TO:	Honorable Doug Miller, Chair, House Committee on Special Purpose Districts
FROM:	Ursula Parks, Director, Legislative Budget Board
IN RE:	HB4128 by Metcalf (Relating to the creation of the Montgomery County Municipal Utility District No. 147; 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 (as substituted) creates Montgomery County Municipal Utility District No. 147 (the "District") with the powers and duties of a 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 simply on the Original Texas Land Surveys mentioned in HB 4128, as of the 2010 census is the proposed district appears to have a population of 20.
     
Population growth in the specific area since the 2010 census is unknown. The 2010 population estimate for areas of Montgomery County served by small systems or private wells (County-Other) is 185,829. The Montgomery County-Other population projections approved for the 2016 Region H Water Plan projects the population to grow to 293,282 in 2020, 427,682 in 2030 and 585,027 in 2040.
  
Location - The Proposed districts initial boundaries are described with a combination of Original Texas Land Surveys, Montgomery County Real Property Records and metes and bounds. Due to the complexity of these boundaries for the various sub areas of the district, staff is able to determine only the general location of the proposed district.
 
The proposed district's area is approximately 0.12 square miles in central Montgomery County, located north west of Conroe City and State Highway 105.  The proposed district does not appear to overlap any existing Certificate of Convenience and Necessity.
 
Comments on Powers/Duties Different from Similar Types of Districts:  The bill grants the District road powers; the bill specifies that Water Code Section 54.016(f), relating to a city's ability to being able to provide for an allocation agreement within its written consent to the District's creation, does not apply to the District; 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:  Similar to general law districts, the TCEQ will have the authority to review of financial reports/audits and the issuance of bonds.
 
Water Use - HB 4128 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 Montgomery County, 98 percent of the total water use was groundwater (Gulf Coast Aquifer) in 2012. Ninety-one percent of all the groundwater pumping was for municipal use. The water source of the proposed district might pursue is unknown.