TO:	Honorable Eddie Lucio, Jr., Chair, Senate Committee on Intergovernmental Relations
FROM:	Ursula Parks, Director, Legislative Budget Board
IN RE:	SB905 by Birdwell (Relating to the creation of the Cresson Crossroads Municipal Utility District No. 2; 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:
 
The bill creates Cresson Crossroads Municipal Utility District No. 2 (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 Real Property Records of Hood County mentioned in SB 905 and using Census blocks, there appears to be no population in 2010.
     
Population growth in the specific area since the 2010 census is unknown. The 2010 population estimate for areas of Hood County served by small systems or private wells (County-Other) is 22,875. The Hood County-Other population projections approved for the 2017 State Water Plan projects the population to reach 26,999 in 2020, 22,057 in 2030 and 19,285 in 2040.
 
Location - The Proposed districts initial boundaries are described with a combination of Original Texas Land Surveys, Hood 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 0.25 square miles in northeastern Hood County, located west of the City of Cresson, and north of Granbury.    The proposed district does not appear to fall within any existing Certificate of Convenience and Necessity (CCN) boundary.
 
Comments on Powers/Duties Different from Similar Types of Districts:  This bill grants the District authority for road projects.

The bill allows the District to divide as prescribed by the procedures of Sections 53.030 through 53.041, Water Code, and only if the District has no outstanding bonded debt and is not imposing ad valorem taxes, as specified in 53.029(b), 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 - SB905 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 Hood County, fifty-six percent of the total water use was groundwater (Trinity Aquifer) in 2014. Fifty-six percent of all the groundwater pumping was for municipal use. The water source of the proposed district might pursue is unknown.