TO:	Honorable Jim Murphy, Chair, House Committee on Special Purpose Districts
FROM:	Ursula Parks, Director, Legislative Budget Board
IN RE:	HB2625 by Bell (Relating to the creation of the Montgomery County Municipal Utility District No. 158; granting a limited power of eminent domain; providing authority to issue bonds; providing authority to impose assessments, fees, and taxes.), As Introduced

The Legislative Budget Board, in cooperation with the Texas Water Development Board (TWDB) and the Texas Commission on Environmental Quality (TCEQ), has determined that:
 
This bill creates Montgomery County Municipal Utility District No. 158 (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 mentioned in HB 2625, staff is unable to determine a population estimate.

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 2017 State Water Plan projects the population to grow to 293,282 in 2020, 427,682 in 2030 and 585,027 in 2040.
 
Location - The Proposed district's 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 0.93 square miles in southeastern Montgomery County, located southeast of the City of Conroe. Tract 1of the district lies to the east of Old Houston Road and tract 2 to the north of Farm to Market Road 1314.  The proposed district may overlap the boundary of an existing Certificate of Convenience and Necessity (CCN) held by Crystal Springs Water Company, Inc.

Comments on Powers/Duties Different from Similar Types of Districts:  The bill requires the TCEQ to appoint the five initial temporary directors upon receipt of a petition from the owners of a majority of the assessed value of the real property in the district; this bill grants the District authority for road projects; the bill specifies that at the time of issuance, the total principal amount of bonds or other obligations issued or incurred to finance road projects and payable from ad valorem taxes may not exceed one-fourth of the assessed value of real property in the District; 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 2625 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, 95 percent of the total water use was groundwater (Gulf Coast Aquifer) in 2014. Ninety four percent of all the groundwater pumping was for municipal use. The water source of the proposed district might pursue is unknown.