By: Ashby H.B. No. 3821

A BILL TO BE ENTITLED

AN ACT

re lating to the procedure for action by the Texas Commission on Environmental Quality on an application for a water right.

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

SECTION 1. Section 11.129, Water Code, is amended to read as follows:

Sec. 11.129. REVIEW OF APPLICATION[; AMENDMENT]. (a) In this section:

(1) "Administratively complete" means an application includes the information and fees required under Sections 11.124, 11.125, 11.1271, and 11.128 and, if applicable, Sections 11.126, 11.127, and 11.1272.

(2) "Technical review" means the part of the process of reviewing an application after the executive director has determined the application is administratively complete in which technical material is analyzed and reviewed in order to prepare a draft permit and draft notice.

(b) Not later than the 30th working day after the date the executive director receives an application, the executive director shall review the application and provide to the applicant:

(1) written notice that the application is administratively complete; or

(2) a written request for information that describes in detail the information that the applicant must provide in order for the application to be considered administratively complete.

(c) Not later than the 30th day after the date an applicant receives a request under Subsection (b)(2), the applicant must submit a response to the request. Not later than the 30th working day after the date the executive director receives a timely response, the executive director shall review the response and provide to the applicant:

(1) written notice that the application is administratively complete; or

(2) a written request for information that describes in detail the information that the applicant must provide in order for the application to be considered administratively complete.

(d) The applicant may request an extension of the time to submit a response to a request under Subsection (b)(2) or (c)(2). The executive director shall grant the request if the applicant demonstrates good cause for the extension. An extension under this subsection extends the deadline provided by Subsection (e) by the same amount of time as the amount of the extension.

(e) Not later than the 180th day after the date the executive director receives the application, the executive director shall:

(1) provide the applicant written notice that the application is administratively complete; or

(2) return the application and the entire filing fee to the applicant and provide the applicant with a list of the deficiencies in the application.

(f) The applicant is entitled to appeal the return of the application and dispute an application deficiency in a hearing before the commission. The commission shall expedite an applicant's appeal of such a decision, review the application and related documents, rule on the issues presented at the hearing, and issue an order:

(1) directing the executive director to return the application to the applicant;

(2) requesting additional information as required by the executive director to render the application administratively complete; or

(3) declaring that the application is administratively complete and scheduling the technical review of the application.

(g) If the commission requests additional information from the applicant under Subsection (f)(2), the applicant must provide the information to the commission not later than the 30th day after the date the commission issues the request. The commission shall review the material and issue an order described by Subsection (f)(1) or (3), as applicable.

(h) Once the executive director determines that an application is administratively complete:

(1) the commission may not revoke the determination that the application is administratively complete;

(2) the executive director may request additional information from the applicant only if the information is necessary to clarify, modify, or supplement previously submitted information; and

(3) a request for additional information does not render the application incomplete.

(i) After the executive director or the commission determines that the application is administratively complete, the executive director shall conduct a technical review of the application. As part of the review, the executive director shall determine whether the applicable water conservation, drought contingency, and water management plans under Sections 11.1271, 11.1272, and 11.1273 are adequate.

(j) Not later than the 180th day after the date on which the technical review begins, the executive director shall provide the applicant with:

(1) written notice that the technical review is complete, a draft permit, a draft notice, and technical memoranda associated with the application; or

(2) a written request for technical information as determined by the executive director to be necessary for the completion of the technical review.

(k) With notice to the applicant, the executive director may extend the deadline provided by Subsection (j) for a period of 30 days. The executive director may not extend the deadline more than three times.

(l) Not later than the 60th day after the date the applicant receives a request under Subsection (j)(2), the applicant must provide the requested information to the executive director.

(m) The applicant may request an extension of the time to submit a response to a request under Subsection (j)(2). The executive director shall grant the request if the applicant demonstrates good cause for the extension. An extension under this subsection extends the deadline provided by Subsection (o) by the same amount of time as the amount of the extension.

(n) Not later than the 60th day after the date the executive director receives a timely response to a request under Subsection (j)(2), the executive director shall review the response and provide the applicant with:

(1) written notice that the technical review is complete, a draft permit, a draft notice, and technical memoranda associated with the application; or

(2) written notice that the response to the request for technical information is deficient.

(o) If the executive director provides notice under Subsection (n)(2), the executive director and the applicant must collaborate in a good faith effort to resolve the deficiency. Not later than the 180th day after the date the executive director provides such notice, the executive director shall:

(1) provide the applicant with written notice that the technical review is complete, a draft permit, a draft notice, and technical memoranda associated with the application; or

(2) return the application and the use fee and the unused portion of the notice fee as prescribed by commission rule to the applicant and provide the applicant with a list of the deficiencies with the application.

(p) The applicant is entitled to appeal the return of the application and dispute an application deficiency in a hearing before the commission. The commission shall expedite an applicant's appeal of such a decision, review the application and related documents, rule on the issues presented at the hearing, and issue an order:

(1) directing the executive director to return the application to the applicant;

(2) requesting additional information as required by the commission; or

(3) requiring the executive director to prepare the draft permit, draft notice, and technical memoranda associated with the application and written notice that the technical review is complete.

(q) If the commission requests additional information from the applicant under Subsection (p)(2), the applicant must provide the information to the commission not later than the 30th day after the date the commission issues the request. The commission shall review the material and issue an order described by Subsection (p)(1) or (3), as applicable.

(r) The applicant may request an extension of the time to submit a response to a request under Subsection (p)(2). The commission shall grant the request if the applicant demonstrates good cause for the extension. An extension under this subsection extends the deadline provided by Subsection (q) by the same amount of time as the amount of the extension.

(s) Not later than the 14th day after the date the applicant receives the draft permit, draft notice, and technical memoranda associated with the application, the applicant must provide the executive director with:

(1) the applicant's comments on the draft permit, draft notice, and technical memoranda; or

(2) a statement that the applicant has no comment on the draft permit, draft notice, or technical memoranda.

(t) The applicant may request an extension of the time to submit comments under Subsection (s)(1). The commission shall grant the request if the applicant demonstrates good cause for the extension. An extension under this subsection extends the deadline provided by Subsection (s) by the same amount of time as the amount of the extension.

(u) The executive director shall file the draft permit, draft notice, and technical memoranda associated with the application with the chief clerk of the commission:

(1) not later than the 14th day after the date the executive director receives comments under Subsection (s)(1), during which time the executive director and the applicant must collaborate to address the comments; or

(2) immediately on receipt of a statement described by Subsection (s)(2).

(v) Notwithstanding any other provision of this section, if the executive director makes a written determination that notice is not required for an application, the executive director shall grant or deny the permit for which the application is filed not later than the 300th day after the date the executive director receives the application. This period shall be extended by the same amount of time as the amount of any extension of time granted to the applicant for the provision of information [The commission shall determine whether the application, maps, and other materials comply with the requirements of this chapter and the rules of the commission. The commission may require amendment of the application, maps, or other materials to achieve necessary compliance].

SECTION 2. Subchapter D, Chapter 11, Water Code, is amended by adding Section 11.1291 to read as follows:

Sec. 11.1291. TECHNICAL REVIEW OF APPLICATIONS

(a) Within 30 days of the written request of an applicant, and following the declaration that an application is administratively complete, the executive director may delegate responsibilities for the technical review of the application to a third-party contractor who will:

(1) follow the direction of the executive director in conducting the technical review of the application and preparing all technical memoranda required by the executive director to reflect the analyses and conclusions developed as part of the technical review; and

(2) be responsible for successfully completing the technical review on behalf of the executive director.

(b) The executive director shall evaluate the principals and all subcontractors to be involved in a technical review conducted under this section for their experience in the areas to be addressed during and as part of the technical review, and shall secure the applicant's written consent before technical review may commence if such review will not be conducted by the executive director.

(c) If the executive director chooses to utilize a third-party contractor to complete the technical review of an application, the executive director shall:

(1) take all necessary measures to ensure that the third-party contractor, its principals, and its subcontractors have no financial or economic interest in the outcome of the application that is to be the subject of the technical review; and

(2) provide the applicant with a written statement of the basis for the executive director's selection of the third-party contractor for the technical review, including a description of the third-party contractor's demonstrated competency in the fields of expertise required for the technical review.

(d) The technical review of an application under this section shall be completed so that the executive director issues a draft permit or a draft permit amendment and associated technical memoranda within 180 days following the date the executive director determines that the applicant may complete the technical review or the applicant contracts with the third-party contractor.

(e) The period of technical review provided in this subsection is exclusive of the time provided for an applicant's responses to requests for information.

(f) For good cause demonstrated to the executive director, an applicant may be granted no more than 90 days to respond to any request for information.

(g) If an applicant requires additional time to respond to a request for information during technical review beyond 30 days from the date of applicant's receipt of the request, the time provided to the executive director in this subsection to issue a draft permit or draft permit amendment and associated technical memoranda shall be extended by the number of days beyond 30 days that the applicant requires to respond to the request.

(h) Upon receipt of the applicant's consent to the use of a third-party contractor to conduct the technical review of an application, the executive director shall require the applicant to:

(1) enter into a contract with the third-party contractor that is consistent with this section and that expresses the scope of work to be undertaken by the third-party contractor during the technical review; and

(2) pay the third-party contractor for all services rendered under the contract as and when they are performed.

(i) If the applicant does not consent to the use of the third-party contractor under subsection (b), then the application shall be reviewed by the executive director.

SECTION 3. Section 11.133, Water Code, is amended to read as follows:

Sec. 11.133. HEARING. (a) At the time and place stated in the notice, the commission shall hold a hearing on the application. Any person may appear at the hearing in person or by attorney or may enter an [his] appearance in writing. Any person who appears may present objection to the issuance of the permit. The commission may receive evidence, orally or by affidavit, in support of or in opposition to the issuance of the permit, and it may hear arguments.

(b) The commission may not refer an application filed under this chapter to the State Office of Administrative Hearings for consideration unless the commission first determines that:

(1) an issue relating to the commission's jurisdiction has been specifically identified in a timely filed request for a contested case hearing on the application;

(2) such request includes supporting documentation and evidence reflecting the interest the requestor asserts is justiciable by the commission at the time of the request; and

(3) the identified issue is one the commission has the authority to address under the statutes that govern the commission's consideration of the application.

(c) If the commission grants a request for a contested case hearing on an application submitted under this chapter, the commission shall:

(1) issue an order identifying the number and scope of issues to be referred to the State Office of Administrative Hearings for a hearing; and

(2) specify the maximum expected duration of the hearing, which may not exceed a period of 270 days from the date of the issuance of the commission's order under this subsection until the issuance of the proposal for decision.

(d) If the commission refers an issue regarding an application to the State Office of Administrative Hearings for a contested case hearing, the administrative law judge who conducts the hearing may not grant party status to a person who failed to timely seek party status from the commission before the issue was referred or to any person who was considered by the commission but was not determined to be a person affected by the commission's action on the application.

(e) In the event of a conflict between this section and any other law, this section prevails.

SECTION 4. Subchapter D, Chapter 11, Water Code, is amended by adding Section 11.1331 to read as follows:

Sec. 11.1331. PARTICIPATION BY PUBLIC INTEREST COUNSEL. (a) The public interest counsel may be named a party to a hearing on an application submitted under this chapter only if:

(1) during the period the commission may receive and consider requests for a contested case hearing on the application, the office of public interest counsel files with the commission a description of each public interest as established by Section 5.276 that the office of public interest counsel believes:

(A) is affected by the application; and

(B) has not been adequately addressed by the executive director or the applicant during technical review;

(2) the commission in its discretion determines that the office of public interest counsel has described a public interest affected by the application that warrants participation by the public interest counsel as a party, and that will not be adequately addressed by any other party to the contested case hearing; and

(3) the commission includes in an order issued pursuant to section 11.133(c) one or more specified public interest issues described by the public interest counsel pursuant to subsection (a).

(b) If the commission names the office of public interest counsel as a party to a contested case hearing on an application submitted under this chapter, the public interest counsel's participation shall be limited to examining only those public interest issues identified in the commission's order issued under section 11.133(c).

(c) The office of public interest counsel may not:

(1) submit responses to any requests for a contested case hearing on an application submitted under this chapter; or

(2) provide assistance to any party to a contested case hearing.

(d) A filing made by the public interest counsel under subsection (a) of this section is insufficient to refer any issue of an application to the State Office of Administrative Hearings for a contested case hearing.

(e) Subsection (d) does not limit any authority of the commission or executive director provided by other law to refer an application to the State Office of Administrative Hearings for a contested case hearing.

SECTION 5. (a) As soon as practicable after the effective date of this Act, the Texas Commission on Environmental Quality shall adopt rules to implement the changes in law made by this Act.

(b) The changes made to Section 11.133 and 11.1331 shall be effective for any notice of an application considered by the commission following the effective date of this Act. The changes made to Sections 11.129 and 11.1291 shall be effective to any application filed after the effective date of this Act.

(c) On notice to the applicant, beginning on the effective date of the rules adopted under Subsection (a) of this section, the executive director of the Texas Commission on Environmental Quality may extend the period for technical review of an application for a new or amended water right under Section 11.129, Water Code, as amended by this Act, by a period not to exceed 18 months from the date the rules take effect if:

(1) on the effective date of the rules there are applications for new or amended water rights pending before the commission the technical review of which has not been completed; and

(2) the applications described by Subdivision (1) affect the same river basin as the application for which the technical review period is extended.

(d) During an extension under Subsection (c) of this section, the executive director shall take all practicable measures to substantially meet all other applicable deadlines in Section 11.129, Water Code, as amended by this Act, related to the technical review of an application.

SECTION 6. 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, 2015.