.5 cents per hundred dollars of valuation; or

(3) for a fee-based district, a 50 percent export surcharge, in addition to the district's production fee, for water groundwater exported [water transferred] out of the district.

(f) In reviewing a proposed export [transfer] of groundwater out of the district, the district shall consider:

(1) the availability of water in the district and in the proposed receiving area during the period for which the groundwater [water] supply is requested;

(2) the projected effect of the proposed export [transfer] on the district’s ability to achieve its desired future condition [aquifer conditions, depletion, subsidence, or effects on existing permit holders or other groundwater users within the district; and];

(3) factors identified in the applicable approved regional water plans that address the following:

(A) the availability of feasible and practicable alternative supplies in the receiving area to the groundwater proposed for export;

(B) proposed methods and efforts by the receiving area to avoid waste and implement water conservation and drought contingency measures;

(C) the projected economic impact reasonably expected to occur in each area as a result of the export;

(4) the information required to be submitted by the applicant;

(5) the approved regional water plan and] approved district management plan]; and

(6) if the export is based on a contractual sale of water, the terms of the contract, including provisions for conservation, drought response and waste prevention.

(g) The district may not deny a permit based on the fact that the applicant seeks to export [transfer] groundwater outside of the district but may limit a permit issued under this section if conditions in Subsection (f) warrant the limitation, subject to Subsection (c).

(h) Export permits [In addition to conditions provided by Section 36.1131, the permit] shall specify:

(1) the amount of groundwater [water] that may be exported [transferred] out of the district; and

(2) the period for which the groundwater [water] may be exported [transferred].

(i) The period specified by Subsection (h)(2) shall be:

(1) at least three years if construction of a conveyance system has not been initiated prior to the issuance of the permit; [or]

(2) at least 30 years if construction of a conveyance system has been initiated prior to the issuance of the permit; or

(3) if the export is based on a contractual sale of water, no greater than the term of the contract, including any extension or renewal of the contract.

(j) A term under Subsection (i)(1) shall automatically be extended to the terms agreed to under Subsection (i)(2) if construction of a conveyance system is begun before the expiration of the initial term.

(k) Notwithstanding the period specified in Subsections (i) and (j) during which groundwater [water] may be exported [transferred] under a permit, a district may periodically review the amount of groundwater [water] that may be transferred under the permit and may limit the amount if additional factors considered in Subsection (f) warrant the limitation, subject to Subsection (c). The review described by this subsection may take place not more frequently than the period provided for the review or renewal of operating [regular] permits issued by the district. In its determination of whether to renew a permit issued under this section, the district shall consider relevant and current data for the conservation of groundwater resources and shall consider the permit in the same manner it would consider any other permit in the district.

(l) Any operating permit associated with an export permit is junior in priority to any other operating permit issued before the time the application for the export permit is accepted for filing, and any groundwater production reductions must be applied to operating permits associated with an export permit before they may be applied to any operating permit issued before the time the application for the export permit was accepted for filing [A district is prohibited from using revenues obtained under Subsection (e) to prohibit the transfer of groundwater outside of a district. A district is not prohibited from using revenues obtained under Subsection (e) for paying expenses related to enforcement of this chapter or district rules].

(m) A district may not prohibit the export of groundwater if the purchase was in effect on or before June 1, 1997.

(n) This section applies only to an export [a transfer] of groundwater [water] that is permitted after September 1, 1997.

(o) A district shall adopt rules as necessary to implement this section but may not adopt rules expressly prohibiting the export of groundwater.

(p) Subsection (e) does not apply to a district that is collecting an export fee or surcharge on March 1, 2001.

[(q) In applying this section, a district must be fair, impartial, and nondiscriminatory].

SECTION 2. EFFECTIVE DATE. 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 on September 1, 2015.