TO:	Honorable Doug Miller, Chair, House Committee on Special Purpose Districts
FROM:	Ursula Parks, Director, Legislative Budget Board
IN RE:	HB1372 by Isaac (Relating to the creation of the Cotton Center Municipal Utility District No. 1; granting a limited power of eminent domain; providing authority to issue bonds; providing authority to impose assessments, fees, and taxes.), Committee Report 1st House, Substituted

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 the Cotton Center Municipal Utility District No. 1 (the "District") with the powers and duties of a standard municipal utility district under Water Code, Chapters 49 and 54.
 
Population - The very specific description of the proposed boundaries does not allow staff to develop precise population estimates. Based on the Original Texas Land Surveys and roads mentioned in HB 1372, the population of the area in 2010 census is estimated to be 62.
     
Population growth in the specific area since the 2010 census is unknown. The proposed district overlaps the CCN boundary of Maxwell Water Supply Corporation. Some of the population from the WSC may be located within the proposed district.
     
The 2010 population estimate for Maxwell WSC is 3,296. The population projections approved for the 2016 Region L Water Plan projects the population to grow Maxwell WSC to 4,070 in 2020, 4,983in 2030 and 5,883 in 2040.
 
The 2010 population estimate for areas of Caldwell County served by small systems or private wells (county-other) is 4,928. The population projections approved for the 2016 Region L Water Plan projects the population to grow Caldwell County-Other to 6,087 in 2020, 7,447 in 2030 and 8,786 in 2040.
         
Location -The Proposed districts initial boundaries are described with a combination of Original Texas Land Surveys, Deeds of Record in the Official Public Records of Caldwell County, and metes and bounds. Due to the complexity of these boundaries for the various sub areas of the district, staff is only able to determine the general location of the proposed district.
 
The proposed district's area is approximately 1.8 square miles in North Eastern edge of Caldwell County. The proposed district is located to the south of Kyle and Uhland, to the east of Lockhart, north of Martindale and west of San Marcos. The entire proposed district appears to be located within the CCN of Maxwell WSC. 
 
Comments on Powers/Duties Different from Similar Types of Districts:  The bill grants the District road powers; the bill allows the District to divide; and if the bill does not receive a two-thirds vote of all members elected to each house, the District may not exercise the power of eminent domain.
 
Overlapping Services:  TCEQ does not have mapping information for water and/or wastewater providers because this function was transferred from the TCEQ to the Public Utility Commission on September 1, 2014.  As a result, TCEQ is unaware of possible overlapping service providers.
 
TCEQ's Supervision:  As with general law districts, the TCEQ will have general supervisory authority, including bond review authority and review of financial reports.
 
 Water Use -HB 1372 specifies that "the district has the powers and duties provided by the general law of the state, including Chapters 49 and 54, Water Code, applicable to municipal utility districts created under Section 59, Article XVI, Texas Constitution".
 
Within Caldwell County, 46 Percent of the total water use was groundwater (Carrizo-Wilcox Aquifer), and 54 percent of the total water use was surface water (Guadalupe River Basin) in 2012. Ninety-seven percent of all the groundwater pumping was for municipal use. The water source of the proposed district might pursue is unknown.