TO:	Honorable Jim Murphy, Chair, House Committee on Special Purpose Districts
FROM:	Ursula Parks, Director, Legislative Budget Board
IN RE:	HB4335 by Guillen ( Relating to the creation of the Willacy County 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 Willacy County 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, with the following exceptions.

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 4335, 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 Willacy County served by small systems or private wells (County-Other) is 468. The Willacy County-Other population projections approved for the 2017 State Water Plan projects the population to grow to 530 in 2020, 600 in 2030 and 666 in 2040.
 
Location - The Proposed district's initial boundaries are described with a Willacy County Real Property Records. 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 0.78 square miles in central Willacy County, located west of the City of Raymondville. The proposed district does not appear to overlap any existing Certificate of Convenience and Necessity (CCN) boundaries.
 
Comments on Powers/Duties Different from Similar Types of Districts:  This bill amends the Special District Local Laws Code by adding Chapter 8014 which creates the Willacy County Municipal Utility District No. 1 (District) with the powers and duties of a standard municipal utility district under Water Code Chapters 49 and 54. This bill grants the District authority for road projects. The bill allows the District to divide. The District may not exercise the power of eminent domain outside the District to acquire a site or easement for: a road project authorized by Section 8014.103; or a recreational facility as defined by Section 49.462, Water Code. 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 4335 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 Willacy County, 2 percent of the total water use was groundwater (Gulf Coast Aquifer) in 2014. Seventy percent of all the groundwater pumping was for municipal use. The water source of the proposed district might pursue is unknown.